The New Zealand government gives Warner Bros a $25m incentive, and possible legislative changes, to lure The Hobbit production its way…
The pre-production of The Hobbit has been a saga as long as the films themselves are set to be, given the delays and problems that have mounted in the run-up to bringing Middle Earth back to the big screen.
They’ve been well-reported, too. The delays due to MGM’s financial problems. Guillermo del Toro quitting the director’s chair, and handing it to Peter Jackson. Union problems that led Peter Jackson and his team to consider upping sticks and filming in Eastern Europe instead. Heck, even casting Martin Freeman as Bilbo Baggins involved some nifty scheduling work.
However, it might just be that the final part of the puzzle has slotted into place, but it’s taken a potential change in New Zealand law, and a fair whack of cash, to make it happen.
The New Zealand Prime Minister, John Key, has announced that his government has basically changed the criteria for its budget incentive scheme, which means that it will give an extra rebate to Warner Bros of up to $15m for making the two Hobbit films in the country. That adds on to existing rebates, which means that the New Zealand government may be paying as much as $25m to host the production.
Furthermore, New Zealand law is likely to change too, all as part of the scheme to keep The Hobbit in the country. For Warner Bros has asked for 'clarification' on the employment status of people who work in the film industry, presumably as a result of the threatened union downing of tools. As such, the New Zealand government will be looking to introduce parliamentary legislation to specifically address that, which could potentially, as a result, change the law of the land.
It’s staggering when you think about it. Appreciating the importance of the productions to the New Zealand economy, it seems that the government of the country is giving remarkable concessions here. In return, though, it gets The Hobbit, one of the world premieres of one of the films, and the promise of future partnerships with Warner Bros.
But it might just have had to change its statute book to clinch the deal. Crikey. That's the power of a movie production with a budget of up to $500m right there...
More on the deal can be found at The Hollywood Reporter here.