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This year promises to be a busy one for the Kiwi film business but there are some big decisions ahead about how taxpayers will underpin the industry's growth.
And if there is a change to a National-led government it is likely to mean a review of the 1978 Film Commission Act that has been a foundation for the industry - at least the industry beyond director Peter Jackson - for 30 years.
Jackson and his Camperdown Studio in Wellington have moved beyond the early successes of Lord of the Rings and King Kong.
Part-owned special effects arm Weta Digital has become self-sufficient and Jackson's lavishly appointed post-production outfit Park Road Post is getting more work.
Jackson is working on the adaptation of The Lovely Bones and the remake of Dambusters with a budget of around $50 million. He is also set to make the first part of the planned Tintin trilogy.
There will also be early pre-production for two Hobbit movies to be filmed in 2009 and 2010 with a combined budget of around $500 million, much of that to be spent in this country.
That is just a part of the revenue earned through the special effects operation owned by Jackson and colleagues and the post-production house.
Elsewhere, after a flat production slate in 2007, the rest of the film production sector faces a busy 2008.
Whale Rider director Niki Caro starts filming here for her version of Elizabeth Knox's The Vintner's Luck next month, with rights already sold for Britain, New Zealand, Australia and Switzerland.
The producers are Robin Laing, Caro and Laurie Parker of Ascension Film and Pascal Judelewicz, Ludi Boeken and Jean-Francois Klein of Kortex Sarl.
It is being financed by the Film Production Fund, the Film Commission, the Motion Investment Group of Belgium, Tokyo-based OLC Rights Entertainment and Kortex Cinema of France.
Production starts in mid-2008 for Separation City directed by Australian-based New Zealander Paul Middleditch. Barrie Osborne (The Water Horse) is producing, with Tom Scott and Mark Overett. Rights have been sold to Belgium and the Netherlands. NZ On Air and TVNZ are minority investors in the film.
Also set to film this year is Under the Mountain, based on a book by Maurice Gee. It will be funded by the Film Commission and the Film Fund and will be be the second feature by Black Sheep director Jonathan King alongside Matthew Grainger and Richard Fletcher.
International sales excluding Australia and New Zealand are to be handled by London-based Capitol Films.
One downside of the high value of the New Zealand dollar has been that fewer US productions have been filming here.
But the sector is perceived as growing and benefiting from increased taxpayer subsidies.
Five years ago industry veterans worried that a rush of interest in filming here was a fashion.
There were concerns that New Zealand would become a fashion victim when Hollywood discovered new countries with more incentives.
Screen Council executive director Tim Thorpe believes we have moved past that issue with better infrastructure, such as all-weather soundproofed studio facilities at Jackson's Wellington complex and in Waitakere, Auckland.
Last year the Government followed its Australian counterparts and increased the grants paid to big budget Hollywood movies from 12.5 per cent to 15 per cent. The increase is significant. For example, it would have given Peter Jackson's interests an additional $10 million on top of the $50 million he received for filming King Kong in this country.
Benefits were also extended to cover spending on special effects and post production. But catching up with the Aussies' incentives may not be enough this time.
Australia has made a fundamental change that could turn the film and TV industry Downunder on its head.
After years of focusing on Hollywood, the Australians have turned their attention to their local industry and introduced a lavish 40 per cent rebate for Australian companies with overseas backing spending money at home.
TV companies are being promised a 20 per cent rebate though, unlike in New Zealand, there are few cash subsidies.
But for any up-and-coming film or TV company it will be tempting to be based in Sydney or Melbourne, not Auckland or Wellington.
Now the Government and film industry have to decide how to react to the attractive new incentives.
Having been convinced that the Hollywood subsidies create economic activity and tax revenue, the Government has accepted the value of subsidies.
The question now is whether politicians will dig deeper for new subsidies and back the local industry.
Some worry that the industry is delaying reacting and allowing Australian incentives to take hold and establish an advantage.
Others say you can react too fast and this country should wait to see how the Australian scheme works out.
But 2008 is an election year here and there is a danger the future of the film industry could get lost in political wrangles.
If there is a decision to give more money it will need extra funding and government departments are already jostling for cash.
Tim Thorpe is executive director of the screen industry lobby group the Screen Council.
He says the Ministry of Economic Development had handled film incentives in the past based on the premise that the screen industries were a favoured sector for developing the economy.
But indications were that the Ministry for Culture and Heritage - which has tighter budgets and a less industrial focus - would take over handling film incentives, Thorpe said.
Meanwhile, the local industry will be considering an end to a Labour Administration that has strongly backed the film and TV production industry.
National is keeping its options open but - ideologically at least - has baulked at subsidies.
There will be interest in the view of its arts and culture spokesman, Chris Findlayson, who may well be arts and and culture minister in any National-led government.
Findlayson has called for a review of the Film Commission Act.
The commission, which has flourished under Labour, has a big role in the funding of the industry. The commission has a difficult role on limited cash, but Findlayson believes it is due for a shakeup.
The Peter Jackson organisation is beyond the budgets financed by the Film Commission.
But on the basis of its early and private lobbying of the Government, it is likely that it will be making its views known and that those views will carry weight.
