Cruise film pockets $3.4m grant money

Taxpayers dished out $3.4 million to Tom Cruise's hit film The Last Samurai because of a "gentleman's agreement" aimed at keeping the big box office studio happy.

Economic development minister Jim Anderton admitted yesterday there was no legal obligation to pay Warner Brothers the money.

The Last Samurai, which pulled in $600m at the box office, had already premiered on December 5 when the final details of the large budget film grants fund were being decided. Mr Anderton announced the fund on December 17.

Figures uncovered by Act leader Rodney Hide show the payment of $3.375m was approved on May 31. On June 9 this year the Ministry of Economic Development wrote out the cheque.

"We couldn't have been forced to do it because we could claim legitimately the scheme came in after the film had been commenced but we had a sort of gentleman's agreement," said Mr Anderton.

"We were keen to see we didn't start off with a wrangle about who did and who didn't qualify and we stuck to the spirit rather than the true letter."

Mr Anderton said the film makers approached the government and asked if they could be a part of any scheme that started during production of The Last Samurai. "We said we would look at it.

"You can say we didn't need to (pay the money) and strictly speaking that's true. But if you want to maintain good relations with the industry you are trying to encourage... at the moment we haveKing Kong, Lion the Witch andthe Wardrobe. Ask Australia what it's got."

New Zealand movie-makers say the $3m alone could have paid for an entire New Zealand film production when The Last Samurai had already been made and any economic benefit secured when the cash was handed over.

Mr Hide accused the government of using taxpayer cash to make itself look good. "Politicians love giving money to Hollywood, the arts and fashion, because it makes them look good and they get invited to the openings."

In February this year Mr Anderton commissioned an economic analysis from Business and Economic Research Ltd, which said the film could have been worth up to $19m to New Zealand.

The $3.375m is 12.5 per cent of the $27m that Warner Bros claims to have spent in New Zealand from April till June last year - equivalent to reimbursing the film-maker's GST. It comes on top of $215,000 paid out of Mr Anderton's development budget for promotional activities for the film.

A ministry spokeswoman said the film would have met the criteria for a large budget screen production grant, if the scheme had been set up earlier, and the money had been paid for the period when the film was in post-production.

Vincent Burke, president of film making industry body SPADA, said he was comfortable with the money being paid given it was in keeping with the government's policy. However, he wanted to see local productions to have the opportunity to access similar grants.

The Last Samurai

A 19th century epic featuring Tom Cruise as an American mercenary training Japanese troops to fight the Samurai.

Budget of around $140 million.

Grossed $610 million worldwide.

Filmed in Taranaki, California and Japan between October 2002 and May 2003.

Injected up to $196m into the New Zealand economy, with more than half going to Taranaki.

Nominated for Oscars for supporting actor, art direction, sound, and costume design (for Kiwi Ngila Dickson).

Tom Cruise is one of the highest-paid actors in Hollywood, earning $US20 million per movie.