McClay Todd; Nash StuartHon TODD McCLAY (National—Rotorua): Madam Chair thank you. Minister Nash I want to come to the conversation we had in committee around The Lord of the Rings and Amazon and the filming of the first series. Your Government decided to give an extra 5 percent take-up of the money that Amazon would spend in New Zealand to them over and above the scheme that was put in place by the National Government that has brought many films to New Zealand. I asked you at the time why an extra 5 percent was given and we asked when the filming started. It's important the taxpayer gets to know whether or not commitments were made before filming started or afterwards. Your official said he thought—in fact he said—filming started in the latter part of last year. Newspaper reports had suggested filming had started earlier in the year. I'd like to ask you Minister if you could clarify exactly when filming started on the Lord of the Rings series. Hon STUART NASH (Minister for Economic and Regional Development): Thank you very much. I can't tell you the exact date filming started but what I can tell you as the member Todd McClay has outlined is that Lord of the Rings received about $160 million in grants from the Government but they spent $650 million and the memorandum of understanding (MOU)—Hon Todd McClay: Is that the extra 5 percent?Hon STUART NASH: So $160 million is the total amount that they received including the extra 5 percent. But the $650 million is how much they spent and what this has done is it's created—we signed quite an innovative MOU with Amazon when we went into the deal. There are a number of things that Amazon have said that they will deliver: internships for example and technology transfers. We can use some of the filming from Lord of the Rings to promote New Zealand. An interesting fact which is quite enlightening actually is the Lord of the Rings movies and the Hobbit movies as opposed to the series which has just been filmed—I think it's about 17 percent of visitors to this country—Hon Todd McClay: Higher.Hon STUART NASH: —or is it 19 percent?—said they came here they came to New Zealand because of what they had seen from Lord of the Rings. So what we do know is the power of such a successful production like Lord of the Rings has the ability to add significant value to our economy. Hon TODD McCLAY (National—Rotorua): Thank you. Minister Nash there's no question that the scheme the National Government put in place is a good one and brings a benefit to New Zealand. Your party opposed it at the time but I'm very pleased you've decided that it is worthwhile. I want to come back to my question though because the Government decided to give an extra $100 million to Amazon for the filming of this series in New Zealand. You said there was no commitment to any future series and it was quite unusual for that to happen. In fact Amazon in other parts of the world where they've filmed where they have received subsidy from Government have committed to more than one series in the cases of Australia and Ireland. Equally Minister you said in committee that there was a concern that they could go somewhere else. You said at the time that this agreement wasn't signed under you it was under a previous Minister. In fact your words were when I asked you No that was already signed before I came on board." and when I asked you when the memorandum of understanding was signed you said it was in April 2020. Do you still stand by that comment given to committee?Hon STUART NASH (Minister for Economic and Regional Development): Thank you Madam Chair. There's a couple of things I'll say with regard to that. First of all you are never going to commit a studio to a second series when the first series cost $650 million and we do not know if it's going to be successful. We're assuming it is going to be successful and if it is successful then they are talking about eight series. They could be here for 10 years filming something iconic. But if it's not successful then of course they're not going to come back. So we can't pre-empt that; nor would we ask them to. The other thing I would say is that the member Todd McClay talked about Australia. What I can say happened in Australia is that the Australians actually withdrew all their subsidies and they lost 97 percent of their film industry. We do not want to be in that position in any way shape or form but we didn't grant them an extra $100 million. Keep in mind they were eligible for 20 percent. They were eligible for another 5 percent if they met a whole lot of terms and conditions which they did. But in terms of when they started filming when the memorandum of understanding (MOU) was signed—the MOU was announced on 16 April this year by myself. I wasn't part of the negotiation team but I just think that this is a fantastic opportunity to not only showcase the best of New Zealand but also build a really innovative film industry in this country provide a level of certainty to those who work in the country and also prove to the global film sector that we can make the very best in the world. I think from all of those perspectives it's been hugely successful. Hon TODD McCLAY (National—Rotorua): Minister Nash thank you. The New Zealand Herald reported that 800 cast and crew were involved in a West Auckland shoot for The Lord of the Rings in March 2020. You said in committee that you weren't the Minister at the time that this came on board and the memorandum of understanding was signed in April of 2020. Equally your officials said that filming started in the latter part of last year but those 800 cast and crew who were on board as part of the shoot in March of 2020 who had to stand down during lockdown were already employed. Minister you said in a committee that the agreement was signed in April 2020 but in a written question to you from me you have confirmed that actually that agreement was signed on 23 December 2020 to give the additional 5 percent uptake after filming had started. So I ask you clearly Minister when filming had already started in New Zealand why did you negotiate—your Government when you were Minister—an extra 5 percent when 800 people were already employed in New Zealand? Why did you tell the committee you weren't the Minister at the time and it had been much earlier? What additional benefit does New Zealand get for that 5 percent which is $100 million? And when you just said it wouldn't be right to ask whether they would do any more series in New Zealand are you saying you gave them an extra $100 million and didn't even ask them whether there could be a commitment for more filming in New Zealand of future series?Hon STUART NASH (Minister for Economic and Regional Development): First of all I would say we didn't give them an extra $100 million. As I have said they got $160 million in totality. They spent $650 million. They got $160 million. So what happens is they were eligible for 20 percent. If they met a whole lot of terms and conditions then they got another 5 percent on the 20 percent. Now $100 million is not 5 percent of $160 million Mr McClay. All I would say is this is a fantastic example of New Zealand leading the world in the most expensive TV series ever. Now as mentioned we are never going to get a commitment from a studio to film season two without knowing how successful season one will be. If season one proves a flop and I very much doubt it will—the trailer's out there. Take a look at it; it looks fantastic—but if it does of course they're not going to come and commit another $650 million. If it is a success which I have every confidence that it will be we could see another seven seasons filmed in New Zealand and that provides a whole lot of certainty to a whole lot of really high-end people. And again what it does is it sends a very clear message to the global film sector that we can make the best movies the best series in the world because we have the best people in the world."