26 Oct 2010

Government looking at law change to save Hobbit

11:14 pm on 26 October 2010

Government ministers are meeting with legal advisers about possible changes to labour laws to try to ensure The Hobbit films are made in New Zealand.

Doubt has been cast over where the films will be shot following a boycott by actors of the films until producers agreed to meet and negotiate terms and conditions.

The ban has been lifted by unions in New Zealand and the United States, but executive producer/director Sir Peter Jackson has warned it may not be enough to save the two films from going overseas.

Warner Bros is financing the films and says the unions' actions has caused it substantial disruption and damage, forcing it for the first time to consider other locations.

Prime Minister John Key and several senior ministers met for almost two hours with Warner Bros executives in Wellington on Tuesday afternoon.

Mr Key emerged from the meeting saying industrial relations and more financial incentives were the main issues up for discussion.

He said the talks went well and there is "a lot of goodwill towards New Zealand" but the US studio has serious concerns about the industrial relations situation.

Mr Key said with an investment of more than $US500 million at stake, Warner Bros needed to be certain that the films can be produced on time.

But the industrial threats by actors' unions have caused the movie executives real concerns, and if it wasn't for that, Mr Key said the films would have been "good to go".

The Prime Minister said lawyers will meet with ministers on Tuesday and Wednesday to discuss what changes, if any, can be made to industrial laws "to give an assurance to Warner Bros that if The Hobbit is made in New Zealand it will not be upset by industrial action".

The Government will also look at more tax concessions, but Mr Key warned it will only be "around the margins", as New Zealand can not bridge the gap that is potentially on offer from other countries.

Mr Key earlier said that if it came to a bidding war, New Zealand would be out of the running, and the Government did not want to be re-negotiating with every single production company that comes to New Zealand.

He said he expects a decision on The Hobbit later this week and earlier rated the chances of keeping the films in New Zealand as 50:50.