Ireland is struggling to retain its attraction as a location for film producers thanks to increasing labour and service costs, growing competition from cheaper foreign locations and now, a new government arts department that seems oddly unenthusiastic about film.

Although the country's 2002 production tally looks healthy enough - seven feature starts in the first five months alone - all are either TV movies such as The Roman Spring Of Mrs Stone with Helen Mirren for Showtime, or contemporary Irish stories like Company Of Wolves' highly anticipated first outing The Actors, with Michael Caine.

In addition, all seven features have largely been shot on location, meaning that Ardmore Studios has been running under capacity for the first half of the year, making 2002 "a very disappointing year so far", according to Ardmore managing director Kevin Moriarty. Given that studio-based projects generally require at least an eight-week pre-production period, and that there is no project in pre-production at the studio now, it will be August at the earliest before Ardmore sees significant usage. The only new project with a definite July 1 starting date, Subotica's Song For A Raggy Boy, will be shot on location in rural West Cork.

And while Ireland's unique combination of light and landscape is of benefit to period or fantasy productions, like Reign Of Fire and The Count Of Monte Cristo, these benefits are in danger of being overshadowed by local inflation, growing labour costs and the increasing competitiveness of rival foreign locations.

Stephen Woolley, producer of The Actors, says there are a number of pros and cons to shooting in Ireland. "The Actors crew and this entire production is probably one of the most smooth flowing and easy I have worked on anywhere in the world. This kind and size of movie is ideally suited to this country. But, having said all that, it has to be said that one does not shoot anything but Irish films in Ireland, other than something that uses the landscape. There has to be a reason to be here. If your film is not using the resources of Ireland in a way that is essential to the film, then it is still more economical to shoot in London and other parts of Europe. People say it is more expensive to shoot here, and it is true ' for certain types of films. There is soft money all over Europe, but it is pointless getting a 15% tax break if the cost of living is 20% higher."

These and other production concerns now fall to a recently re-elected government. John O'Donoghue, formerly the minister for justice, has been put in charge of the newly-formed Department of Arts, Sport and Tourism. The new government's programme document includes only one line in relation to film: "We will support the Irish film industry and the central role of the restructured Irish Film Board."

If Irish film production is to mature into a results-oriented sector ' both in terms of volume of output and quality ' then the new minister will probably require a considerably more proactive approach than is suggested by this line of policy.