Publication of annual production survey shows improvement in the number of foreign films shooting in Australia, although no US films have gone into production this year.

Screen Australian chief executive Ruth Harley says she sees no reason why Australian films, including co-productions and joint ventures with Australia, can’t replace the hole left by the studios’ disinterest in using Australia as a location due to the strength of the Australian dollar.

“The pressure will come from the financiers of those large scale Australian films to reduce budgets but the point is these projects aren’t going to run away,” Harley told She was speaking in response to today’s publication of the annual production survey.

The figures for foreign films showed an improvement on the 2008/2009 year, with 10 films going into principal photography during the 12 months up to June 30 and spending A$178 million in Australia, compared to only 13 titles, all of which were Indian, spending only A$21 million in the previous year.

This improvement was due to the big budgets of The Chronicles Of Narnia: The Voyage Of The Dawn Treader and Don’t Be Afraid Of The Dark but the figures disguise the fact that no US films have gone into production in Australia this calendar year.

Turning to Australian projects, the survey shows that 37 films spent A$265 million during the period in question and this is almost spot-on the three-year average.

“There has been an international downturn, the Australian dollar is very strong and this is a cyclical business, but we have a very solid volume of production and a stable base because of the producer offset (PO),” said Harley. The PO, introduced in 2007 and now bedded down, enables Australian films and co-productions with Australia to get back 40% of their production expenditure.

The annual feature film slate was paid for in several ways: A$147 million came from the film industry itself, including borrowings from producers who would claim the PO on completion; A$68 million from foreign investors; and A$51 million in director government investment.

Fifteen films had budgets of up to A$3 million, 14 were between A$3 and A$10 million, and eight had more than A$10 million. The box office hit of 2010, Tomorrow, When The War Began, is in the last bracket. (Films made for less than A$500,000 are not included in the report unless they have been seen in a festival or been given a cinema release.)