Ruth Harley
CEO, New Zealand Film Commission

Cultural Capital and the Knowledge Economy

Kia ora koutou - Greetings to you all

The film business is all about knowing your audience.

So its my business to know that I'm talking to a roomful of public sector leaders who'll want to walk away from this Conference today with clear ideas about key directions for public policy development. You've got fine-tuned ears - and I've got some ideas that are congruent with most of the earlier speakers - so here goes.

IDENTITY.

National identity. It is a key resource both economically and psychologically for New Zealand's future. It is a resource that requires high quality consideration from public sector leaders because it is a building block for knowledge based industries.

Knowledge based industries are about innovation, creativity, and entrepreneuralism. They are predicated on global markets, powered by digital technologies and particularised by national identity. For example, Italian design, American movies, French wine.

National identity endows products with particular values and, in turn, is reinforced and empowered by its association with those products and values.

But that's not how we're doing it here. No - its not about creativity and identity in NZ. Its about maths, science and IT.

The reforms of the 1980s and 90s were essential and half right - the expenditure half - but half wrong - the income half. Knowledge economy is the right direction - but maths and science is only half of the equation. Let's not limit ourselves to a zealous pursuit of half the story.

Surely we aren't again going to fetter our vision to a single channel in a multi-channel universe.

But back up a bit: Who am I to be privileged to address this gathering? I am a cultural nationalist. I have worked in cultural organisations in New Zealand since 1975. In that time I have put a lot of thought and energy into fighting for space and resources from within the public sector for artists and creative expression. They are a key economic resource as well as an essential part of what it means to be human in New Zealand.

NZ on Air grew out of the public sector reforms. As CEO I took for granted the differences between inputs, outputs and outcomes; between funders and providers. This enabled me to communicate successfully with the broadcasting policy desk in the Ministry of Commerce who monitored NZ on Air. I was required to quantify outcomes. I was also focussed on audience as proxy for cultural impact.

Coming to the Film Commission and the Ministry of Culture and the Arts (as it was) was like winding back the clock. I realised there was no effective communication between the cultural sector and the government policy machine or in fact between the Ministry and the government policy machine. The arts and culture were marginalised from the public policy agenda.

This was at least as much a failure of the artists and filmmakers to recognise and participate in the policy shift which occurred from 1984, as it was of the economists who had captured the policy debate and steered it down a narrow expenditure focussed track. It takes two after all to have a conversation.

My first strategy was to engage George Barker, one of the architects of the post-1984 reforms to bend his very considerable brain to the task of creating a dialogue between cultural values and the principles of economic rationalism to bridge a divide which impoverished both sides of the debate. The point was not to define or redefine culture but rather to create an intersect between the discourses of culture and prevailing economic theory.

Barker's work (soon to be published) is called Cultural Capital and Policy. He defines cultural capital as a form of intangible capital - like human or intellectual capital, which is embodied in individuals, and social capital which occupies the space between individuals. Barker defines cultural capital (without reference to the sociologist Pierre Bordieu) as an aid to connectivity between individuals. It has aesthetic, cognitive and moral dimensions. It is about shared aesthetics, shared understandings of the world and shared moral codes.

Cultural Capital is shared experience. It is an endowment like a genetic inheritance in an individual's life and it tends to change over the generations. It is collectively owned and passed on, with individual artists and art works contributing to its development at the edges.

Barker's work was commissioned to provide an economist's analysis of cultural issues in relation to government policy and as a consequence to locate at least one form of cultural discussion within the mainstream of public policy debate.

Barker's analysis of cultural capital coalesces round the notion of identity which is one of the four government strategic priority areas (responsibility, opportunity, security, identity): the one which has been neglected by successive policy regimes.

The marginalisation of culture from the policy debate is clear from its exclusion from recent Government think-pieces - Bright Futures and Foresight - though not from the Knowledge Economy report. It is also apparent from an analysis of Government spending on culture as a percentage of GDP, and from the lack of policy resource available to the Ministry of Culture which was set up to be a policy Ministry but never resourced to carry out this task. Marginalising the Ministry is a very successful strategy for marginalising the sector.

Does this matter?

Maurice Williamson reported on his visit to Ireland that the Irish had an image of New Zealand as a place where the soil had been expertly prepared but nobody had planted anything. A few brave shoots and lots of weeds grew but there was no strategic planting. The Irish soil may not be perfect, but with careful planting they got a better result.

There seems to be broad agreement on the need for change. This is good because continuing to do what you are already doing and expecting a different result is a definition of madness. The idea that government should not take a developmental role because it might fail or cause distortions has proved to be self-fulfilling. Government inaction has certainly led to failure and distortions. It has resulted in successive governments failing to meet the core goals of social cohesion and economic growth.

But there are signs of change. Both sides of the house seem to have bought into the idea that the government needs to take a lead to stimulate knowledge-based industries as sustainable generators of wealth for New Zealanders.

Recognised players in this are the tourism industry and bio-technology. Newer players are wine, fashion and film. Film has the fastest growth rate of any of these at present.

In knowledge-based industries the generation and exploitation of knowledge play the main part in the creation of wealth. The resources of production are data, information, pictures, symbols and culture. Knowledge is a resource and a raw material. Innovation and creativity become crucial elements of knowledge - wealth is what we have - not only on the hoof - but also between our ears.

We need to act global but think local. Our identity is the key to creating a unique positioning for our goods and services from tourism through wine making to filmmaking.

So far so good - but pervading the government's major new thinkpiece - Bright Futures - is a divide as profound and unhelpful as Descartes dichotomy between body and soul. Max Bradford's dichotomy is between essential analytical left brain knowledge and unimportant creative right brain knowledge. This analytical/good; creative/bad dichotomy again marginalises culture and creative industries to the fringes of policy thinking.

This same disjunction exists between the business world and the art world. The art world has values and knowledge the business world needs to build a psychic premium for New Zealand products and services. It also has values and knowledge that New Zealanders need to confirm their identity and self-esteem.

For example, to ensure our tourism dollar has a high yield we need to be out of the commodity end and into the value added end. Our only point of difference which doesn't exist anywhere else in the world is US - our IDENTITY.

To date we have concentrated on selling New Zealand on the basis of biodiversity and our clean/green image. But higher price points will be dependent on our ability to create and sell our identity; to give romance to the images we already have; to tell the stories that bring our identity to life.

There are marvellous landscapes everywhere. You can climb mountains and ski all over the world. Our uniqueness lies in how our particular landscape is peopled; the human context in which our mountain climbing takes place.

New Zealand has failed to grasp the opportunity that a diverse and resonant identity will create for us. As Pakeha Englishness fades away, we have a new sense of US-NESS coming forward. The trick is to work out how to convert this unique property into sellable stories around the range of goods and services New Zealand can produce for the international market; as well as into stories which promote our own confidence, mutual respect and creative energy.

I want to particularise this discussion now onto the role of film in our culture and our economy, as an example of a cultural industry in action. It's certainly worked for the Americans. Their film product has so dominated our cinemas that our kids know about Disneyland before they've heard of Queenstown.

Film creates culture, builds identity and markets that identity to the world.

Film tells potent NZ stories. Those stories and the voices, characters and landscapes which constitute them give expression to our identity. They create culture. The successful exhibition of our films builds a sense of identity in the viewers - and the sale of the films overseas markets New Zealand to our trading partners.

We know from 20 years selling New Zealand films that we come across as interesting, appealing and - yes - exotic.

The film and TV industry is still small, but it is growing very fast. Between 1994 and 1998 the number of business units increased from 540 to 831 - an increase of 11% against an average of 5.5% for all industries. The number of people employed went from 1320 to 1870 or a 9.1% against an average of only 2.4%. And foreign investment increased in the same period by 249% - making a bigger earner than the wine industry.

That's before this year with Lord of the Rings, Vertical Limit and other productions which will see the industry getting close to $1 billion.

And the intellectual capital off which this industry has grown has been created in very large part by government subsidy through the NZFC and NZOA. Cultural subsidies have generated both cultural and industrial outcomes. Government intervention for cultural reasons has produced a series of small firms now capable of generating cultural and commercial product. Our sector models an industry support mechanism that is working.

It's off a small base but it is showing enormous growth and with that growth will come more and more opportunities to showcase New Zealand - either as a set of awesome landscapes for other peoples films (read American) or as an awesome people living in wonderful landscapes (that's US).

Our films showcase us to the world. They show us as people of the Pacific with a European underlay.

As people in landscapes with our own unique sense of light and space.
As people with history, literary and musical traditions.
As people living a contemporary lifestyle.
A sporting lifestyle.
With humour and imagination.

But with a difference.
With a bit of an edge.
An edge of the Pacific.

Film provides entertainment value and cultural value. It creates a backdrop against which to place products and services. It puts the great stories of New Zealand onto the screens of the world.

Like tourism, film is dependent on New Zealand's beauty - but it is the stars like Temuera Morrison, Lucy Lawless, and Rena Owen - who people our landscape; who show our markets our distinctiveness, our Pacificness, our passion for creative excellence.

Film is important not just as a potent advertising medium for New Zealand; not just as a way of creating and personifying our country as a brand in all its diversity; not just as a high growth, high margin knowledge based business. It is all of these, but it is also as a statement to ourselves. It is a central ingredient in constructing our identity for ourselves, as a lever to help New Zealanders get the confidence and boldness to foot it aggressively on the international stages.

Conclusion

Knowledge based industries are New Zealand's future. Many of them will be predicated on, and marketed, using our national identity - an identity which successive governments have paid only the most cursory of policy attention to. Cultural capital is an undeveloped economic resource. It is also an essential condition of humanity.

It is the people in this room who can make the difference. How can we do this?

Some Suggestions: A New Public Service Manual

1. Do not believe things which aren't true. Like half a brain is better than a whole one.

2. Governments can and must lead. In so doing there will be successes and failures. Without action there will be only failure.

3. Good ideas do not live in neat boxes called KRAs. Current organisational arrangements are compartmentalised. There are too few opportunities to look across government. Are key result areas too tightly defined? Do they lock policy makers into tunnel vision such that cross-sectoral linkages are not made? Is this why a knowledge based industry - TV can develop under the auspices of the Broadcasting desk in the Ministry of Commerce but the Bright Futures desk in the same Ministry doesn't seem to know of its existence.

4. Young New Zealanders must have internationally competitive and recognised educational standards. A reductive inward-looking education qualifications framework is NOT going to serve the NEW New Zealand no matter how neat the boxes are that hang off that framework. New Zealand business - like the Dairy Board today - will recruit the brightest it can afford from the world. So will every other country. Education is a global markets against internationally competitive standards. Lets give our kids a chance.

5. Exporting talented NZers is NOT OK and NOT inevitable. Policy makers' complacency on this point robs New Zealand daily of the best and brightest. They are the locomotives of the knowledge industries. We need structures and strategies whereby wealth generating talented people stay and contribute to our social and economic well-being: like filmmakers.

6. Creative knowledge is not the inconsequential sibling of analytical knowledge. Strangely enough, both hemispheres of the brain are designed to be useful and they are linked: linked physically by the corpus callosum so both information streams, analytical and creative, contribute to our ability to understand ourselves, each other and our world; and to ways of generating products and services; and to ways of distinguishing our products and services from those of our competitors.

Public service managers have the opportunity and responsibility to make the difference. People who believe that governments can't achieve anything shouldn't work in the public sector.

Not only do governments and policy makers have the ability to lead, they have a RESPONSIBILITY to do so. With leadership and planning film and the cultural sector's growth will be a high-yielding player. With a coherent policy approach cultural capital/New Zealand identity can play its part in growing the wealth and health of our beautiful, vigorous, passionate, culturally rich and diverse, small country.