NAO finds good governance issues regarding Malta Film Week project management
A number of good governance issues were raised regarding the Malta Film Commission's handling of the Malta Film Week in 2022, the National Audit Office has said.These good governance issues relate to the project management of the event, "most salient
A number of good governance issues were raised regarding the Malta Film Commission's handling of the Malta Film Week in 2022, the National Audit Office has said.
These good governance issues relate to the project management of the event, "most saliently relating to accountability, transparency and financial management."
This was written within the NAO's report: Evaluating the Role of the Malta Film Commission in promoting the Maltese film industry. This report sought to determine the extent to which the activities undertaken by the Malta Film Commission (MFC) between 2018 and 2022 were considered as value for money and embraced good governance principles. "Through this objective, this audit also addresses the requests made to this Office by the Public Accounts Committee (PAC) and Prof. Arnold Cassola."
The Malta Film Week (MFW) held in 2022 was only supported with rudimentary documentation, the NAO said. "Within this context, a formal strategy covering the period up to 2030 was not in place - a situation which hindered this Office from further analysis related to value for money and returns on marketing expenditure. This assignment raises concerns about the business model employed by the Commission to manage these events, especially when considering a number of deviations from procurement rules. In most instances, direct orders had to be resorted to due to the self-imposed time constraints by the MFC itself to organise these events. It is to be recognised that this event was held during the COVID-19 pandemic and at the time of these events the MFC faced staff shortages in various capacities."
As the MFC still faces an acute staff shortage situation, to varying degrees, the issues outlined in the preceding paragraph prevail as this audit identified concerns in the corporate governance function, the NAO said. "This situation illustrates that the opportunity exists for the MFC to be governed through more comprehensive strategic and operational planning, the anticipation of lead times associated with the regulatory framework governing public funds as well as aspects related to robust audit trails related to the more material decisions taken." The National Audit Office (NAO) acknowledges that during 2024, the MFC in collaboration with Ministry for Tourism and Public Cleanliness (MTP) are working on the drafting of tender documentation relating to the organisation of future events. Moreover, MTP is also supporting MFC through the issue of calls to address vacant positions and the drafting of two tenders.
In its report, the NAO also raised concerns about the MFC's business model to manage these events. "These concerns influence the level of transparency and audit trail embraced by MFC, especially in an event that had a significant financial magnitude. This situation is further compounded by the centralisation of decision-making to a single point of reference, namely the Commissioner of the Malta Film Commission and subsequently the lack of documentation to support budget prioritisation and selection of service providers rather than appointing a project management committee specifically set to deal with an event of this size and planning."
Speaking about the MFC overall, the NAO said that it seeks to promote Malta as a key destination for film production in a fast-paced and highly competitive global industry. To this end, between 2018 and 2022, the MFC incurred an operational expenditure of around €12.3 million. In addition, the Commission awarded financial incentive schemes to local film producers and through its Cash Rebate Scheme.
Between 2018 and 2022, the MFC, mainly through the financial incentives' schemes, especially the 40 per cent cash rebate scheme, was successful in attracting film productions to Malta, it said. "In general, this review confirms MFC's estimates on the impact of the cash rebate scheme on the Maltese economy in terms of expenditure by film productions in Malta, Gross Value Added, employment and tax revenue. The NAO maintains that ultimately, it remains a matter for policy makers to decide the appropriate level of investment in film production, taking into account the opportunity cost of resources used, socio-economic priorities, as well as the potential for the industry to diversify and complement the overall make-up of economic activities in Malta."