Video game fund for small studios welcomed by the local industry, despite Labor’s $25 million promise

After being axed in 2014, the Australian Interactive Games Fund has been reintroduced by the Federal Government.

While industry leaders say it is great news for small to medium game studios, the fund has almost been cut in half compared to Labor’s pre-election promises.

The reintroduction of the grant is just one part of Revive: Australia’s New National Cultural Policy, which was announced by Tony Burke, the Minister for the Arts, on Monday.

“All forms of storytellers now – whether it’s narrative, visual art, music, acting – are finding themselves jobs in the video games industry,’ Burke said in a statement.

“Screen Australia, when you’ve got an industry expanding like this around the world, shouldn’t be left trying to check if there’s some spare change back in the lounge to fund this rapidly growing sector.

“So we’ll restore the Games Fund for Screen Australia that was abolished nearly 10 years ago.”

First introduced by the Labor government back in 2013, the Australian Interactive Games Fund offered $20 million dollars in grants and programs to Aussie game studios. But the dream was short lived, with the Abbott government shuttering the fund just one year later.

Since then, grants have been largely state-based and disproportionate compared to funding for other creative sectors. While there has been an uptick in the last couple of years, most of the available money has been in Victoria thanks to ScreenVic.

This lack of national attention has been a shame, and short sighted. Reports show that the global gaming industry was valued at around US$195.65 billion in 2021. That is expected to see 12.9% in annual growth rate between 2022 and 2030.

According to the new Revive policy, Australian game development studios secured $284.4 million in revenue and employed 2,104 full time workers between 2021-2022.

Eighty-four percent of this revenue was from exports, proving how big an industry this is for Australia and why it should be considered serious business.

“The original AIGF saw the establishment and growth of award-winning studios such as BlackLab Games and SMG Studios from the original funding, who are still in existence today having delivered additional products beyond their original grant,” Ron Curry, CEO of the Interactive Games and Entertainment Association (IGEA), told SmartCompany.

“We expect many of the new recipients will follow a similar trajectory and create interesting and innovative games for a global audience.”

The Australian Interactive Games Fund returns

The Labor government included the return Australian Interactive Games Fund as one of its election promises back in 2019.

Under the proposed policy it would bump the number up to $25 million. The Greens tried a similar thing in 2016, but promised $100 million for the fund.

Neither of these numbers have worked out.

The reinstated fund will contain $12 million via Screen Australia for small to medium game studios. But there may be an explanation for this.

The fund will live alongside the long-awaited Digital Games Tax Offset (DGTO) which was finally introduced to parliament back in November. The DGTO provides a 30 per cent offset to any game studio that spends more than $500,000 on a locally developed project.

Still, there is no clarity around this number or how Labor landed on it. SmartCompany has reached out to Burke’s office for comment.

The IGEA also has some question marks around this amount. Still, the local industry’s championing body is still celebrating the reintroduction of the fund.

“Video game development has earned its place as a culturally significant and artistic medium for telling stories,” Curry said.

“Seeing video games included in Revive: the National Culture Policy, is a big moment for the Australian game development industry.

“IGEA has long been argued for the reinstatement of the AIGF, alongside a tax rebate, to ensure all Australian studios across our sector have access to government support.”