The 2023 New South Wales (NSW) budget, announced by the Australian State’s Labor government in late September, has seen a severe reduction in arts spending. It will have a striking effect on the game development scene in the state, which was already falling behind virtually every other state in the country, despite steady growth.
As announced by State Treasurer Daniel Mookhey, NSW will see AUD $188 million in cuts from a number of screen and innovation programs. The government purports that these cuts were secretly made by the former Coalition government “just days before the March  election.”
State initiatives such as the 10% tax rebate for Post Digital and Visual Effects (PDV) projects and the Digital Games Development Rebate Program will be paused, according to Screen NSW. These programs would have supplemented the Federal Digital Games Tax Offset. The Made in NSW Fund will also be paused.
Additionally, ambitious plans to rebuild the Powerhouse Museum in Ultimo have been changed, with plans for an AUD $500 million rebuild downsized to an AUD $250 million ‘revitalisation’ effort.
The Powerhouse has recently been one of the only cultural institutions in the state to consistently recognise and celebrate the creative nature of games, with exhibitions, events, and archival efforts.
The 2023 NSW budget has been geared towards public services and essential workers, with an effort to reach AUD $13 billion in savings.
NSW is home to many international video game companies, especially in the commercial sector. Companies like Microsoft, PlayStation, Bethesda, Ubisoft, Activision Blizzard, and more operate out of Sydney.
The Interactive Games & Entertainment Association (IGEA), Australia’s peak industry body released a statement expressing how “incredibly disappointed” it was to see the reduction of support in NSW.
“NSW has steadily built its presence in the games sector for the last couple of years,” it said. “Our data shows NSW has achieved growth in full-time employees working in game development and studios establishing and maintaining a base in the region.”
“Other states across Australia are increasing and improving their game development funding to reap the benefits that a thriving, supported and recognised game development sector can tribute to a creative and technically skilled local economy. Sadly, NSW is now headed in the opposite direction.”
“Not only is NSW the only state in Australia that does not have direct video game development funding options, a reduced rebate program leaves NSW with virtually no competitive edge and no incentives for up-and-coming video game creators to stay local.”