In the 1927 silent-era film For the Term of His Natural Life, a starving prisoner on the run from Port Arthur takes an axe to a fellow escapee with the intention of eating him. Based on the Marcus Clarke novel and directed by Hollywood’s Norman Dawn, the epic movie cannibalises cinema history, too: tonnes of flammable nitrate film drawn from Sydney archives and storage were loaded onto Inca, an old sailing ship, and set alight for the climactic scene.

At the end of shooting, “one million feet” of film had vanished, says veteran Australian film producer Sue Milliken, but no one will ever know how much of the nation’s visual record was lost. The eventual reconstruction of Dawn’s film, released in 1981 with some scenes missing, was of a scale unprecedented in silent film in Australia.

Today, federal budget cuts mean film preservation – as well as digitisation of rapidly deteriorating television shows on defunct 20th-century magnetic tape formats – is in competition for funding with provision of public access to existing screen works. Ninety years on from Norman Dawn’s cavalier indulgence on Sydney Harbour, Milliken and others argue, Australia’s modern film preservation bureaucracy lacks vision.

In 2015-16 six feature films were given a new digital life by the NFSA. “Six isn’t many, is it? Fifty a year is what they should be doing.”

In 2015-16, The Odd Angry Shot, a 1979 Tom Jeffrey Vietnam War film produced by Milliken, was among six feature films given a new digital life under the National Film and Sound Archive’s NFSA Restores program, in partnership with Sydney-based post-production company Frame, Set & Match. The restorations, costing about $50,000 each, also included Henri Safran’s Storm Boy (1976), Ray Lawrence’s Bliss (1985) and Jocelyn Moorhouse’s Proof (1991).

“Six isn’t many, is it?” Milliken tells The Saturday Paper. “Fifty a year is what they should be doing.”

The archive received $24.3 million from the federal government this year, cut from $27 million in 2014 and $25.4 million last year. In the past few years it has shed about 50 positions, including much expertise.

Film editor Anthony Buckley says the archive “needs a meaningful presence for Australians to be able to take their children to, to get a sense of our visual and aural history”. Buckley and Milliken are calling for the NFSA to be moved from Canberra to a new, purpose-built building with a public exhibition space in Sydney, given its bigger population. Not everyone agrees.

Buckley estimates such a building would cost $100 million. He says operational government funding should be doubled, to $50 million, and a visionary administrator, not a curator, appointed chief executive. “The board seems to be bereft of any ideas,” he says.

The vision for repair and screening seemed more ambitious on October 3, 1984, when the archive finally separated from the National Library to open under its own banner in the Art Deco former Australian Institute of Anatomy building in McCoy Circuit, Acton, with separate storage vaults established in Mitchell.

In drenching rain, VIPs rolled up in vintage cars and more than a thousand guests packed the main exhibition hall to hear then prime minister Bob Hawke heralding “a new kind of institution”, one “devoted to the popular cultural expression of our age, and dedicated to the preservation of some of the best manifestations of Australian character and Australian imagination”.

Efforts early in the new century hewed to that ambition: in 1999, the McCoy building was doubled in size, to accommodate specialised laboratories. There was, until it was scrapped in 2015, the NFSA’s travelling Big Screen regional film festival, which ran for more than a decade. The Arc cinema and a separate theatrette, still on site, previously ran bigger screening programs.

Notably, in the 10 years from 2002, the archive restored 75 feature films, most famously one of Australia’s greatest, Ted Kotcheff’s 1971 movie Wake in Fright. The work was done in collaboration with Kodak and the now-defunct Atlab (later Deluxe) post-production facilities in Sydney. The long search by Buckley, the film’s original editor, prompted CBS operations chief Harvey Rappaport to track down the missing Wake in Fright negatives, marked for destruction, in a Pittsburgh dump bin.

Yet there remain gaping holes: in the 1960s, a young Buckley rescued the negatives of 17 feature films made by director Ken G. Hall in the 1930s and ’40s from the offices of production company Cinesound in Sydney’s Rozelle. “Those are still not available to the Australian public,” Buckley says, “and I think that’s pretty lamentable.”

In 2014, the then chief executive of the National Film and Sound Archive, Michael Loebenstein, opted to close the public exhibition hall, arguing it was not profitable. The archive no longer has a gift shop, and the library, staffed by volunteers, is open only on Wednesday afternoons.

Loebenstein left the archive in January to return to Austria. The federal arts minister, Mitch Fifield, told senate estimates in late March that the appointment of a new chief executive was imminent.

Ray Edmondson, deputy director of the NFSA from 1984 to 2001, argues Australia should be adequately funding institutions to meet new UNESCO guidelines on preservation of, and access to, documentary heritage, and these institutions “should be seen as an investment, not an expense”.

Edmondson says the archive should “for now” keep its “crucial” public face, including the Arc cinema, in Canberra, although he “would like to see the NFSA have a much bigger presence in both Melbourne and Sydney and at this point I would say Sydney has the greater need”.

The film historian Andrew Pike, who is also a founding member and former president of Friends of the NFSA, says moving the archive out of the McCoy Circuit building would solve no problem. He argues management has failed to balance priorities: “An archive without a diversity of public access programs is just a warehouse for dead film.”

In senate estimates last month, Meg Labrum, the acting archive chief executive, said recent articles implied her headquarters “was a sort of dead duck that was depressing to go to, and why would you? My response is that it is really having to reshape based on its capacities across the board.”

Labrum drew the hearing’s attention to the archive’s “Deadline 2025” report, released in 2015, which estimated only 30 per cent of stockpiles of television on obsolete 20th-century tape-based formats can be saved at present restoration rates, meaning “tens of thousands of hours will be lost to future generations”. The report called for tape digitisation to double, which would require an additional $16 million in government funding.

The Saturday Paper, meanwhile, has learnt that the archive has commissioned property consultant David McCracken to advise on a new Sydney location for when the lease on the archive’s existing small administration office in Pyrmont expires next year. McCracken says the work is “totally unrelated” to his advisory role with the Barangaroo Delivery Authority.

Meg Labrum tells The Saturday Paper McCracken’s employment is part of an examination of the NFSA’s “potential footprint around the country”. In Melbourne, the archive is already “cohabiting” with the Australian Centre for the Moving Image at Federation Square.

Is the NFSA committed to staying in the McCoy Circuit building in Canberra? “Look, we’re committed to staying in Canberra ... [But] it’s an expensive place to be. That whole [Acton] precinct is redeveloping … Having the laboratories at Acton and vaults at Mitchell – it might make more sense closer together.”

Labrum says the NFSA is interested in “more of a public face” in Sydney, but that would not supplant Canberra as headquarters. “It’s one of the things a lot of our supporters and critics are animated about, that the archive needs more of a physical presence … I’d say in Sydney. I can’t imagine us ever having the funds to purpose-build, but some sort of collaborative arrangement, where we exist with another body with exhibition space we can be a part of, that would be attractive.”

Labrum says there is an aim to increase the restoration of feature films and that crowdfunding from the public might be an occasional option. Making shows available online would also become an increasing priority.

Labrum says she has not applied for the chief executive job at the archive, where she has worked in collections since the 1980s. She wants to see “new blood” in the role.