Last week, the Public Policy Forum released its much anticipated report on the Canadian media industry. The report echoed several policy amendments for which our association has long supported. In particular, changes to section 19 of the Income Tax Act would be very helpful to helping contribute to a more vibrant Canadian media ecosystem.
The below is a column written by Bob Cox, board chair of News Media Canada, which addressed the recommendations put forward in the Public Policy Forum’s report ‘The Shattered Mirror‘. It appeared in the Winnipeg Free Press.
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Manitobans know that when the snow comes and your car is sliding around corners, you switch to winter tires. You don’t stare at the summer tires and think about how you could design a different system to push the vehicle forward. In short, you don’t try to reinvent the wheel.
It’s a lesson the Public Policy Forum could have learned in its report on the news media, The Shattered Mirror, which was released Thursday.
The report provides lots of detail on how much ad revenues have declined for traditional news media – newspapers, TV and radio – and lots of detail on how this has cut staffing in newsrooms and curtailed the amount of civic function journalism being done in Canada.
It asks: “Do the media, and particularly the civic function of journalism – the coverage of public institutions, public affairs and community – need a lifeline?”
It answers the question with a clear “Yes!” But then its main recommendations are not anything that I recognize as a lifeline.
It recommends a 10 per cent tax on purchases of digital advertising in foreign-owned media. This is primarily a tax on Google and Facebook, the two U.S. giants that gobble up billions that used to be spent in Canadian-owned media.
The rationale is twofold: it would make Canadian companies more likely to advertise in Canadian-owned media and it would address the fact that large U.S. digital companies take a lot of money out of Canada and put little back in the way of creating content for Canadians.
The tax could amount to $300 million to $400 million each year. That money could go a long way to shoring up responsible journalism across the country. It could, for example, underwrite the entire newsroom budgets of dozens of major daily newspapers.
But that’s not where the money would go. Instead, it would go to a Future of Journalism and Democracy Fund that would support digital news innovation with a special emphasis on early-stage local and indigenous news operations, and research into issues relevant to the interaction of news and democracy.
In other words, the money would not go to support what existing news outlets do to ensure ongoing coverage.
There would also be money for a whole new service by the Canadian Press to cover local news that would be shared. For example, a common reporter at the Winnipeg courts would provide stories that all local media could use.
Apart from the fact that local news media are already doing this, you have to ask: Does it serve Winnipeggers well to have a single source of such news, with the exact same story being repeated in every local media outlet? I would answer “No.” A key part of strong civic function journalism is a variety of reporting, with different versions that provide different perspectives that allow people to come to their own conclusions.
As well, this kind of service is only viable in larger centres. Who is going to do this in Steinbach and Beausejour and every other smaller centre across the country that is currently served by local newspapers?
The report has some useful recommendations. It suggests taking sales taxes off subscriptions to Canadian news outlets, in large part because such taxes are not currently applied to subscriptions to foreign news outlets.
It also suggests that the federal government advertise only in Canadian-owned media and that charity laws be changed so that people can make tax-deductible donations to non-profit news organizations. These would help civic function journalism.
But, after devoting 80 or so pages to the state of news media today, the report’s recommendations do not go very far towards helping the news media with measures to strengthen economic sustainability.
Currently, there are newspapers and news outlets across Canada doing their best to cover their communities, build out digital platforms and adapt to the new business realities. This is the bedrock of civic function journalism in Canada. The best bet for ensuring its survival is to find ways of helping it get better traction in changing conditions, and not reinvent the wheel.
