It has been nine months since a parliamentary committee chaired by MP Clifford Lincoln completed the most comprehensive study of Canadian broadcasting in nearly a generation. Weighing in at nearly 900 pages and containing 97 often sweeping and audacious recommendations, the report by the Standing Committee on Canadian Heritage— tabled in the House of Commons in June 2003— presented a blueprint for bringing Canada’s broadcasting system into the 21st century. However, the government’s response— required by law and issued last November— seemed to resist any notion that the system was in need of considerable overhaul. Recommendations calling for greater transparency and accountability, for dealing with the realities of technological convergence and preparing for a new digital universe, for triggering more local and regional programming, for revisioning the CBC, and for reforming the CRTC and government funding programs have been largely ignored or put off to a later date.

One of the most important and possibly controversial recommendations of the Lincoln report was that the government hold the line on foreign ownership of Canadian media— including telecommunication services, which in this age of technological convergence, have become the pivotal conduits of media content. The Heritage Committee’s view on this question was not shared by another parliamentary committee (Industry) which recommended precisely the opposite, that ownership rules be liberalized to allow for an influx of foreign capital.

The government’s response to the report promised an early review of the foreign ownership question— one of the few areas in which it actually made a commitment to look at an issue. The way that the Martin government handles this question may well set the tone for a whole series of other decisions— decisions that not only deal with the cultural sphere, but with the future of the economy, questions of sovereignty, international trade and Canada’s place in the world, in short, the hallmark themes that will define Paul Martin’s government. Let us explain.

Canada has a stringent set of foreign ownership restrictions in the media sphere, for reasons that are well known and need not be detailed here. This country sits on the edge of the world’s most formidable producer of media content and yet has shown determinedly over the past century that it wishes to control its own media space. Some have argued that in this age of globalization such concepts are outmoded. We would submit to the contrary that they are more important than ever. It is precisely in the current context of transnational corporate convergence and a lessening authoritative role for national governments that a country’s sovereignty over its media becomes essential. No country has to face this issue in quite the same way as Canada.

The question of foreign ownership was a no-brainer for the Heritage Committee. Members of all parties but the Canadian Alliance agreed that any loosening of Canadian ownership rules for media would be a perilous step. The Lincoln report rightly characterized the Industry Committee’s position as naïve and simplistic insofar as it suggested that telecommunication ownership had nothing to do with content. In fact, the system and structure of media distribution has everything to do with what gets produced and circulated— especially when, as is the case increasingly, the same companies own subsidiaries in virtually every corner of the media industry.

Imagine a case where, say, Disney or AOL TimeWarner were to purchase Rogers Cable. Would they just accept Canadian distribution regulations or rather keep the CRTC tied up in court for years on end? The entire point of moving into the Canadian market would be to take advantage of the economies of scale that the parent company would enjoy by distributing its own material. To imagine that Viacom or News Corporation or Sony would become major producers of Canadian programming is to live in a fantasy world.

There will be pressure on the Martin government to open up the limits to foreign ownership, currently capped at 46.8 percent, so that foreign companies can take control. Interestingly, if the testimony received by the Heritage Committee is anything to go by, that pressure will come almost exclusively from the handful of large corporations that stand to gain directly by a quick sellout. Many Canadian media companies, not to mention the entire cultural community as well as the ordinary citizens who spoke out on the question, favor maintaining Canadian media in Canadian hands.

Once this barrier falls, once foreign companies are allowed to take control, the chances of Canadians ever reclaiming this vital cultural space will be small indeed. In fact, once in foreign hands, this crucial high ground may be lost forever. There is no longer a sharp divide between broadcasting and telecommunications, hardware and content. The simple and brutal reality is that the government cannot lift restrictions on telecommunications without also gravely affecting Canadian cultural industries.

The committee also devoted considerable attention to the problems arising from increased concentration of media ownership and especially cross-media ownership. Based on its own commissioned research, the committee suggested six possible approaches and recommended that the government issue a “clear and unequivocal” policy statement on cross-media ownership to guide the CRTC in future transaction decisions. Recognizing that the question was indeed “complex,” the government responded that it would “give further consideration” to these issues. This is simply fudging its responsibilities.

The Canadian media industries have been completely restructured in the past ten years, under the approving eye of the CRTC. If the government feels that it is all right for the same company to control 100 percent of the daily newspapers and 70 percent of the local television news market in Canada’s third largest city— as is the case with CanWest Global in Vancouver— or that there is no problem with one company being the dominant player in newspapers, television and cable distribution in one of our two official languages— as is the case with Quebecor— then let it say so and take the consequences.

It should be noted that Canada seems to be defying an international trend in allowing what amounts to unrestricted cross-media ownership. Last year, the US Congress reacted strongly to attempts by the Federal Communications Commission to expand the degree of market penetration that could be enjoyed by television networks after the FCC’s ruling encountered a squall of public protest. The French, British and Australian governments have also imposed stringent rules limiting the degree of cross-media ownership. The reasons why Canada appears to be out of sync with what appears to be a growing trend remain unclear.

The committee’s work was governed to some degree by the need to adjust to technological imperatives. The digital revolution and the realities of technological convergence cannot be wished away by even the most powerful governments. The Lincoln report emphasized the degree to which all media are merging one into the other. Advances in digital technology have allowed cell phones, for instance, to become devices for instant messaging, playing video games, taking pictures, downloading movies and, of course, making phone calls.

In addition, new technologies such as personal video recorders (PVRs) could well alter the relationship between broadcasters and audiences and disrupt the business model that now drives the Canadian television industry. PVRs, for instance, will allow viewers to download and store entire seasons of a particular program on a hard drive. Viewers will be able to watch programs according to their own schedules rather than those of the networks. The system of simultaneous substitution on which the broadcasting system now rests would be derailed. Moreover there may be no need for networks at all because Hollywood producers will have the capacity to reach viewers directly.

The Lincoln report warned that many of the old assumptions can no longer be taken for granted. It also wished to convey a sense of urgency about the speed at which change was occurring. The need to adapt and prepare for the digital transition, the problems and opportunities associated with convergence and internet broadcasting and the need to think about how program guides can be used to promote Canadian programming are not questions for some distant tomorrow. Unfortunately, the government’s response seemed to suggest that time will somehow stand still.

Most of the report’s attention, however, went to attempting to assess how well the system was doing, in light of the demanding objectives set for it by the Broadcasting Act of 1991. The committee found that the Broadcasting Act and its objectives are still timely and valid but astonishing as it may seem, discovered that there is no mechanism in place for systematically evaluating to what extent these objectives are being met.

It is excruciatingly difficult to tell how well public agencies such as the CBC, Telefilm Canada, the Canadian Television Fund and the CRTC itself are accomplishing their mandates. Annual reports tend to be self-serving and the issues too detailed and complex to stand up to scrutiny. Data are collected haphazardly, or not at all, and often seem to contradict each other, depending on who has done the collection. Furthermore, the Broadcasting Act’s loftier objectives— for example, that the system serve to maintain and enhance national identity, or that it serve the needs and interests of all Canadians— are of a general nature that defies evaluation. The report addresses these problems and makes a series of important recommendations in a substantial chapter on governance— a word which does not appear anywhere in the government’s response.

Canadian broadcasting employs nearly 80,000 Canadians, spends and collects some $14 billion annually, and is the main medium through which we speak to each other and the world. As the report stated, “it is necessary to emphasize the integrity of the broadcasting system as a whole.” The pillars and building blocks are all interconnected, and

the Canadian broadcasting system can be likened to a complex machine where the breakdown of a single working part can threaten the functioning of the machine as a whole. The health of public and private broadcasters depends on the success of independent producers and on government funding mechanisms that are reliable and efficient. The success of programming depends on effective distribution networks. The loyalty of audiences is tied to their sense of place and belonging and whether or not their needs are being served. And the choices available to citizens depend on an effective regulatory framework. 
In short, the objectives of the Canadian broadcasting system depend on maintaining a delicate balance.

The committee therefore reaffirmed that Canadian broadcasting constitutes, more than ever, a single system. Its thinking in this regard was influenced to some degree by Great Britain’s new Communications Act and by the actions of other governments that have recognized the realities of convergence. The report recommended that the government consider adopting a single, comprehensive communications act to replace the three acts that now exist to deal with broadcasting, telecommunications and the CRTC.

It also wished to see a single department of communications, one that would splice together the Department of Canadian Heritage with the communications functions now administered by Industry Canada— as was the case up until 1993. It recognized that there is no reason for governments to be organized around divisions of responsibility that have long since disappeared. The government’s response was strangely silent with respect to these recommendations.

The committee also recognized, indeed celebrated, the successes and accomplishments of Canadian broadcasting, while focusing on ways to help the system better serve Canadians. Among other things, the report

• recommended increased and stable long-term funding for the CBC— while calling on the public broadcaster to submit a detailed strategic plan outlining how it proposes to fulfil its mandate with respect to local and regional broadcasting, Canadian programming, and new media initiatives;

• called on the government to examine the structure of license fees charged to private broadcasters and distribution undertakings, with a view toward generating more investment in Canadian programming;

• recommended recognizing the Canadian Television Fund (CTF) as an essential component of the system and providing it with increased and stable long-term funding;

• applauded the growth and achievements of Canada’s independent production sector, which has revitalized Canadian programming across all genres in both French and English, and called for measures to ensure its continued good health; and

• underscored the contribution of Canada’s not-for-profit broadcasting sector— which includes outlets such as the Aboriginal Peoples Television Network (APTN), Vision TV, the provincial educational broadcasters, the Cable Public Affairs Channel (CPAC) and others— and proposed that these be recognized as an integral part of the Canadian broadcasting system in the Broadcasting Act.

One particularly important recommendation called for creation of a local broadcasting initiative program (LBIP) “to assist in the provision of radio and television programming at the community, local and regional levels.” The LBIP would provide an innovative, new approach to one of the most difficult problems the committee encountered on its travels around the country: the lack of adequate local broadcasting services nearly everywhere outside the large urban centres of Toronto, Montreal and Vancouver.

Previous efforts to deal with this have typically come up against the brick wall of trying to design services which would be all things to all people and, of course, the inevitable problem of scarce resources. The LBIP approach would be based on local partnerships between a community and a broadcaster, with modest support from federal funds. A wide range of possible projects tailored to specific community needs could qualify for LBIP funding, and the program would not need to be applied symmetrically across the country. Private, community and public broadcasters— including the CBC— would be eligible.

The government’s response, quite legitimately, noted that the committee’s recommendations calling for new, increased or stabilized funding “cannot be considered independently of the customary priority-setting exercises which occur in the lead-up to federal budgets.” But it should be called to task to provide the necessary resources to meet public policy objectives or else simply recognize that those objectives are unrealistic.

The Lincoln report illustrates the vicious circle in which the CBC finds itself as dwindling resources force it to cut corners in vital areas of its mandate such as regional programming. It cites OECD figures showing that Canada ranks twenty-second out of 26 countries in public funding for national public broadcasters as a percentage of GDP. Yet the CBC remains possibly the country’s most important public policy instrument in the sphere of mass culture.

But some of Lincoln’s most important recommendations had nothing to do with funding. At the heart of the committee’s report was the desire to see greater accountability and transparency and a system of checks and balances built into the system.

There is little doubt that the CRTC is now the dominant player in the making of Canadian broadcasting policy. It alone made the decision to allow broadcasters to fulfill Canadian content requirements by showing less rather than more Canadian drama, to open the floodgates to cross-media ownership and to deprive the CBC of major positions in the cable universe. But there seems to be no check on the power of the CRTC. Although individual licensing decisions can be appealed to Cabinet, these are strictly decisions about which company should get which license and not about the broad contours of broadcasting policy.

This is a delicate issue, in which great care must be taken to ensure that the cure is not worse than the disease. The integrity of Canadian broadcasting regulation relies on the arms-length relationship between the CRTC and the government. The government’s role should be to set broad policy, and the CRTC’s role should be to carry it out.

The committee recommended a review of the CRTC’s mandate “with a view to refocusing its role on cultural objectives, clarifying its role and establishing clear limits on its power…” The government, in its response, recognizes “that it may be necessary to give policy direction to the CRTC more often to create and sustain coherence within the system.” This is potentially slippery ground and the committee sought to compensate for this and other possible abuses of power with a number of proposals on accountability, nominations and conflict of interest guidelines.

Under present rules, the government alone names CRTC commissioners, as well as members of the board of directors of the CBC and the other public corporations involved in broadcasting. Almost uniquely among the world’s leading public broadcasters, the CBC president as well is named by the government. (In Great Britain, for example, the director-general of the BBC is appointed by the board.)

The committee suggested that nominations to the board of the CBC could be made by a number of sources, and that the president could be hired by and be responsible to the board. The committee also recommended the development of criteria and guidelines governing the nomination of CRTC commissioners and CBC directors. The government’s response took no note of these proposals.

The Lincoln report recommended the establishment of a broadcasting monitor. The monitor, with a small staff and budget, would be housed in the Office of the Auditor General and would report annually to Parliament about the overall health of the broadcasting system. The broadcasting monitor would be in a position to highlight problems, sound a warning about challenges looming on the horizon and ensure that the spirit of the Broadcasting Act was being carried out by those charged with fulfilling its objectives.

Finally, since enhancing the independence and power of ordinary MPs is one of the Martin government’s top stated priorities, some reflections on the advantages and disadvantages of the committee process might prove useful. The broadcasting study showed that an allparty standing committee can do extraordinary work. The Heritage Committee traveled to every province, visited broadcasters on their home turf, held hearings in which industry leaders, interest groups and ordinary citizens gave their views, reviewed over 200 submissions and commissioned research studies. The process was open, inclusive, galvanizing and effective. The mere act of undertaking such an inquiry forced issues onto the table, allowed ordinary citizens and of course major players to express their concerns and yielded a harvest of new ideas and solutions. The MPs developed considerable expertise and were able to cooperate across party lines.

The downside is that the government’s response to the report was likely crafted in this case by officials in the Department of Canadian Heritage— the very officials who were likely to be the most resistant to the changes recommended by the committee. This is a flaw in the system and a major impediment to the work of parliamentary committees of any kind.

Reports by parliamentary committees might go to neutral committees made up of officials from various departments or be handled via another process that ensures that key recommendations cannot be easily sidetracked or discarded. For parliamentary reform to work, MPs must be given the resources and the staff to carry out meaningful inquiries but they must also have the assurance that their efforts will be taken seriously. If these steps are not taken, Prime Minister Martin’s reforms will amount to very little and ordinary MPs are likely to become angry and alienated.

The Lincoln Report and its 97 recommendations can be read as an attempt to deal with several decades of benign neglect. The absence of an overarching framework for Canadian broadcasting policy is not the result of any particular design but rather of the ad hoc way the system has evolved, particularly in the dozen years since adoption of the Broadcasting Act. That said, the report provides the elements of such a framework. Unfortunately, the government’s response does not augur well for implementation of the report’s key recommendations. Yet the change of government offers a chance for a fresh start. If the political will is there, the politics of neglect can be overcome. The ball is now in Paul Martin’s court.

The Standing Committee on Canadian Heritage report, Our Cultural Sovereignty: The Second Century of Canadian Broadcasting, is available on-line at https://www.parl.gc.ca/ InfoComDoc/37/2/HERI/Studies/Report s/herirp02-e.htm. “The Government of Canada’s response to the report of the Standing Committee on Canadian Heritage, “Our Cultural Sovereignty: The Second Century of Canadian Broadcasting,” is available on-line at https://www.canadianheritage. gc.ca/progs/ac-ca/progs/ri-bpi/pubs/ lincoln/index_e.cfm