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 gen- eration. 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 trig- gering 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 gov- ernment hold the line on foreign ownership of Canadian media " including telecommunication services, which in this age of technological convergence, have become the piv- otal conduits of media content. The Heritage Committee’s view on this question was not shared by another parlia- mentary committee (Industry) which recommended pre- cisely 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 deci- sions " 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 for- eign 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 con- tent 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 govern- ments 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 increas- ingly, the same companies own sub- sidiaries 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 Mar- tin government to open up the limits to foreign ownership, currently capped at 46.8 percent, so that foreign compa- nies 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 compa- nies, not to mention the entire cultural community as well as the ordinary cit- izens 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 for- eign 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 aris- ing 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 ”œclear and unequivocal” policy statement on cross-media ownership to guide the CRTC in future transaction decisions. Recognizing that the question was indeed ”œcomplex,” the government responded that it would ”œgive further consideration” to these issues. This is simply fudging its responsibilities.
The Canadian media industries have been com- pletely 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 con- trol 100 percent of the daily newspa- pers 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 unrestrict- ed cross-media ownership. Last year, the US Congress reacted strongly to attempts by the Federal Communica- tions 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 pow- erful 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 relation- ship between broadcasters and audi- ences and disrupt the business model that now drives the Canadian televi- sion 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 dig- ital transition, the problems and opportunities associated with conver- gence and internet broadcasting and the need to think about how program guides can be used to promote Canadian programming are not ques- tions 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 objec- tives 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, depend- ing 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 any- where 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, ”œit is nec- essary to emphasize the integrity of the broadcasting system as a whole.” The pillars and building blocks are all interconnected, and
the Canadian broadcasting sys- tem can be likened to a com- plex machine where the breakdown of a single working part can threaten the functioning of the machine as a whole. The health of public and pri- vate broadcasters depends on the success of independent pro- ducers and on government funding mechanisms that are reliable and efficient. The suc- cess of programming depends on effective distribution net- works. 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 deli- cate balance.
The committee therefore re- affirmed 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 Communi- cations Act and by the actions of other governments that have recognized the realities of con- vergence. The report recom- mended that the government consider adopting a single, compre- hensive 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 commu- nications 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 responsi- bility 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 broad- casting, 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 broadcast- ers and distribution undertak- ings, with a view toward generat- ing more investment in Canadian programming;
recommended recognizing the Canadian Television Fund (CTF) as an essential component of the sys- tem and providing it with increased and stable long-term funding;
applauded the growth and achievements of Canada’s inde- pendent production sector, which has revitalized Canadian program- ming 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 broadcast- ing sector " which includes out- lets 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 rec- ognized as an integral part of the Canadian broadcasting system in the Broadcasting Act.
One particularly important rec- ommendation called for cre- ation of a local broadcasting initiative program (LBIP) ”œto assist in the provi- sion of radio and television program- ming at the community, local and regional levels.” The LBIP would pro- vide an innovative, new approach to one of the most difficult problems the committee encountered on its travels around the country: the lack of ade- quate 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 broad- caster, with modest support from fed- eral funds. A wide range of possible projects tailored to specific communi- ty needs could qualify for LBIP fund- ing, 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 ”œcannot be considered independently of the cus- tomary 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 recog- nize 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 instru- ment in the sphere of mass culture.
But some of Lincoln’s most impor- tant recommendations had nothing to do with funding. At the heart of the committee’s report was the desire to see greater accountability and transparen- cy 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 pol- icy. It alone made the decision to allow broadcasters to fulfill Canadian con- tent 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 individ- ual 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 ”œwith a view to refocusing its role on cul- tural objectives, clarifying its role and establishing clear limits on its power…” The government, in its response, recognizes ”œthat it may be necessary to give policy direction to the CRTC more often to create and sustain coherence within the sys- tem.” This is potentially slippery ground and the committee sought to compensate for this and other possi- ble abuses of power with a number of proposals on accountability, nomi- nations and conflict of interest guidelines.
Under present rules, the govern- ment alone names CRTC commission- ers, as well as members of the board of directors of the CBC and the other public corporations involved in broad- casting. 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 recom- mended the development of criteria and guidelines governing the nomina- tion 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 sys- tem. The broadcasting monitor would be in a position to highlight problems, sound a warning about challenges loom- ing on the horizon and ensure that the spirit of the Broadcasting Act was being carried out by those charged with fulfill- ing 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 advan- tages and disadvantages of the commit- tee process might prove useful. The broadcasting study showed that an all- party 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 sub- missions 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 har- vest of new ideas and solutions. The MPs developed considerable expertise and were able to cooperate across party lines.
The downside is that the govern- ment’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 parliamen- tary committees of any kind.
Reports by parliamentary commit- tees might go to neutral committees made up of officials from various departments or be handled via anoth- er process that ensures that key recom- mendations cannot be easily sidetracked or discarded. For parlia- mentary 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 like- ly 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 gov- ernment’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 politi- cal will is there, the politics of neg- lect 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 http://www.parl.gc.ca/ InfoComDoc/37/2/HERI/Studies/Report s/herirp02-e.htm. ”œThe Government of Canada’s response to the report of the Standing Committee on Canadian Heritage, ”œOur Cultural Sovereignty: The Second Century of Canadian Broadcasting,” is available on-line at http://www.canadianheritage. gc.ca/progs/ac-ca/progs/ri-bpi/pubs/ lincoln/index_e.cfm