CCA Bulletin 19/09

On Friday June 26th, the Honourable Minister James Moore announced that the Department of Canadian Heritage would be renewing a number of programs under the culture portfolio, for the next five years. Minister Moore stated that “the cultural sector needs stability in this time of economic uncertainty. With ongoing investments by our Government, artists and arts organizations can plan their activities for the longer term and continue to create, produce, and present innovative works that will make Canadians proud.”

Four programs which formerly ran under the auspices of the Tomorrow Starts Today (TST) initiative, will be renewed for the next five years. Each program has been given a new title; however, each will retain its current mandate and objectives. The Canadian Arts and Heritage Sustainability Program, now renamed as the Canada Cultural Investment Fund will continue at a funding level of $33.8 million. The Cultural Spaces Canada Program, now the Canada Cultural Spaces Fund will have $30 million beginning in 2011-2012 fiscal year, as the 2010-2011 allotment was announced in Canada’s Federal Action Plan in the 2009 federal budget, alongside a doubling of this budget for the current fiscal year. The National Arts Training Contribution Program will continue as the Canada Arts Training Fund. The Training Fund had been operating at a funding level of $17.1 million but received a $ 7 million increase in the January Budget. The renewal will see this increase continue for five years at $24.1 million. Finally, Arts Presentation Canada, provisionally titled the Canadian Arts Presentation Fund, will be funded for $33.4 million (this budget includes the $7 million increase given last year).

In addition to programs which formerly ran under the TST umbrella, the Department of Canadian Heritage is renewing $25 million in existing funding for the Canada Council for the Arts. This maintains the Council’s annual funding to $181 million for the next five years.

The Canadian Conference of the Arts (CCA) has responded to this announcement with encouragement. CCA National Director Alain Pineau affirmed the need for continued stable funding for the arts. “Today's announcement is excellent news for artists and arts organizations throughout our country, as well as all Canadians whose lives are enriched by the arts. A five-year financial commitment provides exactly the kind of stability that the sector needs to be able to continue making an important contribution to our society and economy.”

Noting that some important programs still have to be renewed – including one for book publishing and the Canadian Music Fund - the CCA has encouraged the government to ensure financial stability for funding programs in the arts as a sound investment in the creative economy. Last week’s announcement is the first step towards a public policy with vision. The CCA will also continue to advocate for federal investments in the promotion and development of markets abroad for Canadian artists and cultural industries.

The recent report Issues and Challenges Related to Local Television published by the Standing Committee on Canadian Heritage, is an inquiry into the importance of strong local media in Canadian broadcasting in light of the current economic downturn. The CCA closely followed the Standing Committee’s proceedings over the past three months, and observed many of our members and stakeholders testify as witnesses to these hearings.

Given the current economic crisis, it was not surprising that funding was listed as a priority in the report. It focused on the effectiveness of current funding bodies, as well as the financial pressures that Canadian media currently face. Declining advertising revenues have affected both public and private broadcasters, the latter being particularly hit by the rising costs associated with bidding wars for successful American programs. Also impacting both public and private broadcasters is the success of specialty and pay channels, which are increasingly competing for both viewership and advertising dollars and can as well rely on fees for carriage.

While these issues are of definite concern to broadcasters, several witnesses have argued that television is a cyclical business and that many current problems will be resolved when the economy recovers. Canadian content continues to be a key issue in Canadian broadcasting (most specifically in English Canada), and a component of the hearings consisted of trying to find measures to ensure the stability of Canadian productions. Some of the other issues on the table included the upcoming transition to digital media, as well as respecting cultural and linguistic diversity.

After affirming that any programs designed to assist local broadcasting be open to both private and public broadcasters, including CBC/Radio-Canada, Aboriginal broadcasters, educational broadcasters, community television, and small broadcasters representing official language minority communities and insisting on the importance of maintaining Canadian content and local programming obligations on broadcasters, the report makes sixteen recommendations, including:

contributions to the Local Programming Improvement Fund created last year by the Canadian Radio-television and Telecommunications Commission (CRTC) go from 1% to 2.5% of broadcasting distribution undertaking revenues commencing September 2009. The Committee further recommends that the Fund be dedicated such that CBC/Radio-Canada and its affiliates receive 1% of broadcasting distribution undertaking revenues, with at least 10% of this amount dedicated to official language minority communities. The money raised should be used exclusively for the production of new, original, local programming in small and medium-size markets.

The Committee reiterates its support for public television by calling for stable, multi-year, and predictable financing for CBC/Radio-Canada. It also calls on the Government of Canada to consider reducing the reliance of CBC/Radio-Canada on commercial advertising and to allow the public broadcaster to keep and reallocate to its own priorities with the approximate $ 50 million dollars which are being identified as part of the current Strategic Review.

The Committee calls on the CRTC to address the growing discrepancy between foreign and Canadian program spending and call on the Commission to consider the impact of the concentration of media ownership on the broadcast sector and to re-examine the balance between conventional and specialty television as it reviews the license terms of private broadcasters.

Finally, to protect the integrity of local markets, the Committee recommends that the Canadian Radio-television and Telecommunications Commission either stop the distribution of distant signals by broadcasting distribution undertakings or restrict them such that a prime-time show may not be viewed in any region before the local affiliate has had the opportunity to broadcast it as per their local schedule.

Fees for carriage of local signals were reintroduced into the discussion on how to raise funds for traditional television with some groups, including the CCA, supporting the idea on the condition that the revenues generated from these fees be entirely dedicated to funding Canadian programming. Fees for carriage were first rejected by the CRTC in May 2007 and were mentioned several times during the CRTC hearings which were held in parallel with those of the Standing Committee. While not rejecting the idea, Parliamentarians do not support it in their report.

Conservative members filed a dissenting opinion in which they blame the Committee for abdicating their responsibility with regards to four major issues. They specifically expressed their “most fervent and rigorous opposition to any potential fee for carriage system, either negotiated or imposed, that would have a detrimental effect on the consumer” and invited Health Canada to immediately remove the current strict restrictions on pharmaceutical advertising “which have become completely ineffective as foreign networks regularly broadcast them into Canada with absolutely no benefit to Canadian

broadcasters or program creators.” They also oppose the recommendation that the CRTC address the growing imbalance between foreign and Canadian programming expenditures by English private broadcasters, confident that “out of control spending on foreign

programming are the effects of competition but will eventually be curbed by the income

The Bloc Québécois also filed a supplementary opinion in which it highlights the differences between the Québec market and the rest of Canada. Recognizing the structural problems which have affected both francophone and anglophone broadcasters, the Bloc insists on the fact that this would be better resolved in Québec by Quebecers. Accordingly, the Bloc insists on the long-standing request by successive Québec governments that “all powers relating to the arts, culture and telecommunications be transferred to the Québec government” and that through an administrative agreement, Québec could create its own regulatory agency.

The Bloc also states that “Committee members should have reiterated the conditions contained in the report of February 2008 regarding the CBC/Radio-Canada. The Bloc Québécois wishes to repeat recommendation 4.4 that the CBC/Radio-Canada should receive core funding of at least $40 per capita, as the Committee concluded in its report entitled CBC/Radio-Canada: Defining Distinctiveness in the Changing Media Landscape. The Bloc Québécois also reiterates recommendation 4.2 of the same report that the additional $60 million in parliamentary votes that the CBC/Radio-Canada has received since 2002 be added to the Corporation’s core funding.”

June 30, 2009

Renewal of art funding for five years

and the Heritage Standing Committee Report on the TV industry