The rules of the new Canada Periodical Fund: The impact on arts and culture magazines

CCA Bul­letin 4/10

Jan­u­ary 28, 2010

Just the Facts

On Wednes­day Jan­u­ary 20, 2010, the Hon. James Moore, Min­is­ter of Cana­dian Her­itage announced that the cri­te­ria for receiv­ing fund­ing from the Canada Peri­od­i­cal Fund (CPF) will dif­fer from the pre­vi­ous Cana­dian Mag­a­zine Fund (CMF) and the Pub­li­ca­tions Assis­tance Pro­gram (PAP. also known as the “postal sub­sidy”), which it is replac­ing as of April 1, 2010.

The CPF pro­vides finan­cial assis­tance to the Cana­dian mag­a­zine and non-daily news­pa­per indus­tries so they can con­tinue to pro­duce and dis­trib­ute Cana­dian con­tent in the face of sys­temic dis­ad­van­tages in the mar­ket­place.

The cre­ation of the CPF was ini­tially announced on Feb­ru­ary 17, 2009 to estab­lish a stream­lined pro­gram in sup­port of Cana­dian mag­a­zines and com­mu­nity news­pa­pers. The new CPF main­tains exist­ing lev­els of finan­cial sup­port for Cana­dian mag­a­zines and com­mu­nity newspapers–a total of $75.5 mil­lion annu­ally. This includes the annual $15 mil­lion “postal sub­sidy” that was once the respon­si­bil­ity of Canada Post and to which the gov­ern­ment has com­mit­ted for two years.

Despite the fact that the CPF remains at the same fund­ing level, there is con­sid­er­able con­cern that one of the areas most affected by the new reg­u­la­tions will be lit­er­ary and arts pub­li­ca­tions which fall under the 5,000 cir­cu­la­tion level. While they will remain eli­gi­ble for the Busi­ness Inno­va­tion com­po­nent of the new Fund, they will lose the addi­tional finan­cial sup­port they were receiv­ing under the pre­vi­ous regime.

Accord­ing to sources, this will affect some 40 titles, mostly in the cul­tural sec­tor. Most of the arts titles with dis­tri­b­u­tion under 5,000 are eli­gi­ble for sup­port from the Canada Coun­cil for the Arts through their Lit­er­ary and Arts Mag­a­zines Pro­gram: how­ever, the Canada Coun­cil will not be receiv­ing any increase in funds to sup­ple­ment mag­a­zines now inel­i­gi­ble through the CPF.

Many small arts pub­li­ca­tions relied on CPF’s pre­de­ces­sor pro­grams as part of their annual oper­a­tional costs. Now, these pub­li­ca­tions may see between 25% — 30% of their annual bud­gets dis­ap­pear, with no other sources of fed­eral fund­ing. It is dif­fi­cult to assess at the moment how they will cope with this new real­ity or how many will sim­ply dis­ap­pear, at least in their cur­rent format.

Tell me more

One of the pri­or­i­ties for the new Canada Peri­od­i­cal Fund is to meet the needs of Cana­dian read­ers and seize the oppor­tu­ni­ties offered by new tech­nolo­gies. To imple­ment this prin­ci­ple, the Gov­ern­ment will:

• Allo­cate the major­ity of fund­ing through a for­mula based on the read­ing choices of Cana­di­ans. The for­mula has been fixed for the first year of the pro­gram and is based on copies sold, not on mail­ing costs or edi­to­r­ial expenses, as was the case under the pre­vi­ous pro­grams in place. In the first year, all pub­lish­ers will receive no less than 90% and no more than 150% of the sup­port they received most recently from the PAP and CMF programs. This for­mula is only in place for the first year and will be replaced with a new for­mula for 2011–2012.
• Cap at $1.5 mil­lion annu­ally the amount that an indi­vid­ual title can receive. The money saved will be real­lo­cated to small and mid-sized titles, rec­og­niz­ing the economies of scale avail­able for larger titles and the need to sup­port a wide diver­sity of choice for Cana­di­ans. This change will affect four large titles in Canada, includ­ing MacLean’s and Chate­laine mag­a­zines.
• Set aside sep­a­rate fund­ing to assist online pub­li­ca­tions in find­ing inno­v­a­tive and prof­itable ways to reach Cana­di­ans. How­ever, pub­lish­ers can­not receive fund­ing from both the Aid to Pub­lish­ers and the Busi­ness Inno­va­tions com­po­nents of the new CPF.
• Con­tinue to rec­og­nize the spe­cial chal­lenges of cer­tain types of peri­od­i­cals (includ­ing farm pub­li­ca­tions, Abo­rig­i­nal pub­li­ca­tions, and pub­li­ca­tions serv­ing official-language minor­ity communities).

One of the strik­ing aspects of the new sys­tem is that the gov­ern­ment has really stream­lined the appli­ca­tion process: most appli­cants will use a two-page appli­ca­tion form that is very quick and easy to fill out. This includes most mag­a­zines that are cur­rently par­tic­i­pants in the PAP or CMF pro­grams. This is obvi­ously a good thing since the dead­line for the Aid to Pub­lish­ers Com­po­nent is extremely short as appli­ca­tions must be in by Feb­ru­ary 19, 2010.

As was men­tioned before, small pub­li­ca­tions with a total annual paid cir­cu­la­tion of 5,000 copies or less are eli­gi­ble for only one aspect of the CPF, with exemp­tions for Abo­rig­i­nal, ethno-cultural and offi­cial lan­guage pub­li­ca­tions. Other exemp­tions include agri­cul­tural pub­li­ca­tions such as The West­ern Pro­ducer, Cana­dian Cat­tle­men and Grainews, mag­a­zines which are on the whole quite prof­itable and, as some crit­ics have pointed out, hap­pen to be in government’s ridings.