OTTAWA – The CRTC said today that while many things should change about the Canadian Television Fund, Shaw Communications and Quebecor Media still have to pay into it – and in a timely manner.
And, while the Commission also said it would alter the BDU regs to make monthly contributions to the CTF mandatory, the report says it won’t make that move until the federal government has dealt with the substantive issues covered by the report.
That means distributors could still choose to withhold monthly payments in favour of quarterly or annual ones until Heritage Minister Josee Verner and her cabinet colleagues deal with the various CTF recommendations. With that threat still hanging over the Fund and the producers it backs, the Commission appears to have found an effective way to force the minister to actually deal with the report and not let it languish on the shelf, like many governmental reports do.
That’s what Shaw Communications CEO Jim Shaw is worried about.
“There are lots of reports that go nowhere,” he told Cartt.ca in reaction to the CTF release. “Look at foreign ownership. I went to three parliamentary committee meetings on that and I don’t know why I even go. It went nowhere.
“There are lots of those type of reports that never make it.”
“I hope that Canadians get value for what they’re paying for and that’s all we’ve ever asked,” added Shaw.
In December of 2006, cable companies Shaw Communications and Quebecor Media decided to withhold their contributions to the fund, citing numerous issues the companies had with the it, from its corporate governance to the types of programming being made with the money contributed by cable and satellite TV customers ($150 million a year) and taxpayers ($100 million). (Click here and follow the links for a full background on this story.)
“It is our hope that the recommendations we have put forward will assist in resolving the issues surrounding the CTF,” said Konrad von Finckenstein, chairman of the CRTC. “The Fund plays a vital role in fostering a strong domestic television industry through its support of independent productions. Its effective operation is vital to the creation of high-quality, Canadian-made programs."
The key recommendations are:
* The CTF’s funding be split into private- and public-sector streams. The private-sector stream would support the production of commercially successful programming and be accessed by private commercial broadcasters. The public-sector stream would be set aside for the CBC, educational broadcasters and other not-for-profit broadcasters.
* Two separate Boards of Directors would be established, with one having oversight of the private-sector funding stream and the other being responsible for the public-sector funding stream. However, both streams should share the day-to-day administrative services of the CTF to reduce operating costs.
* Increased emphasis will be placed on audience success as a criterion for access to the new private-sector funding stream.
* The CTF maintain its current practice of funding productions that score 10 out of 10 points on the scale developed by the Canadian Audio-Visual Certification Office (the CAVCO scale).
* The proposals by two companies (Shaw and Quebecor-owned Videotron) that distribute broadcasting services to opt out of their contributions to the CTF, as required by the Broadcasting Distribution Regulations, be rejected.
* The CTF establish a new funding stream to support the production of Canadian programs for broadcast on new media platforms.
While the majority of the report’s recommendations require action by the CTF board and other government entities, the Commission is able to act in certain areas. Among other things, the Commission will amend its policy to allow tangible benefits stemming from ownership transactions in the broadcasting industry to be directed to the CTF.
Also, the Broadcasting Distribution Regulations will be altered to make mandatory the monthly contributions of companies that distribute broadcasting services, once the Department of Canadian Heritage has resolved the major issues. These are the payments which Shaw and Videotron stopped in late 2006, saying the regs only say payments must be made every year, not that they be made every month, which is the practice.
In February 2008, the Minister of Canadian Heritage announced that the government had asked the CRTC to prepare a report and make recommendations on the Canadian Television Fund, in accordance with section 15 of the Broadcasting Act.
This request followed a public hearing on the CTF held by the Commission from February 4 to 8, 2008, at which interested parties expressed their views. The Commission had previously created a Task Force to provide a detailed analysis of the issues concerning the funding of Canadian programming and the CTF’s governance.
While the ball is in Heritage Minister Josee Verner and the Conservative government’s hands, reaction from the creative community was swift and pretty negative.
"The CTF is already a market-driven results-based fund that supports successful Canadian shows. Splitting the CTF into two streams and giving the cable and satellite companies control over one stream is putting the fox in charge of the henhouse," said Stephen Waddell, ACTRA’s national executive director.
"Dividing the CTF adds needless complexity and means we’ll see more cheap reality and game shows out of the private sector stream, instead of the high-quality dramas we need more of on Canadian television," added Richard Hardacre, ACTRA national president.
It’s not all bad, though, says the actors union. "There are recommendations we welcome. The CRTC did hear us on Canadian content by affirming that only fully Canadian, 10 out of 10 point CAVCO productions will be CTF-eligible. We argued strongly against the CRTC’s earlier suggestion of watering down that requirement, which would have directly jeopardized work for Canadian writers, directors and performers," said Hardacre.
ACTRA also supports the CRTC’s report recommendations that new funds be found for new media instead of diverting existing funds, and that cable and satellite companies be required to make their CTF contributions on a monthly basis.
As for the film and TV producers, they dislike the two-stream idea, too. “The CFTPA is very disappointed that the CRTC has failed to see the fundamental flaws in splitting the CTF into two funding streams, said a memo to its members Thursday. “It’s a bad solution in search of a problem. We’ve been down the two-stream road before and it did not work,” said Guy Mayson, president and CEO of the CFTPA.
“The Association fundamentally believes that splitting the CTF into two funding streams will inevitably result in higher administration costs – money that should be going to programming. It also fails to recognize that producers do not set out to make culturally relevant productions or commercially successful ones. It is not an either or proposition,” adds the memo.
Over at the Canadian Association of Broadcasters, they like the report. “This substantive process has demonstrated that both stakeholders and the CRTC recognize the value in this fund and in the Canadian programming it supports. It is important for the government to respond to the CRTC report in a timely manner,” said Glenn O’Farrell, president and CEO.
“Private broadcasters are very encouraged by the CRTC’s recommendations, which are consistent with the priorities identified by CAB members. We support the recommendation that the CTF be divided into two funding streams, one for commercial broadcasters and the other for public, educational and not-for-profit broadcasters. More importantly, the CRTC has supported the key recommendations of the CTF Task Force, which will ensure stable and continuous financial support for the fund by broadcast distributors,” added O’Farrell.
Finally, the CBC is fretting about losing out on future CTF growth. If the recommendation to split the fund is implemented, it would result in a $150 million decline in funding to Canadian public sector television programming over the next five years, says the Corp.
Under the existing CTF structure, all programming benefits from the increase in CTF funding that flows from growth in the revenues of cable and satellite companies. The government’s $100 million contribution has been static and so the CRTC’s split-fund recommendation would mean the piece of the funding that is growing would pass the CBC and other public broadcasters by.
"Splitting the fund into two separate streams is counter-intuitive," said Sylvain Lafrance, executive vice-president of French services. "What the CRTC is proposing is inconsistent with Canada’s 1991 Broadcasting Act, which calls for a single, integrated public/private broadcasting system."
"Implementing today’s recommendations would effectively take money away from those who have the strongest commitment to Canadian programming," said Richard Stursberg, executive vice-president of English services. "We hope the government will recognize the detrimental effect this report would have on Canadian programming and culture."
