Proceedings of the Standing Senate Committee on
Transport and Communications
Issue 11 - Evidence
OTTAWA, Thursday, May 13, 2004
The Standing Senate Committee on Transport and Communications met this day at 10:53 a.m. to examine the current state of Canadian media industries; emerging trends and developments in these industries; the media's role, rights, and responsibilities in Canadian society; and current and appropriate future policies relating thereto.
Senator Joan Fraser (Chairman) in the Chair.
[English]
The Chairman: Welcome to this continuation of the Standing Senate Committee on Transport and Communications' study of the Canadian news media.
[Translation]
Today, we welcome representatives of the Friends of Canadian Broadcasting, a voluntary organization founded in 1985 with the goal of defending and enhancing the quality and quantity of Canadian programming.
Our witnesses today are Ian Morrison, spokesperson for the Friends of Canadian Broadcasting, and Noreen Golfman, Chair of Friends' Standing Committee.
[English]
Thank you very much for coming to meet with us today. I think you are familiar with the way we do things. We ask the witnesses to make an opening statement of 15 minutes or so and then we go to a question period. If that is agreeable to you, I will ask you to start.
Ms. Noreen Golfman, Chair of the Steering Committee, Friends of Canadian Broadcasting: In fact, we should probably take no longer than 16 minutes.
Senator Graham: You said 16 and the chairman said you only have 15.
Mr. Ian Morrison, Spokesperson, Friends of Canadian Broadcasting: You will get everything except the punch line.
Ms. Golfman: We will do our best. Madam Chair, senators, I work at Memorial University of Newfoundland as associate dean of graduate studies there. In what I like to call my spare time, I chair the steering committee of the Friends of Canadian Broadcasting. Joining me in this presentation today is Ian Morrison, Friends of Canadian Broadcasting spokesperson.
Friends is a watchdog group supported by 60,000 Canadian households. Our mission is to enhance and defend the quality and quantity of Canadian programming in the English language broadcasting system. From time to time, we form alliances with other groups on cultural issues, and through ongoing polling we verify that a broad majority of Canadians agree with us on issues we adopt as our priorities.
Our presentation today will draw upon advance information from an Ipsos-Reid poll, the details of which we plan to release next week.
As you know, in peak television viewing hours when most people are free to watch, we see very little that is Canadian on our screens. We, and most importantly, our children, view stories about life in Los Angeles, Manhattan and Miami; not Edmonton, Winnipeg or Montreal. As the chart before you illustrates, other than on CBC, there is very little about Canada on our television screens each evening. As you know, on Saturdays, when the private networks air the majority of their Canadian shows, most Canadians are either out or watching Hockey Night in Canada.
The CBC could be mandated to play a far stronger role in citizen engagement and lifelong learning, both Canada- wide and in major communities across the land. Private broadcasters could also be encouraged to play a more constructive role.
In this regard, we remind you that over the past two years, the House of Commons Standing Committee on Canadian Heritage has worked in a largely non-partisan spirit to involve Canadians from all parts of the country in a comprehensive review of broadcasting policy. We are confident that Canadians' willingness to consider a new relationship with the United States, one of the government's priorities, will increase if the Canadian government adopts policies that confirm Canadians' confidence in their cultural, not merely territorial, sovereignty.
In the poll we will release next week, 59 per cent of Canadians agreed strongly and 28 per cent agreed somewhat that as Canada's economic ties with the United States increase, it is becoming more important to strengthen Canadian culture and identity. Only 12 per cent disagreed with this statement.
Mr. Morrison: The Heritage Committee's 2003 report, with which I am sure you are familiar, entitled ``Our Cultural Sovereignty,'' lays out a comprehensive series of recommendations, most of them unanimous. Taken together, they are the elements of a new broadcasting policy capable of responding to your priorities and those of the government.
We recall that your committee heard from Clifford Lincoln, the chair of that committee, after it had finished this landmark study. At one point, Senator Eyton, whom I notice joining us, asked Mr. Lincoln to highlight priorities among his committee's 97 recommendations.
While we have no disagreement with Mr. Lincoln's response, we come here today to endorse the Heritage Committee's recommendations and to offer our own sense of a few of the priorities among them. Senator Eyton has had an influence on me.
Our short list is drawn not only from our sense of what is most important in the reform of the Canadian audiovisual system, but also from the government's own priorities, which link with some of the Lincoln committee's key recommendations.
Building that committee's recommendations into a new broadcasting policy for Canada would offer an early and tangible demonstration of the government's commitment to listen to Canadians through their elected representatives. For the record, we found the response of the minister representing the previous administration on November 6, 2003 to the committee's report entirely inadequate.
We would like to draw from some of the Lincoln committee's recommendations to illustrate how broadcasting reform could help to express and implement some of the government's priorities.
Prime Minister Martin recently said, ``The future of our country is going to be set in our communities.'' He added that, ``a strong social base is essential for development.'' One component of healthy cities is local broadcasting, which is under exclusive federal jurisdiction. It is the most important way citizens learn and exchange information in our modern urban communities. The Lincoln committee has determined that ``community, local and regional broadcasting services have become endangered species, and that many parts of Canada are being underserved.''
The committee reports that in many parts of the country, the CBC ``has the capacity to be one of the essential building blocks of community life.'' The committee recommended that CBC be asked to deliver a strategic plan to Parliament on how it would fulfil its public service mandate to ``deliver local and regional programming.''
The need to strengthen local programming is pan-Canadian in scope, but we wish to underline that its importance is nowhere stronger than in the outlying parts of the country, where, perhaps not coincidently, support for our group is very strong. They perceive Ottawa-based decisions in recent years that have hobbled the local capacity of CBC Radio and Television as contributing to their alienation. Some have even come to call the CBC the ``Toronto Broadcasting Corporation.''
Note that in their May 4 to 9 poll of 1,100 Canadians — and we have distributed copies of this document — Ipsos- Reid quoted the CBC's Broadcasting Act mandate to ``reflect Canada and its regions to national and regional audiences, while serving the special needs of those regions.'' They asked:
How important is it that programming made in and about your part of the country be produced? Please use a scale from 1 not at all important to 7 very important.
Seventy-eight per cent of Canadians responded with 5 to 7 — that is strong — up marginally from 77 per cent when we last commissioned that question in 2002. This view is strongest in Atlantic Canada, at 88 per cent, and lowest in Alberta, where two-thirds of the population agree.
Ipsos-Reid also found that last week, 85 per cent of Canadians wanted to see CBC strengthened in ``my part of Canada,'' and 80 per cent agreed with the statement:
We should build a new CBC capable of providing high quality Canadian programming with strong regional content throughout Canada.
The present government has indicated an intention to devolve ``command and control'' from the Prime Minister's Office to Parliament in order to address the democratic deficit. We draw to your attention that the Lincoln committee has recommended that ``in the interests of further accountability and arm's length from government, nominations to the CBC Board should be made by a number of sources, and the CBC president should be hired by — and be responsible to — the Board.''
This recommendation has no fiscal implications and would ensure that only the best and brightest would sit in governance of the country's most important cultural institution. It would also give tangible expression to the government's expressed intent to unravel the command-and-control culture and place CBC governance on a par with the standards of the BBC and national public broadcasters in other leading OECD countries.
Ms. Golfman: We want to brief you on a few other indicators of the high regard Canadians have for their national public broadcaster, drawing upon last week's Ipsos-Reid poll.
One question Ipsos-Reid has posed on our behalf in polls at intervals over the past decade is the following:
I'm going to read you the names of several groups. Please tell me how much confidence or trust you personally have in each group to protect Canadian culture and identity on television...
Again, they used a scale of 1, meaning very low trust and confidence, to 7, meaning very high trust and confidence. The responses are reported by grouping the high trust and confidence responses — 5, 6 and 7 — as a percentage of all responses. Ever since we have tracked this measure, CBC has always led, with 76 per cent in 2004 and also in 2002.
Last week's data go like this: CBC, 76 per cent; TVA, French respondents only, 66 per cent; CTV, English only, 62 per cent; TQS, French only, 57 per cent; specialty channels, 54 per cent; Global TV, 53 per cent; the CRTC, 48 per cent; consumer groups, 43 per cent; the federal government, 40 per cent; your provincial government, 40 per cent; cable television companies, 30 per cent; telephone companies, 29 per cent; satellite companies, 23 per cent.
I think you can see that it is an interesting list and an objective measure of Canadians' regard for their national public broadcaster. Regionally, the CBC percentage ranges from a high of 82 per cent in Atlantic Canada to 67 per cent in Alberta.
While conventional wisdom places CBC Radio ahead of CBC Television in public esteem, Ipsos-Reid's data reveal that by a strong margin, Canadians believe that CBC Television, at 58 per cent, makes the biggest contribution to Canadian culture and identity; compared with 35 per cent who believe that CBC Radio makes a bigger contribution.
When Ipsos-Reid reads a series of statements to survey respondents, here is the percentage of respondents who strongly or somewhat agree: I want to see the CBC survive and prosper, 94 per cent; the CBC is one of the things that help distinguish Canada from the United States, 89 per cent; the CBC provides value for taxpayers' money, 77 per cent.
Finally, regarding the CBC, we want to share with you the views of Canadians last week to the following question:
Assume for a moment that your federal member of parliament asked for your advice on an upcoming vote in the House of Commons on what to do about CBC funding. Which of the following three options would you advise him or her to vote for...decrease funding for the CBC from current levels...maintain funding for the CBC at current levels or increase funding for the CBC from current levels?
Ipsos-Reid reports that last week Canadians responded as follows: decrease, 9 per cent; maintain, 51 per cent; increase, 38 per cent. This is yet another indicator of the high regard of Canadians for their national public broadcaster.
Mr. Morrison: Turning to the issue of foreign ownership of media and communications, we want to draw to your attention that the Lincoln committee has recommended, ``that the existing foreign ownership limits for broadcasting and telecommunications be maintained at current levels.'' That is a direct quote. We stress how important this latter recommendation is to Canada's cultural sovereignty.
The argument has been stated succinctly by the CEOs of three of Canada's leading broadcasting companies, Alliance Atlantis, Astral and CHUM, in a joint brief to the Commons Industry Committee on February 12th of last year. In their submission, these CEOs were focusing on the cable industry, in CRTC-speak, ``broadcasting distribution undertakings,'' or BDUs. As you probably know, the cable industry has launched the strongest lobby for relaxation of foreign ownership restrictions.
Here is what the CEOs of these three broadcasters said:
Broadcasting Distribution Undertakings (BDUs) are not really the analog of ``common carriers''... There is an established legal concept that says that a common carrier cannot control the content or influence the meaning of the content of what is being carried.
But, when a broadcast distributor offers television programming to its subscribers, it does something very different. Unlike a phone company, the BDU does have an active role in ``controlling or influencing'' the content it offers: it makes critical decisions about which services to market, promote and package as well as the appropriate level of resources that should be devoted to such marketing and promotion. It also negotiates vital wholesale prices and sets program packages, sets retail prices and program promotion channels. So BDUs make programming decisions every day: they play a fundamental role in the success or failure of Canadian programming services...
If integrated foreign media companies were to gain control of a Canadian BDU...
For example Rogers, Shaw or Cogeco.
...and remember, we're talking about strategic operating control, it would surely, and quite understandably, be driven by a different set of concerns. Such companies are not just cable companies or Internet portals. They are generally dominant distributors of a large volume of television and film programming. They would have a natural incentive to promote their own content, whether on non-Canadian services currently available to Canadian BDU subscribers or on programs that their other arms already sell to Canadian broadcasters. They have the means and the leverage to prefer their own properties.
This logic, which we endorse, makes clear that any dilution of effective Canadian control of broadcasting distribution undertakings is a threat to Canada's cultural sovereignty, and therefore, in our view, an impediment to summoning a national will to address a new relationship with the United States, a government priority.
Canadians agree with this position. Ipsos-Reid asked them:
As you may know there has been some discussion about foreign ownership in the communications and broadcasting system in Canada. Generally speaking, what is your reaction to foreign ownership in telephone companies, cable companies and media companies... very favourable, somewhat favourable, somewhat unfavourable or very unfavourable?
As you know, Madam Chair, these polling companies always rotate the questions to ensure balance.
The combined somewhat unfavourable and very unfavourable responses for the three industries are: telephone companies, 65 per cent; cable companies, 65 per cent; and media companies, 68 per cent. This finding confirms other research that indicates Canadians are skeptical of lobbies such as the cable industry working non-stop on the Hill to be allowed to sell out to American interests. We found a column by Eric Reguly in Tuesday's Globe and Mail ``Report on Business'' to be right on the money. He said:
You have to wonder whether the Liberals are about to succumb to the big con game. Is lifting ownership restrictions about giving Canadian companies access to cheaper capital? Or is it really about estate planning for Mr. Rogers and Mr. Shaw and, down the road, the media families like the Aspers?
The final issue we wish to address is media concentration and cross-ownership. You know the facts. You know that our media ownership is more concentrated than in other Western democracies. You know that this poses threats to diversity and democracy. We endorse the Lincoln committee's recommendations, and I will note them: the need for CRTC policies to strengthen newsroom separation and editorial independence; the need for a clear, unequivocal statement of government policy; the CRTC should postpone decisions involving cross-media ownership and, in the interim, there should be only short-term extensions of existing cross-media licences.
Ipsos-Reid's poll shows widespread concern about this issue among the public. As senators can see in detail from the advance poll data that we tabled with the committee today, while Canadians have some sympathy for the economy-of- scale logic of concentration: Canadian media need to be concentrated to be competitive, 66 per cent agree; a strong majority also agree with the following statements: media concentration undermines the health of Canada's democracy, 62 per cent agree; owners of Canada's media have gone too far in trying to inject their own personal political opinions into what their media outlets say and what they report, 73 per cent agree; there is too much media concentration in Canada today, 60 per cent agree; and the federal government should act to limit media concentration, 63 per cent agree.
Ms. Golfman: We are aware that there may not be too many other witnesses appearing before you in the current Parliament. Possibly, your minds may be turning to the idea of a report that would justify all your hard work and lay out a strong basis for government action. We urge you to act strongly, to think big and to underline the good work of your colleagues on the Lincoln committee in the other place. Something forceful and cohesive is needed to capture the attention of the government that will come to office following the general election. Senators can play a strong role. In the words of that commercial, ``just do it,'' and our message today is that you do have the people on your side, as you can see from the results of this poll; it is better than the alternative. Thank you for inviting us to appear.
Senator Phalen: I would like to ask what is the major difference between Friends of Canadian Broadcasting and Our Public Airwaves?
Mr. Morrison: Our mission, as stated by Ms. Golfman, is one of Canadian content. We are concerned with the quality and quantity of Canadian programming in the audiovisual system.
Our Public Airwaves focuses on public broadcasting within that larger domain. Our organization is citizen-based and supported financially by 60,000 families. We are a volunteer and not a charitable organization. We engage in non- partisan political activity in the sense of trying to influence public policy and public opinion; we do not simply measure public opinion but we influence it and the decisions of governments.
Our Public Airwaves is not that kind of grassroots-based organization. It is a project of a union at the CBC called the Canadian Media Guild, which is, ironically, American. This committee heard from them.
We coexist with them but we have been rebuffed in our efforts to collaborate since they were established a couple of years ago. I know that Senator LaPierre was involved in their coming into existence.
Senator Phalen: They stated, and I quote: ``The only practical way to increase the quantity of Canadian programming is to pay for it with public dollars by adequately funding our national public broadcaster.'' Do you believe that increased funding to the CBC or to private programming producers is the better route to attaining the goal of enhancing Canadian programming?
Mr. Morrison: It is an important component. Let me illustrate other things. Last week we praised the CRTC for a proposed decision on drama on English television. The CRTC said that if private broadcasters stepped up to the plate and spent more money, acquired more audience, and took other measured actions, then the CRTC would be inclined to allow them to have more advertising minutes available on selected programs to use as they saw fit. With respect to Global, that means the CRTC would be proposing that if they spent more and delivered more audience for Canadian shows, they could put more advertisements on the Superbowl. That has nothing to do with public money, senator, but if it worked, it would help to increase the quality and quantity of Canadian programming.
Both the CBC and the private sector have an important role to play. Canadian broadcasting policy has noted that we have had a dual system since the 1930s. We would take issue with the notion that the only way to do it is through the CBC.
Senator Phalen: According to your Web site, 81 per cent of Canadians think that the CBC is important for maintaining and building Canadian identity and culture. Yet the figures for 2002 show that the CBC enjoys only a 7.2 per cent share of the Canadian viewing public. That figure has decreased in the last couple of years. Could you explain this discrepancy?
Mr. Morrison: You are familiar with the apples and oranges argument. The 81 per cent is factual data. COMPAS was our pollster until forced by a large media company to choose between that company and the FBC. In the last two years, Ipsos-Reid has been our pollster. The 81 per cent figure is from Ipsos-Reid. That means Canadians hold the CBC in high regard, and there are measures that reinforce that. Last week, Canadians held the CBC in high regard. Your 7.2 per cent figure sounds like the English television audience in Canada as a share of total viewing.
Sixty-seven per cent of that viewing is of American programs. Therefore, if you eliminate the viewing of American programs from the equation and consider only the viewing of Canadian programs, you will find that CBC, which is exclusively Canadian, moves up to something like 20 per cent to 25 per cent of Canadian viewing. If you eliminate the times of day that most adults are not able to watch television and focus on prime time, you will find that for the English CBC and Newsworld combined, more than 40 per cent of all the Canadian shows that are viewed in prime time, from 7 p.m. to 11 p.m., are on those two channels, as opposed to the other 60 private channels that exist. The French language statistics are completely different and stronger for Canadian content.
Statistics are complicated. Another way to respond to your question would be to say that people use hospitals when they are sick. They like to have the hospitals in place even when they are well because they know that one day they may be sick. When you measure viewing of the public broadcaster in terms of how many people tune in for 30 minutes per week, you will get a very large statistic. International research that we follow measures public broadcasting differently from the advertising-driven market share method.
People care about having it available and its reach is defined usually as 30 minutes per week. How many people tune in that much is a more valid indication of its importance than its audience share. I remind you, if you go back to our polls, of that the figure on trust in the broadcasters. Take the issue of credibility of news — when a crisis comes along, when there is a war, an accident, a 9/11, the CBC's numbers go way up. That is an indication of its critical importance in the audiovisual system and a kind of reconciliation between the 7 per cent and 81 per cent figure.
Senator Phalen: I would like to make a point: My understanding is that the 7.2 per cent share is English and French, and that the English share would be 5.9 per cent. I think those are the figures I quoted.
Mr. Morrison: I do not have it with me. You may be right. Seven sounds like the English number. The French language number would be quite a bit higher — I am trying to compute 6 million francophones and 25 million anglophones. The French language figure would be substantially higher.
Senator Graham: You say that the column by Eric Reguly in the Globe and Mail on Tuesday is right on the money. Mr. Reguly said — and I think it is important to zero in on what he says — that he wonders whether the Liberals are about to succumb to the big con game.
Is lifting ownership restrictions about giving Canadian companies access to cheaper capital? Or is it about estate planning for Mr. Rogers, Mr. Shaw and, down the road, the media families like the Aspers?
Do you believe that?
Mr. Morrison: He understated it. The case has not been made that the Canadian cable industry — in fact 90 per cent of us are served by four companies, including Videotron, Cogeco, Shaw and Rogers — is short of capital.
The case has not been made. What you have is four families with restrictions on the share of foreign ownership that they are entitled to have in their voting shares. You know the restriction is effectively 47 per cent aggregate for holding and operating companies.
The only people who would benefit if we were to allow an American company to come along and buy up those companies are those controlling shareholders. The case has not been made that there is a shortage of capital.
There is a shortage if we go to the telecom industry. I can quote some of the non-incumbents, who have said, ``Our problem is not a shortage of capital. Our problem is the inability to generate a business plan in this regulated market that enables us to show potential investors that we could make a profit down the road.''
Senator Graham: Is there any other form of public broadcasting that you champion besides the CBC?
Ms. Golfman: TVO, and we have been involved recently in supporting a severely challenged broadcaster in B.C., Knowledge Network, and our own polling demonstrates wide support for them; also Télé-Québec, but in English Canada, TVO is a big file for us.
Senator Graham: Knowledge Network, can you tell us what that is about?
Mr. Morrison: It is a provincial educational broadcaster under the authority of the CRTC. It holds a broadcasting licence. It reaches about one-and-a-half million British Columbians each week — and again, that is reach, not share. It receives a subsidy from the British Columbia government in the range of $6 million a year, or something like $1.60 per British Columbian. It is a modest, educationally driven public broadcaster. Two-thirds of its programming is directed at children in the K-to-12 system during daytime hours and one-third towards the adult population.
The current Government of British Columbia has, we believe, stated an intention to privatize it, although the government denies that. They say they are looking for creative partnerships with the private sector, or something like that. We recently conducted a poll — the results are on our Web site — that shows that something like 75 per cent or 80 per cent of British Columbians oppose that plan of the provincial government, including half of the people who would currently vote Liberal in an election in British Columbia.
Senator Graham: Does Friends of Canadian Broadcasters have a headquarters?
Mr. Morrison: We are a virtual organization. There is no money in our budget to pay rent. We have an address on Bloor Street in Toronto, a fairly swanky address, 131 Bloor Street West. Somebody once sent me a cheque, but saying ``You are not getting more money until you persuade me you are not wasting money on that expensive address in Toronto.'' We wrote back and said, ``We cannot give that assurance, but if it is any consolation, that address is 6 inches high, 12 inches wide and 18 inches deep. In other words, we work out of a post office box. We have no employees, just a series of focused contractual relationships with suppliers of services and a fairly substantial number of dedicated and high-level volunteers, like my Chair, Ms. Golfman, and other prominent Canadians.
Senator Graham: Are there any full-time or part-time employees?
Mr. Morrison: No, there are only contractual relationships.
Senator Graham: My colleague has asked how you get your money. I presume it is from contributors? I think it would be interesting if you could give us your budget.
Mr. Morrison: We raise, in round figures, $2 million a year. The largest contribution is about $1,000. The number of contributions last year was 48,000 and the average gift was about $40.
Senator Graham: Before that, you said the largest contribution?
Mr. Morrison: The largest was $1,000 and the average gift was $40. The total raised last year was $1.9-something million. The Chair, in introducing us in the French language, used the word ``bénévole,'' which has the sense of voluntary — and that is true. We are not a charity and those dollars are after-tax contributions from people who care about our work.
We are strongest in British Columbia — there are 13,000 families in British Columbia that support our work — and we are weakest, unfortunately, in Newfoundland.
Ms. Golfman: Although Atlantic Canada, obviously, shows high support for public broadcasting in our polls. There are a lot of contradictions in this country.
Senator Graham: Senator Johnston is obviously a Hockey Night in Canada fan. Her phone is playing the theme song.
Mr. Morrison: She has a reputation with me for being patriotic.
Senator Graham: Ideally, how would you see the CBC structure and its programming? Do you see it commercial- free? Would you like to see the taxpayers pay the whole shot? Should there be any American content at all, these series or shows? Should it all be Canadian content? How much would it cost?
Ms. Golfman: We could probably spend a lot of time on that. I think there is one thing on which all Canadians agree, that they all have an idea of what the CBC should be doing. It is a national blood sport, in a way. We have suggested here, and it is one of the planks in our platform certainly, that the governance structure of the CBC should be changed.
We think we have a long way to go to be in keeping with other developed countries. We often look at the way governance is practised in other nations with public broadcasting, for example, South Africa. This is something that we reiterate from the top and to the top.
Of course, we believe that Canadians should be producing Canadian programming for Canadians. If there is an international market for that, well that is another matter. Certainly, yes, we believe that the public broadcaster should be producing Canadian content for Canadians.
We have long argued that what we call the hybrid structure of the CBC undermines their ability to do that. Its heavy reliance on commercial income undermines its mandate. The same is true in many other areas of public life, such as universities. The argument is a broad one that applies to many public institutions in this country. When you start doing that, it is a slippery slope.
Mr. Morrison: Since the senator used the adverb ``ideally,'' it occurred to me this is not a new discussion. When the Bennett government created the Canadian Radio Broadcasting Commission in 1932, this was part of the discussion. In Canadian public policy over the past 72 years, the model for the CBC has always been a mix of advertising and tax- supported revenue. As you know, senator, that was certainly the case with CBC Radio until 1974. There is a lot of misinformation about the CBC. Your question sounded like a television question, but CBC as an institution is radio and television.
As you know, a disproportionate amount of the public funds go toward the support of radio. The Toronto Star put forward a complete fabrication last week in a story about CBC English television costing $500 million, and that that comes out of the taxpayers' pocket. Fully 50 per cent of that is from television advertising revenue.
When Senator Johnson's phone started to play the Hockey Night in Canada theme, the distortion that came to mind is that in order for the CBC to make ends meet, it starts to chase audience at the expense of other priorities, like children, for instance. I know that the current senior management, the President of the CBC, is aware of that and is trying to address it.
A purist might say, yes, give the CBC another half a billion dollars. I am quoting the journalist Lawrence Martin, who came up with that figure a few years ago. By the way, that led to his dismissal from a media organization. We think that in an ideal world, you could do that. However, in a world where there is a shortage of money, competing priorities and people are lining up for MRIs, that is not likely to be the world in which we will live.
We came here today with a policy proposal. It is that we endorse the recommendations of the Lincoln committee, which were that the priority in CBC radio and television ought to be to strengthen the grassroots, to reinvest in the capacity in Edmonton, Halifax and St. John's, and that CBC should be coming to Parliament with a business plan to achieve that. Parliament would then invest in that business plan. In other words, this is not a free gift of money, but something focused on a specific target that Parliament deems to be important.
If you took away CBC's capacity to earn $350 million from advertising, then you would be wasting precious money, as opposed to investing it to strengthen the capacity of the organization. I remind you that radio is a different matter and is totally government supported.
Senator Graham: Is it not true that Hockey Night in Canada is the biggest money-maker for CBC? Did the government not increase the CBC's public allotment by $200 million in the past fiscal years?
Ms. Golfman: To be brief, yes and no.
Mr. Morrison: The government's contribution to the CBC expressed in 2004 dollars, senator, is on a chart I have with me. I will pass it over to you and you can read the facts for yourself.
Senator Graham: Is Hockey Night in Canada the big money-maker?
Mr. Morrison: It depends on the audience. They make quite a bit of money on it during the Stanley Cup playoffs.
It is a big money-maker, yes. However, if CBC did not broadcast that it would have to spend money to create programming to replace it.
Professional sports account for 15 per cent of their programming, 25 per cent of their audience and 40 per cent of their advertising revenue.
Senator Merchant: How long has the Friends of Canadian Broadcasting been in existence?
Mr. Morrison: For some 19 years.
Senator Merchant: What would you say has been your biggest success? What have you been able to accomplish? You must have some way of measuring whether your efforts have been rewarded.
Ms. Golfman: The fact is that the subscription to our cause grows. Certainly we are out there widely, trying as much as possible to encourage Canadians to demonstrate their support for us. I should say that at almost every board meeting we are astonished at how eager Canadians are to do that. We feel quite heartened by the reinforcement of that through the sheer numbers of people who belong to our organization. That is certainly one clear measure of our success.
In more abstract terms, what we have done is and what we continue to do is to raise the level of debate about these very complex issues. I think that is a challenging thing to do. Many of us, including my own students and my colleagues, are mystified by the increasing complexity of the entire telecommunications system, particularly in view of globalization and various pressures on them as spectators and listeners in their own world.
Our challenge is to be as clear as possible, without being condescending, about what the issues are and let Canadians decide for themselves what they want and what they want their national public broadcaster to do. That is an ongoing challenge for us. I think we do it rather well. It takes a lot of work, focus and polling. One needs to have evidence for what one is saying. We try to build relationships and inform policy-makers, anyone who is interested, from students who write to us and are working on research papers and dissertations to people who are directly involved, as you are, in the future of this country.
Mr. Morrison: Last year — and it is possible you have seen it; millions of Canadians have — we invested in four television commercials. The tag line was: Tell Canadian stories. A Hollywood director was coming to Canada to tell Canada's story to the world south of the border. Four television networks agreed to put these on. The value of contributed time in the 5,000 runs they have had — the RCMP has forced us to withdraw some of them because their was an image of a Mountie in the background — was $5 million. They were aired for nothing. They were created for $400,000, of which we put in $80,000 cash and the rest was contributed by 30 enterprises like Kodak, which contributed seven miles of film. We do have a lot of concrete indicators of how you can take $80,000 of people's money and turn it into $5 million of exposure. We could give you a long list, if there were time.
Senator Merchant: I have to apologize because I have not seen any of them. I do not watch television except for the news.
Second, there may be an election soon. Do you become politically involved? Do you encourage participation? I think you enter the lawn-sign wars with political parties? Am I maybe thinking of someone else?
Mr. Morrison: I am thinking of the word ``Saskatchewan'' when I look at you. It happened in Saskatchewan. We are, by policy, non-partisan. However, in the 1997 general election there were some candidates who were not happy with our interventions because we were holding their feet to the fire. We do this across non-partisan lines. We are will be making an intervention shortly in Ottawa Centre, in a by-election. We have identified 10 ridings in the country that are top priorities and we are organizing local committees to try to inject our set of issues, congruent with what we have said to you today, into the election campaign. We are quite a force in some of those ridings because of our base of support.
For example, Mr. Owen, the Minister of Public Works, is aware that 3 per cent of the households in Vancouver Quadra are supporters of the Friends of Canadian Broadcasting.
Senator Merchant: In Saskatchewan, we did notice that your signs were frequently on the same lawn with a certain political party, so it did create a stir. It seemed that the CBC was being very political.
Mr. Morrison: The CBC would have had no voice in that. That would have been the Friends of Canadian Broadcasting.
Senator Merchant: That is what I am saying.
Mr. Morrison: We are non-partisan but our supporters are partisans. You would be surprised by the multi-faceted nature of our support. People who are members of groups that you might not imagine are supporters of Friends of Canadian Broadcasting. Some of them are in the judiciary or places like that. It is a far-flung organization. That particular sign said, ``We are voting CBC.'' It was actually directed at the Liberal government in view of their broken promise when holding up a Red Book and saying, ``We are promising stable, long-term financing to the CBC.'' You now have my chart and you can see the result.
We were calling them to account. The late Dalton Camp was part of that campaign and participated in a conference call one day. When asked to comment, he gave a synopsis of the 1997 election. At the end, he said, ``I like what you are doing. Hold their feet to the fire.''
The Chairman: I am sorry to cut you off but time is getting very tight.
Senator Eyton: Welcome. I directed a question to Mr. Lincoln about his commission and his work and asked him to assign priorities relative to the 1997 recommendations in their report. I did not get much of a response, but you are here today. I am sorry that I was a little late, but you made two main points today. One was more money for public broadcasting — and I will come back to that in a minute — the other one was limitations on foreign ownership.
Going back to the first one, of more money, it seems to me that it is wrong to simply say that it is a policy matter, that they should have more money and that we should determine policy and establish what it takes. Everything is in the context of available cash. You have to go where the money is.
This is a very general question and follows up on something Senator Graham mentioned, namely, what kind of increase are you talking about? The CBC now, for example, gets about $1 billion a year and they have advertising revenues as well. How much are we talking about, let us say for CBC, the question of public broadcasting? What kind of increase are you talking about? Within that, can you start to frame the policy options that are available?
Mr. Morrison: There are two other recommendations, and perhaps they were buried, senator, because I think you came in near the beginning. One was about reforming the governance of the CBC to make it more arm's-length of the government of the day.
Senator Eyton: I heard that.
Mr. Morrison: The other had to do with cross-ownership.
Senator Eyton: I had limited time, so I picked two that resounded with me.
Mr. Morrison: We had 4 priorities, not 97. We passed the first test.
On the money question, our estimate is that in order to address our recommendation about restoring the regional local capacity — that is, the grassroots capacity of the CBC, not the network capacity — over a four- or five-year period, and in response to the business plan that the Heritage Committee called for, the government would probably have to increase its grant by $100 million a year. In other words, the ongoing cost five years hence would be in the range of $400 million. The Heritage Committee has made the case. Were there time, I would show you an interesting chart that demonstrates that amongst the OECD countries, we are the fifth from the bottom in terms of public support for public broadcasting. Others are below us; everyone else is above us, for example, the U.K., Germany, Japan, Sweden, et cetera. Switzerland is at the top. In view of what would be achieved, $400 million would be a reasonable amount of money, in our judgment. However, it does not really matter what I think. Your opinion counts as much. We are asking the government to address the fact that the CBC's capacity has been stripped away. You could speak about, for example, the province of Newfoundland, where the CBC is at the point where it is no longer able to do what Parliament has asked it to do when it said to pay attention to the special needs of the regions.
You mentioned foreign ownership as well. I will pause.
Senator Eyton: Would advertising play a part in this as well? When you are looking for additional revenue, would you be looking for an advertising-revenue stream?
Mr. Morrison: CBC is maxed out on advertising revenue right now. It is probably not possible for them to raise more than about $350 million on advertising revenue because of certain rules — for example, the 12-minute rule, that is, 12 minutes per hour of advertising is available. Those exist. Advertising would not be a solution, because as you know, in most communities in this country it is still a market. There are some monopolies out there, but in most communities there is a market, and supply and demand determines the revenue.
Senator Eyton: This is a side issue. I was involved at one time with TSN and their most profitable show was neither hockey nor any of the popular sports, it was the fishing show. It is hard to imagine there was any kind of audience for that, but the magic was that it cost very little to produce, so the margin spread on fishing shows was profitable.
Mr. Morrison: TSN is an interesting anomaly. You would know it well. For the rest of you, it is the most profitable broadcasting institution in this country, according to CRTC data. It does not come from its ability to attract audiences, although in a general way it must attract them. It comes from the fact that the CRTC requires every cable and satellite operator in the country to take $1.02 out of each subscriber's pocket each month, whether they watch it or not. Not a bad deal. You were smart to be involved in it.
Senator Eyton: The second question was on limiting foreign ownership. In your remarks, you said that there had not been a case made against it. As a libertarian, I would have put it the other way around and ask what is the case for regulation? In today's world of convergence, where I am looking very shortly to a hand-held device, something about this high that includes almost everything that is now served by radio, television, newspapers, Internet, telephones, all of it wrapped together, trying to regulate some piece of that action is almost irrelevant and not very practical. You can comment.
Mr. Morrison: Regulation often facilitates markets. That is sometimes forgotten.
In that context, what Parliament has had in mind, and indeed other countries such as the United States of America have had in mind, when they almost uniformly require that effective ownership and control of their broadcast media be in domestic hands, is that broadcasting is so linked to the central nervous system and the functioning of our democracies that it is important that decisions about them be made by those within the country. We are not different from other countries in that regard. The United States Congress made Rupert Murdock a citizen so that he could own a television licence in the United States.
Senator Eyton: We must look more forward than back, and that ability to control is slipping away pretty rapidly.
Mr. Morrison: Possibly, but let us talk about the next 5 or 10 years. It does not so much matter what I think. We have come to you today with evidence that the Canadian public is very concerned about this on a two-to-one basis, and a democratic government should listen to that strong element of public opinion. They understand the link between cultural sovereignty and maintaining effective control of the television system.
The Chairman: Senators, there are still people who want to ask questions, including myself, so I will do what we are driven to do sometimes, which is to ask senators to put their questions and ask the witnesses to respond to them in writing. It is always frustrating to do it that way, but it is better than not putting the questions at all.
Senator Corbin: I had questions that would have engendered a debate. I am not sure a letter would serve me adequately.
The Chairman: Then maybe we can invite the witnesses back another time.
Senator Corbin: I would like to make a comment about Dalton Camp. CBC paid Dalton Camp generously for his many appearances.
Mr. Morrison: I think they owe him a lot of money, senator.
Senator Johnson: I am a member of the Friends of Public Broadcasting and a patron for many years. I think we should invite the witnesses back.
Senator Corbin: I will challenge you. What did you say about the chairman, or the boss, of the CBC being picked by the board? That is what you said, is it not?
Ms. Golfman: That is what we are recommending.
Mr. Morrison: In most Western democracies the head of the national public broadcaster is recruited, hired, promoted and fired by a board.
Senator Corbin: I simply want to suggest that you are dreaming in technicolour if you think this will happen in Canada under a responsible government
Mr. Morrison: I said ``democracy.''
Senator LaPierre: I am interested in knowing about the choices the CBC makes with the little money it keeps telling me it has. Have you studied those choices? Do you have any views on how they spend their money? We cannot go on putting in more money if no one ever studies the choices that are being made, and the Friends of Canadian Broadcasting, who are responsible people, should certainly conduct that study at their cost.
Senator Johnson: I have some written questions but I will submit those just briefly. I have been a patron of the Friends of Canadian Broadcasting through the years. Welcome today. I am sorry we are a bit rushed. The Chair is doing her best. I personally think this organization, the Friends of Canadian Broadcasting, has done well, as it is not easy to keep public broadcasting on the agenda in this era of large media firms with extensive holdings.
My question, of course, is what is the future for Friends of Canadian Broadcasting in the present public broadcasting climate, which is so affected by this media concentration?
Senator LaPierre: I also want to know whether the Friends of Canadian Broadcasting are also on the French network.
The Chairman: Do you mean whether they follow the French network?
Senator LaPierre: Are you friends of the French network too, or just the friends of the English network?
Senator Johnson: They are friends of all Canadians, senator.
The Chairman: In your brief you take a very dim view of cross-ownership, concentration of ownership in the media and potentially foreign ownership of the media. Could you rank these in order of, in your case, alarm, threat, dislike, whichever? Which do you think is the most dangerous, the second most dangerous and so on?
My second question is related to the fact that, as you know, this inquiry is focusing on news. Apart from your call for more local programming, which I assume would be largely news based, I wonder if you have any other specific recommendations or observations about news in the Canadian media?
Does any other senator have any questions?
I thank the witnesses very much. However, before I close this meeting there is something that needs to be noted, and that is that this is very likely to be the last meeting of this committee attended by Senator Graham.
Hon. Senators: Oh, no!
The Chairman: Oh, yes. It is a sad day. He has been not only a wonderful member of the Senate, but also a wonderful member of this committee. We will miss him more than I can say. In that connection, I will ask the senators and staff to stay for just a couple of moments after the meeting breaks up.
Do you want to say anything, Senator Graham?
Senator Graham: Sure. I want to thank the witnesses today. This has been a fascinating ongoing study. We are very interested in what you have had to say, what you have done over the years and how you look to the future. You mentioned public opinion, Mr. Morrison. I believe there are two superpowers in the world, one is the United States and the other is public opinion, and we ignore public opinion at our peril.
I want to thank the Chair for the excellent way in which she manages this committee, and I want to thank my all colleagues, individually and together, for the way in which they have conducted themselves. This is one of the most interesting investigations and examinations that I have been involved in over the 32 years of my membership in the Senate. I thank everyone very much for their friendship and for their excellent contribution to the public good.
The Chairman: Mr. Morrison, Ms. Golfman, I apologize for the time pressures. It is the way we live, but it is always frustrating. We thank you very much for your contribution and for your further contributions in answer to all those questions we asked.
The committee adjourned.