February 17, 2018
The underwhelming response in the federal budget to the crisis in Canadian print journalism was long expected.
Heritage Minister Melanie Joly habitually labels the Press “a failing business model” unworthy of a “bailout.” Finance Minister Bill Mourneau’s own indifference has been ill-concealed.
A year after Joly’s consultant Ed Greenspon documented the dire future of a news industry starved of advertising revenues— findings that were loudly echoed by the Liberal-dominated Heritage Committee— the federal cabinet has approved two limited measures.
The $75 million Canadian Periodical Fund will be expanded by $10 million. The money will undoubtedly do some good for community news outlets that get a slice of it, but Heritage spokespersons were unable to clarify if mid-sized or large urban daily papers will be eligible.
To benchmark the scale of that $10 million figure, recall the industry group Newsmedia Canada had lobbied Ottawa for $350 million to provide a 15% subsidy of editorial costs for Canada’s 100 daily print and online news outlets. The Liberals themselves bestowed a much needed $150 million annually on the CBC.
It would have come at a political cost for the Liberals to subsidize commercially owned news outlets, even if journalism is acknowledged by all as a public good. Opinion polls on public aid were lacklustre. In fact it’s become a Canadian pastime to slag our #MSM (mainstream media) like the Toronto Star (“too left!”), Postmedia (“too right!”), and Bell CTV (“too rich!”). You have to know that the only thing the Liberals want to do less than throw a life line to their nemesis Postmedia is to throw a lifeline to Postmedia and take political flak for doing so.
But even if subsidies to the independent Press were politically toxic to the Liberals, solutions more palatable than government cheques were available. Many policy commentators including Unifor recommended (https://www.thestar.com/news/canada/2017/01/23/tax-law-tweak-could-bring-millions-to-canadian-media-study-finds.html ) closing the digital loophole in section 19 of the Income Tax Act. Aligning the tax rules for online advertising (mostly Google and Facebook) with TV and print advertising would have driven about $250 million of Canadian advertising from Google and Facebook back to Canadian news outlets starved for revenues.
A nice surprise however was the Finance Minister’s announcing a study of tax rules governing charitable status to assist journalism, an idea which he had dismissed only a few months ago. Still, eighteen months after Joly kicked off her public review of Canadian media, Ottawa will begin to study the issue.
As token as these new policy measures may be, the Liberals now acknowledge that journalism is a public good, it’s in crisis, and a solution needs to be found.
That Liberal acknowledgement likely would not have happened without the political noise across the country, particularly in Quebec, and 300 layoffs at community papers closed by Postmedia and Torstar in November.
Canadian newsrooms have shrunk by 25% since the Liberals took office. With more newspaper closures and journalist layoffs in the months to come, we will be having this same discussion at the next federal budget and the 2019 election.