Funding public service media: time for a new approach

September 12, 2017, Sinaia, Romania

Speaking notes for Hubert T. Lacroix at Public Broadcasters International (PBI) 2017 (session 2)

Hubert T. Lacroix, President and CEO of CBC/Radio-Canada, was invited to participate in two panels at the Public Broadcasters International (PBI) 2017 conference. The first one, “Financial system changes and the defence of public service media,” focused on the challenges of funding public broadcasters in a rapidly changing media landscape so that they stay relevant and independent.

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Thank you for inviting me to this panel. This is a great topic. There are few things more important to the public broadcaster than its funding and its independence. And as countries around the world have dealt with austerity and budget cuts, so have their public broadcasters. Let me tell you about Canada’s public broadcaster.

Like many of you, CBC/Radio-Canada has a mixed funding model. Sixty-six per cent of our funding comes from a yearly parliamentary appropriation, which is part of the Canadian government overall budget.

The other 34% of our funding comes from commercial revenue. Advertising revenue on our TV and digital platforms account for 18% of that.

Like everyone, our advertising revenue is under pressure as advertisers shift their money to the big digital aggregators like Facebook and Google. That’s why we believe that our funding model needs to change. I’ll tell you more about this in a moment. First, I’d like to talk a bit about the Canadian market.

Canada is a vast country, but in terms of population, it’s small; we are 25 times larger than the state of California but California has more people; 39 million compared to our 36 million. We are 37 times the size of the United Kingdom with about half its population.

A third of our population is French-speaking and they strongly prefer Canadian French-language content.

The other two-thirds of Canadians are English-speakers. And with the exception of what’s on their public broadcaster, their prime time television choices are mostly American shows, whether broadcast from across the border or purchased by private broadcasters in Canada.

That means that whether it’s Canadian music, amateur sport, drama, or news and current affairs, the public broadcaster is THE home of Canadian content. We broadcast across a vast country in English, French and 8 Indigenous languages. And we do all that for $34 per Canadian. Of 18 OECD countries, Canada ranks 16th in terms of funding to public broadcasting.

We have been able to do a lot with the funding we have and I am proud to say we are now the number one digital media company in the country. Nearly 18 million people, almost half the population, now use our digital platforms every month. We are a leader in new innovative storytelling like our recent award-winning digital investigation into the fate of murdered and missing Indigenous women in Canada. We would like to do more.

As you know there are two things we all require in order to thrive as public broadcasters; stable multiyear funding, and protection from political interference.

Both of those can be a challenge in democracies where economic and political pressures make us – like all government-funded organizations – vulnerable to changes in funding.

Let me give you an example; in Canada in 2012, in an effort to balance the federal budget, the Government implemented a 10% cut to all government spending.

Our funding was cut $115 million. About 11%. We had to scramble to balance our budget; cutting jobs and services at a time when we were trying to adapt to the digital shift. It was a difficult time.

Today, the Canadian government has reinvested in culture and in public broadcasting. An additional $150 million per year is helping us complete our digital transformation and strengthen our services. It has brought us some important breathing space.

But as advertising revenue continues to weaken, we know we need to find another way; we need to stabilize our funding and we need to do more to support Canadian culture. In today’s world of global conglomerates and digital powerhouses, we believe public broadcasting must play a leadership role in strengthening the entire cultural sector in our own country.

We’re calling it “A Creative Canada”.

We are proposing that CBC/Radio-Canada take a leading role in a Council of creative and cultural industries. Together, we will find ways to increase our cultural impact, maximize the economic value of the cultural industries, and identify public policy solutions that will strengthen Canadian culture. We’re all in this together, and we believe this kind of coordinated approach is not only smart. It’s necessary.

We’re also proposing to increase our public funding so that CBC/Radio-Canada can become an ad-free public broadcaster. That way we can focus more sharply on our public service mandate. If we are no longer competing with other media for advertising revenue, we can be a better partner to the entire cultural community.

An independent economic analysis found that increasing our funding from $34 to $46 per Canadian per year, and removing all advertising from our platforms, would bring economic benefits to the entire country.

It would create a net total GDP gain of $488 million, a total labour income impact of $355 million, and 7,200 additional jobs in Canada.

That’s good for Canadian culture and it’s good for the Canadian economy.

We’re also proposing that CBC/Radio-Canada’s public funding be removed from the election and annual government budget cycles. Instead, by linking our funding with our five-year licence renewal cycle, we could better match Canadians’ expectations for their public broadcaster with the resources required to meet those expectations.

We are now talking with Government and with Canadians about what our Creative Canada proposal could do for their CBC/Radio-Canada and for Canadian culture. It’s a big ask but it’s a model we believe will secure the future of both public broadcasting AND Canadian culture.

I look forward to our discussion.

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