Anne Ruston (SA, Liberal Party) Share this | Hansard source

Before I comment on the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015, can I draw to the attention of the chamber the fact that, despite what has been said by those opposite and by those at the other end of the chamber, the changes this bill proposes are very small. They have come about not because the government have thought that this is a fabulous idea which is going to be the most wonderful thing for the Australian public, for viewers of SBS and for the media but because we inherited the most extraordinary budget position and we were forced into a situation where we had to find savings across the board. Mr Deputy President Seselja, you would know that nobody, no agency, no program, nothing was left unscrutinised for opportunities to find additional funding to fix up what was the most extraordinary budget disaster, a disaster we inherited in September 2013. Getting that onto the record puts into context the fact that we even need to be here today discussing this bill.

You would think from listening to those opposite and to those at the other end of the chamber that somehow we had made some extraordinarily huge change which is going to end up seeing a massive amount of additional advertising on SBS. The simple facts are that in a 24-hour period there is no capacity whatsoever for SBS to increase the total amount of advertising they put to air. At the moment they are required to have only five minutes per hour. Should this legislation pass the chamber today, SBS will still be able to advertise for only 120 minutes in any 24-hour period, which adds up to five minutes per hour. So the scenario been painted on the other side that somehow we are going to end up with a completely and utterly bogged down and over-advertised SBS is just a load of baloney and it should be called out for exactly what it is. The bill is simply seeking to give some level of flexibility to SBS to be able to make advertising placements at a time when they have more capacity to generate revenue.

The other thing we also need to remember is that SBS is already a hybrid model, by which I mean a model which includes both taxpayer or state-supported funding and a level of commercial advertising. It is not a pure model like the ABC, which has no advertising, and, on the other hand, it is not purely a commercial model like the commercial stations, which have to generate their entire revenue through commercial means. You may think the SBS hybrid model sounds interesting and unique. It is not interesting or unique in any way, shape or form. The majority of multicultural broadcasters, particularly government-funded broadcasters, around the world have some level of commercialisation. The ABC is probably the more unique of them because it does not have any commercial aspect to its funding model. If you look around the world at some of the countries to which we consider ourselves aligned—for instance, Canada is a very good example of where they use hybrid models for their national broadcaster—we can see that the information being spun by those who oppose this bill is factually inaccurate. And as I said, the fact that we have to be here in the first place because of the budget situation makes it even more hypocritical that they will not allow us to pass this minor amendment to give the SBS the flexibility they seek to generate a little additional income, so that they can take some pressure off what is already very much a budget under pressure.

Also discussed, the efficiency studies undertaken by Lewis when we came to government were to establish how we could ensure that both of our national broadcasters are as efficient as possible. The review undertaken by Mr Lewis was very clear that there are a number of things the ABC could do back of house to enable them to achieve some savings to go to the bottom line of the government's budget without any need to attack programming or content. A similar undertaking occurred with SBS. It must be stated that the findings of the Lewis report acknowledged that the SBS is quite an efficient organisation. Certainly some areas identified where efficiencies could be made, but it was very clear that the SBS would have more difficulty in achieving the kinds of savings that we were hoping for simply by addressing back-of-house inefficiencies in the way Mr Lewis, the independent assessor, believed the ABC could. The Lewis review made an independent recommendation that by allowing the SBS to change the placement of a very much capped amount of advertising in a 24-hour period they may be able to generate a small amount of additional income to assist in making their contribution to the bottom line of the budget problem we inherited when we came into government

The placement opportunity comes about because, for those of you who are watchers of the SBS—I certainly am at occasions and there is nothing we enjoy more than watching the Tour de France or the World Cup—there is an opportunity for SBS to maximise revenue when they broadcast programs on their station which will attract a very large audience, ones which advertisers would seek to be promoting during those programs.

We have to remember that, because of the SBS charter, they have to do quite a lot of programming which would not necessarily be attractive to an advertiser. A lot of the content is culturally very specific and, while it appeals to a very important part of our Australian community, it probably is not a community that is necessarily going to attract high-paying advertisers. We need to recognise that we often make SBS, by virtue of their charter, run programs to which they cannot attract advertising. If you are suggesting that there absolutely must only be five minutes of advertising per hour for every hour instead of only an average of five minutes over a 24-hour period, you are being very, very restrictive of the capacity of the SBS to be flexible in generating the maximum amount of revenue it can within the constraints of its charter.

There are a couple of things that I think everybody would immediately associate with SBS, such as the Tour de France and the World Cup. During these broadcasts, obviously a lot of advertisers would be keen to participate in that space. Similarly, with multicultural cooking shows there may be opportunities for the SBS to target a little more advertising in a particular hour simply because they have advertisers that will be happy to spend the money. However, the comments by those opposite, about the capacity for this minor amendment bill to somehow prevent the SBS from being able to deliver their charter because they will have such extraordinary commercial imperatives put on them, also need some further discussion because that simply is not true. The SBS, since they were first allowed to have some commercialisation through advertising a number of years ago, seem to have managed the balance of achieving some sort of commercial outcome through advertising without ever jeopardising or compromising their charter. I sat through the debate during the committee hearings into the bill and I listened to the witnesses, and nobody—but nobody—was able to provide us with any clear evidence as to how or why the charter would be compromised by a change from a situation where only five minutes of advertising an hour, and only 120 minutes a day, was permitted to a situation where only 120 minutes a day was permitted but up to 10 minutes in any hour, where, in the process, advertising time in another hour was forgone. To suggest that that kind of minor change will cause this extraordinary situation for SBS where they will not be able to meet their charter strikes me as possibly some scaremongering for the sake of politics rather than any clear or defined reason or evidence to suggest that that will happen.

During the inquiry, there was a huge amount of discussion of the figures that were put forward by the SBS concerning the additional revenues that they believe they would be able to achieve over the forthcoming years through a change of this nature in comparison to the numbers put forward by the free-to-air television network agency, Free TV. Whenever anybody puts forward a proposal, an argument or an advocacy document in support of their argument, of course they are going to skew it as much as they possibly can in the direction that most supports their argument, but the disparity between the SBS and Free TV was so massive that it really warrants some comment. The first thing I would say is that SBS are obviously going to be in the best possible position to understand the impact that a change will have on the bottom line of their commercial advertising revenue. As we quite rightly accept, the SBS have a charter that requires them to achieve an amazingly different set of outcomes than a commercial television network would be required to achieve. Obviously, SBS are in possession of the facts that will tell them what additional hours and numbers they are able to achieve. They will know what their fill rates are at certain times of the day and night. They will know what their fill rates are when it comes to particular types of programming. So one would suggest that there is no reason why the SBS would not be in the best position to provide information that is as close to accurate as possible. It was difficult for us to get to the very bottom of exactly what the figures were because this kind of commercial information is something that neither the free-to-air television networks nor the SBS are likely to put on the public record—because, of course, that would be detrimental to them in the longer term. But, even if we accepted that the figure was somewhere in the middle between what Free TV was saying and what SBS were saying, we are still talking about something of the magnitude of 0.1, 0.2 or 0.3 per cent of overall television advertising revenue.

We seem to be arguing in this chamber today about something that will have a major impact for SBS and will allow them to make a contribution to the bottom line of the budget dilemma that we face but, in the process, probably have very, very little impact on broader advertising revenue. If we suggested that additional commercial advertising revenue of $28.5 million over the forward estimates, which SBS project that they are likely to be able to earn, will somehow be of such significance that it will have a huge effect on the free-to-air commercial advertising market, I think we would be kidding ourselves. There are a lot of things that are changing in the television space at the moment, as you would be well aware, Mr Acting Deputy President. The change in the digital marketplace at the moment is putting such extraordinary pressure on free-to-air television. In only the last few weeks, Netflix has come into Australia, and we have Foxtel and the like and online streaming. There are such a myriad of things challenging this space and the advertising dollar that commercial television networks are able to access that it would seem a little like crying poor and crying foul to suggest that not allowing a possible 0.1, 0.2 or 0.3 per cent change would be a silver bullet or panacea to deal with the issues currently facing the free-to-air networks. I think that is probably stretching the issue a little too far.

In summary, the committee acknowledged that SBS play an extraordinarily important and pivotal role in building social cohesion in Australia. There is no doubt that they serve a very diverse group of communities which all of us, as members of this place, have a responsibility to make sure that we also serve. They provide information, education and entertainment across a myriad of platforms, a myriad of cultures and a myriad of requirements.

The committee also considered the evidence, and it was quite clear that there was no evidence whatsoever to suggest that a move of the sort that has been proposed by this piece of legislation would in any way representative a move to establish SBS as a fourth fully commercial television channel. There was no evidence to that effect, and anybody who comes into this place and tries to convince this place and those listening that that is the case has not read the evidence that has been put before us. It is clear that the bill proposes to introduce flexibility to the SBS; there is no question about that. But it is not in any way suggesting that we are changing the status of the SBS or doing anything that would be considered internationally as an unusual model for this type of broadcaster.

Similarly, the committee does not consider that the proposed amendments are in any way a threat to the SBS's charter. As I have said in my contribution up to this point, the SBS has been providing a charter obligation within a hybrid model for a number of years. I do not think anybody in this place has ever questioned up until now their capacity to deliver on that charter without compromise. So I do not think there is any evidence to suggest that this minor amendment is going to make any difference to that. None of the evidence that I was listening to was such, and I sat through the entire inquiry listening to every word that every witness said and I read every submission. So I do not think there was any such evidence. There were plenty who were prepared to suggest that it was going to happen, but I did not see any evidence to support the allegations that were being made.

In addition, the committee notes the SBS board will also be required to come up with a set of reporting and governance requirements regarding the placement of advertising. So, once again, there is a requirement for the SBS to be transparent in the delivery of any changes that may transpire if this legislation should be passed in this place, and there are safeguards that have been put in place to ensure that nothing is going to occur that would be able to be swept under the carpet and not be seen. The legislation requires transparency, and transparency invariably gives the opportunity for somebody who see something that is untoward to say something. So I think the safeguards have been very well thought through and they are very evident.

The fact that this is such a small component of the overall television advertising budget that we are suggesting may be changed I think is something that needs to be considered. We have an obligation in this place to ensure that we return this budget to surplus and, hopefully, one day in the future, start addressing some of the extraordinary level of debt that we have inherited. To suggest that any organisation within the control, the power or the budgets of this particular government should not have to share in some of the contribution to fixing up the budget deficit and bottom line is just an outrage. This is made all the more disappointing because it was not us, as a coalition government, that caused the problem in the first place. We are merely seeking to remedy the problems that we inherited from those opposite, who sit here today and refuse to allow us to make the changes that we need in our budget so that we can get this country back onto a trajectory of profitability and so that we do not make our children—your children, Mr Acting Deputy President and my children—inherit a debt because of the largesse and overspending of our generation. I do not think I want that on my conscience. I find it very hard to believe that those on the other side would want it on their consciences either.

Another comment that was very clear in this debate was about fill rates. There is a lack of acknowledgement within this space that the SBS has a lot of difficulty with its fill rates for many of the programs that it is required to put to air. I am wholeheartedly in support of recommending that the Communications Legislation Amendment (SBS Advertising Flexibility and Other Measures) Bill 2015 be passed. I am supportive of that because I believe that we have an obligation in this place to make sure that we have the most efficient and effective organisations that we possibly can. I acknowledge the work that the SBS has done to make sure that their back-of-house operations are as efficient as possible. But, in doing so, I also acknowledge that the capacity for SBS to make the changes and the budget savings was more difficult and, therefore, this bill is essential.