Nick Xenophon (SA, Nick Xenophon Team) Share this | Hansard source

This is a very important piece of legislation. I apologise to my colleagues on the crossbench that I haven't spoken to them in the last few hours or the last couple of days. I think it's fair to say that this has been the most difficult and protracted and robust set of negotiations I have engaged with in 20 years of being in parliament, state and federal. I believe the outcome reached, which I will speak to, is a good outcome for diversity of journalism; for journalists' jobs; and for small, independent and regional publications around the country. And I apologise to the journalists who I have ignored in the last 24 hours. It's just been impossible, in terms of these negotiations, to get back to people when I would have liked to.

As most senators are aware, Australia's commercial media companies and the profession of journalism have been, and continue to be, in a period of profound change. Indeed, it's no exaggeration to say that our media, like the media across much of the Western industrialised world, is in a state of crisis. Media companies large and small are under great pressure. A great deal has been said about the impact of the internet, the so-called digital revolution, as the great disruptor of established business models for journalism and publishing. Broadcasters and publishers are operating in circumstances of rapid technological change. There is intense competition for audiences and advertising revenue not only from other companies, including online and on-demand operators, but also from, most fundamentally, foreign technology companies Google and Facebook in particular, which have aggregated news and content while simultaneously separating content producers from digital revenue streams.

When you consider that Google and Facebook are hoovering away over $4 billion in advertising revenue in this country every year—and some say that it could be upwards of $5 billion or $6 billion—of course that will have a profound impact on journalism in this country and on the news organisations that fund the content providers that fund the journalists, the camera operators, the photographers and the editors to bring the news and analysis to our living rooms, to our iPhones and to our doorsteps around the country. When Mark Zuckerberg said, 'Move fast and break things,' that maybe said something about the ethos of some of these technology companies. The fact that they only pay about one per cent of their turnover, of the billions of dollars they make, in taxes is a real concern, although I note that it appears from some media organisations I have spoken to that the technology companies have seemed more willing in recent times to engage with media organisations to give them a better deal, but there is still a fundamental issue of their enormous market power and the data they control—and I'll address that in due course.

It's been much the same story across print, radio and television. Advertising sales and subscriptions of one form or another have fallen and, with that revenue crisis, we have seen dramatic contraction in the business of news, with 3,000 journalists, subeditors, designers, photographers and other content producers exiting this profession in Australia in recent years. Newsrooms have shrunk dramatically. You can see it here in the parliamentary press gallery, but the bigger cuts have been spread across the country even more deeply. Regional newspapers have folded. Regional news services, such as they now are, are being produced from capital cities in many cases. High forms of public interest journalism, especially investigative reporting, are increasingly working with fewer and fewer staff and resources. There are still fine journalists producing excellent product, but they are fewer in number and spread much more thinly. Coverage of local developments, from what is happening in local councils to who won the local football match, is evaporating. Court reporting is also rapidly diminishing. Fewer and fewer journalists are churning out more and more digital product, but more and more of that is 'churnalism': recycled and repackaged PR handouts and celebrity trivia. The production of one form or another of clickbait appears to be an increasingly favoured business model in an environment of declining revenue—constant churn but ever more shallow content. In this environment, increasing PR manipulation, spin and fake news are indicators of a deep malaise.

The seriousness of these issues was reflected in the Senate's decision earlier this year to establish a Select Committee on the Future of Public Interest Journalism. I genuinely and sincerely congratulate Senator Dastyari for his leadership on that and for chairing that committee. It has been a very valuable committee in terms of the evidence we've heard to date and the work we still need to do. That inquiry is ongoing but has already generated many useful submissions and valuable debate about the future of journalism in our country.

Many of us have long presumed that a free and vibrant media is essential for a well-informed citizenry and a vibrant democracy. But it can't be assumed that current media business models, especially in a market increasingly dominated by foreign technology companies, will necessarily serve that important democratic role. I don't think anyone could say our media industries are healthy today, and with that our democracy is not healthy either.

That said, the legislation before the Senate today, introduced by the government and now associated with additional measures negotiated between the government and NXT, is an attempt to modernise current media regulation and help the Australian media industry to deal more effectively with the huge challenges it faces. The bill amends the Broadcasting Services Act 1992 to abolish the 75 per cent audience reach rule, which prohibits commercial television broadcasting licensees from controlling licences whose combined licence area populations exceed 75 per cent of the Australian population.

The bill will further abolish the very contentious two-out-of-three cross-media control rule, which prohibits control over more than two-out-of-three regulated media platforms in any one commercial radio licence area. The bill will also provide further additional local programming obligations for regional commercial television broadcasting licensees, amend measures relating to the anti-siphoning scheme and abolish broadcast licensing fees, datacasting charges and apparatus licence fees paid by commercial broadcasters. The Australian Communications and Media Authority, the ACMA, will be required to undertake a further review of developments by 1 July 2021. And, of course, there are other measures that have been alluded to by other speakers related to a restriction of gambling advertising. It's by no means perfect, but at least it is a significant improvement on what we have seen. It is something I and my colleagues have campaigned for, as indeed have many others in this chamber who believe, who know, that gambling advertising, including sports betting advertising, has gone far too far in this country and that it needs to be curtailed. This will go some way to that, but I see that as a first step, not a final step.

The bill enjoys strong support from major sectors of the media industry. That is important, though one should say that the commercial interests of the major media players should not weigh heavily in this debate. We should look at what this does for diversity. It does weigh heavily on my mind when regional broadcasters tell me how tough it is and how their revenue has been declining. When you look at their share price and when you look at their advertising budgets shrinking, in part because of Google and Facebook, we cannot ignore the pressures on those companies. I do not want to see any other major or indeed minor media company going into administration.

We support the legislation as necessary reforms that reflect the very large changes, especially the convergence of technologies, that have transformed the media landscape. We cannot credibly say that the two-out-of-three rule has the same currency and validity as when it was first enacted in the pre-internet era, before digital broadcasting and the impact that has.

Our support has been conditional on the negotiation and agreement with the government on a major package of additional measures to support the small publishers, especially in Australia's regions but also in metropolitan areas, and the profession of journalism itself in this very challenging period. I and my colleagues welcome the government's commitment to implement a regional and small publishers jobs and innovation package worth $60.4 million over three years. The government has accepted that public support is necessary to help small publishers and small regional newspapers as well as to create opportunities for more cadetships and for regional students to study journalism.

The significance of this agreement should not be underestimated. An important threshold has been crossed. We accept that many elements of Australian industry and commercial life may need government support from time to time, especially in times of rapid economic change and external pressure. I believe that government has a judicial role to play in many sectors of the economy, particularly in these challenging times, where there has been market disruption, where the playing field is no longer level and where you have two foreign technology companies ripping away at least $4 billion in advertising revenue each year, with the impact that has on traditional media, those that provide the content, tell the stories and provide the analysis and the investigative reporting that are fundamental to our democracy. All of my colleagues have long supported public broadcasting through the ABC and SBS, but government support for elements of the commercial media is a new development in Australia. There is no doubt about that.

But it is far from unprecedented. On this, I direct senators to submissions and evidence given to the Select Committee on the Future of Public Interest Journalism, chaired by Senator Dastyari, especially the submission of the Journalism Education and Research Association of Australia, which draws on a review of media systems in 14 European countries as well as the United States, Canada, New Zealand and also Australia. Among the key messages was a conclusion that, because of the current loss of advertising and the need to safeguard pluralism and editorial competition, alternative funding sources for public interest journalism need to be considered.

The report found that indirect subsidies for the media in the form of tax breaks were the most common form of aid, something that would have been my first choice. All 14 European media systems analysed had a reduced form of VAT—similar to GST—on sales of newspapers and magazines, while in four countries, including the United Kingdom, all sales were entirely exempt from VAT. Further indirect subsidies were found via reduced tariffs for telecommunications, electricity, paper or transport and through subsidies for news agencies, journalism schools, journalism research, reading promotion or professional associations. Several countries had a form of production aid for certain media organisations. Mainly these were to support second newspapers in particular defined areas. They were sometimes to support newspapers in minority languages. Other forms of aid helped to support distribution, internal training and the formation or reorganisation of newspapers. No fewer than 12 of the countries analysed used direct financial production subsidies to support private broadcasters, mainly regional and community broadcasters. In Denmark, Sweden and Italy, press subsidy schemes are now open to fully online media as well. So what is being announced today might be new for Australia, but it is hardly unprecedented when one looks abroad at what other countries are doing to deal with very similar challenges in the commercial media sector.

Returning to what has been agreed between NXT and the government, the government will establish, to assist smaller publishers and to foster diversity, a one-off regional and small publishers innovation fund involving $50 million worth of grants over three years from the 2018-19 financial year. The government will set up the fund such that the first round of grants can be announced no later than 1 June 2018, with the first grant moneys to flow from 1 July 2018. The government has undertaken to keep me and my colleagues aware of the process. It needs to be a public process, and it must be one involving the architecture of the scheme. The purpose of the fund is to assist small publishers in transition to compete and innovate more successfully in a changing media environment.

Publishers will be able to use the grants for initiatives that support the continuation, development, growth and innovation of Australian civic journalism, including initiatives that explore and expand the journalism funding model. In the context of this agreement, civic journalism is defined as 'journalism that has a primary purpose of investigating and explaining public policy and issues of public interest or significance with the aim of engaging citizens in public debate and forming democratic decision-making'. Grants could be allocated, for example, to programs and initiatives such as the purchasing or upgrading of equipment and software, development of apps and trading—all of which would assist in extending regional journalism. It will also help fund business activities that drive revenue and readership, something that is very important.

The aim of the fund is to enhance the ability of small publishers to maintain and expand employment. The criteria should be broad and flexible, and it's important that it's there to expand civic journalism. The eligibility criteria will include measures such as: a primary purpose test of producing civic and public interest journalism with an Australian perspective; an Australian resident test where grant recipients must be incorporated under Australian law and have their central management and control in Australia; an independence test where grant recipients must not be affiliated and must not be part of a political party, union, superannuation fund, financial institution, non-government organisation or policy lobby group; a control test, so it's an entity controlled and majority-owned by Australian residents; being a member of the Australian Press Council, or else have a robust and transparent complaints process and do their journalism ethically. They must have editorial guidelines, a code of conduct or framework relating to the provision of quality journalism. Publishers with an annual turnover of not less than $300,000 and not more than $30 million of revenue would be ineligible. Large publishers, such as News Corporation and Fairfax, will be ineligible. Funding grants will be capped at a maximum of $1 million per year for any media group. At least two-thirds of funding must go to regional publishers that have been under enormous stress and not less than 25 per cent for non-regional publishers.

The fund will be administered independently of government by the ACMA. They will seek input from an advisory committee, or representatives invited from each of the Australian Press Council, the Walkley Foundation and Country Press Australia, to give advice on the distribution of the fund. The advisory committee's recommendation will be made public. The fund may well give much-needed support to existing publishers. Those newspapers and publishers may adopt whatever editorial lines they like.

In addition, NXT and the government have agreed to funding to provide opportunities for students, including graduates, in regional areas and/or smaller metropolitan publications to access journalism training. In terms of regional scholarships, the government will establish 60 regional journalism scholarships worth $40,000 each, which will support regional students to take up opportunities to study journalism courses, with the aim of equipping more regional Australians with journalism training. That will commence in the 2018-19 financial year. Funding for the scholarships will be provided through the department of communications to a number of our premier journalism and media training institutions. They will be allocated proportionately so that students in every state and territory will have an opportunity to apply for scholarships.

To assist in creating employment opportunities in regional media, the government will also establish a regional and small publishers' cadetship program. The cadetships will be supported with a wage subsidy, with eligible organisations able to apply for a wage subsidy or a grant of up to $40,000 per journalism cadet. The cadetship program is there to increase journalism resources, not to supplant existing resources. Two hundred cadetships will be available for funding over two years, with 100 cadetships available each year. Of those 100 cadetships in a single year, at least 80, but not more than 90, cadetships will be for regional publications. And I'm sure in the committee stages we can discuss the eligibility criteria, as we must.

In addition to these measures, the Treasurer has agreed to our proposal that he direct the ACCC to conduct an inquiry into the impact of the new digital environment on media, specifically the impact of digital search engines, social media platforms and other digital content aggregation platforms on competition in media and advertising markets—in particular in relation to the supply of news and journalistic content and the implications of this for media content, creators, advertisers and consumers, something that my colleague Senator Griff has done an enormous amount of work on. I congratulate him for that forensic work that he's done. This will be the template for reform. The ACCC inquiry will commence as soon as possible and not later than 1 December 2017. There is to be a preliminary report within 12 months and a final report within 18 months, which has huge implications for the future of journalism in this country and ensuring that the playing field is levelled.

In negotiations with government, the government has agreed to grant a further six-month extension for community television licensees, taking them to 30 June 2018 so there can be, once and for all, a round table to determine their future. I believe in community television. The government has also committed to a review on Australian broadcasting services in the Asia-Pacific region and examining whether short-wave radio technology should be used.

Altogether, this is a very significant package of additional measures that will enhance the proposed media reforms contained in the bill. In this, we are dealing with the circumstances of commercial media in Australia. Some other contributors to this debate have wanted to say that this is a debate about public broadcasting. If they want in some way to modify the editorial independence of the ABC and have it more attuned to their particular viewpoint, they can always introduce legislation to give effect to their objective, but they will not have support from NXT. We are absolutely committed to a fully independent and well-resourced ABC and, indeed, SBS as well. In the $60 million package we have secured, we will not support that.