David Pocock (ACT, Independent) Share this | Link to this | Hansard source

I move:

That this bill be now read a second time.

I seek leave to table an explanatory memorandum relating to the bill.

Leave granted.

I table an explanatory memorandum, and I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

Australia is where song began.

Scientific findings show songbirds originated in Australia tens of millions of years ago and then spread across the world over time. The wellspring of the planet's songbirds, this singing country, became home to songlines and the sounds of the didgeridoo, or as the Yolŋu call it, the Yidakia, and clap sticks of this continent's First Peoples. The oldest continuing cultures in the world have been playing music for tens of thousands of years.    

It is no surprise Australia has developed an authentic sound. It may be hard to put in words, but you know it when you hear it.

Gang of Youths, Slim Dusty, AC/DC, Human Nature, Archie Roach, KLP, Silverchair, Peking Duk, The Living End, INXS, Powderfinger, The Presets, Baker Boy, Grinspoon, Yothu Yindi, Percy Grainger, Sherbet, Billy Thorpe, Glenn Shorrock, Guy Sebastian, Shannon Noll, Don Burrows, The Kid LAROI, Pete Dawson, Skyhooks, Cold Chisel, Peter Allen, Men At Work, The Seekers, Gurrumul, The Bee Gees, The Aston Shuffle, Paul Kelly, The Angels, Richard Clapton, Jimmy Little, Thelma Plum, Olivia Newton John, Dune Rats, John Farnham, Little River Band, Split Enz, Renee Geyer, Smoky Dawson, Briggs, The Easybeats, Hunters & Collectors, Coda Conduct, Jimmy Barnes, Midnight Oil, Divinyls, Rose Tattoo, Dan Sultan, Helen Reddy, Daddy Cool, Icehouse, Lobby Loyde, Frank Ifield, Hoodoo Gurus, Marcia Hines, Jo Jo Zep & The Falcons, Ross Wilson, Brian Cadd, Radio Birdman, Nick Cave, Dragon, Max Merritt, Russell Morris, A.B Original, The Triffids, Bluejuice, John Paul Young, Lee Kernaghan, Mental As Anything, Little Pattie, Big Scary, Boy & Bear, The Dingoes, Mallrat, Kev Carmody, John Williamson, Models, Johnny Young, The Loved Ones, The Church, Kylie Minogue, The Wiggles, Pez, Air Supply, Ruby Fields, Urthboy, Tina Arena, Daryl Braithwaite, Kasey Chambers, Jebediah, Hilltop Hoods, The Whitlams, Crowded House, Tame Impala, The Temper Trap, Gretta Ray, Hermitude, Drapht, Horroshow, The John Butler Trio, Jet, Boilermakers, Sparkadia, Holy Holy, You Am I, Missy Higgins, Karnivool, Angus & Julia Stone, Birds of Tokyo, Josh Pyke, Hands Like Houses, Cut Copy, Wolfmother, The Avalanches, Regurgitator, Gotye, The Vines, Something for Kate, Middle Kids, Empire of the Sun, Eskimo Joe, Spiderbait, Cog, Washington, Nick Cave & The Bad Seeds, Xavier Rudd, Bernard Fanning, Cloud Control, The Preatures, The Cruel Sea, The Amity Affliction, Sarah Blasko, Sia, Flight Facilities, The Rubens, Pendulum, The Panics, Art vs. Science, Sleepy Jackson, The Grates, The Saints, The Rions, Pete Murray, Nina Las Vegas, The Waifs, Lisa Mitchell, The Go-Betweens, Dead Letter Circus, The Butterfly Effect, Pnau, Children Collide, Gypsy & The Cat, Frenzal Rhomb, Augie March, Paul Dempsey, Nick Cave & The Bad Seeds, Alex the Astronaut, Dom Dolla, Genesis Owusu, Teen Jesus and the Jean Teasers, Hayden James, Boo Seeka, King Stingray, Fun Machine, Vallis Alps, SAFIA, Rufus du Sol, Lime Cordiale, Courtney Barnett, Budjerah, Violent Soho, Camp Cope, Jack River, Citizen Kay, The Terrys, Skegss, Vancouver Sleep Clinic, San Cisco, JK-47, Panama, Tkay Maidza, Allday, Bag Raiders and The Middle East.

Across generations, Australian music has been the soundtrack of our favourite TV shows and movies, underpinned memories made at special events, kept us company on road trips and helped us remember friends and family who may no longer be with us.

The sound of our music has helped shape the character of our nation. We should all feel very proud of the music industry that has grown up here and continues to evolve as our shared culture does.   

For these reasons, I was pleased to see the Australian Government launch the National Cultural Policy earlier in the year.

The Policy places a strong focus on supporting Australian artists, including through the establishment of Music Australia, which will have a mandate to support and empower Australia's contemporary music industry to realise its local and global potential.

There is one issue that has fallen by the wayside for too long, which is how artists and rights holders are remunerated for the use of their works on radio under the Copyright Act 1968.

Firstly, it's important to understand that the music you hear on the radio comprises two forms of copyright: the performance of the underlying composition of the song (known as the musical work), and the performance of the sound recording itself—being a particular recorded version of that musical work.

For the composition, licensing agreements are generally struck between the relevant copyright collecting society representing the publisher, songwriter and composer, and the broadcaster. The collecting society, APRA in this case, will then collect the agreed licence fee and distribute it to the songwriters, composers and publishers.

For sound recordings, there is a statutory licence, which means that the sound recording rights holders are unable to prevent radio broadcasters from using their recordings. PPCA, the relevant collecting society for sound recordings, and the ABC and other bodies representing commercial and community radio broadcasters will generally negotiate a licensing agreement, and then collect the licence fee and distribute it to recording artists and sound recording rights holders.

For any form of copyright, when the parties are unable to reach agreement on licence fees, the Copyright Tribunal is able to determine an appropriate rate, taking into account a range of factors including those raised by the parties, such as the regionality of a radio station, the economic climate, the cost of inputs and other market forces.

However, under subsection 152(8) of the Copyright Act, for published sound recordings only, the Copyright Tribunal is precluded from determining a rate that would equate to more than 1 per cent of a commercial radio broadcaster's gross annual earnings.

For the ABC, for published sound recordings, the Copyright Tribunal is unable to determine an annual rate that exceeds 0.5 cents per head of population in that year.

These are caps, and their presence has framed negotiations since the Copyright Act was first enacted in 1968. They do not apply to any other form of copyright material, including the musical works performed each time a sound recording is broadcast.

This cap is unique in the Copyright Act. It does not exist for any other type of copyright; for all other types of copyright, the free market agrees the rate and can access the Copyright Tribunal if an agreement cannot be reached.

It is also unique globally; there is no similar cap anywhere else in the world.

Today, commercial radio, comprising 260 stations, pays just 0.4% of gross earnings to artists and rights holders, which equates to around $4.4 million per year. The ABC pays around $125,000 for the broadcast of sound recordings across all of its radio stations.

Compare that to what is paid for composition. According to a 2019 House of Representatives Inquiry, the licence fees for the broadcast of lyrics and composition were at that time 3.76% of gross earnings.

At least five reviews and inquiries over the past 30 or so years have touched on the cap and its impact on the music industry.

The most recent was under the last government in 2019, in a review of the Australian music industry conducted by the House of Representatives Standing Committee on Communications and the Arts.

In the final report, the Committee stated:

"The Committee sees no public policy which is served by the cap and is concerned that it distorts the market in a way that disadvantages Australian artists."

The Review of intellectual property legislation under the Competition Principles Agreement in 2000, sometimes referred to as the Ergas Review, commented:

"...since the time of [the caps] introduction, the economic circumstances of the commercial radio industry have evolved, and the Committee does not believe capping remains warranted. No public policy is served by this preference, which may distort competition … resources use, and income distribution … to achieve competitive neutrality and remove unnecessary impediments to the functioning of markets on a commercial basis, the Committee recommends that s. 152(8) of the Copyright Act be amended to remove the broadcast fee price cap."

In 2013, the Australian Law Reform Commission also considered the pricing caps in its broader review of statutory licensing arrangements for sound recordings. It recommended that the statutory licensing scheme be repealed in favour of a voluntary licensing scheme, such as the one that exists for composition and lyrics. However, they also commented that "if [the scheme] is retained, there appears to be a strong case for repeal of the one per cent cap".

The findings of these reviews are clear, the mere presence of the cap is distorting the market to the disadvantage of artists, who we must remember are small businesses, often operating on a shoestring to brand, and market and distribute their product.

This Bill makes a small change that over time will benefit Australian artists, walking in tandem with the National Cultural Policy.

It will allow artists and rights holders to negotiate a fair market-based value for their work.

And it will bring the treatment of sound recordings on radio in line with how sound recordings are treated elsewhere in the Copyright Act.

This Bill does not remove the protection of the Copyright Tribunal, which will still be able to make determinations on rates if parties are not able to agree, as they do now and as they do for other forms of copyright.

Removing these caps also won't automatically change any royalties. Passing this Bill simply allows the market to decide a fair rate and always with the safeguard of the Copyright Tribunal.

As mentioned earlier, for all music that is played across all of the ABC's radio stations, just $125,000 is paid each year to artists. The ABC pays its actors, its writers and its journalists a fair market wage, it should also pay its artists.

There are over 5,300 registered Australian artists that the collecting society collects for and I believe they are entitled to a fair go at the negotiating table when looking at the value of their works.

I commend this Bill to the Senate.

I seek leave to continue my remarks later.

Leave granted; debate adjourned.