Canadian Heritage Committee on Feb. 13th, 2007

[Bev Oda, Conservative, Durham, ON]

Mr. Chair, in addition to answering the question, I would like to have the ability to respond to a number of comments that were made, if I may.

First of all, the Broadcasting Act and the commission as a body, whether there is an actual chair or not, have structure. There was an acting chair. The responsibility is not only with the chair, but with the CRTC as an organization, and there are commissioners there who will carry on. I would suggest the leadership is there and has been there throughout--not only the staff at the CRTC, but also the commissioners of the CRTC. The commission now has a new chair; I have full confidence in the new chair and full confidence that the commission will continue to fulfill its responsibility.

With regard to comments being made, exaggeration, and hyperbole, I am certainly not in control of any individual's comments. I find that some comments have been made in public. This government does not govern through public comment or through the media; this government acts responsibly, makes sure it gets the information, and makes sure it has a full comprehension of the situation in order to assess its response to any situation.

In meeting with the producers, I asked about the state of the current productions. They indicated, and I understand, that there is a very serious situation, and steps will have to be taken in the future months as we go through this production year. However, to use hyperbole such as “going up in smoke”.... I had asked this committee to help and to contribute to the information that will help us in our deliberations. I suggest that the many public comments are not constructive, are not helpful, and do not contribute to a positive action being taken.

With regard to the CRTC, the CRTC is not on the sidelines. The CRTC is monitoring and looking at its powers as well. The CRTC will be considering its actions, I'm sure, and will fulfill its responsibility.

Yes, Mr. Angus, I understand Vidéotron did something publicly yesterday. They also provided a comment or copy, etc. As I said, these announcements, etc., are being put before us today. We are asking that the monthly payments be resumed. At that point, then, we will be able to stabilize the industry, and that is our first objective.

[The Chair, Conservative, Gary Schellenberger]

That was a very long question and you got a very long answer.

[Charlie Angus, NDP, Timmins—James Bay, ON]

May I have just a short one, please?

[The Chair, Conservative, Gary Schellenberger]

It must be very short.

[Charlie Angus, NDP, Timmins—James Bay, ON]

Madam Oda, Jim Abbott was at our committee speaking to the CRTC chair on October 30, 2006. He said, “I think we're in agreement that you”--the CRTC--“take direction from the government. The CRTC takes direction from the government--from the minister...” and later, “That's the way that is.”

It's very interesting to see, now that we have a full-blown crisis, that we're suddenly stepping back and saying, no, the CRTC has nothing to do with government. It's in direct contradiction to the message your government has been putting out to Canadians, which is that the CRTC is under you.

[Bev Oda, Conservative, Durham, ON]

The CRTC is created by government. The CRTC is also created through the Broadcasting Act. The CRTC has powers given to it from government through the Broadcasting Act. The direction, ability, and power of the government relative to the CRTC are clearly outlined in the Broadcasting Act.

[The Chair, Conservative, Gary Schellenberger]

Thank you.

Mr. Fast is next.

[Ed Fast, Conservative, Abbotsford, BC]

Thank you, Minister, for appearing before us.

Today the opposition is suggesting that you interfere and meddle in the affairs of the CRTC. That's very clear from comments of Ms. Robillard, as well as from Mr. Angus. Yet I would suspect that if circumstances were different and you had actually interfered in the affairs of the CRTC, today they'd be criticizing you for interfering in the affairs of an arm's-length body that is so constructed by its constating laws.

Madam Minister, I was surprised and indeed shocked at the suggestion from certain opposition members that in fact you should be immediately pulling the broadcast licences of Shaw and Vidéotron. The reason it's shocking to me is due to the profound legal and financial implications that kind of a decision would have on the taxpayers of this country.

I want to read to you a quote from Mr. Douglas Barrett, the president of the Canadian Television Fund, when he appeared before us at the last meeting:

We understand there's an ambiguity within the CRTC regulatory environment that makes the annual payment provisions of the BDU regulations enforceable while the monthly payment requirements of the CRTC circular are apparently somewhat less enforceable.

I wonder if you could comment on the impact that an immediate pulling of those broadcast licences would have, the risks your ministry would take in doing that, and what steps you're taking to monitor that situation and what kind of resolution you're hoping for in the long run.

[Bev Oda, Conservative, Durham, ON]

Thank you very much for the question.

Let me be clear: the government, through the Department of Canadian Heritage, does not have the power related to any licences as far as suspension of licences and so on is concerned. Those powers are outlined in the Broadcasting Act.

Let me be also clear that this government expects every entity, including the government itself, to abide by and respect the laws of the country. We have a Broadcasting Act. That Broadcasting Act has been established to outline the specifics of the relationship between the CRTC and its powers and the government and its powers.

One of the things I pointed out earlier is that this structure that has been set up is a model that is envied by many countries around the world. We have, in one extreme, a situation where we have a good working relationship with the industry. We work on their behalf under the powers given to government. The CRTC has been given the powers to regulate and supervise the system.

Just taking logic to its conclusion, the impact of pulling anyone's licence, of course, is on Canadians. If you look at the licences of broadcasters, it's the service they provide, the information they provide, the entertainment they provide. It's the Canadian perspective, the Canadian information, and the Canadian creative talent that they provide through their Canadian content requirements.

The broadcast distribution undertakings licensed in Canada have millions of subscribers, to which they provide a number of services, both Canadian and foreign. Without those licences, those subscribers would be the immediate sufferers of non-service. Consequently, as to the powers that are there as far as awarding licences or amending licences and so on is concerned, the Broadcasting Act is a very judicious and reasonable approach, and it calls upon public study of the public impact of any action of the CRTC.

[Ed Fast, Conservative, Abbotsford, BC]

The president of the CTF clearly indicated that even if the CRTC wanted to pull the broadcast licences of Shaw and Vidéotron at this time, in fact there may not be any power to do so. Are you in a position to be able to comment on the impact of the circular on our ability as a government or the CRTC to actually be able to pull those licences?

[Bev Oda, Conservative, Durham, ON]

I am aware of the difference between a regulation and a circular. However, I would suggest that it's within the commission's power to do its own assessment and to act accordingly.

[Ed Fast, Conservative, Abbotsford, BC]

Thank you.

[The Chair, Conservative, Gary Schellenberger]

Ms. Robillard.

[Lucienne Robillard, Liberal, Westmount—Ville-Marie, QC]

Madam Minister, once more, you referred to the CRTC which is independent. There is a much more important issue: two cable operators are not abiding by their licence’s terms and are in complete violation. You have met them but no one has ever heard you say, as minister, that it was unacceptable for them not to honour the terms of their licences.

You told the committee today that your are requesting them to make their monthly payments. This is the first time you said it. On December 20, Shaw said it was not contributing to the CTF anymore. On January 23, Mr. Péladeau, from Québécor, made the same announcement.

How can people publicly state they will not abide by the law and the regulations? How can a government minister not say this doesn’t make sense, this is unacceptable and this country’s laws and regulations must be obeyed?

Madam Minister, you are being blamed for not responding quickly, for not saying this is unacceptable. You said the CRTC can act. This is true. It could change the terms of the licences starting tomorrow morning. But it is not doing it, it is not acting.

This is obvious to us. In his announcement yesterday, Mr. Péladeau did not show any intention of abiding by the CRTC’s regulations concerning the CTF.

I have a very direct question to ask you. What do you think of Mr. Péladeau’s suggestion to invest everything in the Québécor Fund instead of the Canadian Television Fund?

[Bev Oda, Conservative, Durham, ON]

Thank you for your question, Madame.

I would suggest that the act clearly outlines the procedures. If we look at the commission's own regulations, etc., any action taken regarding the awarding or amending of any licence requires a public process. It is up to the commission in exercising and fulfilling its responsibilities to decide the process it will undertake. The act, as I said before, is very judiciously structured to ensure there is an ability for public comment and that every sector affected by any act of the commission has fair opportunity to participate.

Yes, Mr. Péladeau had publicly put forward a proposal. However, first of all, let me say that any proposal, any suggestion, or any contribution would be listened to and considered only once we have returned stability to the situation at hand.

Mr. Péladeau and the CTF itself have made some very interesting observations. This government has made some interesting observations. This is why I asked the CRTC to give me a report last year on the new realities: how the new technologies are affecting their broadcasting system and how consumer behaviour is changing because of the new technologies. That is one area that the commission will, I'm sure, take into consideration. As you know, it is reviewing radio and television, and it's taking action. The report I received from the CRTC gives us information as we continue our deliberations.

The indication from Vidéotron is that the funding model does not currently recognize the new technologies and the new platforms available. It makes some observations that we, that is the CRTC, the public, and the government, recognize may not have been recognized to date.

[Lucienne Robillard, Liberal, Westmount—Ville-Marie, QC]

Madam Minister, you are responsible, on behalf of the Government of Canada, for the Canadian broadcasting policy which promotes the increase of Canadian content on our airwaves. I am asking you this again: what do you think of the proposal made yesterday by Québécor, indicating this company will not contribute anymore to the CTF but will invest in its own private fund, thereby weakening the leverage of government contributions to the fund? What do you think the impact of this proposal will be on the Canadian broadcasting policy, which you are responsible for?

[Bev Oda, Conservative, Durham, ON]

Madame, I cannot comment on any specific proposal. That's why this system has been structured in such a way that the full public discussion of any proposal, of any matter that comes under the commission, has been fully outlined to ensure that there is input from all sectors and that it's fair and reasonable, that not only the government but through the CRTC they hear and listen to the proposals. As you know, this is why there is the ability to have public hearings. This is why the Broadcasting Act stipulates under what circumstances public hearings and public comments are a necessity. Consequently, I cannot comment. Certainly, in looking at any proposals, we'd have to get all the information from all the parties and consider them.

However, let me reiterate. First, whatever proposals come forward...as it has been traditionally over many years of developing CRTC regulations and policies, and even government policies, we always have input and we always take into consideration the views and the proposals put forward by everybody. There is an opportunity for honest debate and there is an opportunity for full information gathering.

So, Madame, I would suggest that first we have to return stability to the situation before we would make comment on any proposal put forward by any company or organization.

[The Chair, Conservative, Gary Schellenberger]

Thank you.

Mr. Kotto.

[Maka Kotto, Bloc, Saint-Lambert, QC]

Madam Minister, in a public statement made around the end of January, you said this:

I understood that there have been concerns with the CTF for many years, and that those concerns of the private sector contributors have not been fully satisfied.

Is this statement an admission of your compassion for Vidéotron and Shaw? Does this mean the ultimate dismantling of the CTF is being considered?

[Bev Oda, Conservative, Durham, ON]

Absolutely not. Let me be clear: that should certainly not be read into any statement that I have made. I want to make sure also that the positions taken by the two companies.... As far as when I read the Auditor General's report that made recommendations regarding governance, I am also very aware of the steps taken to address those recommendations. The new structure for the governance of the CTF was announced in 2005. In fact, this government wanted to allow the new structure to unfold and certainly to be monitoring it over the period in time that was outlined.

This situation was created, as I understand it, by an incident with the dissolution of the CCTA. The representation from one sector was not fulfilled. There has also been some other request about the satellite distributors not having representation, as you heard from Mr. Barrett in his appearance. The CTF had put forward a proposal to maybe address some of those concerns.

[Maka Kotto, Bloc, Saint-Lambert, QC]

Right now, many productions have been cancelled or are on the verge of collapse. Don’t you think it would be a good idea to loan some interest-free money to the fund until the crisis is dealt with and Shaw Communications and Vidéotron resume their payments?

[Bev Oda, Conservative, Durham, ON]

In the information provided, it's been indicated to me that the CTF is able to honour the commitments up until March 31. I have also been monitoring the state of production and if any productions had to be cancelled. I've asked for the employment situation. We will ensure the production sector is fully supported to meet the system and the stability of the system.

Let me say that we recognize that there are some key steps that will happen very shortly in the production cycle. I'm very aware of that. That's why it's important that I'm aware of the state of the events as they're happening. As I say, first of all, we have to make sure...and this is why I've asked for the return to some stability, to give assurances to the producers.

[Maka Kotto, Bloc, Saint-Lambert, QC]

I understand your request for a return to stability but you know this probably cannot be expected before August 1^st. Until then, many productions will be jeopardized, particularly since everything is being decided right now. So a number of productions will be doomed.

What action are you considering in order to avoid a degradation of the situation, particularly in Quebec, where, as you know, production of TV series is important?

[Bev Oda, Conservative, Durham, ON]

Thank you, Mr. Kotto.

As you can appreciate, I would, because of past experiences, be very aware of what would normally happen over the next few months as far as the production community and industry are concerned. I have a full assessment in exploring the various options available to the government. As I said, the first step here is the request I've made to Vidéotron and Shaw that the resumption of monthly payments be made immediately. We await their response, at which time I'm hoping we can move forward positively, and the production sector can move forward as well.

[Maka Kotto, Bloc, Saint-Lambert, QC]

Thank you, Mr. Chair. I have a quick question for the minister.

Wouldn’t it be appropriate to question CBC/Radio-Canada’s share? Also, would an increased funding of the public broadcaster help solve this problem by allowing the CTF to provide more funds to private broadcasters?