Canadian Heritage Committee on March 4th, 2009

[The Chair, Conservative, Gary Schellenberger]

Thank you for that.

We move now to Mr. Everson, please.

[Jim Everson, Executive Director, Public Affairs, Magazines Canada]

Thank you, Mr. Chairman.

I'd like to begin by thanking the committee for having Magazines Canada here today.

My name is Jim Everson. I'm the executive director of public affairs for the association.

Magazines Canada is a national trade association representing leading Canadian-owned, Canadian content, consumer, cultural, specialty, professional, and business magazines in the country.

Canada's magazine policy and programs are currently the subject of a substantial review led by the Department of Canadian Heritage. This review has coincided with the strategic review of arts and culture program expenditures that the committee is looking at today. We'd like to take this opportunity to discuss some of the challenges ahead and highlight the importance of continued investment in the Canadian magazine sector.

Canada's magazines are challenged currently by a very serious economic downturn, the one that we're all experiencing. Advertising revenues make up, on average, 60% to 65% of magazine revenues. As companies deal with today's economic turmoil, they have pulled back on advertising expenses, which has had an impact on all media, including magazines. There have been layoffs, reductions in freelance commitments, and work-sharing in some of our work environments.

In this environment, the uncertainty around our national policy framework and investment in key programs is an added challenge. There has been considerable uncertainty as a result of a decision by Canada Post to eliminate its $15 million annual contribution to the publications assistance program, which is used to help distribute Canadian magazines across the country. This would have reduced the value of the program by 25%. So our sector very much welcomed the January 27 federal budget announcement of $30 million over two years, which replaces that Canada Post contribution that was eliminated. We further welcomed the announcement by Minister Moore just last month, on February 17, of the creation of the new Canada periodical fund, which will replace both the Canada magazine fund and the publications assistance program. The financial investment provides much-needed stability for the sector in this time, and the new program, we expect, will update the existing framework and provide greater flexibility and targeting of support.

While not all the details of the new program have been finalized, there are areas we feel require more work to ensure that the program meets the diverse needs of the sector. For example, under the existing program structure, Canada's arts and literary magazines benefited from a specific and targeted program as part of the Canada magazine fund. This program will not continue under the new framework; however, the design of the new program allows for special eligibility guidelines for some classes of magazines and a flexible formula of support. So we'll be urging the minister to take steps to ensure that these magazines' special needs are addressed through the instruments that are already built into the design of the program, to ensure that those magazines' needs are addressed.

With respect to the investment in collective industry initiatives, the part of the current programming that was reduced through the expenditure review process, the new program will maintain a component for this purpose. These collective projects are valuable to the sector, and we support maintaining them. They've been used for promotion initiatives on behalf of all Canadian magazines and research into industry issues, types of things that the whole industry can benefit from.

In conclusion, we want to highlight how effective and valuable the federal support is. Successive governments have supported and continue to refine and improve our national magazine policy. It includes the Foreign Publishers Advertising Services Act, Canadian ownership regulations, the publications assistance program, and the Canada magazine fund. Together they've proven to be very successful. We have one of the most open and competitive magazine sectors in the world, with a very high ratio of magazine titles, both domestic and foreign, per consumer. At the same time, we've been able to steadily improve access to Canadian magazine content relative to foreign magazines. Canadian titles make up about 40% of magazine purchases in Canada, which is better than the Canadian share of most other cultural media, and it's largely as a result of a consistent application of federal magazine policy.

We are looking forward to continued support from the Government of Canada to build on this success.

Thank you.

[The Chair, Conservative, Gary Schellenberger]

Thank you very much, and I thank everyone for your great presentations.

We'll try to keep our questions short and our answers concise, if we can. You have five minutes each.

Mr. Rodriguez is first, please.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

Thank you, Mr. Chairman.

Good afternoon to all of you and thank you for being with us today. I want to commend each and every one of you for what you are doing in your respective areas.

As I have said to other witnesses, I would have liked to see this meeting occur in a different context. Perhaps then, we could have talked about your successes or what you are planning for the future, rather than talking about funding cuts. In any case, since the government has decided to make these cuts, we have no choice but to talk about them.

Were any of you consulted during the review process or with respect to these cuts?

[Pierre MacDuff]

No, not at all.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

Never, at no time?

At a certain point you heard about the cuts and that was it? Nobody was consulted?

[Amy House]

Correct.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

Since you are the ones who are most acquainted with these programs, because you use them, if there is no attempt to consult you, then I really wonder what the basis for this decision is, if not ideology. That is my view.

Our competitors, particularly other European countries, provide such programs to their artists and companies. Is it your impression that the people using these programs for foreign tours—people like you, Mr. MacDuff—will now be trying to compete with both hands tied behind their back?

[Pierre MacDuff]

Canada had already distinguished itself from some other countries. When we went on tour with our show about war, entitled Leitmotiv, we made a stop in Russia. We gave a performance in Russian, because we like the challenge of performing in the language of the country. We were the first Canadian company to play in Nijni Novgorod. The only foreign companies who have performed there previously were French companies, for the very simple reason that France pays all the expenses, believing that this is a way to extend the influence of French culture.

In our case, we have been paid fees both in Russia and China. Although it may seem perfectly normal to be paid fees in China, even though it is common for artists to be provided food and accommodation, they were not necessarily paid a performance fee. That ideologic threshold had not been crossed. So, we were paid a performance fee, but international transportation fees were covered by Foreign Affairs, as is the case in other countries.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

That puts you at a disadvantage in relation to countries that continue to provide these programs to their artists and theatre and dance companies.

As for the tours, have they or will they be cancelled in some cases?

[Pierre MacDuff]

Yes, of course. International work has to be planned a long time in advance. Not only are people already working on the next season, which is pretty well completed, but we are working on the one that follows it. Foreign companies and festivals are now afraid to invite Canadian artists, because we can no longer guarantee that there will be funding available for transportation costs, which are usually covered. So, everybody is in a waiting game at this point. They want to know what will happen in Canada.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

So this is hurting the credibility or reputation of Canadian artists in general.

From now on, people will hesitate to invite Canadian companies to perform because they will be wondering whether these companies will have the funding they need or not.

It's going to hurt all of them, actually, and our own reputation also as a country, right?

Madame White, you recommended increasing the budget of the Canada Council by $100 million. Did you mean going from $180 million to about $280 million? Is that what you meant?

[Lucy White]

Yes.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

Let's look at the role of PromArt. Mr. MacDuff, I want to come back to you. When you were asked why you perform abroad, you said that it was because it is an opportunity to be open to the rest of the world, since the Canadian market is too small, and also because it is profitable. You earn a little more abroad than you do here. You also said that PromArt represents a small portion of the total financing package.

My concern is that we are throwing the baby out with the bath water. It has been said that the program was not always well managed. However, we could retain the objective and funding for the program and turn over its management to the Canada Council for the Arts or another organization. That way it would be possible to keep these programs in place. Do you not think these programs are necessary to support our artists?

[Pierre MacDuff]

Yes, they are absolutely fundamental, unless our society decides that it no longer is interested in showcasing our culture abroad.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

And that is exactly what is going to happen, if this continues.

[Pierre MacDuff]

It is an obvious consequence. There would be no other means of support.

There are a number of fabulous programs in place that support culture, but PromArt was the one that made it possible to export our cultural productions in all areas of endeavour to foreign countries. At the time, it was estimated that, in order to meet the need, the budget should be $20 million, when it was actually only $4.7 million.

[Pablo Rodriguez, Liberal, Honoré-Mercier, QC]

Thank you.

[The Chair, Conservative, Gary Schellenberger]

Thank you very much.

Madame Lavallée, please.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

Thank you very much.

I'm sure you are aware that the Department of Canadian Heritage, in the person of first one, and then another, Minister of Canadian Heritage, abolished the Trade Routes and PromArt programs, the two programs that have been the subject of most of our discussions this afternoon, without providing any rationale or any of its own research or analysis.

Did any of you see any analysis about the Trade Routes or PromArt programs?

[Pierre MacDuff]

I saw one on PromArt in 2006.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

You saw it in 2005?

[Pierre MacDuff]

There was a document back in January 2006.

[Carole Lavallée, Bloc, Saint-Bruno—Saint-Hubert, QC]

And did it say the program was effective?

[Pierre MacDuff]

Yes, it did.