Canadian Heritage Committee on Oct. 21st, 2022

[Peter Julian, NDP, New Westminster—Burnaby, BC]

I'm sorry to interrupt. Half a million dollars is an accurate figure, then, from the broadcast participation fund.

[Ian Scott]

I don't have the...but my understanding is that, yes, I know they participated in several major broadcast proceedings, and it is that independent organization that awards funding. I have not seen anything to disagree with those numbers.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Okay.

What are the measures, then, that the CRTC has taken, to funds that you provide funding for?

[Ian Scott]

I don't mean to be picky, but we don't fund organizations and we haven't funded that organization.

These are cost awards after the fact. When parties participate in our proceeding, they can seek some costs if they represent a broader public interest—not a private interest—and if they have made a significant contribution to the proceeding. Thereafter, the panel or the commission, whatever is relevant, will make a determination. They will accept the cost application. It gets looked at, assessed and awarded, but it's after the fact. No one has a right to costs. We have no contractual relationships with that or any organization of its type.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

My question still stands, and that is what vetting procedure have you put into place? I ask because obviously another organization, the convoy group, can throw themselves in and have an active participation and then seek an award, so to what extent has this episode of rampant anti-Semitism served the CRTC to ensure that groups that are vehicles of hate are not given funding or given awards?

[Ian Scott]

Again—and I absolutely share your view, and this is a new situation for us—I have instructed staff. They were already looking at it since we first saw public reports about Mr. Marouf's comments, recognizing that he and the organization had been a party to commission proceedings.

There are two things I would say. One is that we're quasi-judicial in nature and we control our processes. I can tell you that if Mr. Marouf or organizations or individuals that hold views like that seek to intervene in our process in the future and we're aware that they are anti-Semitic or otherwise preaching hate, it's within the powers of the commission not to allow their participation. More importantly, I have instructed staff—I'll just finish this quickly—to review our cost award process to address this very situation, should it arise again.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Okay, so that is in process, but at this point, it is not implemented.

[Ian Scott]

We have no public hearing involving a cost award at the moment, and staff have been instructed to look at this and to assess our approach.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Thank you. I'll move to another element.

We have Telus with record profits, $11 billion, in the corporation. They applied to the CRTC in August to start gouging consumers by adding a processing fee to Internet and phone bills paid by credit cards, another 1.5%, when Canadians are already struggling. The CRTC has not approved this, but Telus has gone ahead. They're already gouging consumers.

I have two questions. First off, to what extent can the CRTC rule to ensure that corporations don't gouge when they haven't received approval from the CRTC, and what is it about the complaint process that allows corporations simply to move ahead when they haven't actually received approval from the CRTC?

[Ian Scott]

First of all, I must say that this is a matter that's currently in front of the commission, so I'm very limited in how I can respond.

The parties made an application to allow them to add that charge to their tariff services where we oversee their rates. They also have forborne services. We don't regulate the retail rates for wireless or Internet services outside of the far north. We are seized of this matter, and the commission will render a decision in the coming weeks or months on Telus' application.

[Peter Julian, NDP, New Westminster—Burnaby, BC]

Would you apply punitive measures if—

[The Chair, Liberal, Hedy Fry]

Thank you very much. Sorry, Peter, your time is up.

Now we're going to move to the second round. This is a five-minute round.

I shall begin with Mr. Waugh for the Conservatives.

Kevin, you have five minutes.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

Thank you, Madam Chair.

Mr. Scott, your term is up at the CRTC. Can you give us an update on your position as chair, and are you helping to find a replacement for yourself?

[Ian Scott]

Thank you.

I was anticipating somebody saying, “What are you doing here? I thought you were done in September”, but I'm back. I'm a little bit like the common cold in the autumn. It's hard to get rid of me.

I am not involved in the process. I'm often invited to sit on the panels that stream candidates for other roles, but the government quite properly didn't see it appropriate for the chair to participate in the selection of his or her successor, so I am not engaged in that process at all. My term has been extended to early January, and I expect it to end at that time.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

All right. Thank you.

You know the Australian model made Rupert Murdoch very, very rich. I see here with Bill C‑18 that very rich will come from Bell Media, from Rogers media.

I want your thoughts. You said you are following the Australian model, or at least Bill C‑18was intended to follow the Australian model, but when I look at broadcasters now, I see they've got their hand into the pot of Bill C‑18, and not only their hand; I would say they've got their whole body into this. They are getting most of the money that could be available through Google and Meta.

With the independent local news fund that you cited, $23 million, how much more do Bell, Rogers and other independent media need to survive in this country? I thought Bill C‑18 was going to be the bill to help local newspapers. It is in fact the exact opposite. We have the multinationals again getting most of the money. They were involved in Bill C‑10, Bill C‑11 and Bill C‑18. I just want your comment on that, because I'm very worried that this bill was designed for newspapers and has turned out to be anything but.

[Ian Scott]

First of all I should note that the fund the CRTC established to support small news players excludes the vertically integrated players, so they're not eligible to take money from that fund.

I think the focus of the legislation—again maybe this should be directed to the minister—is to help news and journalism broadly. We regulate the broadcast news sector, and I can tell you that they have very extensive expenditure requirements that are imposed on them by us to ensure that Canadians obtain more than adequate quality news and independent news. The Australian situation is different. I think it's much more concentrated. Mr. Murdoch seems to play a very pre-eminent role in Australia.

We don't know yet—subject to further processes once legislation, if passed, is brought into force—who exactly will be eligible and who will be on the hook, so to speak, to pay for it.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

I think we know. I think we know, Chair of the CRTC. We're seeing reports out daily that Bell, Rogers and even our own public broadcaster will be at the trough on Bill C-18. I will say to you, because you're the chair the CRTC, that you know how much CBC news means in this country and how much money they take out of private organizations.

Here is the public broadcaster again, when they shouldn't be taking money away from private broadcasters trying to survive in the media sphere, taking most of the money away from those that need it desperately, like the newspapers.

This is just absurd. I just cannot believe that this bill has gone this far, allowing Bell, Telus and especially the CBC—

[The Chair, Liberal, Hedy Fry]

You have 30 seconds.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

—now to take most of the money away when it was once designed for small local newspapers.

[The Chair, Liberal, Hedy Fry]

Now 23 seconds...

[Ian Scott]

Very quickly, we don't know what the numbers are. With respect, we haven't seen the final text of the legislation and we haven't established either the exemption criteria or other qualifications. We simply don't know what those monetary amounts are or will be.

[Kevin Waugh, Conservative, Saskatoon—Grasswood, SK]

Well, they're going to be big, and the PBO has indicated that.

[The Chair, Liberal, Hedy Fry]

Thank you, Kevin. I love the mellifluous tones of your radio voice, but your time is up.

We're going to go to Mr. Housefather for the Liberals for five minutes.

[Anthony Housefather, Liberal, Mount Royal, QC]

Thank you so much, Madam Chair.

I'm going to follow up on my colleagues Ms. Thomas and Mr. Julian and ask you about CMAC.

There were two telecom orders that you issued, 2021-175 and 2021-356, which provided $16,851 and $15,332.48 respectively to CMAC. As well, since 2016, over half a million dollars have been provided under the broadcasting participation fund, which I understand is independent, but it was established by the CRTC and is funded through CRTC orders. I'm going to have questions on the funding in both directions.

I'll start with the orders.

I read your statement, and I think we all share the disgust about the comments by Mr. Marouf and all those associated with what CMAC has done. In your statement last October 13, you said that the applications for costs are then subject to a further public process, following which the CRTC could approve the application in full or in part or deny the application, but you didn't follow this procedure in the case of awarding funds to CMAC.

In the May 2021 decision, telecom order CRTC 2021-175, the commission wrote in paragraph 3 that such responses were unnecessary.

I also want to go on to say that in March of 2021, in reviewing CMAC's cost application, the CRTC had an articling student ask CMAC if the consultants, Laith Marouf and Gretchen King, controlled the day-to-day operations of CMAC and should therefore be paid at an internal rate of $470 per day instead of the external rate of $225 per hour that was claimed, which is four times the internal rate.

Now, based on all that we know, based on the incorporation documents showing CMAC being at the home address of Mr. Marouf and Ms. King, it appears that CMAC and Marouf and King are one and the same. Therefore, my question is this: Will the CRTC use its own powers under section 62 of the Telecommunications Act to review its cost award to CMAC?

[Ian Scott]

The information you cited is correct, but I do chafe a little bit at your use of the word “funding”, because we give cost awards.

I want to explain very quickly that you are correct in saying that the process was different, and there was a reason for that. It was not only CMAC. There were nine, I believe, organizations that received support for intervening in that process on accessibility. The hearing was under the accessibility act, and we cannot award costs like broadcasting under the accessibility act. Bell Canada offered. It had excess funds associated with something called the deferral account. I won't go into it. It is, if you will, an outstanding obligation, and they offered us the opportunity to pay costs using it and we took that up.

Normally, those processes determine how to apportion the costs and if there are any objections to the cost awards. Bell had no objections. They were the sole supplier of funding, and so we did forgo any further process for all of those parties.