Canadian Heritage Committee on April 21st, 2026

[The Chair, Liberal, Lisa Hepfner]

Thank you.

Mr. Ntumba, you now have the floor for five minutes.

[Bienvenu-Olivier Ntumba, Liberal, Mont-Saint-Bruno—L’Acadie, QC]

Thank you, Madam Chair.

Witnesses, thank you all for being with us today for this study, whether you're here in person or online.

Mr. Gonez, you often talked in your remarks about Bill C‑18 and what you think it will prevent in the media.

I'll give you a bit of background.

Before this happened, I think most of us would often go on Facebook and watch media summaries. Sometimes it was even to follow election nights. Back then, I went on Facebook to watch Radio-Canada, which posted them live. I think that generated a lot of traffic for media like Facebook. It fed their algorithms. A lot of people have subscribed to follow their media on these platforms.

Since Bill C‑18 was passed, we have had regulations in place that, thanks to the strength of the government and teamwork, provided some media outlets with $100 million, which they are benefiting from today.

Isn't this approach beneficial for the media community in Canada?

Should we really set that aside and give people free rein to go on Meta?

[Brandon Gonez]

To your question on Bill C-18, I think what the government at the time may not have understood was that Meta-owned platforms like Facebook and Instagram were driving huge referral traffic back to legacy publishers and digital publishers. That, in turn, allowed traffic to increase natively, which then allowed publishers—again, whether they were traditional or digital—to sell off that traffic to garner advertising revenue. Everybody lost that traffic. The $100 million, when I look at it in the grand scheme of things, is a drop in the bucket of what it put at risk.

On the digital innovation side, it stopped a whole industry that was booming. I know of digital publishers that are smaller in scale than my organization that have gone out of business or are at risk of going out of business, despite the $100 million from Google. At the end of the day, that money is tied to how many people you employ, not to your impact.

What does that then foster? It fosters organizations that probably weren't on the right trajectory in terms of impact, but now have bloated operations and are still not reaching the number of Canadians they should be reaching, whereas the organizations that were building business models actually reaching those Canadians are not offered any incentive to continue doing that.

It all goes back to what type of country we are trying to foster and what type of business ecosystem we are trying to foster. I'm not here to say we should forget the legacy players and push them to the wayside. It's none of that. What I am saying is that we can't protect an industry that is dying at the expense of a group of organizations in a new industry that is being fostered. That is what we have essentially done over the last three years.

We've protected the old guard at the expense of a new generation of media companies and organizers that took a risk, put their livelihoods on the line, started employing Canadians in different regions across this country and brought diversity of thought to people's screens. It may not have been the big screen—it was a smaller screen—but it was the screen Canadians were consuming content on. We've hindered and stifled that growth.

Is that money good? I look at it as a stopgap. It's holding organizations together that have to do that hard work to essentially reinvent themselves. We may lose some of those organizations. On the flip side, there were organizations that could have potentially grown bigger to replace those organizations or complement the loss that those organizations were dealing with.

[Bienvenu-Olivier Ntumba, Liberal, Mont-Saint-Bruno—L’Acadie, QC]

Thank you.

Mr. Pineault, can you also answer my question?

[Jean-Philippe Pineault]

In terms of Bill C‑18, the problem is actually mainly that Meta is not compensating the news media. Anyway, it has been excluded from platforms like Facebook and Instagram.

However, there is unfortunately still a lot of news content, which is sometimes even stolen from our own media and reused by other people. There's a lot of misinformation out there.

In addition, I think we have to be careful when we talk about impact, because the purpose of the program is to reward journalists who do journalistic work. The impact of our published stories, which cover remote communities, for example, and are the result of months of investigative work, is also not simply measured by the number of clicks on a story.

I think that what we were trying to do in this program was to reward the quality journalism carried out by journalists in the field.

[The Chair, Liberal, Lisa Hepfner]

Thank you, Mr. Ntumba.

Your time is up.

Mrs. Thomas, you have the floor now for five minutes.

[Rachael Thomas, Conservative, Lethbridge, AB]

Thank you very much.

Mr. Gonez, you've made some interesting points here today.

With regard to Bill C-18, it seems that the government perhaps made a few mistakes. We want to make sure that Canadians have access to local news. We want to make sure that there is a thriving ecosystem within our country. Certainly, that is the case. However, in order to do that, the news needs to be where people are, which is largely digital nowadays, not in these antiquated systems.

When $8 million goes to a place like Bell to prop up an already existing system, no money goes to Tri-Cities Community TV and about $100,000 goes to you, I see an incredible imbalance. At the end of the day, you're actually meeting the audience where they are and giving them more of what they want.

Bill C-18 had an opportunity to make sure that Canadians were, in fact, getting what they needed and to make sure that the ecosystem was strengthened, but based on the testimony I've heard here today, it hasn't hit the mark. What could be done better to make sure that we're actually providing for the needs of Canadians in terms of their access to news?

[Brandon Gonez]

It's a great question.

My thought process is always “let's incentivize.” We should be incentivizing Canadian businesses and advertisers to spend money on digital media companies that, again, have taken that risk and built business models that are now ready to scale. That's the opportunity before us right now. We have digital media companies that, if we didn't have Bill C-18 and weren't being hindered by the two biggest platforms Canadians utilize, would be scaling at an exponential rate right now, but right now, we're dealing with that roadblock.

What I would love to see, if we are going to utilize funds, is the creation of an incentive program so that if advertisers are working directly with these digital media companies, they get an incentive, whether that's a tax write-off or whatever. When an advertiser wants to spend money on Canadian media, there's a pipeline of all of these people in the middle. That's where it gets siphoned off. That infrastructure in the middle, whether it's ad agencies, DSPs, SSPs or ad exchanges, is all owned by Americans. That's why most of the money ends up south of the border and doesn't end up in the hands of legacy publishers or digital-first publishers. There needs to be an incentive for Canadian organizations to work directly with Canadian-owned digital media companies. That will, in turn, see more of that money stay here in Canada and create more opportunities and jobs and so forth.

There also needs to be a special program for digital media companies that have taken that risk so that they can continue to grow. I look at some of the funds that are out there, like the Canadian periodical fund, for example. A lot of those programs are based on and help solely legacy players that do print. I'm not saying don't do print, but when I look at the numbers, the number of people buying and reading a newspaper continues to dwindle every single day. The organizations creating content for people where they are don't have access to these programs and those funds. They're never part of the conversation. They're always looked at as an afterthought.

What I'm saying is that we now need to be central in this conversation. We need to be key stakeholders in revolutionizing and creating the framework for how our media ecosystem looks in the future.

Again, the intention of Bill C-18 was good. I think everybody here can agree that we need a solid media ecosystem, and that includes all of the players here at this table. Bill C-18 inadvertently impacted new innovators and digital media start-ups more heavily than the traditional players. All we did was safeguard an industry and players that were already struggling. Those that were actually doing well and on the precipice of becoming big national media companies at scale to compete with the likes of those in the U.S. were harmed in the process.

[Rachael Thomas, Conservative, Lethbridge, AB]

May I summarize quickly? Did I hear you correctly that if we're going to think about policy changes in this country and fairness toward media, we need to think about incentivizing innovation and creativity, rather than trying to prop up an old model that isn't working for Canadians?

[Brandon Gonez]

That should be the first thought. What would work well is if we could have a combination of the two, because some players will need some time to adjust. Again, it cannot be at the expense of those that have done the hard work already and are now being sacrificed in the process.

[The Chair, Liberal, Lisa Hepfner]

Mr. Myles, you have five minutes.

[David Myles, Liberal, Fredericton—Oromocto, NB]

Thank you very much, Madam Chair.

Ms. Jamet, you talked about the tax credit, about how it works now and how it could work in the future.

In fact, we sometimes tend to say that the government doesn't spend, but we know full well that, when we say that, we mean that it doesn't spend on advertising in Canada's media companies. However, this is also a trend in the private sector. It is pretty widespread, if I understand correctly.

How could we support these investments with tax credits in Canada?

[Caroline Jamet]

Thank you for your question.

I can say that, when it comes to advertising, not all advertisers focus on foreign platforms. Across our markets, we have customers who choose to support local media. I could give many, many examples. It is therefore inaccurate to say that all companies focus on foreign media for their advertising.

Local advertising is actually the bread and butter of stations across our network.

Second, we believe that the proposed measure would be foundational for the media industry. A tax credit for advertising would be a significant incentive to encourage advertisers to focus on local media.

Third, I need to clarify something about subsection 19(1) of the Income Tax Act. This subsection was originally included in the act to protect Canadian media and encourage investment in Canada.

Unfortunately, it has not been updated over time. Today, there is a loophole that allows platforms such as Meta and Facebook to be considered Canadian media. As a result, advertising expenses incurred on these platforms can be deducted.

All we're asking for is that this provision be adjusted to bring it back to its original spirit, which was to support Canadian media, because right now there's a loophole.

[David Myles, Liberal, Fredericton—Oromocto, NB]

That's very interesting. It's exactly the point I wanted to clarify.

How was the decision made to put Meta and Google in the same category as Canadian companies?

In what year did that happen, and how did it happen?

[Caroline Jamet]

I can't specify the exact year, but the provision dates back to a time when the media was basically traditional. Digital media didn't exist yet.

The objective was to ensure that, when a Canadian company purchased advertising in a foreign media outlet like The New York Times, the expenses incurred could not be deducted like they could if it had been in a Canadian media outlet like La Presse.

The measure was designed before the advent of digital platforms. That is precisely why an update is needed. The Income Tax Act, as it is currently written, focuses on traditional media and doesn't take into account digital media. It's that disconnect that is now creating a loophole.

[David Myles, Liberal, Fredericton—Oromocto, NB]

Thank you. That's very interesting.

I would like to ask a question about the rules in Quebec, particularly the change related to the category of radio stations, separate from journalistic funds. This is another suggestion that broadens the scope of the measure.

Could you explain that in more detail?

[Caroline Jamet]

The provincial budget was tabled a few weeks ago. It hasn't been passed yet, but the Quebec government added a measure to make radio and television eligible for the journalism tax credit. That way, the fund would be extended to other media outlets to address the current unfairness of two classes of journalists receiving support through programs.

Currently, the federal program's rules still exclude radio. What we're asking for, similar to the approach taken by the provincial government, is a recognition of radio's journalistic contribution.

We therefore hope that there will be parity and that the program will be applied in a way similar to what is proposed in Quebec.

The provincial budget has not passed yet, but that should happen in the next few days.

[David Myles, Liberal, Fredericton—Oromocto, NB]

Is it specifically for the journalism that radio stations do?

[Caroline Jamet]

Exactly, it's that program.

[David Myles, Liberal, Fredericton—Oromocto, NB]

Great, thank you.

[The Chair, Liberal, Lisa Hepfner]

Mr. Champoux, you have the floor for two and a half minutes.

[Martin Champoux, Bloc, Drummond, QC]

Thank you, Madam Chair.

Earlier, Mr. Gonez said that the measures were put in place to save a dying industry on its last legs. I just wanted to correct that. Radio, television and traditional media cannot be described as a dying industry at all. Radio and television are still the preferred media for Quebeckers and Canadians.

I think it's more that the industry has been crushed by regulations from another era at a time when it was being invaded by digital media, which was not regulated in time.

I remember back in the early 2000s, when we were talking about regulating platforms, new players in the music broadcasting industry. At the time, the CRTC said they didn't see a day when we were going to watch news on our phones. We had no kind of vision of what the technology was going to become.

If we had regulated this industry on time, the world in which digital companies and new players operate today would probably be regulated. They would have had access to that world in a regulated environment rather than in the wild west that was created by a lack of regulation. It's a bit like saying that there could never be flying cars, and then when flying cars arrive, we let them zoom around in the sky and crash all over the place without any regulations because we claim we didn't see it coming. I think this lack of vision is reflected in a number of broadcasting decisions made by successive governments, and I find that quite worrisome.

Particularly since the measures you are proposing are easy to implement. Extending the tax credit to radio and television stations, particularly newsrooms, is an easy measure to implement. We don't need to vote on a bill for that.

When it comes to buying advertising on traditional media, we're not talking about stopping advertising investment or purchases on the platforms. We know that it's 2026 and that it's part of today's reality. Devoting a portion of an advertising budget to traditional media is not hard to do.

Furthermore, in terms of the programs in place, the media have to reapply year after year, whereas it would be preferable to have a little predictability and spread the programs out over two, three, even five years in some cases. These are not hard things to do.

I find it hard to understand why this government is letting radio stations die. The loss will be felt in the regions first, where it hurts the most. Montreal is not the place where news will stop airing first. It will be in Chibougamau or in the regions served by the Groupe Radio Simard. It will be small regional TV and radio stations. That's where it's going to hurt the most. I don't understand this inaction.

Some programs work well. The Independent Local News Fund, which we were talking about earlier, works well. The local journalism initiative for regional weeklies works well.

We want predictability, we want commitment and we want to save this industry.

This has to be said. It's so easy to put measures in place that I can't explain why it hasn't been done for such a long time.

Since I only had two and a half minutes of speaking time, I won't ask you any questions right away. I'll come back to this later.

Thank you, Madam Chair.

[The Chair, Liberal, Lisa Hepfner]

Thank you, Mr. Champoux.

Mr. Diotte, you have the floor now for five minutes.

[Kerry Diotte, Conservative, Edmonton Griesbach, AB]

This is for Mr. Gray.

I'm going to share my time with Bernard as well.

Mr. Gray, Scott Reid, Paul Martin's former communications director, is a vocal detractor and critic of our Conservative leader, Pierre Poilievre, and a regular CTV commentator on Vassy Kapelos' show. I'm told that recently, his son Jack Reid was named a senior advertising adviser in Carney's PMO. That seems to me to be a bit of a conflict of interest.

Do you think Scott Reid should be featured on CTV, given this conflict of interest? At the very least, shouldn't this be disclosed to your audience?

[Richard Gray]

Every time Scott Reid appears on air, we identify him as a Liberal. We do that with all of our political analysts. We do that when Lisa Raitt appears as a Conservative analyst. We do that when Thomas Mulcair appears as an NDP analyst.