Good afternoon.
My name is Robert Goyette and I am Chair of Magazines Canada. Magazines Canada is a national, non-profit association representing Canadian consumer magazines across Canada—about 90% of all Canadian magazines' paid circulation in both official languages.
Member magazines span a wide range of topics including business, news, politics, sports, arts and culture, leisure, lifestyles and the environment, among others. There is additional information about the Canadian magazine industry in our brief so I will not repeat it here.
I would like to take this chance to draw your attention to one critical point. Canada's magazine sector is delivering on federal cultural policy objectives. Successive federal governments have sought to ensure that Canadian cultural materials are available across Canada. Historically this has been a challenge given our enormous geography, relatively small population, two official languages and our proximity to the huge U.S. entertainment industry.
So we are pleased to point out that when Canadians and Quebeckers choose their magazines, 41% of the time, they choose Canadian. This compares favourably with the other cultural sectors—struggling with the same challenges—like Canada's film sector where only 3% to 5% of Canadian screen time is devoted to our films.
We are pleased with the current federal government's ongoing support, specifically two actions. The first is Canada's continued leadership in establishing the UNESCO Convention on the Diversity of Cultural Expressions, an initiative which, in no small measure, had its genesis in the Canada-U.S. dispute over magazines in the 1980s.
The second measure is the Cabinet direction, just over a year ago, to Canada Post, requiring the Crown corporation to remain a supporter of the Publications Assistance Program—that we know by the name PAP—until at least March 2009. However, there are some significant challenges on the horizon and I'd like to focus attention, in the short time I have, on these.
Much of our success in making Canadian magazine content available to Canadians results from a supportive environment for distribution, largely through two measures—Canada Post delivery of subscription magazines and the Publications Assistance Program.
Canada Post's approach to the magazine sector is changing dramatically. Our costs for postal delivery are the fastest growing expenses for publishers, far exceeding inflation. Additionally, Canada Post is actively studying a move to distance-related pricing, a very substantial change from current practice which is likely to make national distribution of magazines more expensive and discriminate against rural subscribers.
Finally, Canada Post wants to withdraw its support of the Publications Assistance Program which would eliminate one-quarter of the budget and lead to an immediate increase in postal costs for the 1,200 Canadian magazines and community newspapers that are eligible.
Fully 70% of subscription magazine sales in Canada—magazines that are delivered by Canada Post—are Canadian. So a marked increase in subscription costs will impact on Canadian titles—more than foreign, which are often distributed at newsstands. These changes could reverse years of success gained from effective cultural policy and lead to a reduction in Canadian content available to readers—not to mention many creative jobs and economic activity in the sector.
Canada Post is a crown corporation for a reason. We believe it contributes substantially to this country's cultural policy objectives, and we are not alone. A 2005 Treasury Board report noted:
With their mixture of public policy and commercial objectives, Crown corporations, such as the Canadian Broadcasting Corporation and Canada Post Corporation, play critical roles promoting the country's identity and connectedness.
Canada Post's withdrawal from PAP would forever change a longstanding distribution partnership and a highly successful subscription-based delivery model that has evolved because of a federal government magazine policy.
Canada Post may no longer be an affordable option. If the industry is required to create other avenues for delivery, it could mean prohibitive distribution costs, especially in rural areas of the country. This will mean that Canadians living outside major urban centres will not have the same access as others to affordable Canadian magazines. It is important that the government and our sector work together in confronting this issue, determining how to support magazine distribution and the future role of Canada Post in this process.
What we're asking today is that the Finance Committee recommend that adequate budgets be maintained for the Publications Assistance Program, the PAP. This can be achieved either through direction to Canada Post that the Crown corporation maintain its support or that this portion of funding be delivered as part of the Department of Canadian Heritage budget.
Before we allow drastic cuts to successful programs, we ought to be looking at how we can do things differently, and at how we can ensure there continues to be a choice of Canadian content available across the country.
A year ago, when the federal Cabinet directed Canada Post to continue to support the PAP at least until Match 2009, it also promised to conduct a review of this area and consult our sector. We are in the process of doing this now and we hope this committee will support these efforts.
The Canadian magazine sector has been highly effective in utilizing public investment to ensure a healthy presence for Canadian opinions, perspectives and information, thanks in part to the PAP and Canada Post.
That's the message I wanted to give you today.