CBC to face 2.5% cut this year, rising to 10% in 2014-2015, Tory budget says

OTTAWA—CBC/Radio-Canada will face reductions to its $1.1 billion annual public spending budget of 2.5 per cent this year, rising to 10.4 per cent starting in 2014-2015, according to the Conservative government’s federal budget. The budget, tabled in the House of Commons by Finance Minister Jim Flaherty Thursday, said the public broadcaster will experience a $27.8 million budget cut in 2012-2013, which amounts to 2.53 per cent of the CBC’s $1.1 billion in annual parliamentary appropriations. For the following year, CBC’s reductions will increase to a total of $69.6 million, or 6.33 per cent of $1.1 billion. The reductions will increase to a total of $115 million, or 10.4 per cent, in 2014-2015, and level off at that rate on an ongoing basis, the budget document said. The cuts to the CBC are part of the Conservative government’s broad expenditure review of about $75 billion in program spending, for which all federal departments and agencies submitted proposals for cutbacks. The budget announced cuts to all government portfolios that amount to ongoing annual savings of $5.2 billion, or 6.9 per cent of the program spending under review. “These are important choices that have to be made now,” Flaherty said at a news conference in Ottawa. “The spending reductions themselves are moderate.” Heritage Minister James Moore said last year that the CBC would have to do its part, like other departments and agencies, in the budget cuts. This year, the CBC will also not receive a $60 million additional subsidy for content creation, which it has received annually from the government since 2001. Advocacy groups OpenMedia.ca and LeadNow.ca and watchdog group the Friends of Canadian Broadcasting have campaigned over the past year to protect CBC funding. Leadnow.ca delivered a petition to Conservative MPs last week with 27,000 signatures from Canadians against CBC budget cuts. The Friends of Canadian Broadcasting released a survey by Nanos Research this week that said a majority of Canadians, 59 per cent, “support or somewhat support” a previous government pledge to maintain or increase CBC funding. Nanos polled 1,004 Canadians online in March. Ian Morrison, a spokesman for the Friends, said in an emailed statment Thursday that the cuts “will require CBC to cut hundreds of staff and thereby incur heavy separation costs, putting further downward pressure on programming.” He said the reductions will mobilize the Friends and CBC's supporters who “are not going to take this lying down.” The Canadian Media Guild (CMG) issued a release Thursday that said the cuts to the CBC “will have a devastating impact on programming and services.” It said the coming 10 per cent cut to the public broadcaster will be much higher than the 6.9 per cent overall cut in federal program spending. “This is the biggest government cut to CBC since the mid-1990s,” the release said. “Once the dust settles on this budget, we will work with Canadians to rebuild CBC’s mandate and its relationship with Parliament,” Carmel Smyth, the CMG's national president, said in a statement. CBC issued a release Thursday that said it will “review its approach for dealing with this reduction” so that it does not affect its five-year strategy, which is intended to increase the broadcaster's reach. “The measures that CBC/Radio-Canada intends to take over the next three years will be set out in greater detail for our employees and the Canadians we serve as soon as possible,” the CBC release said. The government's budget document said the departments of Canadian Heritage and Industry Canada will face departmental budget reductions of 6.9 per cent and 6.3 per cent, respectively. The Canadian Heritage reductions will total $17.8 million in 2012-2013, rising to $42.2 million the following year and level off in 2014-2015 with an ongoing budget reduction of $46.2 million from today’s amount. Industry Canada will experience reductions of $49.2 million in 2012-2013, which will rise to $65.2 million in the following year. The department’s reductions will total $79.5 million in 2014-2015 and remain at that level. The CRTC, which said last November that any federal government cuts to its budget would apply only to its anti-spam and do-not-call list enforcement programs, will experience a reduction of $400,000 starting in 2013-2014 and which will continue on an ongoing basis. The commission will not face any federal budget cuts this year. The CRTC largely earns its own revenues. Denis Carmel, a spokesman for the commission, told The Wire Report last year that its parliamentary appropriations are $4.7 million in 2012-2013 to support its do-not-call list and anti-spam programs. Telefilm Canada will see cuts of $2.7 million this year, rising to $6 million in 2013-2014. The annual reduction will increase to an ongoing $10.6 million starting in 2014-15. The National Film Board will experience cuts of $100,000 in 2012-2013, rising to $3.3 million 2013-2014 and an ongoing $6.7 million starting in 2014-15. The National Film Board declined to comment Thursday. Douglas Chow, manager of external communications at Telefilm, said the organization has no comment for the moment. “We’ve just learned about it, so there’s nothing to say,” he said. The 2012 budget document did not discuss the Tory government’s work on a digital economy strategy, which it first pledged in 2009. Industry Minister Christian Paradis has held a series of roundtable discussions, including one this month, with provincial economic development ministers to talk about innovation and a national digital economic strategy. The government’s 2011 federal budget, released in March 2011, introduced measures related to education and the adoption of technology. The document said it “sets the stage for the release of Canada’s Digital Economy Strategy later this spring” but a strategy was not released. Paradis said last September that the strategy remains a “high priority” and “we are committed to having a solid digital strategy here in Canada.” The government said Thursday that its economic action plan for 2012 will allocate $400 million to help increase private sector investment in “early-stage risk capital and to support the creation of large-scale venture capital funds led by the private sector.” The budget said the Canadian venture capital market has had mixed results in the past decade and faces challenges including a decline in fundraising, “which is partially attributable to the market’s inability to consistently attract private investors, including large, well-funded institutional investors such as pension funds.” The government said that over the coming months it will “consider how to structure its support in order to incent private sector investments and management of seed and large-scale venture capital funds.” The budget also pledged $40 million over two years to support Canada’s high speed research network, Canarie, which encourages “world-class research collaborations across the country,” the budget document said. The budget document did not forecast any revenues to come from Industry Canada’s 700 MHz wireless spectrum auction next year. Scotia Capital estimated this month that the proceeds from the auction will be worth about $3.5 billion. Industry Canada’s 2008 AWS spectrum auction generated $4.25 billion in proceeds for the government. dgrenier@thewireport.ca

CBC to face 2.5% cut this year, rising to 10% in 2014-2015, Tory budget says

Broadcast | March 29, 2012

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