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TVNZ's Charter: expectations and accountability

Funding TVNZ's Charter: expectations and

Peter Thompson

Unitec School of Communication Studies
27 May 2008

Trevor Mallard, the Minister for Broadcasting, has indicated that in the future, TVNZ's Charter funding will be administered by NZ On Air. The ostensible reason for the Minister's decision is continuing concern over TVNZ's deployment of the $15 million of public funding it receives annually to fulfil its public Charter commitments.

TVNZ's recent use of this revenue to subsidise content that had previously been made available without the support of public funding has invited criticism both from the government and its commercial rivals. This comes in the wake of previous concerns that, from the inception of the Charter in 2003, there was inadequate transparency in TVNZ's reporting of how the public funds were used.

The new Charter funding mechanism that Mr. Mallard proposes would retain the earmarked Charter fund, but oblige TVNZ to apply to NZ On Air with any programme proposal it wished to fund with the money. Furthermore, NZ On Air may be able to place conditions on the scheduling of Charter-funded programmes to ensure they are not relegated to peripheral slots well outside prime time. TVNZ's schedulers are unlikely to welcome such news.

However, the timing of the Minister's statements are curious. The Commerce Select Committee has only recently completed its 5-yearly review of the TVNZ Charter. Its findings endorsed the revised version of the Charter, but emphasised the need for an accountability system to ensure that TVNZ's use of public funds is aligned to its Charter obligations. To this end, it also endorsed TVNZ's new system of measures for evaluating its Charter performance. It is therefore not clear whether the Minister disagreed with the Commerce Committee's findings or felt that its recommendations did not go far enough.

Moreover, the Minister's proposal appears to pre-empt the government's recent Review of Regulation for Digital Broadcasting and Future of Content Regulation (a point Paul Norris also noted in a recent Scoop comment). These consultations on broadcasting regulation in the context of new digital media services generated a number of substantial submissions from broadcasting stakeholders. These have only just been made public and debate on the policy implications has barely started. It therefore seems a little premature to commit to specific policy concerns addressed in the government's review without a fuller consideration of the implications. The Minister's comments regarding the change in the Charter funding mechanism therefore raises a number of issues:

The proposed funding mechanism would appear to require significant statutory revisions to TVNZ funding arrangements and also NZ On Air's remit. On the latter point, NZ On Air's current principal role is to is to commission local content, and entails neither the delivery nor the evaluation of a wider range of public service functions. Indeed, the original establishment of TVNZ's directly-funded Charter stemmed from two important policy insights which Mr. Mallard needs to bear in mind :

Firstly, the acknowledgement that local content provision is only one component of public service provision, not a substitute for it; and secondly, the recognition that a fair proportion of the local content commissioned by NZ On Air contributed relatively little to extending the overall free-to-air television schedule beyond the commercial mainstream (ironically, the very criticism now being levelled at the Charter funding). This stemmed primarily from the fact that NZ On Air is not vertically integrated and requires the advance agreement of a broadcaster to screen a commissioned show, thereby allowing the broadcasters a gatekeeping role over what sort of local content gets funded. There is no doubt that at times, broadcasters (including TVNZ) have been able to utilise NZ On Air funding for programmes that exhibited very little public value other than the virtue of having been made in New Zealand.

Despite the structural limitations of its institutional arrangements, NZ On Air has vigorously promoted the contestable funding mechanism it administers, and strongly opposed TVNZ's direct funding (not least because TVNZ previously argued that it should receive all the contestable television fund for the Charter). Indeed, its own submission on the Review of Regulation for Broadcasting, in addition to expediently proposing a far more central role for NZ On Air as both the central funding administrator and public broadcasting regulator, outlines a model quite similar to that outlined by the Minister (although it goes further in recommending that any Charter funds not disbursed by the last financial quarter be redistributed through the contestable fund).

Jo Tyndall, the current head of the Ministry for Culture and Heritage's broadcasting policy section responsible for coordinating the government's Review of Regulation, is also, perhaps coincidentally, a former head of NZ On Air. Regardless of personal integrity, such arrangements (perhaps inevitably in the closely-knit networks of broadcasting professionals who populate industry and state agencies in New Zealand's broadcasting sector) may blur the already-imprecise line between institutional empathy and sympathy. Indeed, Paul Norris's blunt assessment of the Minister's policy proposal was that, "The Government and NZ On Air win. TVNZ loses", suggesting that the Minister had accepted NZ On Air's claims that it knows best how to administer public broadcasting funds. Unfortunately, vested institutional interests are rarely aligned to the public interest.

In principle, a strong case can be made for establishing an independent regulatory body to ensure that public broadcasting money is used responsibly and that its recipients are held accountable for securing the intended public broadcasting outcomes. In regard to TVNZ, such a bureaucratic development may not be welcome, but it could potentially relieve some of the political pressure it is currently subjected to due to the contradictory imperatives of its dual public service and commercial remit.

To date, the Charter funding still leaves TVNZ 90% reliant on commercial revenue, and its continuing dividend obligations have seen it return as much money to the government as it has received for the Charter. Having an independent evaluation of its Charter performance that can take account of contextual factors and help set performance criteria that are proportional to funding levels might bring about an end to the dysfunctional political charade in which the government pretends to fund the Charter and, in the absence of any meaningful benchmarks, obliges TVNZ to dutifully pretend to deliver it.

But the proposal that NZ On Air could fulfil just such a role still needs careful scrutiny. NZ On Air has been an excellent champion of local content, but its valorisation of NZ- made programming as the central issue in public broadcasting policy means that extending its remit to encompass a broader range of public broadcasting criteria is not straight-forward. There is surely a risk that this could either conflate local content provision with public service provision, impoverishing the political conception of public broadcasting, or that the extension of NZ On Air's remit beyond local content could dilute its historical effectiveness at defending it.

Moreover, NZ On Air is already responsible for the disbursement of around $100m of public funds. If it is to take on a more prominent role in evaluating public service provision and the extent to which public broadcasting funding achieves desired policy outcomes, then it must be noted that NZ On Air will effectively become both the central broadcasting funding body and the regulator which determines whether those funds are used appropriately and effectively. Given NZ On Air's historical proximity to broadcasting industry players and the aforementioned close networks among programme producers, broadcasters and regulators, a functional distinction between the funding body and the regulator which determines whether those funds deliver broadcasting policy outcomes effectively is necessary.

Adding TVNZ's charter money to the funds to be administered by NZ On Air may not be an unduly onerous proposition if TVNZ's content proposals are handled in the manner similar to current programme producers seeking to access the contestable fund. However, the prior approval of a programme on the basis of its genre or intended audience will provide very little valid indication of the various cultural and democratic functions specified in the Charter. These cannot be meaningfully operationalised in terms of statistical measures of local content ratios.

Public service functions require more complex, qualitative measures post-broadcast which TVNZ is still in the initial stages of developing. In that respect, the new system proposed by the Minister for Broadcasting might end up duplicating the quality-control mechanisms without increasing the probability that the desired outcomes will be realised.

The government's recent Review of Regulation for broadcasting has generated a range of submissions number of policy options regarding alternative regulatory and funding mechanisms for public broadcasting on the discussion table. Trevor Mallard's proposal is only one of many options, and others surely need to be debated before such a policy is finalised. TVNZ will no doubtless be wary of the Minister's proposal, not least because of the implications for its commercial remit if NZ On Air has a say in its scheduling decisions.

But the complications of the new funding regime are not merely TVNZ's burden. The Minister for Broadcasting will have to justify any decrease in commercial performance to the Treasury and CCMAU, while NZ On Air will directly take on an institutional responsibility for TVNZ's Charter performance. Both should be careful what they wish for…


Peter Thompson is a Senior Lecturer in Unitec's School of Communication Studies. He has written extensively on the government's broadcasting policies since 1999, and chaired the working party which reviewed public submissions on the redrafted version of the TVNZ Charter, and made amendments to the Charter in line with those submissions. He has also undertaken policy research projects for the Ministry for Culture and Heritage (on broadcasting funding-setting mechanisms in OECD countries) and NZ On Air (on approaches to measuring broadcasting quality).


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