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Broadcasting Policy: Objectives

6 July 2000

Broadcasting Policy: Objectives and Delivery Mechanisms

At its meeting on July 3, 2000 the Cabinet:

a) noted that New Zealand governments have acknowledged a role in ensuring that desired kinds of broadcast content are available to the New Zealand public in addition to what may be provided commercially;
b) agreed to the following set of objectives to guide the development of the Government's broadcasting policies to ensure that desired kinds of broadcast content are available to the New Zealand public:

(i) Ensuring all New Zealanders have reasonable and regular access to broadcasting representing the uniqueness and diversity of New Zealand life, recognising that the histories and stories of whanau, hapu and iwi are integral to any description of that life;
(ii) Meeting the information and entertainment needs of as many interests as reasonably possible, including those that cannot be met by commercial broadcasting;
(iii) Contributing to public awareness of and participation in the political and social debates of the day;
(iv) Providing for minority interests and increased choice;
(v) Encouraging innovation and creativity in broadcasting while aiming to continually increase audience satisfaction with the quality of the content;


c) noted that when implementing its policy objectives and delivery mechanisms, the government will ensure that appropriate account is taken of its significant investment in public broadcasting;
d) directed officials to have regard to these objectives in developing advice on specific delivery mechanisms and policies in accordance with the work programme agreed by Cabinet on 10 April 2000.


The following paper was prepared for Government consideration.

Office of the Minister of Broadcasting


Cabinet Policy Committee

BROADCASTING POLICY: OBJECTIVES AND DELIVERY MECHANISMS

Proposal

1. This paper proposes that Cabinet agree to a set of objectives to guide the development of the Government’s policies aimed at ensuring that desired kinds of broadcast content are available to the New Zealand public. It surveys the range of delivery mechanisms available to the Government for carrying out these policies. It proposes that officials be directed to have regard to the objectives set out in the paper in developing advice on specific delivery mechanisms and policies in accordance with the work programme agreed by Cabinet on 10 April 2000. (CAB (00) M 12/2G(2) refers.)

Executive Summary

2. This paper is concerned with establishing objectives for the work programme for broadcasting policy agreed by Cabinet on 10 April 2000. It notes reasons for Government’s interest in broadcasting content: the view that certain kinds of broadcast content are goods that should be available to the New Zealand public; that Government intervention is required to ensure the availability of content beyond what the current market will otherwise provide; and the need to ensure that desired types of content are produced in a period of technological change.

3. The paper then proposes a set of four objectives to guide the development of the broadcasting policies set out in the work programme agreed by Cabinet on 10 April:

Representing the uniqueness and diversity of New Zealand life, recognising that the histories and stories of whanau, hapu and iwi are integral to any description of that life

Contributing to public awareness of and participation in the political and social debates of the day

Providing for minority interests and increased choice

Encouraging innovation and creativity in broadcasting.

4. In its final section the paper outlines the range of delivery mechanisms available to Government to pursue its policies, guided by these objectives. It notes the choice of mechanisms that has characterised New Zealand broadcasting policy in the past decade, and those that the Government has now identified for investigation.

Scope of this Paper

5. In addressing the objectives that may be adopted by Government for the achievement of broadcast content, this paper complements the paper on Platform and Technology Issues. In that paper it is noted that, in regulating and fostering broadcast content, governments have been concerned with such goals as:

Enforcement of standards of content which conform with and support perceived community values.

Promotion of national culture and identity.

Promotion of participatory democracy, including encouragement of a diversity of sources of information.

6. The first of these goals is met in New Zealand through the mechanism of the Broadcasting Standards Authority. As there is currently no proposal to alter or amend this regime it is not addressed by this paper.

7. This paper is also not directly concerned with the Maori broadcasting issues that are the subject of a separate Cabinet paper on Maori Broadcasting Policy. It can be remarked, however, that the Crown has given assurances in the courts that it will act to promote te reo Mäori through radio and television broadcasting. To date this policy approach has been carried out through:

NZ On Air using its funding to include more Mäori language and culture in mainstream programmes, particularly broadcasting to Maori in English; and

by Te Mängai Päho funding Mäori broadcasters such as iwi radio, as well as funding programmes that promote Maori language and culture on network television (Television New Zealand Limited and TV3).

The broadcasting policy objectives proposed in this paper are intended to contribute to the fulfilment of the Government’s Maori broadcasting policy.

Reasons for Government’s Involvement in Broadcasting Content

8. The following reasons can be cited in support of Government’s interest in broadcasting content. Broadcast media are uniquely pervasive: they have the potential to reflect and explore every aspect of a nation’s life and thus contribute to the shaping of its identity. They can exert a powerful influence on the kinds of information readily available to its citizens, helping, for better or worse, to shape opinion and condition perceptions. They have an unparalleled capacity to provide a shared experience, make minority voices heard and, through programme selection and exposure, influence the agenda of topics and issues which is presented for the attention and consideration of the public.

9. In light of the above, certain kinds of broadcasting content can be regarded as goods that it is socially and culturally desirable for a society to have whether the market will produce them of itself or not. New Zealand governments have traditionally acknowledged a similar principle as justifying their support - at arm’s length, rather than politically directed - for other forms of cultural production. These include the production of literature, the visual arts, the performing arts - and film, which in New Zealand has many close connections with television. In each case, Government’s concern has been to act to ensure that desired “content” of some kind is produced that might not otherwise be available.

The need for subsidy

10. In New Zealand, as in most countries, the production of certain high-cost programmes, like the maintenance of the professional performing arts, has only proved possible with subsidy. Commercial broadcasters will favour programming that maximises returns. This implies minimising purchase cost and maximising ratings and advertising revenue. They will also tend to be concerned with satisfying the demands of the segments of the population of interest to advertisers, not necessarily the population as a whole. This can restrict variety and the level of relatively high cost/low revenue local programming such as drama and documentaries. A dependence on advertising has also tended to result in a bias towards “safe”, mainstream programming.

11. New Zealand’s small population is a crucial factor in determining the level of cultural-sector activity that is possible with and without government intervention. In countries with large populations and markets, or the natural barrier of a language other than English, the mere availability of local content is not the principal issue. Yet many of these countries’ governments regulate and intervene in various ways to ensure that certain kinds of content are available, and that the public has access to them.

Access to the spectrum

12. Successive governments have also recognised that access to broadcasting spectrum is a factor in ensuring diversity of content and meeting audience needs. Spectrum has therefore been reserved to meet defined social policy and cultural objectives.

Responding flexibly to technological developments

13. It is difficult to predict the eventual impact of digital and other multi-channel technologies, whether on the nature of content or the behaviour of audiences. It appears likely, however, that free-to-air networks commanding a significant share of the audience will be an important part of the broadcasting scene for the foreseeable future. In the longer run, a proliferation of television channels will probably increase the present tendency for the audience to fragment. It is likely, however, that a sizable part of the mass audience will remain loyal to a few “general” channels, while “niche” channels cater to more specialist interests. As channels proliferate and seek to establish their brands, there may be a greater variety among channels, but less variety within them. It is doubtful whether, in a multichannel environment, our small market can of itself sustain a high level of local content in the expensive genres that, internationally, have proved to be highly valued by audiences.

14. Whatever the ultimate effects of new broadcasting technologies, it seems highly likely that certain programmes, like certain books or movies, will continue to have a shaping effect on a nation’s culture. The Government’s broadcasting policy needs to be able to respond effectively and flexibly to the changes brought about through technological developments, so that such programmes can be created and broadcast by networks with a wide audience reach. In the absence of mechanisms to provide for local content, there is a danger that the new technologies will reinforce the development of a globalised, undifferentiated culture.

15. Platform and technology issues are addressed in the paper to be separately submitted to Cabinet in accordance with the work programme agreed by Cabinet on 10 April.

The Government’s public position

16. This Government’s public statements about its broadcasting intentions have focused on the need to develop the potential of broadcasting media as means of reflecting and exploring aspects of New Zealand life. In particular, the Government has emphasised the contribution that broadcasting might make to democracy and public debate, and the role of radio and television in representing our cultural distinctiveness and diversity. The Government has stated that New Zealand could and should be achieving a greater level and variety of local content, particularly in such key genres as drama, documentary, current affairs and children’s programming.

Broadcasting Policy Objectives

17. I propose that a set of objectives be adopted by Government to guide its development of specific broadcasting policies according to the work programme agreed by Cabinet on 10 April. Aspects of these objectives can be found in the existing statutory provisions for NZ On Air and Radio New Zealand (its charter), and the statutory functions of Creative New Zealand. The objectives proposed here are consistent with these statutory remits. No such set of objectives has previously been adopted to guide the full range of Government’s broadcasting policies for content.

18. The objectives proposed here, therefore, are intended to indicate in broad terms the kinds of outcomes Government wishes to see produced by broadcasting as a whole as it develops its programme of policies. They would provide benchmarks to assess the extent to which the potential of New Zealand broadcasting to produce content was being realised. Although all broadcasters would contribute to these objectives, it may be considered that broadcasting interests owned by the state have a particular responsibility to provide impetus and to lead by example.


Representing the uniqueness and diversity of New Zealand life, recognising that the histories and stories of whanau, hapu and iwi are integral to any description of that life;


This objective aims to ensure that the rich and diverse reality of New Zealand life, and of the cultures making up the New Zealand population, particularly the language and culture of Maori, will be represented in broadcast content. Aspects of New Zealand life will be represented in the various genres of programming. Broadcasting will feature New Zealand performers and other artists, and contribute to the general public level of knowledge, appreciation and enjoyment of our history and culture.

Contributing to public awareness of and participation in the political and social debates of the day

This objective aims to address the needs of the audience as citizens. It entails the comprehensive exploration in broadcast media of current affairs, social trends, and national and international developments in politics, science, medicine and any other area where information and understanding will enhance the opportunities of all citizens to play a greater part in national or community life.

This objective is also intended to recognise that the impact sought from broadcast content is not restricted to individual viewer-listeners, but has a multiplier effect. That is, the quality of discourse in the nation as a whole is enhanced, as ideas and views are transmitted from listener-viewers to friends, colleagues, and family members. The impact of certain broadcast content therefore will be disproportionate to the size of its audience.

Providing for minority interests and increased choice

This objective aims to ensure that broadcasting not only satisfies the demand of the mass audience but also addresses the interests, tastes and informational needs of the various minorities that make up that audience. It also aims to ensure that broadcasting does more to enrich the experience of the mass audience by including in programming intended for that audience material dealing with minority interests. Most viewers and listeners are at different times members of a mass audience and of specific minorities. The achievement of this objective implies a variety of special interest programming beyond what is currently available.

In meeting this objective broadcasting policy will aim to satisfy three kinds of demand:

Existing demand that is currently being met

Existing demand that is not currently being met

The demand that may be created by establishing the basis for a greater choice and variety of programming.


Encouraging innovation and creativity in broadcasting

This objective aims to ensure that broadcasting creates an increase in the level of local content. An increase in the level of local content would allow the provision of more programmes which would promote and support Maori language and culture.

This objective also aims to ensure that broadcasting creates indigenous types of content, and adapts innovative forms created internationally. This entails both the development of existing genres with a New Zealand “flavour” and the creation of types of programming unique to New Zealand.

19. It is important to note that local and international content are complementary in the achievement of each of these objectives.

20. These objectives do not of themselves suggest any precise form of measurement for assessing the impact of broadcasting policy. They do, however, indicate how a framework of assessment might be applied. If broadcasting content is to contribute to a high level of public information and debate, for example, certain standards suggest themselves: comprehensiveness; depth and extent of inquiry; the range of issues and topics covered when compared with what is actually going on in the country.

21. The primary usefulness of agreeing to such a set of broad objectives for broadcasting policy, however, is their function as benchmarks in determining an optimal set of delivery mechanisms and policy settings. The final section of this paper looks at the choices available to Government.

Possible Delivery Mechanisms

22 If the objectives proposed in this paper are to be fulfilled, it is important that the mix and design of the broadcasting mechanisms are optimal. To the degree that these mechanisms are transparent, the Government will be able to understand their costs and benefits.

23 The various policy tools used internationally to ensure the presence of desired types of content may be categorised in the following way:

Ownership of broadcasting services by the state on behalf of the public

Statutory functions/charters assigned to a publicly owned broadcaster

Regulation – attaching conditions to broadcast licences; requiring specific content quotas to be met; controlling types of ownership

Funding – made available directly to publicly owned broadcasters or through funding agencies.

These forms of intervention may of course be used in combination.

24. Governments also use a variety of means to fund certain types of local content:

By a licence fee paid by the audience, allocated to a publicly owned broadcaster and/or funding body

By direct government grant to a publicly owned broadcaster and/or funding body

From a publicly owned broadcaster’s advertising revenue or other commercial activity

By cross-subsidisation from commercial broadcasting.

25. In comparison with this range of possible interventions, New Zealand currently employs the following mechanisms:

i ownership of broadcasters (Television New Zealand Limited and Radio New Zealand Limited). In the case of Radio New Zealand, statutory programming obligations apply. The Government also has scope to direct the activities of the companies through the annual Statement of Intent. Government has not to date sought to use its ownership of Television New Zealand as a means of achieving desired forms of content;

ii subsidies for the provision of broadcast programmes and services to meet defined policy objectives. Such funding has been disbursed through two Crown entities, NZ On Air (sometimes as required by ministerial direction) and Te Mängai Päho;

iii reservation of radio spectrum to provide broadcasting services that may not be offered through commercial providers.

These three mechanisms are discussed in more detail in Appendix 1.

26. In the context of the delivery mechanisms used internationally to achieve content objectives, certain features of New Zealand’s model can be noted. New Zealand has not, to date, opted to use the regulatory tool of quotas. It has opted to continue to own broadcasters, but in the case of its television company has not given it a specific remit for content. And it has established a funding agency, NZ On Air, supporting the production of programmes that may be featured by public or private broadcasters.

27. Cabinet has now approved a work programme that will investigate how this model may be supplemented by the introduction of other measures from the international repertory of delivery mechanisms. These include a charter for Television New Zealand, and local content quotas on television and radio. Each of these forms of intervention presents a range of options for implementation and raises its own series of issues. I propose that, in developing advice on the implementation of these measures and specific policies in the work programme such as youth radio, officials be directed to have regard to the objectives set out in this paper.

28. That work programme envisaged four papers being prepared to deal with these issues. Those papers were to report on:

Youth radio
New Directions for TVNZ
Local Content Quota; and
Funding.

It is my intention that papers involving decisions by Cabinet will be considered by Cabinet in terms of the following timetable:

Youth radio: September 2000
New Directions for TVNZ: fourth quarter 2000
Quota and Funding: 2001.

Considerable work will be required in the development of these papers, including public consultation. Officials are developing the detail of these work programmes at the present time. I have instructed officials to make the New Directions for TVNZ issues, and particularly the implementation of a charter, the first priority.

29 Although there are specific Government policy commitments, it is expected that officials will examine and report on all options available that will determine the best outcomes to achieve Government’s objectives and to contribute to the promotion of Mäori language and culture.

Consultation

30. The following departments have been consulted in the preparation of this paper: Ministry for Culture and Heritage; Treasury; Ministry for Economic Development; Department of the Prime Minister and Cabinet, Crown Company Monitoring Advisory Unit, Ministry of Foreign Affairs and Trade, Te Puni Kokiri and the Ministry of Pacific Island Affairs.

Fiscal Implications

31. There are no fiscal implications directly arising out of the recommendations in this paper.

Legislative Implications

32. There are no legislative implications arising out of the recommendations in this paper.

Compliance Cost Statement

33. There are no compliance costs arising out the recommendations in this paper.

Publicity

34. A media release on the objectives proposed in recommendation (b) would be released following Cabinet’s decision.

Recommendations

35. I recommend that the Committee:

a) note that New Zealand governments have acknowledged a role in ensuring that desired kinds of broadcast content are available to the New Zealand public beyond what may be provided commercially;

b) agree to the following set of objectives to guide the development of the Government’s broadcasting policies to ensure that desired kinds of broadcast content are available to the New Zealand public:

Representing the uniqueness and diversity of New Zealand life, recognising that the histories and stories of whanau, hapu and iwi are integral to any description of that life;

Contributing to public awareness of and participation in the political and social debates of the day

Providing for minority interests and increased choice

Encouraging innovation and creativity in broadcasting; and

c) direct officials to have regard to these objectives in developing advice on specific delivery mechanisms and policies in accordance with the work programme agreed by Cabinet on 10 April 2000 (CAB (00) M 12/2G (2) refers).


Hon Marian L. Hobbs
Minister of Broadcasting
Appendix I: Current New Zealand Model for Achieving Desired Content

Ownership

The delivery of broadcasting objectives through ownership is covered by the State Owned Enterprises Act 1989 and the Radio New Zealand Act 1995.

State Owned Enterprises Act 1989

The Act provides, inter alia, that the principal objective of every State enterprise shall be to operate as a successful business (section 4). To this end a State enterprise is expected to be:

 as profitable and efficient as comparable businesses that are not owned by the Crown;

 a good employer;

 an organisation that exhibits a sense of social responsibility by having regard to the interests of the community.

Section 7 provides that where the Crown wishes a State enterprise to provide goods or services to any persons, the Crown and the State enterprise shall enter into an agreement under which the State enterprise will provide the goods and services in return for the payment by the Crown of the whole or part of the price.

Television New Zealand Limited is included in the first Schedule to the Act.

Radio New Zealand Act 1995

Section 7 of the Act establishes a Charter for Radio New Zealand (RNZ) limited. This specifies a range of service and programming requirements.

Compliance with the Charter is monitored by NZ On Air through an annual funding contract with RNZ. NZ On Air is required by Ministerial direction under section 44 of the Broadcasting Act 1989 to transfer $21.4m (excluding GST) to RNZ per annum.

Subsidies

Since 1989 successive Governments have provided subsidies for the production of programmes and provision of broadcasting services that may not be provided on a fully commercial basis. The Broadcasting Act 1989 defines broad programming objectives and establishes a funding mechanism.

For the purposes of the Act “broadcasting” is defined as:

any transmission of programmes, whether or not encrypted, by radio waves or other means of telecommunication for reception by the public by means of broadcasting receiving apparatus but does not include any such transmission of programmes:

(a) made on the demand of a particular person for reception only by that person; or

(b) made solely for performance or display in a public place.

The Act provides for the disbursement of funding by two separate Crown entities, to provide for broadcasting services and programmes that may not be provided on a sustainable commercial basis.

The functions of the Broadcasting Commission (also known as NZ On Air) is are set out in s36 of the Act as:

 to reflect and develop New Zealand identity and culture by

- promoting programmes about New Zealand and New Zealand interests and

- promoting Mäori language and culture;

 to maintain and extend the coverage of radio and television signals to new Zealand communities that would not otherwise receive a commercially viable signal;

 to ensure that a range of broadcasts is available to meet the interests of women; children; persons with disabilities; minorities in the community including ethnic minorities; and youth;

 to encourage the establishment of archives of programmes likely to be of historical interest in New Zealand.

Te Reo Whakapuaki Irirangi (also known as Te Mängai Päho is established under section 53B of the Act. Its function is to promote Mäori language and culture by making funds available for broadcasting and the production of programmes to be broadcast.

Reservation of Radio Spectrum

Successive Governments have reserved spectrum to meet defined social and cultural objectives and to meet Treaty of Waitangi obligations in respect of the promotion of Mäori language and culture through broadcasting.

Services for which spectrum is currently reserved include non-commercial television services, Access Radio services, community radio, Radio New Zealand’s National Radio and Concert FM programmes, Pacific Island radio in Auckland and Wellington, youth radio, and radio and television services to promote Mäori language and culture.

The reservation of spectrum to meet social policy objectives is a form of subsidy, which has operated in tandem with financial subsidies disbursed through NZ On Air and Te Mängai Päho. Licence holders pay annual administrative fees to the Ministry for Economic Development, which vary according to the transmitter power of the radio station, but the spectrum is otherwise provided free of charge.


ENDS

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