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Dunne's Weekly: Bailing Out Ski Fields Or Media Companies?

This week’s government bailout – the fifth in the last eighteen months – of the financially troubled Ruapehu Alpine Lifts company would have pleased many in the central North Island ski industry. The government’s stated rationale for the $7 million funding was that it would enable the coming ski season at Whakapapa to proceed. Given the ski field’s substantial annual contribution to the Ruapehu district’s economy, the relief in some quarters at the government’s decision was understandable. It is estimated that since 2020 the government has advanced $32 million to keep the ski field operation open, but it has made it clear that the latest payment will be the last.

However, the decision does raise a question about relative priorities. For example, the same week that the government was considering this latest bailout, Associate Education Minister David Seymour was questioning whether the government could afford to keep providing free school lunches to around 220,000 students each day. Seymour argued that the programme, which covers about a quarter of all school students, was not working, because around 10,000 lunches a day being wasted.

When challenged why bailing out a ski field was more important than the school lunches programme, or settling the looming Police pay dispute, Ministers responsible for the Ruapehu decision offered the lame excuse that the funding they were making use of came from a different part of the budget. However, that was likely to be of little consolation to those facing losing their school lunches, or Police pay negotiators.

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Nor is it likely to have cut much ice with the hundreds of journalists and technical staff facing uncertain futures following the substantial news and current affairs cutbacks announced recently by both TVNZ and Newshub. Many were stung by Broadcasting Minister Melissa Lee’s initial comments – which she has subsequently walked back from – that it was not the government’s business to bail out struggling media companies. She is now promising a Cabinet paper on how the Broadcasting Act 1989 needs to be updated to address the current uncertainty in the media industry, although the details of her plan are still skant.

The crisis brought to a head by the Newshub and TVNZ decisions has been simmering for some time. The previous government attempted to provide some security and certainty for broadcast media during the Covid-19 downturn by establishing the $55 million Public Interest Journalism Fund in 2020. But, however well-intended, the plan was doomed from the outset, being widely perceived as an attempt by the government to buy favourable media coverage during the pandemic. This perception was confirmed by the way the government played media favourites in its highly staged Covid-19 daily media conferences. So, any genuine intent to support media struggling in a difficult environment was lost by this negative perception. It was consequently no surprise that the Fund was wound up in July 2023.

However, its demise left a hole which the Newshub and TVNZ cuts have exposed. But, even if it was of a mind to, the costs involved make it unlikely that the government could bailout entirely TVNZ’s struggling news and current affairs operations, let alone Newshub’s. And if it were to do so, it would only be a short-term solution.

Therefore, a more long-term response is required which is presumably why Lee is now looking to changes to the Broadcasting Act. That Act is 35 years old and was developed when there were just two state-owned television channels. TV3 was yet to be established, and satellite and digital television services, and the explosion in channel numbers they would lead to were off in the future. Concepts like streaming, social media, and the expansion of smartphone technology were still far-off dreams in a society where the ubiquitous brick was seen as the height of technological sophistication.

In today’s environment, TVNZ needs radical change if it is to survive. The crisis it is facing with its news and current affairs services is a symptom of a wider problem. To put it simply, how does it remain relevant? Is it destined to follow TV3s path and become just a delivery platform for a range of overseas produced programmes? And if so, where would that leave it as a national broadcaster?

An overarching issue relates to the important role of the media in an open and democratic society. That has been largely taken for granted over the years. The threat to diversity and pluralism the potential restriction of news and current affairs services poses has been put into stark relief by the TVNZ and Newshub cuts.

One solution might be to establish a new national non-commercial public broadcasting entity, combining both TVNZ and RNZ, with a redeveloped Public Broadcasting Charter. In this model, TV2 could be sold, and the proceeds used to properly establish and set up the new public broadcasting agency. Thereafter, it would need to be funded by the government through an annual appropriation, like, although more generously than, the way RNZ is funded now.

The task facing Lee as she develops her paper is to establish a framework which both addresses the issues now confronting the sector, but which also gives the flexibility to anticipate and accommodate further changes as they arise. It is likely to be an almost impossible challenge to satisfy completely, given the rapidity of technological development and the diversity of media platforms already available.

So, in these circumstances, it is easy to see why bailing out a ski field where the snow can be virtually guaranteed to fall every year seems so much easier.

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