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Thursday, 14 November 2002
Page: 6334

Senator IAN CAMPBELL (Western Australia—Parliamentary Secretary to the Treasurer) (10.03 a.m.)—I move:

That this bill be now read a second time.

I seek leave to have the second reading speech incorporated in Hansard.

Leave granted.

The speech read as follows—

The Broadcasting Legislation Amendment Bill (No. 2) 2002 will provide a new and more appropriate regulatory framework for community television services, known as CTV.

This bill introduces new provisions governing CTV services to assist in creating a viable future for the CTV sector, a sector that has much to offer to the Australian community, but also a sector that has operated with mixed success since trial services began in 1994. The bill will also introduce measures to improve arrangements for community broadcasting licensing generally.

The changes will be made by amendments to the Broadcasting Services Act 1992 and the Radiocommunications Act 1992. The bill will also amend the Broadcasting Services (Transitional Provisions and Consequential Amendments) Act 1992 to repeal the remaining provisions of the Broadcasting Act 1942 dealing with political advertisements that the High Court held to be invalid.

In 1992, the Government asked the Australian Broadcasting Authority (the ABA) to conduct a trial of CTV using the vacant sixth television channel, known as Channel 31, in Australia. CTV has operated on a trial basis since 1994.

The CTV trial has shown that CTV can have a valuable role in Australian society. CTV services help to meet local information and entertainment needs in a communications environment that is increasingly national, if not global. The service values of CTV are distinct from network and pay television, tending to focus on innovative and niche programming, local events, news and culture. The programs are typically low-budget affairs, often produced by enthusiastic volunteers and television presenters-in-training. Indeed, CTV has proven to be a significant training ground for future media professionals. Some CTV programs are developed and produced in conjunction with tertiary institutions as a practical way for media studies students to experience, and experiment in, the television environment.

CTV programming is valuable because it caters to distinct and widely diverse community interests not served by network or pay TV. CTV contributes to overall Australian television program diversity.

Unfortunately, there are occasions when the availability and quality of this programming is severely constrained by financial and other factors.

Under current arrangements, most CTV operators are financially vulnerable due to high capital and operating costs, particularly those related to transmission. The situation is exacerbated by the temporary nature of current CTV licensing, which discourages long-term planning and capital investment. The trial status makes it difficult for operators to obtain sponsorship, to achieve savings from longer term contracting arrangements and to generate surpluses for reinvestment in CTV.

Significant concerns were also raised about the corporate governance and accountability of some CTV operators at various times during the trial.

Some CTV trial operators have been more successful than others in providing community-focused television programming. Some have proved better able to balance the competing demands of providing a CTV service, including providing adequate community participation in program production, transmission of a reasonable quality, programming that reflects community interests, and the ability to attract sufficient funds to operate the service while managing commercial relationships appropriately.

The presence of the challenges facing CTV should not, however, obscure the fact that CTV has shown that it can provide an important extra dimension to the Australian media landscape. This bill introduces measures that will assist the ongoing viability of the sector, while preserving the unique characteristics of CTV.

The new CTV licensing arrangements will build on the system which is already in place for community broadcasting licensing in Part 6 of the Broadcasting Services Act. This legislation will recognise a particular category of community broadcasting licence, the CTV licence, which will reflect the unique circumstances and needs of CTV.

Digital television is currently at an early stage of development and it is still too early to make decisions about the permanent future of CTV in the digital environment. Arrangements for the digital carriage of CTV will be reconsidered before the end of December 2006—which is the end of the moratorium for the allocation of new commercial licences set out in section 28 of the Broadcasting Services Act.

Under this bill, the spectrum currently used for CTV broadcasting services will continue to be used for analog CTV transmission until 31 December 2006. The date the relevant spectrum can be used for analog transmission of CTV would be able to be extended by disallowable instrument, to deal with a situation where the Government decides, closer to that time, that analog CTV should continue. These arrangements will ensure that the relevant spectrum currently used for CTV broadcasting services will be available for use for other digital services if alternative arrangements for digital carriage of CTV broadcasting services become available and it is appropriate to cease analog transmission.

Even though access to current spectrum is only guaranteed until 31 December 2006, under the proposed amendments the ABA may issue a CTV licence for up to five years. This is a significant improvement on the current trial arrangements for CTV, which require licensees to renew their licences annually.

The ABA will be responsible for allocating CTV licences under a merit-based process.

The proposed legislation will require CTV licensees to be non-profit companies limited by guarantee. The corporate governance and accountability requirements under the Corporations Act for non-profit companies limited by guarantee will impose higher and more uniform corporate governance standards on CTV licensees.

There is wide acceptance that providing a CTV service is far more expensive than providing a community radio service. The CTV sector needs to have the ability to raise revenue which will enable it to balance operational and production costs with providing quality programming for community purposes. At the same time it is necessary to balance the need to raise substantial revenue with the community and non-profit nature of the sector.

Therefore, as an underlying regulatory policy, the bill makes it clear that it is the Parliament's intention that CTV services are to be regulated in a manner that causes them not to operate in the same way as commercial television broadcasting services.

At the same time, the bill assists the revenue raising ability of the CTV sector by increasing the period for which a community television broadcasting licensee can broadcast sponsorship announcements from five to seven minutes in any hour.

Another way that the sector can generate revenue is to sell airtime. Sale of airtime involves the CTV licensee selling a defined period of broadcasting time under its service to a third party. The third party is then responsible for developing and providing programming in that broadcast period. A CTV licensee would be able to use funding raised from sale of airtime to assist with transmission costs, administrative costs and the costs of producing other community access programming.

However, the bill recognises that sale of air-time arrangements may have the potential to compromise the community nature of the CTV service. Therefore, a balance is drawn between the revenue raising requirements for the CTV sector and the community and not-for-profit nature of the sector, by imposing conditions on CTV licensees in relation to sale of air-time.

There is a condition which limits the CTV licensee to selling no more than 2 hours of access to air-time in any day to an individual business which operates for profit or as part of a profit-making enterprise. The condition recognises the need to accommodate those profit-making businesses which are currently producing dynamic and successful CTV programming focusing on a particular community interest. These businesses are not only an important revenue source for the sector, they provide genuine community television programming.

This condition would ensure a business could not purchase a large amount of airtime for commercial purposes.

There is a second condition which limits the licensee from selling more than 8 hours of access to air-time in any day in total to businesses which operate for profit or as part of profit-making enterprises.

Further, there is a third condition which prevents sale of more than up to 8 hours of air-time in any day to any particular person.

The ABA will be able to make a determination to change the sale of airtime conditions if they need fine-tuning to achieve their desired effect. However, it must seek public comment before doing so and the determination will be a disallowable instrument.

Additionally this bill will enable the ABA to impose on all CTV licensees conditions dealing with matters such as community access to airtime, governance, and the provision of annual reports to the ABA.

The CTV licensing arrangements in this bill relating to corporate governance and accountability, spectrum planning and imposition of additional conditions on CTV licences will not apply to remote Indigenous community broadcasting services that provide television programs. Currently these services operate with community broadcasting licences. However, it is likely that these services will not have the resources at this time to meet the higher corporate governance and accountability requirements that the Government is proposing for CTV services.

The bill will also introduce some measures to improve the general community broadcasting licensing regime.

Foremost of these is a measure to reinforce the community and not-for-profit nature of the community broadcasting sector by making it a condition of community broadcasting licences that the licensee will provide the service for community purposes, and will not operate the service for profit or as part of a profit-making enterprise.

Another improvement is to give the ABA more discretion to review community broadcasting licences when deciding whether to renew them. At present, the ABA cannot refuse to renew a community broadcasting licence unless it seems likely that licence renewal would result in significant risk of an offence against the Broadcasting Services Act or regulations, or a breach of licence conditions. This means, in practice, that community broadcasting licences are renewed almost automatically, even when there is an identified problem with the service.

The proposed amendments will extend the range of factors which the ABA can take into account when considering whether it should renew community broadcasting licences to make community broadcasters more accountable for their operations. The amendments will allow the ABA to consider issues that are taken into account in an original licence allocation when deciding whether to renew the licence. The ABA, when renewing a licence, will also be able to consider a proposal from a licensee to change the community interest it is required to represent.

The ABA will not need to undertake a comprehensive review of all licences due for renewal, but under the proposed arrangements, a review could occur where the ABA believed there were problems with the service of the current licensee (for example, because of complaints it had received).

In presenting this bill, and through the introduction of permanent licensing arrangements and better accountability measures, the Government is demonstrating its commitment to a long-term future for community television in Australia. Community television has an important role in Australia, providing programming of a character quite different from that provided by free-to-air networks and pay television. Community television is innovative and diverse. This bill will provide a regulatory basis for a long-term future for the community television sector and for the unique programming it provides.

Debate (on motion by Senator Ludwig) adjourned.

Ordered that the resumption of the debate be made an order of the day for a later hour.