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Wednesday, 11 October 2006
Page: 16


Senator CONROY (10:32 AM) —I welcome Senator Joyce’s contribution. I do not agree with everything he said, but I welcome it. However, I must comment on a couple of points that he made. It was not the leader of the Labor Party who stood up in his party room yesterday and demanded, right there, right then, ‘Sign up or else.’ It was not Kim Beazley who did that. It was not Kim Beazley who forced, with no debate, a decision to be made right there and right then. It was not Kim Beazley who gave his party room the bum’s rush yesterday and locked people in. It was not Kim Beazley—


The ACTING DEPUTY PRESIDENT (Senator Hutchins)—Order! I am not sure that ‘bum’s rush’ is parliamentary.


Senator CONROY —If that is unparliamentary, I withdraw it and I apologise. I didn’t think it would be but I happily withdraw.


Senator Vanstone —Mr Acting Deputy President, for the record, I am not personally offended by that language at all; it is water off a duck’s back. But in the Senate chamber it is perhaps inappropriate. That is my point.


The ACTING DEPUTY PRESIDENT —It has been withdrawn, Senator.


Senator CONROY —I accept that, and withdraw. It was not the Labor Party which passed a resolution at its Queensland conference which was considered to be binding on Queensland National Party members. So when it comes to who stands over people, it is quite clear in this debate what has gone on. Senator Joyce and Senator Nash signed a dissenting report, and they have talked a great fight. But it will catch up with you, Senator Joyce, because at some point someone is going to work out that the speech was great, but why on earth, after giving that speech, did you vote the other way?

We will be voting with you on the voices test, because that is at the heart of this debate. But once we are defeated, as is likely, Senator Joyce, when you then vote not to excise the cross-media laws and to allow the very voices test you say is not good enough, so that the Pussycat Dolls and the Red Hot Chili Peppers get to count the same as the Packer and the Murdoch empires, you will not be able to show people your speech.

There was a famous Labor Party person who used to come to the ALP national executive meetings and give passionate speeches against the outrages of the New South Wales Right. He would go home to Tasmania and say, ‘God, you should have heard the speech I gave.’ People would say, ‘How did you vote?’ ‘Oh no, I voted for it.’ He became a laughing stock pretty quickly. I have to tell you, Senator Joyce, that it will be hard for you to keep giving these great speeches and writing these great dissenting reports and then turn around and vote the other way. Credibility in politics is important, too. Maybe the media, because you are ultimately delivering them what they want, will not highlight it too much, but I know that the people of Queensland are pretty smart. They can smell a rat when one runs across their path, and you cannot say on the one hand that a voices test that allows the Red Hot Chili Peppers and the Pussycat Dolls to counterbalance the Packers and the Murdochs is a terrible thing and then on the other hand vote for it. You actually have to stand up and be counted sometimes. What is at stake, as you said, is to ensure that no organisation ends up being more powerful than the Parliament of Australia.

The government likes to call the measures in the Broadcasting Services Amendment (Media Ownership) Bill 2006 and related bills its ‘media reform package’. However, when you look at the measures in detail, it is clear that this label just does not fit. It is a case of misleading advertising. Sure, the bills concern the media, and there are four of them so it is a package. But the word ‘reform’ cannot be applied to what the government has put forward. I suppose this is just another application of the two out of three rule that we have heard so much about, and that apparently, according to Senator Joyce, is the saviour of democracy. The government’s media ownership bill will reduce media diversity, it will reduce competition and it will reduce consumer choice. Where is the reform in that? Where is the reform in measures that give even more power to some of the most powerful people in the country?

Let us not misunderstand Prime Minister Howard when he says, ‘I’m not really fussed about this legislation.’ Let us be clear: this is his third attempt in the last 10 years for a bill he does not care about. Let us not be fooled by the Prime Minister pretending that it is not a priority for him. As soon as the government got its way, it was going to force it through the Senate at any and all costs. The government knows that it is hard to sell increased media concentration as good public policy. The Prime Minister has twice tried before to get the parliament to swallow this bitter pill. Sensibly, these proposals were rejected. This time around he has tried a different approach. This time around he has tried to sugar-coat the plan to repeal the cross-media laws by trying to link it to new digital television services. In truth, the Senate should realise that there is no connection between the two. Australia does not need to sacrifice media diversity in order to enjoy the benefits of the digital age. This is a package that looks after the interests of media moguls, not media consumers.

Before I get to the detail of the legislation and its flaws, some comment has to be made about the process that has preceded this debate today because it says so much about the government’s attitude to media reform. The media package that we are debating today has been under development by the Minister for Communications, Information Technology and the Arts for more than 12 months. Countless meetings have been held with representatives of the big media companies. The government has been very keen to come up with a package that balances their commercial interests. Regrettably, the public and the parliament have not received the benefit of a similar courtesy.

As we saw last year in the debates on the sale of Telstra and industrial relations, this is a government that pays mere lip service to notions of Senate scrutiny and public accountability. The minister dictated that the Senate Standing Committee on Environment, Communications, Information Technology and the Arts would have just three weeks to conduct its inquiry into the legislation. Members of the public were given just over a week to scrutinise four bills. Key elements of the government’s legislation were not even released to the public. It was not until four o’clock yesterday that we finally saw the amendments containing the rules governing the new digital channels, the so-called channels A and B. The committee hearings were a complete farce. The committee was forced to cram more than 30 witnesses into just two days of hearings.


Senator Brandis —That was to meet your convenience because you were unavailable.


The ACTING DEPUTY PRESIDENT (Senator Hutchins)—Order!


Senator CONROY —I appreciate your pointing out that Senator Brandis is out of order, Mr Acting Deputy President, but I want to put this on the record because I keep hearing this complete untruth, this complete misleading of the Australian public: I was unavailable for one day only; Senator Ian Macdonald was unavailable for another two days. Let us be clear: there was no need for this committee to be rammed through in two days, no need whatsoever.


Senator Brandis —The schedule was to meet the convenience of senators, including you.


The ACTING DEPUTY PRESIDENT —Order, Senator Brandis. You will get your opportunity to speak next.


Senator CONROY —Senator Helen Coonan announced the committee hearing completion date in a press release prior to the committee even holding a meeting to discuss it. You can hide, you can run, but that is the truth. The minister dictated to members of the coalition on that committee when the bill had to be finished being considered by the committee, so do not try to pretend that people’s calendars were not completely moved around to suit the government senators. Minister Helen Coonan announced the date that the inquiry would have to be finished—unprecedented, Senator Brandis. I have never in my 10 years in this place seen a minister announce the completion date of an inquiry. That is actually the purview of the Senate and the committee process.

This debauched process has continued. Opposition senators were given just on 10 minutes to question most witnesses. Witnesses who sat down to address the committee were instructed by the chair that they could speak for no more than five minutes. Nearly 100 pages of amendments and explanatory material have already rained down on the Senate as the government has sought to fix drafting errors and appease the concerns of dissidents in its party room. The Senate will not be given time to properly scrutinise these changes, as the government wants to ram the bills through this week. This is the disgraceful way the Howard government makes law. We should not be surprised when such an approach produces poor policy.

I will now turn to the bills in detail. Despite claims to the contrary, it is quite clear that the centrepiece of this package is the Broadcasting Services Amendment (Media Ownership) Bill 2006. The bill makes two key changes to the media ownership law. Firstly, it repeals the specific foreign ownership provisions in the BSA that relate to commercial and subscription television. Secondly, it repeals the current cross-media laws and inserts new provisions which are described as diversity safeguards.

Labor’s approach to the issue of media ownership is based on the principle that regulation should promote the free expression of a diverse range of views. There is no doubt that free and open discussion of ideas and opinions is the lifeblood of democracy. Consistent with this principle, Labor supports changes to the foreign ownership rules that are contained in the bill. This is a position that we have held since 2002. There is already substantial foreign investment in the Australian media—in radio, newspapers and television. Foreign investment offers the potential to introduce new players into the market and increase media diversity.

Labor does not believe that the restrictions on foreign ownership in the Broadcasting Services Act are justifiable in the public interest. In contrast, the case for the cross-media laws which restricts media companies to owning newspapers or radio or television assets in any one market remains as valid today as it did in 1987, when the laws were first introduced. In its landmark report in 2000, the Productivity Commission spelt out clearly why diversity of ownership is so important in a democracy. The Productivity Commission stated:

The likelihood that a proprietor’s business and editorial interests will influence the content and opinion of their media outlets is of major significance.

The public interest in ensuring diversity of information and opinion leads to a strong preference for more media proprietors rather than fewer. This is particularly important given the wide business interests of some media proprietors.

Anyone who thinks that ownership of the media does not matter should have a look at a survey of journalists conducted by Roy Morgan and Crikey earlier this year. Some 48 per cent of those surveyed said they have felt obliged to take into account the commercial position of their employer. Thirty-eight per cent said that they had been instructed to toe the commercial line of their employer, 32 per cent said they felt obliged to take into account their employer’s political position and 16 per cent said they had been instructed to do so. These figures demonstrate conclusively why maintaining a diversity of ownership is so fundamental and why the media ownership bill is such a threat to Australian democracy. Of course the government says that it understands the need to protect diversity. It claims that its package has safeguards to prevent excessive concentration. In truth, these safeguards are completely inadequate.

The first alleged safeguard is the five-four voices test. Under this test a media merger will not be allowed to occur unless there will remain a minimum of five media voices in metropolitan markets and four in regional Australia. For the purposes of this test, a voice is a commercial television licence, a commercial radio licence or a newspaper that is sold in the relevant area at least four days a week. It also includes a media group that has a combination of these assets. The government has never provided any satisfactory explanation of why it thinks that five and four are acceptable numbers, other than it wants to allow scope for firms to reap ‘economies of scale’.

The five-four test is designed to facilitate media mergers. It is not really a safeguard at all. There are currently 12 owners of the major commercial media in Sydney, 11 in Melbourne, 10 in Brisbane, eight in Perth and seven in Adelaide. In 19 major cities in regional Australia, like Cairns, Mackay or Bundaberg, there are six or seven owners. The five-four rule is just a recipe for increased concentration. This fact became so obvious that yesterday the minister was compelled to announce that the five-four test will be supplemented by a two out of three rule.

The two out of three rule will prevent proprietors from owning newspaper, radio and television assets in the same market. While some members of the National Party have claimed this as a great concession, in reality it offers little additional protection for media diversity. The proposal does nothing to protect diversity in the 17 regional markets where there are only five commercial voices. These areas include major centres like Bathurst, Bendigo, Coffs Harbour, Grafton, Lismore, Tamworth and Mildura. Under the two out of three rule, it would still be possible for the number of owners to fall from six to four in many regional markets like Bundaberg, Townsville and Rockhampton.

In both metropolitan and regional markets, a person in control of a newspaper and the television station would still be able to exercise an unhealthy degree of influence. Even with the two out of three rule, a media conglomerate composed of Channel Nine and the Age would be given the same weight in the voices test as a small radio station like Sport 927. To borrow from my colleague Senator Joyce, the Red Hot Chili Peppers and the Pussycat Dolls would get as many votes in this ballot as the Packers or the Murdochs. That is the farce; that is the absurdity. It is a fact, and you are voting for it, Senator Brandis. The revised test will still take no account of the relative influence of different voices. The fact that some coalition senators have convinced themselves that the two out of three rule protects diversity shows an amazing capacity for self-delusion.

The other alleged safeguard in the package is the ACCC’s power to examine cross-media mergers to see if they substantially lessen competition. If there was one piece of evidence that emerged clearly from the Senate inquiry—and I thank Senator Brandis for interceding in this part of the debate, because he called a spade a spade—it was that section 50 of the Trade Practices Act cannot be relied upon as a substitute for the current cross-media laws. The ACCC is the competition regulator. It has no responsibility for protecting diversity. It is not able to take public interest considerations into account in assessing mergers under section 50.

In order to find that a merger of newspaper, radio or television assets lessened competition in a market for news or opinion, the ACCC would have to demonstrate that news products produced by different media types were substitutes for each other. This is a difficult test to apply in markets like news where products are typically not priced. The ACCC has stated that in order to determine whether, for example, radio and television news were substitutes, it would undertake research into consumer attitudes and conduct surveys to see if people would switch to radio if there was deterioration in the quality TV news.

Several leading competition lawyers have questioned the ACCC’s ability to stop cross-media mergers on the basis that it would lessen competition in the market for news. Peter Armitage, the competition partner at Blake Dawson and Waldron, has described the ACCC’s approach to defining news markets as ‘fairly speculative, brave new world territory’. It is important to remember that the ACCC’s interpretation of market definition is subject to challenge in the Federal Court. The ACCC does not make the law. I can just see Mr Samuels bowling up to the Federal Court and saying: ‘The basis on which I have blocked this merger is that I did a survey of a few hundred people. Thirty or 40 replied and they told me what they thought about whether or not these items were substituted.’ It is going to be a compelling argument! Even Senator Brandis has to smile about it. The Federal Court will not cop such rubbish.

In its report on broadcasting the Productivity Commission stated:

It is clear that the Trade Practices Act as it stands will be unable to prevent many cross-media mergers or acquisitions which may reduce diversity. It is also clear that the adoption by the ACCC of a broader definition of the media market would not adequately address the social dimensions of the policy problem, and will be open to legal challenge.

Let us be clear. The existing current cross-media laws are protecting and generating diversity—(Time expired)