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Tax reform and the national broadcasters

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MEDIA RELEASE WARWICK SMITH M.P. '< '/ / / -^ιΕ γ^ x vvy" Shadow Minister for Communications

2 4 November 1991

Tax Reform and the National Broadcasters

The reforms announced by the Coalition in its Tax Reform package will affect the publicly funded national broadcasters, Warwick Smith, Shadow Minister for Communications, said today.

'It is obvious that a shift in resources to the private sector, in particular to lower and middle income groups, will require funding cuts to a wide range of government departments and enterprises, including the national broadcasters. It is envisaged that the annual ABC/SBS budget will be reduced by 10% or $56 million. This, in turn, will require a long hard look at the ABC/SBS if the provision of high quality

and diverse services are to continue.'

'The restrictions on the financial resources available to publicly funded broadcasters are a world wide trend as are the rising costs of program production. In Australia, each household paid $109.77 in 1990-91 for access to free-to-air publicly funded broadcasters, a total of $576.3 million (ABC-$513.5m, SBS-$60.6m, Community broadcasters-$2.2m). This figure excludes the additional transmission costs of $110 million for 1990-91 which are provided by the Department of Transport and Communication.'

Mr Smith said that the independence and integrity of the ABC were being compromised by its conscious chase for ratings and the attrition of education, rural and local services. 'The SBS is now allowed sponsorship and advertising which will further blur the differences between the public and commercial sectors.'

Mr Smith also pointed to technological changes which would affect broadcasting in the run up to the 21st century. 'The convergence of broadcasting and

telecommunications technologies is breaking down the market distinctions between personal and mass communications and the drive is away from "universal", undifferentiated services towards segmented, niche markets. It is inevitable that new technologies will allow the end consumer much greater control over programming.'

'In addition, the proliferation of radio stations, the introduction of Pay TV and the proposed sixth TV channel for community broadcasters will eventually erode the market shares of current public and commercial free-to-air stations.'

'The rapid changes occurring in broadcasting and telecommunications technologies and economics will undoubtedly give rise to questions about the role, structure and funding of the public broadcasters', Mr Smith concluded.

A background paper on publicly funded broadcasting is available from my office.

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