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Tuesday, 28 April 1987
Page: 1907

Senator SHEIL(6.18) —I suppose it has been for about 10 years now that the television industry has been waltzing in a tango of administrative wilderness and discussing, having inquiries, consulting and negotiating with the Department of Communications. I think it has more or less reached exhaustion point. I happened to be on the Senate Select Committee on Television Equalisation. It was a big inquiry and an interesting one. I think the aims of the Government's legislation are laudable; that is, to give a better service to the regional areas and eventually to reduce centralisation in ownership and control. I think it is important to realise that the legislation does apply only to regional television, there being four main sections to the television industry: The city networks, the regional services, the remote commercial services and-over arching them all-the satellite.

The effects of this re-organisation of the regional services was going to have a spin-off to all the other areas. For example, the regional services are being asked to pay for and implement the entire new network of equalised and aggregated services. By doing so they will reach some form of financial stringency, will therefore be less able to help provide the remote commercial television services and, in addition, will put themselves under the hegemony of the city networks. I can remember that when the Government's response to the report was brought in I said that the legislation was virtually asking the regional services to buy a gun to shoot themselves in both feet, putting themselves under the influence of the networks and reducing services to the remote areas. This was a pretty dangerous situation to become involved in. Senator Lewis and I came up with a dissenting report because we saw the dangers facing the regional services. However, since the Press release of the Minister for Communications (Mr Duffy), I think in November last year, we have seen the introduction of the Bill and its referral to the Senate Select Committee which had the big inquiry to which I have referred. The Bill was then returned to the Senate and the Government quickly responded to the Select Committee's report, which I think shows the degree of urgency it applies to the Bill and probably the degree of lobbying that is coming from the television industry. I think it was one of the quickest responses to a report that I can remember.

Senator Puplick —They tried to sneak it in at Question Time.

Senator SHEIL —That was a cagey little move which I might mention. I thank Senator Puplick for reminding me. A dorothy dix question was asked of Senator Walsh and he said quite casually: `Yes, here is a response to the Select Committee's report'. Senator Walsh was going to table the report and have it incorporated in Hansard in reply to a question, thereby precluding any debate on the report. Fortunately, the Leader of the Opposition (Senator Chaney) was awake to this ploy. We had quite a little ruckus in the Senate and eventually were able to have the Government's response brought in and debated as it should have been, that is, as a proper ministerial statement.

At that time many of us spoke about the inequities that would be caused by the legislation. Now, of course, the Bill has been restored to the Notice Paper and reintroduced. During this long process the industry has tried to outguess the Government, wondering which way the Government would jump and what alterations would be made. I think the industry is sick and tired of operating in a vacuum. People will be well aware of the major buying and selling of various interests that has taken place in the meantime. Now, in spite of the three dissenting reports and the warnings they contain, the regional stations appear to be lobbying for acceptance of the Government's Bill. I think that is because they want to know what the rules are. The position they are taking is completely understandable.

Over the past few weeks I have been lobbied quite considerably. The regional stations realise that what the Government proposes will be difficult and that it will cost a lot of money. All business needs to have a stable atmosphere in which to operate. I think that is what the industry is now starting to clamour for. I do not want to go into the whole structure and texture of the legislation: I did that before when the report came in. The mechanism by which the Government has chosen to implement its plan to reorganise regional television is what it calls equalisation and aggregation. The Government has given people a choice of either aggregating straight away or proceeding to aggregation by a process of multi-channel services. In order to force along the legislation the Government has introduced two poison pills into the package so that within a certain amount of time the regional stations will have to aggregate.

To make the legislation more acceptable the Government may consider removing at least the first poison pill, that is, the one in, all in rule. In other words, we have three stations servicing an aggregated market and, if one of them wants to aggregate, under the Government's proposal all of them must aggregate. If one little station and two larger ones service an area, the little station would have a financial windfall because the two larger stations would be forced to pay a lot more than the little station in order to gain a small market, whereas the little station for a smaller outlay than the bigger stations would gain a much larger market. If that poison pill were removed and the one in, all in rule were altered to make it a majority decision, I think the legislation would be a lot more acceptable, particularly in the current climate in which nearly all the regional stations in Australia seem to be prepared to accept the legislation in spite of all the evidence pointing to the problems that it will cause, and not just to them. Heavy imports will be necessary and an enormous network of pylons will have to be erected throughout Australia. Most of this equipment will have to be imported into Australia, and that will cost a lot of money.

The regional stations rightly point out that the advent of new technology will have a major effect on the industry. They feel that many of the new services, particularly satellite services, will not be available until around the year 2000. That may or may not be so. Technology seems to be exploding at an enormous rate at the moment. Cable television was mentioned by Senator Robert Ray, who was also a member of the Select Committee. He pointed to the enormous cost of introducing that into Australia. I do not think that the introduction of cable television into Australia was ever contemplated, although some small networks may be profitable in the cities. I think the advance of technology will result in cable television in Australia being bypassed rather quickly. Fibre optics was also mentioned. Again, that would be expensive and its implementation is in the distant future. The advent of new satellites, particularly with pencil beams for specialised areas, is still a fair way off. I think these are the reasons why the industry is now saying that it needs time to recoup the great capital costs that will be required for implementation. I think that is why we are hearing the cry from the industry at least to get some rules under which it can operate in a stable climate.

I point out that this whole aggregation and equalisation system applies only to regional television services and only in eastern Australia. Vast areas of the country are left outside its effects. South Australia, the Northern Territory and Western Australia are not touched, and they contain a large proportion of the remote areas of Australia. The Bill attempts to reorganise the regional services. The Select Committee has come up with dissenting reports that provide warnings. I have noticed an enormous change in the industry's attitude to the introduction of the Bill since all this has happened. I think that, if the Government were willing to have another look at the legislation, particularly in the area of the first poison pill-that is, the one in, all in rule-agreement could be reached in regard to the future administration of the television industry in Australia.

Sitting suspended from 6.30 to 8 p.m.