Five things Canada’s news bailout panel got right

Last week, the independent panel appointed by government to determine how to implement the $595 million government support package for journalism recommended making a broader group of news outlets eligible for funding.

This is good news for news. Many people raised concerns about the previous narrowly-defined criteria in the 2019 budget: that approach would have distorted the playing field dramatically in favour of newspapers, as I wrote after details were released in March. I argued that subsidizing newspaper journalists to compete with outlets unable to access government support would discourage journalism entrepreneurs, chill investment in early stage media startups, and ultimately slow innovation.

Our critique got quite the reaction. Many of you emailed and tweeted. The article was republished in Nieman Lab and J-Source. The Discourse was invited to present our analysis to Finance Minister Bill Morneau’s tax policy people. In response, we created a crowd-sourced policy memo and dozens of people — from independent media to journalism professors to entrepreneurs to audience members — contributed feedback. We, along with a coalition of independent media, provided a version of the memo to the independent panel.

To those of you who helped shape the policy recommendations, thank you! How often does a group of stakeholders come together organically and have an impact on policy? (All without lobbyists.) After reading the panel’s report, I am convinced it considered concerns about how the news bailout could hurt small publishers and digital startups. I am convinced our ideas for improving the approach were heard. 

But, while broadened criteria is a positive development, many small and startup newsrooms are still left out. A gap remains if the measures are to spur the innovation and growth the industry needs for its long-term sustainability.

Here are five things the panel got right — and how the policy could be made even better:

1. 👍The panel recommended broadening criteria defining a Qualified Canadian Journalism Organization (QCJO). For starts, it would not disqualify news outlets that cover specific topics as long as they focus on “issues of public interest.” This means that outlets responding to specific coverage gaps will qualify, such as The Logic, which reports on the innovation economy, or The Narwhal, which reports on the environment. Rather than defining criteria by the topics covered (the product), the panel suggested assessing whether the outlet applies journalistic process such as verification of facts, attempts at balance, and transparency about errors. Eligible outlets will also need to produce original reporting, rather than only republishing Canadian Press wire stories or aggregating news from other sources, and serve regular people rather than specialists in a specific field. (Sorry, Progressive Dairy.)

👎Funding will still only support written media, which the panel defined as newsrooms that publish 60 per cent written content. Exactly how this 60 per cent will be determined is unclear. Will they count URLs? Compare column inches to podcast minutes? (Yikes.) The criteria could have avoided all that by simply disqualifying broadcasters and magazines that benefit from other subsidies, without leaving out innovative newsrooms experimenting with new formats that could be an important part of the next generation of news, such as MEDIA INDIGENA and Canadaland.

2. 👍To be eligible, outlets need to regularly employ at least two journalists not related to its owners; the panel interpreted that criteria as broadly as possible. It defined “regularly employ” as either full or part time, even if that role is temporarily unfilled in the 12 months before applying, and defined “journalist” as any newsroom employee who exercises “journalistic judgement.”

👎Because most small digital startups and family-run outlets rely on contracted freelancers, they won’t qualify for the program. The panel recognized it was leaving out some small outlets and recommended that those that are more than 10 years old be allowed to use regular contractors to meet this criteria. I would have gone a step further and allowed all small outlets to count budget spent on freelance journalists in the past 12 months toward meeting this eligibility criteria. That would encourage those outlets to transition freelancers to employed positions to access the labour tax credit, incentivizing job creation.

3. 👍The panel called on the government to earmark a portion of its advertising budget for news media. It makes sense for the government to use its spending power to support news media instead of the global platforms Google and Facebook, which don’t contribute taxes or original reporting.

👎The panel could have also encouraged government to make its bulk subscription purchasing process more accessible. As Canadaland reported, the government already spends millions to access news media without violating copyright. Making that process easier to access for small publishers would support a more diverse ecosystem.

4. 👍The panel called for government to immediately explore an additional program to address the needs of small print and digital publications focused on ethnic and Indigenous communities.👎The panel’s recommendations overlooked innovation. As it stands, startups will be disqualified for their first 12 months. Without some kind of innovation fund that offers access to seed funding, new newsrooms will need to compete with subsidized competitors for at least a year before becoming eligible for the same support.

5. 👍The panel recommended against creating another panel to certify qualified media organizations. Many people were concerned about appointing a panel to create government-approved newsrooms. The recommendations rightly avoided that by providing clear eligibility criteria for CRA to implement directly. It suggests creating a panel of journalism professors with a mandate to provide guidance to the CRA when they have questions about how to apply eligibility criteria.

👎There was no mention of an appeals process. This second panel should be able to accept appeals from media outlets deemed ineligible, not only from the CRA. Besides calling for the government to publish a list of publications that applied, the panel did not make recommendations to ensure the transparency of the process.

What we’re learning

Canada does not need to reinvent the wheel to support a robust news ecosystem. Here are three ideas to learn from:

• In May, New York Mayor Bill de Blasio signed an executive order that directs municipal agencies to spend at least half their advertising budgets on local and ethnic news outlets. Research found that local and ethnic media reach 55 per cent of New York’s population, but that little advertising budget was directed there.
• An initial commitment of $5 million from state legislators created the nonprofit news incubator New Jersey Civic Information Consortium. While that initial funding commitment is still being negotiated, the hope is that it will inspire other funding from philanthropic and other players that provides seed funding for local news organizations.
• Longmont, Colorado is exploring how to create a tax scheme that would fund local news, governed by its public library system.

Shout-outs

Thanks to everyone who weighed in on the crowdsourced policy memo, which contributed to the government’s journalism package criteria broadened to support a more diverse group of news outlets. Here are excerpts of the feedback we received:

I am a media academic but I’d argue this panel should not be solely made up of journalists and ex-journalists. Journalism and communications scholars and even political scientists would provide useful insights and a sense of history to the decision-making. Maybe some representatives of traditionally-underserved communities or communities with different journalistic norms (ie First Nations) could be guaranteed a seat at the table?
— David Brake, science editor, Let’s Talk Science

I also think this is an opportunity to make some benchmarks around diversity and representation within the organizations’ staff part of the minimum criteria.

— Kalli Anderson, freelance documentary maker and journalism lecturer, Ryerson University

I have been boot strapping and operating LiisBeth, a feminist business digital magazine and newsletter, for three years. I have two core editorial staff that I pay freelance, and we have paid over 30 different writers/journalists for 140+ original works in the past three years (on average $500-1200 per article). We are growing but it would be years of organic growth before we would be at the level of three full-time staff. I have financed this venture because I believe there was a huge feminst media gap in Canada.

—Petra Kassun-Mutch, publisher, Liisbeth [end]