In a world where taxpayer dollars are raining down on Canadian media outlets like confetti at a parade, we can’t help but wonder, is this financial support really saving the day? More on this below. Keep reading.
The Struggles of Canadian Media: A Matter of Public Trust
Public trust in Canadian news outlets has been on a steady decline, despite significant financial support from the Department of Canadian Heritage under Prime Minister Justin Trudeau’s leadership. Recent revelations have shown that taxpayer bailouts, including a substantial $595 million grant approved by Parliament in 2019, have failed to revive the nation’s mainstream media apparatus. In this article, we delve into the challenges faced by the Canadian media landscape and explore potential solutions.
The Alarming Statistics
A government memo from the Department of Canadian Heritage, published by Blacklock’s Reporter on September 26, 2023, paints a bleak picture. Titled “The Online News Act,” the memo reveals that despite substantial financial assistance, mainstream media outlets are struggling. Here are some alarming statistics:
- Job Losses: Approximately one-third of Canadian journalism jobs have vanished since 2010.
- Local News Decline: Between 2008 and February 1, 2023, a staggering 470 local news operations closed in 335 communities across Canada.
- New Outlets: During the same period, 210 new news outlets were launched, but these additions have not countered the overall decline.
- Income Tax Act Changes: In 2019, Parliament amended the Income Tax Act to provide annual rebates of $13,750 for each employee in specific cabinet-approved media outlets.
- News Media Canada’s Appeal: News Media Canada, a trade association for newspaper publishers, argues that the rebate is inadequate and calls for doubling it to a maximum of $29,750 annually.
A Temporary Lifeline
The current subsidy program was initially designed as a one-time benefit and is set to expire at the end of this fiscal year. Bob Cox, former chair of News Media Canada, characterized it as a transitional and temporary program during 2019 hearings of the Commons Finance Committee. Cox emphasized that some outlets would inevitably fail during the transition, and perpetual support was not viable.
The Unfulfilled Promise
Despite the costly bailout efforts, the Department of Canadian Heritage admits that the struggling industry has not seen a significant increase in net job creation. The COVID-19 pandemic‘s impact on advertising revenues resulted in service reductions and newspaper closures, leading to the loss of over 2,500 jobs, as highlighted in a 2021 briefing note titled “Improving Federal Support For Journalism.”
While 342 journalists were hired, their wages were entirely subsidized by the Trudeau government under a $50 million Local Journalism Initiative. Media outlets have since requested an extension of this rebate.
A Shift Towards Alternative Media
Interestingly, even as the Trudeau government continues to allocate substantial funds to legacy media outlets, Canadians are increasingly turning to alternative media sources for their news. The recently passed Online News Act, designed to compel Big Tech companies to pay for Canadian news on their social media platforms, earmarks over $150 million for the government-funded Canadian Broadcasting Corporation (CBC). Additionally, the Trudeau government has expressed its intention to extend the $595 million bailout.
Eroding Trust in Government and Mainstream Media
A recent study by the Public Health Agency of Canada (PHAC) sheds light on the declining trust levels among Canadians. The report reveals that trust in both the federal government and mainstream media is exceptionally low:
- Federal Government: Less than one-third of Canadians express “high trust” in the federal government.
- Mainstream Media: Large mainstream media outlets and their journalists score a “high trust” rating of only 18 percent.
- Alternative Sources: Only 12 percent of respondents trust “ordinary people,” while celebrities garner a mere eight percent “trust” rating.
The challenges faced by Canadian media are complex, with dwindling public trust being a significant hurdle. While substantial financial support has been provided, it is evident that this alone cannot address the structural decline of the current business model. As the industry navigates these challenges, a balanced approach that considers the changing media landscape and evolving audience preferences will be crucial to ensure the sustainability of Canadian journalism.
Hot take: It’s almost like giving a leaky bucket a fresh coat of paint and expecting it to hold water.