Julian Leeser (Berowra, Liberal Party, Shadow Attorney-General) Share this | Link to this | Hansard source

I rise to speak on the Communications Legislation Amendment (Australian Content Requirement for Subscription Video On Demand (Streaming) Services) Bill 2025, a very important and long-overdue bill. I move the amendment circulated in my name:

That all words after "That" be omitted with a view to substituting the following words:

"whilst not declining to give the bill a second reading, the House notes that:

the Coalition has been an unwavering supporter of the Australian screen industry for decades, and is responsible for:

establishing the producer offset, the location offset, and the digital and visual effect production offset, which have underpinned support for the sector for almost two decades;

introducing the location incentive, which attracted billions of dollars of investment into Australia in the film industry;

providing in excess of $100 million in financial supports to the Australian screen production industry throughout the COVID-19 pandemic; and

first proposing an Australian content guarantee for streamers in February 2022; and

after almost four years of inaction, the Government has asked that this bill be passed in just four sitting days, having taken the industry by surprise and despite significant concerns about potential unintended consequences".

Speaker, I want to start by directing my comments, through you, not just to those in the chamber, those in the gallery or those who are reading the Hansard for posterity but to the Australian screen industry—the producers, writers, actors, directors, camera men and women, sound engineers, postproduction specialists, set decorators, storyboard artists, costume designers, hairstylists, editors, musicians, animators, drivers, caterers, agents, publicists and everyone else who derives their living and their entertainment from the Australian screen industry. I want to say that we back you. The coalition supports you. We want your industry not just to survive but to thrive.

The coalition is the party of small business, and we know that hundreds upon hundreds of small businesses work in and around the screen industry here in Australia. We want the Australian people to hear and see Australian stories on Australian screens. This is the cultural argument. It's about forging a unique national identity. It's about pride in our country. The coalition is the party that has never taken a step back from the pride in our country and in our identity as Australians, whether that is the ancient and living Aboriginal and Torres Strait Islander heritage, our British foundations and the institutions and structures that guarantee the freedom and equality we enjoy today or our multicultural character, a triumph that has brought to this land the gifts and culture of people from all around the globe. These are the three great strands of our history, these are the markers that make our place in the world unique and these are the stories that should be seen and heard by Australians. That means that we support the Australian screen industry. We back Australian content. We back the screen industry. We want the Australian screen production industry to be supported, and we don't accept that they should wear the financial hit that the government has built into the legislation if it is not rammed through in the next couple of days.

Support for the screen industry in this country is in the coalition's DNA. This is an area where we have an enviable track record going back more than 50 years. In the sixties and seventies, it was the coalition under John Gorton who established the Australian Film Development Corporation, and Gough Whitlam followed in the coalition's lead with the National Film and Television School. In the 1980s, it was the coalition under Malcolm Fraser who made a 150 per cent tax concession on the investment risk for Australian made film and television production. That incentive was whittled away under Hawke and Keating. In 2007, it was the coalition under John Howard that first introduced the Australian Screen Production Incentive. This was the birth of the producer offset, the location offset and the post, digital and visual effects production offset. When Peter Costello introduced that measure, he described its purpose as being to build stable and sustainable production companies aiming to increase private investor interest in the industry.

These three measures are the legacies of the Howard era, and, again, Labor has followed the coalition's lead. Indeed, in 2020, the Office of Impact Analysis estimated that, as at 30 June that year, the Australian Screen Production Incentive had produced $2.9 billion to support the Australian screen industry since its introduction. It's a coalition policy that has been the backbone and linchpin of government support to the screen industry over the last two decades. It was the coalition that provided critical support to the Australian screen industry throughout the difficulty years of the COVID pandemic, including more than $100 million through the modernising Australian screen content and the Temporary Interruption Fund measures. In 2018, it was the coalition that introduced the location incentive program with funding of $140 million, which was expanded by $400 million in 2020. Analysis in February 2022 by the Bureau of Communications, Arts and Regional Research made clear that that measure stood to generate more than $4.3 billion in production, with economic, employment and skills in the metropolitan and regional areas through to 2026-27.

In February 2020, it was the coalition that first proposed an Australian content guarantee, a vision of Paul Fletcher, who was then both the Minister for Communications and the Minister for the Arts, who consulted deeply with industry and designed the light-touch framework to ensure that five per cent of the revenue that streamers derived from the Australian market went into local investment. Paul Fletcher had done the work. He had done the heavy lifting in this policy space. He commissioned the ACMA and Screen Australia paper to develop options for supporting Australian stories on our screens. He distributed the policy papers on streaming services, reporting an investment obligation. He worked alongside industry to develop something effective and functional. Labor was left flatfooted, and, typically, Labor followed the coalition's lead. They followed us by promising an investment obligation in the lead up to the 2022 election. They backgrounded industry and media about the now minister's plans to introduce a 20 per cent investment obligation. But it was a rushed and unworkable response, and it wasn't ready to go.

These days, Minister Burke will say that he's been calling out this issue since he was last arts minister in 2013, but the fact of the matter is that he didn't do anything about it. There was no action in the 43rd Parliament. There was no action in 47th Parliament. Indeed, by May 2024, the Senate Standing Committee on Environment and Communications noted in an interim report on the national cultural policy that the government was still considering two different models and was progressing with different drafting. Embarrassingly for Minister Burke, a status update on the issue prepared by the Parliamentary Library records, for posterity, that around this time last year, on 5 November 2024, Minister Burke told the Labor caucus:

… that the interaction of any new local content rules with the US free trade deal was a stumbling block.

That is the ABC article dated 6 November 2024 entitled 'Federal government quietly shelves plans for local content requirements'.

Now, after almost four years of delay, we have this bill—a bill which is a weird combination of being long in the making and rushed in the delivery. It's worth saying a few things about it. What does this bill do? There are two main parts to it. The first is a reporting obligation on major streamers called 'major subscription video on-demand', or SVOD, services. The second is an investment obligation. I'll say that again—a reporting requirement and an investment obligation.

As we head into 2026, I invite you to cast your mind back to the policy papers released by Paul Fletcher almost four years ago and the commitment he made in the lead-up to the 2022 election which spoke about a reporting requirement and an investment obligation. That's a tick there for the coalition on the headline issues. Again, they're following the coalition's lead on the broad policy measures. There are some differences of approach, of course, and, with Labor, the devil is always in the detail. There are notification and reporting obligations, which differ depending on the size of the streamer in terms of its subscriber base, and there's a dual-track investment obligation. The default position in the bill is that streamers have an investment obligation that amounts to 10 per cent of the total program expenditure for Australia. There is an option to instead elect for an obligation amounting to 7.5 per cent of revenue derived by the service from Australia in the relevant year. This selection can be made once every three years in advance.

In terms of the scale of the difference, we understand that most streamers easily meet that requirement already and that what this bill does is put a floor under the level of investment and provide a steer for future players entering the market. There's a three-year acquittal process for each year's obligation, which the government says helps smooth some of the lumpiness inherent in screen production expenditure. Those are the headline features of the bill.

I want to turn to the process now. The way that this has finally come before parliament, with a level of urgency that's entirely within the government's power to control, means there are missed opportunities. My initial concern is that, after almost four years, the government is asking that this bill be passed in three sitting days. I'm doubly concerned that the bill has been drafted in such a way that the Australian screen industry stands to lose if the parliament takes the time to examine the bill. That's because the bill has been drafted so that, unless it is passed by the parliament in this calendar year, the investment obligation will not commence until July and those who support the investment obligation will be made to wait. The risk is that, if parliament doesn't pass the legislation now, the screen production industry stands to lose financially. That's something that we on this side of the House do not accept should be the case. There is no reason to draft the bill in that way. It's a matter that is entirely within control of Minister Burke, both as the responsible minister and as the Leader of the House. Minister Burke writes the sitting calendar for this chamber. He's the Leader of the House. He decides how many days we sit each year. He's the one who decides when the bill is slated for introduction, and, as the minister responsible, he's the one who decides when the investment obligation in this legislation would commence. In other words, the urgency in relation to this bill and the potential financial penalty to the screen industry have been created entirely by this government, and that is a matter of deep concern.

If the parliament decides to scrutinise this legislation to ensure it's fit for purpose, Minister Burke has a range of options to ensure that the screen industry is not disadvantaged. He could draft the bill to ensure the obligation commences on the day after royal assent. He can draft transition provisions so that, even if the bill is passed in the first sitting week of next year, the obligation is taken to commence on 1 January. He can even recall the parliament if he wants to, to allow time for a committee hearing. The point is that this is a problem that is entirely within the government's hands to fix. The reason for making these points is not just that the bill may have problems—which are within parliament's power to fix—but that there may also be missed opportunities in this bill to benefit the screen production industry in Australia.

We've been told by industry that the government is not prepared to consider amendments to this bill. That's a shame because it's clear that there are questions on all sides which warrant answers. The screen producers association, for instance, has made clear there are both positives and negatives to the bill. A number of streamers have proposed amendments to the scheme that they say would make the scheme more workable, with a view to ensuring there's a sustainable industry in Australia.

There are issues that the bill should include but doesn't, which should be ventilated through closer examination. One of those is the issue of a prominence framework for Australian content. In the old days of broadcast media, content requirements and prominence were two sides of the same coin. Prominence means Australian content actually being accessible to watchers—being easily found, being visible and discoverable—so that watchers can effortlessly choose Australian content if they want to. In the old days, this was built into the content requirement. Broadcasters were required to play a certain amount of local content in given timeslots. Anyone who tuned in at a timeslot would see a certain proportion of the Australian content presented to them. Prominence and local content were a package deal—you couldn't have one without the other. The subscription video-on-demand model breaks that link. Just because you commission an Australian show it doesn't mean it will be easily found.

In theory, it would be possible for a major streamer to fully acquit its investment obligation under this bill by commissioning a range of Australian content and hiding it in the back catalogue where it wouldn't be seen. Let me be clear, this is not what the streamer say they would do, and I do not say that they will do that. The commercial imperative is obviously otherwise. Overwhelmingly, the streamers that I have spoken to do the right thing. They say that if they are going to invest in Australia, they want to give it appropriate prominence so that it is seen as successful. They want the show to come up on the carousel when you log on to Netflix or Amazon Prime as a selection that you can easily choose from, and that's great. But no-one has a crystal ball. We don't know how the market will change in the coming years. There will be new players coming into the Australian market, and we don't know what their approach will be. We don't know what new pressures will influence the major streamers in the years to come, and we can't guarantee that the Australian content that will be commissioned when this bill finally passes will actually be easy to find by ordinary Australian families.

We know that the size of the Australian content catalogue is patchy. For some streamers in the Australian market, it is less than one per cent of their overall catalogue. So if you don't have much Australian content, why doesn't the bill deal with that? Why not have a mechanism to give the minister the power to deal with the prominence of Australian content on streaming services as a safeguard to future-proof this bill? Why not make this bill deal with more than just reporting an investment and do better as a cultural policy? After all, it's in the interests of all Australians to be able to easily find Australian stories, and it's in the Australian screen production industry that their stories are easily found.

That's why I am moving a amendment to the bill. It's a very simple amendment, modelled on the light touch but highly effective approach of Paul Fletcher, which is to allow the minister to set requirements for the prominence of Australian content on streaming services. It's not a formal obligation; it's a power to take action in the future. That's why I described it as future proofing a few moments ago. It puts the prominence and discoverability of Australian content front and centre. This is the natural partner of an investment obligation. Why not have a proper inquiry into that type of issue in the context of the bill?

I want to turn to other questions about this bill. As we said when the bill was first introduced, we back Australian content, but there are questions about how this measure will work. The first one is the question the minister reportedly described as a stumbling block in his own caucus room when he delayed the bill over a year ago. That question is: does this bill breach the Australia-US Free Trade Agreement? Chapters 10, 11 and 16 of the Australia-US Free Trade Agreement deal with electronic commerce, investment and cross-border trade and services. Under John Howard, the coalition had the foresight to include some reservations to those chapters. We included specific carve outs for audio-visual and broadcasting sectors. They are recorded in annexure 2 to the agreement. But the question is whether this bill fits within those carve outs and whether there are broader impacts on our relations with other countries. This is an issue which should be explored in an inquiry.

Another question is: is the content requirement appropriate? When this bill passes there will be three different standards for Australian content depending on whether you're a broadcaster, a subscription TV provider or a streamer. What does the introduction of this new third standard mean for the market? How will it affect competition between the players? What impacts does it have on investment in the market? What impacts will it have on pricing when it comes to commissioning new shows?

The third question is: does this bill make any difference at all? We're led to believe that most streamers already meet the investment thresholds in the legislation. Will this bill actually change the current state of play, or does it only place a floor under the current investment levels, as the government has said, and shape new players considering entering into the market?

A fourth question is: what are the unintended consequences? Do those unintended consequences adversely impact the Australian screen industry? Amongst the focus of the US-based streamers there is, of course, Stan, the only Australian owner streamer, which is an offshoot of Nine, a free-to-air broadcaster. Will this bill hobble Stan's ability to commission local Australian dramas and documentaries? Will it mean that an Australian company could be outbid by global streamers, forcing them to acquire low-quality content or pay inflated prices or both? Will the bill inadvertently put more local content behind pay walls? Will the bill damage local broadcasters, who have local drama and documentary quotas but provide that content for free, by driving up prices in the marketplace. Will this bill do harm to the services and platforms that are the backbone of local production? These are important questions, and important questions that should be ventilated in an inquiry.

Let me be clear about the coalition's position. Our position on this bill is simple: we support Australian content, we support the Australian screen industry, and we support Australian content being accessible, visible and easily found on Australian screens. In the ordinary course, this bill would be the subject of an inquiry. We don't accept that the industry should face a potential financial penalty if this parliament conducts such an inquiry. This is an issue within the government's power to correct, and we ask them to do so. I thank the House.

Milton Dick (Speaker) Share this | Link to this | Hansard source

Is the amendment seconded?

Rebecca White (Lyons, Australian Labor Party, Assistant Minister for Women) Share this | Link to this | Hansard source

I second the motion and reserve my right to speak later.

Anne Webster (Mallee, National Party, Shadow Minister for Regional Development, Local Government and Territories) Share this | Link to this | Hansard source

I rise as the first shadow minister for regional communications in Australia—yet another principled position the Nationals took to ensure that, in the 21st century, there is a continuous focus on regional connectivity. This bill mandates the production of Australian content, and nothing is more Australian than regional Australia. From The Flying Doctors, filmed in my electorate of Mallee at Minyip, to Mad Max, Crocodile Dundee and The Adventures of Priscilla, Queen of the Desert, the star of the show has been the people and the landscapes of regional Australia. As we see the capital cities grow at breakneck pace under Labor governments—federal and state—I come to this debate with an unashamed and strong emphasis on regional Australians. That is why—and I foreshadow—I will be moving an amendment to ensure transparency on how much of the Australian production proposed through this bill will actually occur in regional Australia.

Let's remember the regulatory space we have here. Our media regulations were made during the 20th century of television towers and antennas on roofs. Now, builders do not even put antennas on house builds. This is the 21st century, and regulation has not caught up to the reality where many Australians—if not the majority—are digesting the bulk of their news and entertainment over the internet through the NBN broadband internet, 5G, 4G or whatever else they use. Critically, regulation hasn't caught up to the fact that we have strictly regulated the Australian broadcasters while regulation does not effectively touch the international broadcasters such as those this bill seeks to regulate. Australia's media is not a free market. This is a failed market, and the Nationals know about interventions in market failure situations all too well, as we see the need for it time and time again in regional Australia.

Free-to-air television broadcasters face many barriers. There are laws and rules that apply to our commercial broadcasters that do not apply to offshore based, streaming, video-on-demand providers. SBODs, or streamers, are free to use the digital airwaves—so to speak—as they wish with no barriers. The bill is an opening step in changing that. How can we, Australian parliamentarians, in good conscience say to Australian broadcasters, 'We'll keep you under red tape but not apply the same or similar red tape to others who broadcast in Australia'? These international broadcasters are swallowing up advertising revenue that keeps Australian broadcasters on air. For example, international broadcasters can run gambling advertising that Australian broadcasters cannot, particularly at times of match play.

As I said earlier, we Nationals know all too well about market failure and the need for government to intervene, as we see it all too often in regional Australia. I publicly stated in August that we have a declining regional media and lack of journalists. I don't have one single television journalist based in Mallee—which, I might remind viewers, is Victoria's largest land electorate, a third the size of Victoria. We need to see ourselves on screen and in our news services, but in streaming services as well. Of course, the investment this bill refers to is not for news or sport but for Australian creative content, including documentaries and movies. Having said that, I give a shout-out to the WIN network who, as of Monday this week, resumed news bulletins in Sunraysia, my hometown of Mildura and in Griffith in the Murrumbidgee Irrigation Area. It is wonderful to see ourselves on TV news again.

I spoke on WIN News across regional Australia last night, including—I am excited to say again—in Mildura, about streaming platforms, how they minimise their tax in Australia and how commercial broadcasters are not on a level playing field. I'll repeat what I said in August 2024 for the benefit of the House. I haven't had time to update the figures, but this is the tilted playing field we operate in—this blurred online media market space. Apple, who have streaming platform Apple TV, who earned $9.3 billion on Australian shores in the most recent reporting year I have to hand, paid just $137.3 million in tax, which was only 1.5 per cent of their Australian revenues. In 2018, Netflix reportedly had an effective tax rate of 0.05 per cent in Australia, despite $1 billion in revenue, and paid just $342,000 in tax. That figure rose to $868,000 in 2022 but is still far short of its revenue and impact on Australian society.

Netflix's tax avoidance smarts aren't limited to Australia. In the USA, during the life of the Trump administration, Netflix paid US$81 million in corporate tax, despite earning $10.5 billion over that period. We've seen the news in the last 24 hours of US officials warning the Commonwealth we could be hit with more tariffs if we keep pushing on the media bargaining incentive—what was the media bargaining code under the coalition government—on the social media bans for under 16s, on this initiative to require Australian content and on more. As elected representatives of Australians as the Australian parliament, it is now our sovereign right and duty to act in the national interest.

Let me tell you a few Australian stories streaming platforms might want to look into to fill their Australian content quotas. Regions are out of sight, out of mind for the Albanese Labor government. The radical pursuit of net zero at all costs railroading regional communities—Victorian Labor government said, without offshore wind, 70 per cent of Victorian farmland would be needed. Can you imagine the documentary—the headline? It would play potentially all over the world—railroading of farmers without social licence.

On Monday 24 November, the Victorian government issued a draft renewable energy zone order for five onshore renewable energy zones, including several in my electorate. What we know is that, under Victorian Labor, the word 'draft' actually means 'final'. Even though there is apparently a consultation until February, we know that, in Victoria, it means nothing. VicGrid attempted, earlier this month, to access properties at Greens Creek and Bunguluke, in my electorate, using powers the Victorian Labor government energy minister Lily D'Ambrosio gave them. Farmers are starting harvest very shortly. They don't have time to be protesting, but they are because this means so much to them—farmers like Rod Reading and Greg Bladwin, who spoke with Wimmera Mallee News earlier this week about how they face compulsory access from VicGrid in the near future.

This is about Australian stories, and all of Australia needs to hear Australian stories—whether it's documentaries, whether it's creative films—and streaming platforms need to invest in Australian stories. That is what this bill is about, and I will be moving amendments to ensure this happens.

Milton Dick (Speaker) Share this | Link to this | Hansard source

The question before the House is that the second reading amendment moved by the honourable member for Berowra be agreed to.