Stephen Conroy (Victoria, Australian Labor Party, Deputy Leader of the Opposition in the Senate) Share this | Hansard source

Senator Helen Coonan announced the committee hearing completion date in a press release prior to the committee even holding a meeting to discuss it. You can hide, you can run, but that is the truth. The minister dictated to members of the coalition on that committee when the bill had to be finished being considered by the committee, so do not try to pretend that people’s calendars were not completely moved around to suit the government senators. Minister Helen Coonan announced the date that the inquiry would have to be finished—unprecedented, Senator Brandis. I have never in my 10 years in this place seen a minister announce the completion date of an inquiry. That is actually the purview of the Senate and the committee process.

This debauched process has continued. Opposition senators were given just on 10 minutes to question most witnesses. Witnesses who sat down to address the committee were instructed by the chair that they could speak for no more than five minutes. Nearly 100 pages of amendments and explanatory material have already rained down on the Senate as the government has sought to fix drafting errors and appease the concerns of dissidents in its party room. The Senate will not be given time to properly scrutinise these changes, as the government wants to ram the bills through this week. This is the disgraceful way the Howard government makes law. We should not be surprised when such an approach produces poor policy.

I will now turn to the bills in detail. Despite claims to the contrary, it is quite clear that the centrepiece of this package is the Broadcasting Services Amendment (Media Ownership) Bill 2006. The bill makes two key changes to the media ownership law. Firstly, it repeals the specific foreign ownership provisions in the BSA that relate to commercial and subscription television. Secondly, it repeals the current cross-media laws and inserts new provisions which are described as diversity safeguards.

Labor’s approach to the issue of media ownership is based on the principle that regulation should promote the free expression of a diverse range of views. There is no doubt that free and open discussion of ideas and opinions is the lifeblood of democracy. Consistent with this principle, Labor supports changes to the foreign ownership rules that are contained in the bill. This is a position that we have held since 2002. There is already substantial foreign investment in the Australian media—in radio, newspapers and television. Foreign investment offers the potential to introduce new players into the market and increase media diversity.

Labor does not believe that the restrictions on foreign ownership in the Broadcasting Services Act are justifiable in the public interest. In contrast, the case for the cross-media laws which restricts media companies to owning newspapers or radio or television assets in any one market remains as valid today as it did in 1987, when the laws were first introduced. In its landmark report in 2000, the Productivity Commission spelt out clearly why diversity of ownership is so important in a democracy. The Productivity Commission stated:

The likelihood that a proprietor’s business and editorial interests will influence the content and opinion of their media outlets is of major significance.

The public interest in ensuring diversity of information and opinion leads to a strong preference for more media proprietors rather than fewer. This is particularly important given the wide business interests of some media proprietors.

Anyone who thinks that ownership of the media does not matter should have a look at a survey of journalists conducted by Roy Morgan and Crikey earlier this year. Some 48 per cent of those surveyed said they have felt obliged to take into account the commercial position of their employer. Thirty-eight per cent said that they had been instructed to toe the commercial line of their employer, 32 per cent said they felt obliged to take into account their employer’s political position and 16 per cent said they had been instructed to do so. These figures demonstrate conclusively why maintaining a diversity of ownership is so fundamental and why the media ownership bill is such a threat to Australian democracy. Of course the government says that it understands the need to protect diversity. It claims that its package has safeguards to prevent excessive concentration. In truth, these safeguards are completely inadequate.

The first alleged safeguard is the five-four voices test. Under this test a media merger will not be allowed to occur unless there will remain a minimum of five media voices in metropolitan markets and four in regional Australia. For the purposes of this test, a voice is a commercial television licence, a commercial radio licence or a newspaper that is sold in the relevant area at least four days a week. It also includes a media group that has a combination of these assets. The government has never provided any satisfactory explanation of why it thinks that five and four are acceptable numbers, other than it wants to allow scope for firms to reap ‘economies of scale’.

The five-four test is designed to facilitate media mergers. It is not really a safeguard at all. There are currently 12 owners of the major commercial media in Sydney, 11 in Melbourne, 10 in Brisbane, eight in Perth and seven in Adelaide. In 19 major cities in regional Australia, like Cairns, Mackay or Bundaberg, there are six or seven owners. The five-four rule is just a recipe for increased concentration. This fact became so obvious that yesterday the minister was compelled to announce that the five-four test will be supplemented by a two out of three rule.

The two out of three rule will prevent proprietors from owning newspaper, radio and television assets in the same market. While some members of the National Party have claimed this as a great concession, in reality it offers little additional protection for media diversity. The proposal does nothing to protect diversity in the 17 regional markets where there are only five commercial voices. These areas include major centres like Bathurst, Bendigo, Coffs Harbour, Grafton, Lismore, Tamworth and Mildura. Under the two out of three rule, it would still be possible for the number of owners to fall from six to four in many regional markets like Bundaberg, Townsville and Rockhampton.

In both metropolitan and regional markets, a person in control of a newspaper and the television station would still be able to exercise an unhealthy degree of influence. Even with the two out of three rule, a media conglomerate composed of Channel Nine and the Age would be given the same weight in the voices test as a small radio station like Sport 927. To borrow from my colleague Senator Joyce, the Red Hot Chili Peppers and the Pussycat Dolls would get as many votes in this ballot as the Packers or the Murdochs. That is the farce; that is the absurdity. It is a fact, and you are voting for it, Senator Brandis. The revised test will still take no account of the relative influence of different voices. The fact that some coalition senators have convinced themselves that the two out of three rule protects diversity shows an amazing capacity for self-delusion.

The other alleged safeguard in the package is the ACCC’s power to examine cross-media mergers to see if they substantially lessen competition. If there was one piece of evidence that emerged clearly from the Senate inquiry—and I thank Senator Brandis for interceding in this part of the debate, because he called a spade a spade—it was that section 50 of the Trade Practices Act cannot be relied upon as a substitute for the current cross-media laws. The ACCC is the competition regulator. It has no responsibility for protecting diversity. It is not able to take public interest considerations into account in assessing mergers under section 50.

In order to find that a merger of newspaper, radio or television assets lessened competition in a market for news or opinion, the ACCC would have to demonstrate that news products produced by different media types were substitutes for each other. This is a difficult test to apply in markets like news where products are typically not priced. The ACCC has stated that in order to determine whether, for example, radio and television news were substitutes, it would undertake research into consumer attitudes and conduct surveys to see if people would switch to radio if there was deterioration in the quality TV news.

Several leading competition lawyers have questioned the ACCC’s ability to stop cross-media mergers on the basis that it would lessen competition in the market for news. Peter Armitage, the competition partner at Blake Dawson and Waldron, has described the ACCC’s approach to defining news markets as ‘fairly speculative, brave new world territory’. It is important to remember that the ACCC’s interpretation of market definition is subject to challenge in the Federal Court. The ACCC does not make the law. I can just see Mr Samuels bowling up to the Federal Court and saying: ‘The basis on which I have blocked this merger is that I did a survey of a few hundred people. Thirty or 40 replied and they told me what they thought about whether or not these items were substituted.’ It is going to be a compelling argument! Even Senator Brandis has to smile about it. The Federal Court will not cop such rubbish.

In its report on broadcasting the Productivity Commission stated:

It is clear that the Trade Practices Act as it stands will be unable to prevent many cross-media mergers or acquisitions which may reduce diversity. It is also clear that the adoption by the ACCC of a broader definition of the media market would not adequately address the social dimensions of the policy problem, and will be open to legal challenge.

Let us be clear. The existing current cross-media laws are protecting and generating diversity—(Time expired)