As we in this place are all aware, the regional commercial broadcasting industry has certainly been making its case for change, for some time, in this House. The government’s Broadcasting Legislation Amendment (Television and Radio Licence Fees) Bill 2016 amends the Television Licence Fees Act 1964 and the Radio Licence Fees Act 1964 to permanently reduce the licence fees payable by commercial television broadcasting licensees and commercial radio broadcasting licensees by 25 per cent.
This, as you know Mr Deputy Speaker Broadbent, is in response to those constant and persistent representations by commercial broadcasters and a genuine awareness of all of us in this House and in parliament that their environment has significantly changed. Commercial television broadcasting licensees and commercial radio broadcasting licensees are required, under the relevant acts, to pay broadcasting fees, which are levied on an annual basis as a sliding percentage of the licensees’ gross earnings for that particular year.
For television, the maximum rate of licence fees payable is 4.5 per cent of gross earnings applicable to licensees with revenues in excess of $100 million. The current rate of television licence fees were set following an amendment to the Television Licence Fees Act 1964 in 2013, which provided a permanent 50 per cent reduction in commercial television licence fees. In relation to radio, the maximum rate payable is 3.25 per cent of gross earnings applicable to licensees with revenues in excess of $11.5 million. There have been no changes to the rate of radio licence fees since 1991. What we do know is that there has been a massive change in the media landscape during the last few years. We have seen total disruption through the internet. This bill will permanently reduce the rate of broadcasting licensing fees by 25 per cent per annum, effective for licence fees payable from the 2015-16 financial year, giving effect to a measure contained in the 2016-17 budget.
This fee reduction recognises that the Australian media market has changed significantly—dramatically, in fact —since broadcasting licence fees were introduced. With the move to online and on-demand content fragmenting the market for media services and significantly increasing competition, commercial television broadcasters are the largest funders of Australian content and remain a key source of news for Australians, especially for those of us who live in rural and regional Australia.
The reduction in broadcasting licence fees contained in this bill will allow commercial broadcasters to more effectively meet the challenges of an increasingly competitive global environment and continue to be able to invest in high-quality content. The bill will also amend the Radio Licence Fees Act to permit regulations to be made for licence fee rebates, mirroring a provision already contained in the Television Licence Fees Act.
When I look at the regional broadcasters and I look at the south-west of Western Australia, where my electorate is, my regional broadcasters produce local news, news that is relevant to our audiences in our market. There is nothing like being a local person and turning on your local TV station and watching news about people and places that you actually know. They also constantly update their news services.
For us in rural and regional Australia they provide jobs in our regional communities, jobs for people like journalists, editors, camera operators, broadcast engineers, IT technicians, and sales and administration staff.
But even more significantly, they are often the wonderful starting point for a lot of our reporters who go on to greater things at a national level. It is the training ground for local reporters. They have great aspirations, but they need a starting point. Where do they start? In local and regional areas. They start in local media.
These regional broadcasters also provide incredible support for local regional communities. They engage with their communities. They are directly connected. They are at every local major event. We see them out on the ground—the regional broadcasters are going to cover it. You know they are going to be there. They pay licence fees to ACMA as well to comply with the code and captioning obligations. They also pay tax in Australia. Because of their affiliation agreements, they pay affiliation fees to networks as well.
They are engaged in an absolute battle, as we know. I think everybody in this House understands the battle that our regional broadcasters face, whether it is to simply exist or for the advertising dollars, with the likes of Foxtel and through all the internet services that are both local and global. These operators are in their licence areas. It is an extremely aggressive, competitive space. It is changing constantly and it has a multitude of players.
The government decision to reduce the fees recognises these facts. It recognises that the Australian media market has changed unbelievably since the broadcasting licence fees were first introduced. In the current media environment the move to online and on demand content is absolutely fragmenting the market for media services. It is increasing the competition for audiences and for the advertising dollars. I look at WIN TV, Prime and GWN7 in my part of the world, and Southern Cross TV. It is placing increasing pressure on our commercial broadcasters —these same broadcasters that are regulated and paying licence fees, whose main competitors, including online operators like Netflix and Apple, pay no licence fees. You only have to look around—YouTube, Facebook, Instagram, Amazon Prime, Google Play, Presto, Apple iTunes, Foxtel Go, Quickflix. It is a matter of what is next. This is not the end—it is only the beginning of more and different services that are going to be provided.
These services do not provide my community with local news and they do not provide my community with regional employment in the south-west of Western Australia. My regional broadcasters cover things like local AFL footy finals and major sporting events, then we see this on our local news bulletins. They cover things like the local emergencies. During the Yarloop and Waroona bushfires my local regional stations were giving us updates all the time. We even see local ads. That is exactly what we want to see in our part of the world. We do not want to see an ad for a product or service that is in Perth or over east or wherever; we want to see what is available in our south-west. That is what our community broadcasters do. They even deliver community service announcements that are relevant to us where we live, where we work, where we retire and where we invest.
But there are more changes ahead. We only need to look at young people to see how their habits have changed. As the members in this House know, I do a lot of cybersafety presentations in schools and community groups. We have heard statistics quoted today about the change in people’s habits. We know that there are fewer and fewer people reading physical newspapers. There is an increase in the number of people who want their information and news live, now, at the moment it is happening. And they are receiving their news online in various forms.
Of course, this has put significant pressure on our local community newspapers. In our small communities, what people, and even younger people, do read is the very small and often free local newspaper. There is one in a little place called Brunswick, which is known as the ‘Moos paper’, because it is very much a dairy community and it does get read. It is all about local people and local events, and it means something. That is the connection that is required, and that is what regional broadcasters provide—the connection with community.
The 2016-17 budget included a measure to permanently reduce the rate of broadcasting licence fees by 25 per cent a year, and this bill gives effect to that budget measure by amending the Television Licence Fees Act 1964, as I said earlier. These amendments will provide that commercial television and radio broadcasting licensees must pay a fee that is 75 per cent of the amount otherwise due to be paid in a given year. The bill also introduces a measure to address an anomaly between the two licence fee acts relating to the making of regulations.
The bill also amends the Radio Licence Fees Act 1964 to address inconsistencies and to provide flexibility in the future administration of the licence fee regime as it applies to commercial radio broadcasters. The measures contained in this bill will build on the government’s media reforms contained in the Broadcasting Legislation Amendment (Media Reform) Bill 2016, which will repeal redundant media control rules and enhance local content obligations on regional commercial television broadcasters.
We do know that the Australian public is best served by a strong and vibrant free-to-air commercial broadcasting sector. These reforms provide tax relief to assist Australian broadcasters so they can be better positioned to invest in Australian content and local jobs and to maintain their presence in rural and regional Australia. I commend the build the House.