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Half of private Canadian journalism could now be government supported

News

On Wednesday, the Trudeau government announced that it had reached an agreement with Google that would see the tech giant pay $100 million annually to Canadian news outlets under the Online News Act.

The legislation, which was passed in June 2023, mandates Google and Meta to enter into compensatory agreements with Canadian news outlets for the distribution of their choice on the major internet platforms. Meta has chosen to opt out of the legislation by not featuring news on its platforms in Canada. Google warned that it may adopt a similar position. The window to reach an agreement was closing because the law takes effect on December 19.

The immediate resolution to Google’s possible exit from news in Canada will be a relief to news media outlets of all sizes. But it does create some of its own challenges concerning which outlets will receive funding under the agreement, as well as the total magnitude of direct and indirect government subsidies now going to the industry.

“We’re pretty close, by my estimation, to a 50 percent wage subsidy on journalist salaries up to $85,000 per year,” says Rudyard Griffiths, executive director of The Hub

Canadian Qualified Journalism Organizations were already eligible for the Canadian Journalism Labour Tax Credit which provides refundable tax relief of 25 percent up to an annual cap of $55,000 per eligible newsroom employee.

Last week’s Fall Economist Statement announced that the government will increase the generosity of the tax credit to 35 percent and the annual cap per newsroom employee from $55,000 to $85,000. 

Griffiths estimates that after combining Google’s $100 million in new funding with the now-enhanced federal tax credit, roughly half the salary of a journalist earning $85,000 will be defrayed by the federal government or Google. He says this ostensibly achieves the government’s goal of effectively subsidizing 50 percent of journalistic salaries in Canada. 

“What does it mean long term when as much as half of the newsroom costs of private media organizations, not the CBC, will be paid for by government support?” asked Griffiths. “This likely is not going to be positive for the ongoing challenges that mainstream media is facing in terms of declining public trust in the very news and information that they produce.” 

Trust in Canadian news media has noticeably declined in recent years. According to one survey, the share of Canadians who reported that they trusted the news most of the time fell from 55 percent in 2015 to 40 percent in 2023. Griffiths says this declining trust is unlikely to be reversed when half of newsroom costs are being subsidized by the federal government and large technology firms like Google. 

“They’re paying half of the bills of the very newsrooms that are extensively there to investigate them, challenge them, and report on their policies and prescriptions for society,” says Griffiths. 

Appearing before the committee as a witness, Michael Geist, the Canada Research Chair in Internet and e-Commerce Law at the University of Ottawa, stated that any funds raised for media outlets through the Online News Act would mainly benefit legacy media organizations. 

“The parliamentary budget officer tells us 75 percent of the money goes to the broadcasters, radio, and television largely based on the way it was structured,” said Geist, noting that media in Canada is dominated by a handful of large organizations. “Personally, I think it was a mistake to think that, at a minimum, if the goal was to support the core and what we would think of as newspapers or digital publishers. And that’s where the focus of the legislation ought to have been.” 

Griffiths says it is unclear right now as to whether all media outlets, including both established legacy organizations and newer startups, will benefit from the new Google agreement. He points out that the eligibility for the Canadian Journalism Labour Tax Credit is adjudicated by the Canadian Revenue Agency, while the Google agreement will be overseen by the Canadian Radio-television and Telecommunications Commission.

“There will no doubt have to be some interesting decisions that get made about what the CRTC thinks original news content is,” says Griffiths. “My sense is that you would probably want to allocate the funds as close as you can on a qualified journalist per organization basis.”  

Bill C-18’s consultations began in 2021 when Canadian Heritage met with various news media professionals and experts. In the last 12 years, news media in Canada has shed $4.9 billion in revenue, with over 33 percent of Canadian journalism jobs disappearing since 2010, and 450 news outlets shuttering from 2008 to 2021. 

According to data from Statistics Canada in 2018, there were 13,000 journalists in Canada in 2011. It is estimated that there are roughly between 8,000 and 9,000 working journalists today, meaning that Google’s $100 million contribution should represent something between $11,111 and $12,500 per journalist.

‘Canadians need to feel pride’: Three key insights from David Frum’s Hub Dialogue

News

Last week, The Hub‘s executive director Rudyard Griffiths spoke with leading author and journalist David Frum at a live event at the Gardiner Museum. The two discussed what we learned about Canada since Hama’s attacks on October 7th and the consequences for our social cohesion and national identity. Here are three key insights from their conversation.

1. Rebuilding a national security culture in Canada

“Canada faces a deep internal security problem that the country isn’t prepared, not only to cope with but even, to think seriously about. Canada does not have a substantial national security culture. All problems of security are seen through domestic political prisms. There are so many examples of this including espionage from the People’s Republic of China, an assassination by a foreign government on Canadian soil of a Canadian passport holder, etc. All of these things were interpreted through the prism of immediate political needs for one political party or another without the apparatus and the method to think about them from a national point of view. And we have seen that very much since October 7.

Canada is an amazing immigration success story. When you pull people from all over the world, one of the things that you owe them is a clear message about what the rules of engagement on this new land are going to be. There are things that if you liked them, they were welcomed in your old place, but you can’t do them in the new place. There are many benefits to life in the new place. But the new place has its own customs, its culture, and its rules. And these are the things that have to be done. Although you try to communicate that in the nicest possible way, there also is an enforcement arm where you have an apparatus that is capable of detecting radical and potentially violent activity, and either thwarting it or punishing it. That has been sorely missing including the lack of clarity.

I’m not going to criticize what the Canadian government has said about events in the Middle East. But the lack of clarity about events in Canada and expectations in Canada is really alarming. Those expectations need to be clear, and they need to be backed up by an apparatus with the skill, the technology, and the legal power to protect Canadians from extremism and potential violence at home.”

2. An intellectual self-defence of Canada

“I think it reveals that Canada is in the grips of an ideology that is very dangerous to the health and safety of Canadians. If it’s true that people who identify as Indigenous have the right to murder people who they identify as settlers, that isn’t a principle with a lot of bite, not just in Israel [but here too].

If you have systems of belief that are defenceless to explain why that is wrong, why the whole concept of indigeneity is meaningless, and why the whole concept of settlership is equally meaningless, if a country like Canada can’t explain that, then a country like Canada lacks the wherewithal for an intellectual self-defence. Canada has been on that slope for some time.

That makes it very difficult for Canadians to say ‘I’m proud of this country’s history.’ It is blemished as every country’s history is, but less blemished than just about anybody’s. And as for the blemishes, there’s a process for correcting them.

Canadians need to feel pride. Canadians need to not only feel it but to assert it. If you’ve discovered their fellow citizens who don’t feel that same pride, the majority who do feel it should have ways and arguments that can say in a forthright way ‘You are wrong; it’s a free country, you can have that view, obviously, no one’s going to prevent you from having the view. But at the same time, the majority that have the view of affirmation and pride are not going to be bashful.’”

3. The risks of voting for the Leopards Eating People’s Faces Party

“There’s a common internet joke about ‘I never thought the leopards would eat my face said the lady who voted for the Leopards Eating People’s Faces Party.’ What we’ve seen in Canada and in the United States is, for a long time, there’s been a culture where people say things that other people take offence to and then there’s this massive campaign of suppression not by the government, but by society, to hold them accountable—to give them economic and social consequences including directly targeting their careers.

What has happened since October 7 is that because the majority of Canadians and the huge majority of Americans abhor Hamas terrorists, the people who have been seen to make excuses for them are suddenly discovering they voted for the Leopards Eating People’s Faces Party. Now the leopards are on the prowl, and they’re being devoured.

We’re seeing a social pushback where people are saying ‘We disapprove of people endorsing terrorism on the public dime,’ or people who have honoured positions of instruction are teaching contempt for human life and gleeful disregard for the suffering of families that have loved ones in captivity.”

Listen to David Frum’s full interview with The Hub’s executive director Rudyard Griffiths on the audio player below or on your favourite podcast app.

If you enjoy Hub Dialogues, be sure to check out more insightful commentary on The Hub’s YouTube page: