Source : Globe & Mail

Standoff over production fund continues

OTTAWA, TORONTO -- A parliamentary committee has voted to investigate the health of Canada's television production industry, just days after a second major cable company announced that it would no longer support the country's primary support fund for domestic producers.

In a motion passed unanimously yesterday, the House of Commons heritage committee also said it plans to make recommendations to Parliament about how Ottawa can help bolster the industry.

NDP MP Charlie Angus, who proposed the motion, said the recent announcements by Shaw Communications Inc. of Calgary and Vidéotron Ltée of Montreal to stop contributing to the Canadian Television Fund sent a "shockwave" through Canada's television production industry.

Mr. Angus said the motion is designed to put pressure on the government and on the five big companies that contribute to the television fund.

But a Shaw executive said his company is finished with the CTF -- at least for now.

"It's broke -- it's time for a new car," said Ken Stein, Shaw's senior vice-president for corporate and regulatory affairs. "We really don't want anything to do with that fund."

Shaw and Vidéotron say the CTF is inefficient, wastes money on programs that viewers don't want, and shouldn't be providing additional programming money for the publicly funded CBC.

Mr. Stein said his company would like to return the money to subscribers, which could amount to about $15 a year per subscriber.

The CTF, which helps produce many Canadian TV programs, was created 12 years ago to distribute money to independent producers of domestic programs, and is designed to be separate from government and industry. Vidéotron is pushing for an industry-led fund.

CTF officials and Heritage Minister Bev Oda met yesterday in Gatineau, Que., and both sides said the meeting didn't lead to any type of tentative solution, but that it marked a good first step. Ms. Oda is expected to meet next week with content producers and other "stakeholders" who use CTF money.

MaryBeth McKenzie, spokeswoman for the CTF, wouldn't say whether the fund would be willing to change to meet some of the companies' wishes, although she said all sides want a solution.

The companies' recent announcements about CTF contributions sent the production industry reeling, prompting fears of job losses if new programs are shelved. As part of their licence agreements with the federal regulator, cable and satellite companies contribute $150-million annually to the fund's $250-million budget, with the remainder coming from the federal government.

"It's quite outrageous," Mr. Angus said of the companies' moves.

Four of the fund's five major corporate contributors held an emergency meeting Tuesday with Heritage Minister Bev Oda, presenting different arguments on what is wrong with the CTF. Behind closed doors, sources say, the companies raised concerns over how the fund is structured, who is eligible to receive money and whether the dollars are producing enough worthwhile programs -- a criticism raised by Shaw.

Ms. Oda expressed empathy for the companies' concerns following her meeting with them. "I understood that there have been concerns with the [fund] for many years, and that those concerns of the private sector contributors have not been fully satisfied," she said in a news release this week.

The CTF, which has helped fund such programs as CBC's Da Vinci's Inquest and Showcase's Trailer Park Boys, is the main source of financial assistance for Canadian productions, although not all shows draw on the fund. CTV's Corner Gas, for example, drew upon a different fund, made up of contributions to the industry that were required following BCE Inc.'s purchase of a stake in CTV several years ago.

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