Paul Fletcher MP

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Broadcasting Legislation Amendment (Media Reform) Bill 2016

Parliamentary Speeches Thursday, 01 December 2016

I am pleased to speak on the amendments moved by the shadow minister, the member for Greenway, and to indicate that the government will be opposing them. The effect of the amendments would be to remove the second schedule of the bill, which is the schedule which gives effect to the government's policy intention to remove the two-out-of-three rule. Of course that forms one of the key limbs of the integrated package of policy measures in this bill, with the other key limb being the removal of the 75 per cent reach rule.

It does seem that Labor is rather conflicted as to what their approach is in relation to legislation in this area. On the one hand we have the shadow minister in her contribution to the debate earlier today criticising this as piecemeal reform. The Labor Party is proposing with the amendments the House is presently considering the removal of one very substantial component of this integrated package of reforms. On the one hand she says it is piecemeal; on the other hand her plan is to make it even more piecemeal. This is not a logical approach; it is not an approach that the government is prepared to agree to. What we have in the bill before the House is an integrated package of reforms in the regulation of media in this country.

Let me remind the House that much of the legislative framework governing broadcast media in this country was developed at a time when there were only three principal media platforms—newspapers, TV and radio. It was well before smartphones, well before social media, well before streaming services. One key element of a legislative framework which was developed in a different time was the two-out-of-three rule, and that rule, which continues to have effect on the statute books today, prevents a person from controlling more than two out of three regulated media platforms—commercial television, commercial radio and associated newspapers in any commercial radio licence area. That is a rule that needs to be analysed and assessed in terms of its impact today on Australian media companies, employing Australians, with Australian investors—important Australian businesses. You have one set of businesses which are subject to this restrictive and prescriptive set of rules but at the same time you have other unregulated platforms owned by businesses all around the world, freely available to Australian consumers. Of course the increase in media diversity is a good thing, the increase in choice is a good thing, the increase in the options available to all Australian media consumers, thanks to the extraordinary development of the internet, is a good thing. But the parliament of Australia needs to be cognisant of the economic impact of fundamental technological transformation, and in turn fundamental economic translation, on Australian businesses. The reality is that from a consumer perspective online media is no longer viewed as something distinct from more traditional media platforms. Audiences in Australia and overseas now use multiple sources.

I do want to remind the House that changes to this rule would have a material impact only in capital city markets, and here I exclude Darwin and Hobart, and in a limited number of larger regional licence areas where for the most part sources of news and information are multiple and widespread and the maintenance of diversity is not generally an issue. In most regional and remote markets the removal of the two-out-of-three rule would have minimal impact. I also remind the House that media transitions would still be subject to general competition laws as administered by the ACCC.

This amendment moved by the shadow minister is not one that the government will support. It is ill thought through and it would undermine what is a comprehensive package of reforms.


First of all, can I expand on the answer I gave previously and correct a small misstatement I made. The rule that I was referring to is known as the minimum voices rule or the 5/4 rule. That is a rule, which is in the legislation now and will continue, that there must be at least five independent media voices in metropolitan commercial radio licences areas and at least four in regional commercial radio licence areas. Just to explain, there is a rule today, and that rule will be maintained regardless of the passage of the bill before the House this afternoon. That rule requires that there must be at least five independent media voices in metropolitan commercial radio licence areas and at least four in regional commercial radio licence areas. That is defined in media 'voices', but the reference area that is used is the metropolitan commercial radio licence area, or the regional commercial radio licence area. That determines the geographic area in which the rule applies. There must be at least five independent voices in a metropolitan commercial radio licence area and four in a regional area. Of course, a 'voice' can be radio or television.

The next rule that applies today, and will continue to apply—

The DEPUTY SPEAKER ( Mr S Georganas ): On a point of order, Member for Kennedy?

Mr Katter: In answer to my question, he has said—


Mr Katter: It is a genuine point of order.

The DEPUTY SPEAKER: I will listen to your point of order.

Mr Katter: From his answer to my question 'Does it apply to television and newspapers?' I am not clear at all, and I do not think anyone else here is clear. Does it apply to television and newspapers?

The DEPUTY SPEAKER: The member for Kennedy may have an opportunity to speak again at another time.

Mr FLETCHER: Let me expand upon the explanation of how the minimum-voices rule works. Step 1: you go to a commercial radio licence area, either in a metropolitan area or a regional area. Step 2: you ask yourself: in that area, are there are at least five independent voices? An independent voice can be a television station, a radio station or a newspaper. There must be at least five in a metropolitan area. There must be at least four in a regional area. That is the rule that applies today. That rule will continue to apply should this bill pass into law. That is the first law which will continue and will continue to be an important determinant and safeguard of media diversity.

Mr Katter interjecting—

Mr FLETCHER: The criterion is 'independent'. That is to say, if two of them are owned by the same owner, that does not count as independent.

The next rule that will continue to apply is the one-to-a-market rule, which is that a person, either in his or her own right or as a director of a company, must not exercise control over more than one commercial television broadcasting licence in a licence area. The third rule which applies today and will continue to apply is the two-to-a-market rule. That is the rule that a person, either in his or her own right or as a director of a company, must not control more than two commercial radio broadcasting licences in the same licence area. I go back to the explanation of the five-four rule.

The DEPUTY SPEAKER: On a point of order, Member for Kennedy?

Mr Katter: I crave the indulgence of the chair here. Can one entity own all of the television—

The DEPUTY SPEAKER: The member for Kennedy does not have the call. This is not a debate between the two members. I ask that you resume your seat. There will be an opportunity to get up. This is not a debate. It is not question time.

Mr FLETCHER: The short answer is no. I am happy to repeat that, for clarity. The answer is no.

The point that I make is that there are a series of rules which apply to deliver an outcome of media diversity, and those rules will continue: the five-four rule, otherwise known as the minimum-voices rule; the one-to-a-market rule; and the two-to-a-market rule. I have just run through each of those. Under this bill, two provisions, two existing rules as part of the regulatory regime, will be removed—the 75 per cent rule and the two-out-of-three rule. (Time expired)


It hardly needs to be said, but regional members on this side of the House would know full well that the quality of advice from the member for Greenway about what serves the interests of regional Australians is poor indeed, because the reality that underpins the reforms in the legislation before the House this afternoon is that the three regional television broadcasters, PRIME Media Group, Southern Cross Austereo and the WIN network, strongly support this bill, and they do this because of concerns about their continuing economic viability under the present arrangements and, with that, the capacity to provide continued employment in regional Australia. I can tell this House that there is one side of this House which has a strong track record on protecting the economic interests of regional and remote Australia, and it is not the Labor side of the House.

A critical reason for this legislation being before the House this afternoon is precisely to protect and advance the economic interests of regional Australia, including the regional broadcasters who are a strong employment presence and a strong community presence in regional Australia, and it is important that that strong presence be maintained. Let me refer the House to the report of the Senate committee which has looked at this legislation, which observes at paragraph 2.36:

The regional television broadcasters (Prime Media Group, Southern Cross Austereo and the WIN Network) … strongly support repealing the two control and ownership rules.
And the shadow minister engaged in a world-class piece of selective quotation and selective referencing of third-party groups, because she had one media organisation that she referred to, and she did not give a balanced picture.

Let us have a look at what the Senate report had to say at paragraph 2.38 on the ripper suggestion we have got from Labor this afternoon, that these two provisions should be split. What did the Senate committee conclude about this, Mr Deputy Speaker? You may be interested to know. Here is what the Senate committee concluded:

Prime Media Group, Southern Cross Austereo, the WIN Network, Ten Network and Fairfax argued that the repeal of the 2 out of 3 rule should occur at the same time as the repeal of the 75 per cent reach rule.
So it turns out that, despite the highly misleading statements by the shadow minister, there is extensive industry support for the integrated package of reforms that the coalition is putting forward to the House this afternoon.

For example, what was said to the Senate committee by a witness, Ms Annabelle Herd, from Ten Network Holdings? She had this to say:

The point about not splitting these two issues is: why would you split them? I certainly have not heard an argument from anybody about what the two-out-of-three rule is actually doing right now to protect diversity.
So there is an integrated package of measures that is before the House in this bill this afternoon. It is a package of measures, as the Senate committee report demonstrates comprehensively, which is widely supported by an extensive range of industry players. It is motivated—our urgency here is motivated—by a desire to preserve the viability of businesses which are vital to serving regional Australia.

On the Labor side of the House, what we have seen is indolence and obstructionism, when it comes to this package of measures, because of their evident indifference to the economic impact of this on regional Australia. This side of the House is committed to regional Australia. That is why we have put the bill forward in the form that we have. That is why we say very clearly to the House this afternoon: do not be confused; do not be misled by this ill-conceived stunt, in these amendments that are being put forward by the Labor Party this afternoon. The only game that is being played here is obstructionism. The only game that is being played here is delay. The Labor Party is prepared to frankly make hostages of vital regional businesses rather than engaging with what is a critical economic reform that is strongly supported by the three regional broadcasters and a wide range of other stakeholders in the sector.

Authorised by Paul Fletcher MP, Level 2, 280 Pacific Highway Lindfield NSW 2070.

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