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Senate defeats proposed legislation to allow SBS to double advertising in prime time

Proposed legislation to allow SBS to double its advertising in prime time has been defeated in the Senate, a move which SBS managing director Michael Ebeid says “leaves SBS with a $28.5 million hole in its budget over the next four years”.

The vote was defeated 31-28 with Labor, Greens and key independents opposing the bill.

The amendment to the Special Broadcasting Service Act 1991 looked to increase the restriction of no more than five minutes per hour of advertising to 10 minutes of advertising in any hour of broadcasting on the SBS and clarify the network’s ability to earn revenue through the broadcast of programs containing product placement.

The proposed bill also included an amendment to the Australian Broadcasting Corporation Act 1983 to provide consistency between two the acts, repeal redundant provisions and add a reference to digital media services, as well as seeking to repeal 26 Acts and redundant provisions in four Acts in the Communications portfolio.

Ebeid has said the failed passage of the legislation is a “setback” which will force the public broadcaster to make cuts to programming.

 

“Following the ABC and SBS Efficiency Study last year, SBS’s funding was cut by $53.7 million. Of the cuts, $28.5 million was predicated on the Parliament giving SBS slightly more advertising flexibility through an amendment to the SBS Act, whilst maintaining its current daily cap of 120 minutes of advertising permitted,” he said.

“The failed passage of this legislation is a setback and leaves SBS with a $28.5 million hole in its budget over the next four years. Given this legislation did not pass and SBS has largely exhausted back-office efficiencies, this funding cut is unable to be absorbed without impacting programs and services.”

The SBS said it will now consider its contingency plans internally and will provide an impact report to the Federal Government as it reviews its overall funding.

Meanwhile, the industry body representing the main commercial free-to-air channels has described the defeat as a “win for good public policy”, with Free TV chairman Harold Mitchell saying the body is “grateful” parliament rejected the bill.

Mitchell said in a statement: “The failure of the SBS advertising bill in the Senate is great news for viewers and for the continued production of quality Australian content.

“It is a win for good public policy. It never made sense to turn SBS into a 4th commercial television licence, especially at a time when the television advertising pie is flat and we are facing increasing competition from global players who are unregulated and pay little or no tax in Australia.

“We are grateful that the Parliament has decided to reject these changes that the public did not ask for and which would have damaged Free TV broadcasters at a critical time.”

The Greens have welcomed the Senate’s rejection of the SBS advertising bill.

Senator Scott Ludlam, Australian Greens communications person, said in a statement today the party will continue to fight government moves “to weaken our public broadcasters and our national discourse”.

“Prime Minister Abbott promised no cuts to SBS or the ABC, but since coming to office they’re done just that and tried to effectively blackmail SBS with the threat of increased advertising or harsher cuts,” he said.

“People trust the ABC and SBS a lot more than the Abbott Government. The Greens strongly oppose the defunding or creeping commercialisation of a trusted and treasured public institution.

“We will continue to fight Abbott Government moves to weaken our public broadcasters and our national discourse.”

Miranda Ward 

SBS managing director Michael Ebeid statement in full:

SBS’s special Charter to explore and celebrate Australia’s multicultural diversity is at the heart of the organisation.

Revenue raised through advertising goes directly to protecting SBS investment in great Australian programs and services that deliver on our Charter.

Following the ABC and SBS Efficiency Study last year, SBS’s funding was cut by $53.7 million. Of the cuts, $28.5 million was predicated on the Parliament giving SBS slightly more advertising flexibility through an amendment to the SBS Act, whilst maintaining its current daily cap of 120 minutes of advertising permitted.

A survey of SBS audiences showed that 73 per cent would have preferred to accept slightly more advertising in some programs than see SBS programs and services cut.

The failed passage of this legislation is a setback and leaves SBS with a $28.5 million hole in its budget over the next four years. Given this legislation did not pass and SBS has largely exhausted back-office efficiencies, this funding cut is unable to be absorbed without impacting programs and services.

SBS will now need to consider its contingency plans internally, provide an impact report to the Federal Government and review our overall funding. Once this process is complete, SBS will be in a position to outline further details about the impact the failed legislation will have on the organisation.

Free TV statement in full:

Free TV Chairman, Harold Mitchell says “The failure of the SBS advertising bill in the Senate is great news for viewers and for the continued production of quality Australian content.”

“It is a win for good public policy. It never made sense to turn SBS into a 4th commercial television licence, especially at a time when the television advertising pie is flat and we are facing increasing competition from global players who are unregulated and pay little or no tax in Australia.”

“Viewers can be assured that there won’t be more ads on SBS in prime time and that Free TV broadcasters will be able to continue to fund the great Australian programs they love”.

We understand that governments have to make decisions difficult budget decisions. Our concern has always been that any savings should not be at the expense of privately owned companies subject to a range of rules and taxes which SBS does not face.”

“The SBS has an important role in Australian television as do the commercial free-to-air broadcasters”

“We are grateful that the Parliament has decided to reject these changes that the public did not ask for and which would have damaged Free TV broadcasters at a critical time.”

 

 

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