Question Period Note: Federal Support for Journalistic Content

Canadian news and magazine organizations face many challenges. The COVID-19 pandemic and its impact on the economy has exacerbated the situation of journalism and media, already weakened by declining advertising revenues. To support these organizations, Budget 2022 allocated an additional $10 million in 2023-24 for the Local Journalism Initiative and $40 million over three years (2022-25) for the Canada Periodical Fund.

• Our government recognizes that the news and magazine industries have faced significant economic pressures for years and these challenges have been exacerbated by the COVID-19 pandemic.
• Through Budget 2022, the Government of Canada will be investing an additional $50 million dollars over three years to support the availability of journalistic content to Canadians: $10 million in 2023-24 for the Local Journalism Initiative and $40 million over three years for the Canada Periodical Fund.
• Canadians deserve to have robust newspapers and magazines. We remain committed to supporting the news information ecosystem while respecting the freedom of the press.

Local Journalism Initiative (LJI) and the Canada Periodical Fund (CPF)
• The Local Journalism Initiative (LJI) supports the creation of original civic journalism that covers the diverse needs of Canada's underserved communities has resulted in the hiring, or maintaining levels, in employment of 435 journalists in 2020-21. Collectively they offered journalistic coverage to 1,943 underserved communities, including 59 Indigenous, 69 ethnocultural, 122 official-language minority and 1 LGBTQ2+.
• To further support local journalism for underserved communities, the 2022-23 Main Estimates provided $5 million in contributions and Budget 2022 allocated an additional $10 million in 2023-24 for LJI.
• The Canada Periodical Fund (CPF) provides financial assistance to Canadian magazines, non-daily newspapers and digital periodicals to enable them to overcome market disadvantages and continue to provide Canadian readers with the content they choose to read. The program has four components: Aid to Publishers, Business Innovation, Collective Initiatives and Special Measures for Journalism. The bulk of funding is distributed through the Aid to Publishers component, which uses a funding formula based primarily on the number of copies sold and gives publishers the flexibility to spend funds as they see fit.
• Budget 2022 provided $40 million in funding under the CPF:
o First, Canadian Heritage re-launched the Special Measures for Journalism component with a new investment of $38.5 million over 3 years, starting in 2022-23. This funding will support publishers that have a free circulation model or low levels of paid circulation or that are published in digital format.
o In addition, an investment of $1.5 million over 3 years will be provided in the Business Innovation component of the CPF, beginning in 2022-23, for new and unique projects that focus on innovative ideas that can help magazines and community newspapers.

COVID-19 Emergency & Recovery support for journalism
• The Government offered additional support to magazines and community newspapers during the COVID-19 pandemic.
o Budget 2021 increased the budget of the LJI program by $10 million over two years, with at least 60 percent of this funding reserved for groups that are often underrepresented in the media (e.g., Indigenous, ethnocultural and official-language minority communities).
o Through the Aid to Publishers component of the CPF, existing magazine and community newspaper clients received a $15.4 million top-up in 2020-21 and $10 million in 2021-22 which was provided to 571 and 754 recipients respectively.
o Also, via the Special Measures for Journalism component of the CPF, the Government provided $45.4 million in 2020-21 to 792 new recipients, including free, digital and small-circulation periodicals, and provided an additional $23.5 million in 2021-22.

Fiscal measures to support journalism
• Budget 2019 reaffirmed and clarified three measures to support Canadian journalism that were previously announced in the 2018 Fall Economic Statement:
1. the implementation of a 25 percent refundable tax credit on journalists’ salaries for eligible news organizations;
2. a temporary 15 percent non-refundable tax credit for Canadians on digital news platform subscription fees; and
3. a change to the status of registered journalistic organizations to allow them to receive and issue official receipts for donations, tax-free. These measures are estimated to cost $595 million over five years.

Recent industry developments
• The proposed Online News Act (C-18) is currently in second reading in the Senate. Bill C-18 would require digital giants such as Google and Facebook's owner Meta to negotiate agreements to compensate Canadian media companies for republishing or linking to their content on their platforms.
• Since the beginning of the pandemic, 78 news outlets closed including 65 community newspapers. However, in the same period 57 new local news outlets have launched (2 TV stations, 5 radio stations, 9 community newspapers and 41 online/digital-only news organizations). (Local News Map Data, Local News Research Project, December 2022).
• Due to Government support and a recent boost in advertising revenue some news organizations have experienced some stability and growth. Since the peak of the pandemic closures 16 community newspapers have reopened, although overall job losses have continued upwards (Local News Research Project, 2022).

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