OTTAWA - The federal cabinet is considering a $150-million fund for the country's private broadcasters to help rescue local TV stations and their newscasts, The Canadian Press has learned.
Members of the cabinet priorities and planning committee met Tuesday to discuss their options for helping broadcasters who warn they are stretched to the max, sources said.
The discussions came on the same day that Canwest Global Communications, which owns Global TV network, faced another deadline for reaching a debt repayment schedule with its lenders.
They also came as the government announced nearly $1 billion to guarantee warranties on new vehicles sold by GM Canada (NYSE:GM) and Chrysler LLC.
Canwest, CTVglobemedia and Quebecor have all been lobbying Prime Minister Stephen Harper's Conservative government to come up with both short-term and long-term assistance.
Harper has met with Canwest's CEO Leonard Asper and Quebecor's Pierre Karl Peladeau in the last few months.
The $150-million local programming fund would be tied to news and current affairs programming, and would favour smaller urban centres. A formula would be worked out to ensure that big cities such as Toronto and Montreal did not swallow up the lion's share of the cash.
Whether the CBC would be eligible is still unclear, although the private broadcasters have been lobbying vigorously against it. The CBC is facing a $170-million shortfall this year and is planning 800 layoffs.
One source said the discussions are still "fluid." Proposals have been batted back and forth between cabinet and the Department of Canadian Heritage.
The idea of help for local television has widespread support in cabinet and among the Conservative caucus, where the issue has come up repeatedly at weekly meetings.
Last month, Heritage Minister James Moore confirmed that the government was considering the issue but he would not reveal the details.
The question of how exactly to help the broadcasters is a sticky one. Some Tories favour an approach that tweaks regulations and helps the broadcasters financially, rather than simply handing them more money.
Most of that conversation has centred around the concept of "fee for carriage," a practice whereby the broadcasters could charge the cable companies for transmitting their signals.
But getting the Canadian Radio-television and Telecommunications (CRTC) to make that change quickly is complicated. The commission is currently reviewing the licenses of all the broadcasters, and is also looking at the regulatory regime as a whole.
The change would also be decried by the cable and satellite companies, who warn the fees would be passed on at least in part to the consumer.
"The government is trying to address something in the short term, while recognizing that regulatory changes need to take place -- but that will take some time," said one source.
The political landscape has become more fertile for broadcasters in recent months.
MPs have been clamouring for help for local TV stations, as they feel pressure from constituents who are bracing for the planned closures and sale of their stations. Local TV is also a critical venue for MPs to get out their particular messages.
The Commons heritage committee is currently studying the issue of local TV broadcasting, and MPs from both the Conservative party and the Liberals seemed to be pressing for movement on the fee-for-carriage.
