Ottawa takes over television fund dispute

Heritage Minister Jose Verner has told the CRTC that the Conservative government will decide the fate of the Canadian Television Fund (CTF) that has been under attack by two of Canada's large cable operators.

The fund was the subject of heated week-long hearings earlier this month in which Shaw Communications Inc. and Quebecor Inc. told the CRTC they wanted out of the program, saying few people watch the Canadian shows backed by the fund.

With the CRTC set to issue a ruling in the next two months, Verner said Wednesday she wanted the recommendations sent to her department and that the government would make any final decisions.

"Our government takes the need for change at the CTF seriously and values the CRTC's input," Verner said in a statement, a message she also delivered to the Canadian Film and Television Production Association, a supporter of the fund, in a Wednesday evening speech.

The statement came as a surprise because the key issue to be decided whether the $280 million fund will be split into separate streams for commercial TV and cultural-public policy programs is already in the government's realm.

"This is not a purely regulatory issue," said CRTC spokesman Denis Carmel. "We're mostly a vehicle by which the cable operators contribute to the fund."

One major complaint is that the CBC has access to shows produced from the fund even though cable and satellite operators pay about $160 million in annual fees. The federal government contributes the rest, about $120 million a year.

Gravel said the CRTC would decide technical issues such as whether the cable operators would pay into the fund on an annual or monthly basis.

But a government official said the action means the government will make final decisions on the broad range of policy issues concerning the fund and intends to ensure long-term viability for Canadian content.

While unusual, the Conservative government has intervened on CRTC matters before. Last April, the government demanded changes be made on the issue of deregulating local telephone service against the CRTC wishes.

The heritage minister has given few indications of her position on the television fund, which is seen by many in the production end of Canadian shows as pivotal to maintaining a vibrant domestic television industry.

The CTF has financed shows such as Little Mosque on the Prairie and The Border.

"My guess is that we're unlikely to stick with the status quo," said Ian Morrison of the Friends of Canadian Broadcasting. "But I think the government knows this is a political hot potato, and I doubt the CBC will be cut off."