HERI Committee Meeting

STANDING COMMITTEE ON CANADIAN HERITAGE

COMITÉ PERMANENT DU PATRIMOINE CANADIEN

EVIDENCE

[Recorded by Electronic Apparatus]

Thursday, February 17, 2000

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[English]

The Chair (Mr. Clifford Lincoln (Lac-Saint-Louis, Lib.)): I declare open the meeting of the Standing Committee on Canadian Heritage.

[Translation]

The committee is meeting today to hear from the new President and CEO of the CBC.

[English]

We are especially pleased today to welcome the new president of CBC, Radio-Canada, Mr. Robert Rabinovitch, who comes to us with immense challenges but also great expectations.

I think your appointment was extremely well received by all. We congratulate you. We welcome you here and we're ready to hear your message and follow up with questions by the members. CBC represents a huge element in all our lives. It's an icon for most of us, so we are anxious to hear from you. The floor is yours, Mr. Rabinovitch.

[Translation]

Mr. Robert Rabinovitch (President and CEO, Canadian Broadcasting Corporation): Mr. Chairman, members of the committee, thank you for inviting me here. I am very pleased to be here for what I hope will be the first of many appearances.

I am now three months into the job and quite frankly, each day is a new learning experience for me. I have a long way to go in my learning curve. I view my job as an ongoing immersion course and it's going to take me at least another year or two before I'm fully up to speed. I still have a great deal to learn about the CBC, the country's largest cultural institution.

[English]

I would like to take this opportunity as well to introduce Jim McCoubrey, the executive vice-president of the CBC and the chairman of the re-engineering task force I have put into place. We anticipate that it will be the leading edge of changes within the CBC. Jim's role is critical, and I'm sure we will be discussing it later on as we go ahead.

I have not come with any other people this time. I presumed this to be the first meeting where I would get a chance to talk and exchange opinions and views with members of the committee. If there are issues we cannot handle, I'll take them under advisement, as you would say, and get back to members as quickly as I can. I'd like to say a couple of words to start with, and then I am available to answer your questions.

I'd like to start with the current environment we are in. This is an environment that is changing and changing rapidly. We are into an era of mega-mergers: AOL merging with Time Warner and turning around a week later and merging with EMI; BCE and Teleglobe; Rogers and Videotron; Polygram and Universal.

A voice: Reform and Tories.

Mr. Robert Rabinovitch: The result of all these mergers can play havoc with Canadian producers and artists. In a world dominated by non-Canadian companies, there's a very important question we have to ask ourselves: how do we ensure that foreign gatekeepers allow and ensure that Canadian stories and Canadian talent get air time? I think it's something we will all have to look at, and CBC in particular has a very important role to play in this field.

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It's also an era of great opportunities. The changes that are going on now with the Internet as a new system of distribution, as a new system of linking communities together, is a great opportunity for all of us and one we cannot ignore and must participate in.

Finally, we have new specialty services arriving daily, some American and some Canadian. The CRTC has called for more licensing of new services. This is inevitable, but it does result in fragmentation of audiences and it does result therefore in smaller audiences for conventional broadcasters. Within this context, we have to look at the fiscal realities within which the CBC operates.

I will now ask Sheila to pass out a deck outlining the CBC's financial situation as we see it. I don't intend to review every page on this deck, but rather to highlight a few of the pages. I will, however, answer questions today and I will also answer questions at a later date, whenever you wish.

I want to make one point very clear to start with. This is not a plea or a request for additional funding from the government at the present time. I am very strongly of the opinion that our first step is to ensure that we have in the CBC as efficient a public broadcaster as possible. I'm very convinced, as I will refer to later on, that we can and should be generating more of the funds internally. However, we do live within a very tight fiscal reality, and this is what I'd like to bring to your attention at the present time.

As you will see if you turn to page 3, our operating grant from the government has decreased over the past five years to $760 million. Consequently, our dependence on other revenue has increased. On page 5 of the deck you will see that $250 million of that $760 million operating grant supports our four non-commercial radio networks. That leaves $500 million to run two national television networks with more than 25 individual stations. On page 6 you'll see that the $500 million is in turn divided into approximately $200 million for French television and approximately $300 million for English television.

To put this into context, the BBC's budget is about £3 billion, or $7.5 billion. The new chairman of the BBC just took office a couple of weeks ago. Actually, it was a couple of months ago; it's been a slow entry into the job, a different process from what we have here. He has indicated that he wants to cut out a level of management, which he hopes will result in a £300 million saving. That's approximately $750 million, which just so happens to be the size of our entire grant.

To put it into context, this is a system that basically works in one language and one can say almost has but one transmitter with several repeats. This is what we are compared to from time to time. I should note that given the size and the population spread, the costs of actually running the English network are higher than the cost of running the French network, and that accounts for most of the differences between the two networks.

While we have stable government funding, our costs are increasing due to such things as inflation, wage settlements, increased broadcasting and copyright expenses, and some taxes, such as property and water taxes. The result is that the CBC's budget is fixed but in fact decreasing.

In an environment of such a budget, we must also balance our books each year. To do that balancing in the past few years, we have relied upon a series of one-time solutions. The result of this is that we have made it work, but we have not undertaken the fundamental structural changes that are necessary to the CBC. Hence, the operating deficit continues to grow. In short, we have attempted to do the same things with less money, and despite the valiant efforts of our employees, it's beginning to show at the edges.

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We are now also more dependent on advertising revenue and other revenues than we have been in the past. It's important to note the 1999 McKinsey report on public broadcasters around the world. It concluded that if you increase the dependence on advertising in public broadcasting, the result is a more general, less distinctive service, and that this reliance on general programming at the expense of distinctiveness can potentially compromise the rigours of a broadcaster's schedule.

You may want to know a bit about my objectives and where I plan to go with the CBC. I've been on the job, as you know, for three months. It's been an exciting three months. Things happen much quicker than I ever expected them to happen. I still think, as I mentioned when I started, I have a long way to go in my learning curve, but there are certain objectives I have, and I'd like to define them.

I want the CBC to be a true public broadcaster. For that to occur, I believe we have to look at, one, fewer commercials; two, we must maintain credible, independent journalism; three, we have to focus on distinctive programming of the highest quality; and four, we must maintain and develop more excellence in children's programming.

I'd also like to see the CBC take risks. One of the benefits of the CBC is that it can take risks in its programming. Sometimes it will win and sometimes it will lose. Sometimes it will be a success and sometimes it will be a failure. But I think it's important to take risk and take some chances. An example is the Drop The Beat program that appeared on CBC starting a week ago Monday in a language that I don't understand. It's neither English nor French; it's a language that our kids speak. But it's important to do it. It's also an interesting program because it works with the Internet and is interactive in a very unique way, in a way that I hope we'll be able to do more of in the future.

Perhaps we'll have the opportunity to discuss some of our plans later on for what was the Radio Three project.

If we are going to achieve these objectives, we have to focus on programming and content. That is basically what our job is. To do this, we need to find more money. I recognize that this must be done through internal reorganization. One thing is certain. The CBC cannot continue to be all things to all people. We are overstretched and we must focus on what we do well. We must have the courage to get out of areas where others are doing a good job and where perhaps we are not doing a good job. It takes courage to do that because that calls for fundamental change. Fundamental change is required, but fundamental change is also painful. For organizations that go through fundamental change, there has to be a desire and a recognition of the need for it, and I believe at the CBC there is such a recognition.

In December I created a re-engineering task force, and I asked Mr. McCoubrey to take on the task of leading that task force. I'll go through a couple of its areas in a second, but I've asked him to look at both nuts and bolts and some of our programming areas. I believe we have to look at different ways in which we produce our product, and we have to look at some of our assets and see if they can be converted into revenue for the corporation. The task force will take no prisoners. There are no sacred cows. It will look at everything.

It has begun by looking at four areas in particular: a restructuring and redesign of English-language television; our property management system; our transmission and distribution system; and our method and means of sports programming. It is my hope and desire and belief that efficiencies will be created that will result in more flow of funding to enhance our programming.

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It is my hope as well that you can be of assistance to me and to the CBC in helping to define what is wanted, what is expected, and what can really be done by a public service broadcaster.

I return, in conclusion, to a point I made earlier. I don't believe for a moment that we should or could or will ever be able to stop some of the mergers that are going on right now. I believe it is inevitable. I come from that sector. That is where I was in the business world. I am, however, very concerned as a Canadian that we ensure that Canadian stories get told, that Canadian stories get on the air, and that Canadian talent be discovered and exposed on the airwaves.

Some of the resulting synergies of these mergers are that there is a limitation on the types of artists that are now being attracted, and in the process, inevitably, I fear that some of our Canadian artists, especially in the music world, will get short shrift. Again, I say this is not an argument against these mergers. It's an argument for Canada to look realistically at what we can do, and I believe the CBC is an integral part of any Canadian response.

Thank you very much.

The Chair: Thank you very much, Mr. Rabinovitch. I think in your remarks you have laid before us the immense challenges that you face and that we all face regarding the CBC.

I would like to turn now to Mr. Mark or Mr. Breitkreuz. Mr. Mark.

Mr. Inky Mark (Dauphin—Swan River, Ref.): Thank you, Mr. Chairman. I'd certainly like to welcome Mr. Rabinovitch and Mr. McCoubrey to the committee, and also belated congratulations on your appointment as the president and CEO.

There's no doubt, as stated in the opening remarks by our chairman, that CBC is dear to most Canadians, including myself, who grew up in the 1950s and 1960s, when really that was the only game in town. Certainly today there are lots of changes, but I believe CBC must return to its roots, and that is informing Canadians about each other and also serving as a vehicle for Canadians to communicate with each other.

I'm sure that members of this committee will ask you about Midday later this morning. This is essentially, in my discussions and travels throughout the country, what makes CBC radio, in both languages, so successful—because Canadians are endeared to the service they provide.

I just want to give you an example of where I come from. My riding is 200 miles long by over 100 miles wide. It's basically rural. Many of the people who live there don't have access to cable or satellite or Internet. It's about a four-hour drive out of Winnipeg. In my 10 years as an elected official, CBC has really been the only public broadcaster that would make the effort to drive four hours out to that area to cover any story or stories—consistently.

My concern is that if CBC goes off the air, certainly it will affect my constituents. And yes, there are sectors in the private sector that do a good job, but will they do what CBC is currently doing in terms of covering areas that may not be cost-effective, as a public service, which is the job of a public broadcaster? My question is, can you assure Canadians that centralizing CBC to Toronto, certainly on the English side, will not kill the regional operations from coast to coast?

Mr. Robert Rabinovitch: Thank you, Mr. Mark.

The CBC is, as I mentioned in my opening remarks, reviewing all of its operations. It is reviewing this within the context as well and especially of the Broadcasting Act.

We recognize that we have an extremely important role to play in connecting Canadians, and there is no question in my mind that there may be changes in how we do our work, but there is no doubt that we will maintain our news presence, our ability and need to cover events across the country, and to explain what is going on in various parts of the country to other parts of the country.

Mr. Inky Mark: My second question is this. Your predecessor indicated to me that in the year of the millennium the CBC will assure Canadians that they will watch a large number of productions celebrating our history. It must be the millennium projects. I actually haven't had a lot of information in terms of what's happened, so I would like to ask you, in reference to that initiative, how much money was spent, where was it spent, and when will Canadians see the product?

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Mr. Robert Rabinovitch: I can't give you a dollar breakdown today, but we will endeavour to do that. The year continues. It started with a bang, so to speak, where more than 39% of Canadians tuned into our millennium programming. I think it was extremely well received across the country.

We have engaged in a very significant history project, the history series that will begin at the end of September, the beginning of October. I think it's a 30-hour series. It's a unique program between Radio-Canada and CBC packaged together, which I believe, from what I have heard and seen, will be a very unique contribution to telling the Canadian story and Canadian history.

Mr. Inky Mark: Since there is a difference of opinion in terms of what Canadians want from the CBC as a public broadcaster, do you have any plans to survey the public? In your summary you say “ Canadians must confront the hard questions of what they expect from the public broadcaster”. Do you have any plans to consult with the public to find out what they want?

Mr. Robert Rabinovitch: We consult with the public very regularly. I believe this committee is a means of consulting with the public. We have our reports to the public, and we try to talk to them, be it on talk shows.... Two of the vice-presidents just did one in Newfoundland. We listen to what the CRTC has said with respect to their opinion as to what the CBC should be, and of course we have a board that is directly responsible and represents various aspects of the public.

The answer is that we are, I believe, and I think we should continuously be, in discussion with the public.

Mr. Inky Mark: Are you going to give Canadians the opportunity, through a comprehensive survey procedure, to have input into what they consider to be essential public service of a public broadcaster?

Mr. Robert Rabinovitch: I would be most willing to consider it and to look at that. We have done a lot of survey work. We have a research department whose job it is to do that regularly. I'd like to see what we have and I'd like to share it with you.

Mr. Inky Mark: Thank you.

The Chair: Monsieur de Savoye. We'll get back to you, Mr. Mark.

[Translation]

Mr. Pierre de Savoye (Portneuf, BQ): Thank you, Mr. Chairman.

Mr. Rabinovitch, in appearing before the committee this morning, you have shared with us your vision of the corporation while at the same time you have raised many questions. What you've presented isn't in fact your action plan, but rather a list of questions about strategic directions and challenges. I trust you realize that we won't be able to find the answers to all of these questions this morning.

As a rule, the opposite occurs, that is we are the ones who ask the questions. In fact, I do have several questions for you, ones which I hope will help us identify these strategic challenges.

You stated earlier that the English and French networks had different operating costs. The reason for this, obviously, is that the English network is larger, although we mustn't forget that the French network also broadcasts from coast to coast.

I have here some historical financial data, along with some financial projections about the Corporation's situation. I note that there are two types of costs: on the one hand, programming costs, that is the cost of producing programs, and on the other hand, costs associated with leases, broadcasting, distribution, collection and payments to affiliated stations. Obviously, costs other than those associated with programming are moderately higher for the English network than they are for the French network.

However, just between you and me, there are only 24 hours in a day, whether we're talking about the English network or the French one, and one hour of programming costs more or less the same, whether it is destined for broadcast in English or in French. The fact that the English viewing audience may be larger than the French viewing audience shouldn't make any difference in terms of programming costs.

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Yet English programming costs are significantly higher. Currently, French language programming costs anywhere from $280 to $300 million, whereas the tab for English language programming is somewhere between $430 and $450 million. Don't you agree that there is some ground to be made up on the French programming side, particularly in light of your mission, which is to meet the needs of francophone communities outside Quebec, not to mention those of Quebec itself, which has a great tradition of loyalty toward the Corporation.

Mr. Robert Rabinovitch: I'll have to think about this for a moment before I can give you a direct answer. As I see it, programming costs are not the same for the two networks. For example, the English network pays more for copyright and the like.

Programming in the case of the French network is much more centralized. The English network has more regional productions. I'd like to increase French service and programming in the various regions, but for the time being, French programming is more highly concentrated in Montreal. Therefore, costs really aren't the same.

Mr. Pierre de Savoye: I understand what you're saying. However, my question was based on information supplied to us earlier by your own officials. It showed that costs for both categories of programming were substantially the same. Perhaps you would care to give us an answer in writing and to forward it to the clerk. This might give us a better understanding of these differences and the reasons for them.

This being said, I would like to point out that from a francophone and in particular, from a Quebec perspective, we are concerned about the transcultural nature of certain programs. Sometimes, we get the feeling that money which should have gone to national French language programming is diverted either in whole or in part to English programming, which only make the perceived gap wider.

Mr. Robert Rabinovitch: We try to use the resources we have to improve programming for both networks. It's not a matter of taking funding from one network and giving it to the other, but rather a matter of trying to produce coast-to-coast Canadian programming in English and in French.

Mr. Pierre de Savoye: You must understand that when I talk about funding earmarked for English programming, I meant that given the transculturation phenomenon, we end up with French programming with English undertones that we could well do without. Canadian francophone and Quebec culture certainly have the necessary maturity and richness to stand on their own. Transculturation is a new, worrisome phenomenon. Would you care to comment about this?

Mr. Robert Rabinovitch: In my opinion, it's not a question of one culture dominating the other, but rather of one culture contributing to the other. This doesn't mean promoting the dominance of one culture, but rather providing support so that both cultures can develop together.

In today's global environment, cross-cultural contact is commonplace. I would hope that this phenomenon will enrich the two cultures.

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Mr. Pierre de Savoye: Mr. Rabinovitch, your comments haven't reassured me. Imagine for a moment that you return here in one or two years and talk about two cultures enriching each other, but this time in reference to the Americans. I think the people seated here at this table would be ready to bite your head off. Quite frankly, I'm very disturbed by what you just said about one culture influencing or enriching another. I don't think this is the approach that we should be taking.

I'll have more questions during the second round, Mr. Chairman. Thank you.

[English]

The Chair: Is there anything you'd like to say?

Mr. Robert Rabinovitch: I have nothing more to add.

The Chair: Okay. Ms. Bulte.

Ms. Sarmite Bulte (Parkdale—High Park, Lib.): Thank you, Mr. Chairman.

Congratulations, Mr. Rabinovitch, on your appointment. I know that people in your industry certainly welcomed and applauded your appointment, and we're keenly looking forward to working with you in the future.

What I would like to speak about is the CRTC decision. I noticed that you did not mention it in your opening remarks. Certainly during the first week of January you were on the front pages of all the papers, disagreeing mildly, shall we say, with the decision made by the CRTC. I noticed that in your response to Mr. Mark you said that you have listened to the CRTC. I also note that you did not appeal the decision to cabinet. So I'd be interested to learn how you see the CRTC decision being implemented. Do you see a way of partnering with the CRTC?

Mr. Mark asked you whether the CBC has gone out and surveyed the public. I know that when we were doing our cultural policy report, this committee actually travelled and talked with Canadians, and certainly it came out loud and clear how important the CBC is to all Canadians.

One of the concerns I have with the CRTC is that under its legislation its role is to supervise and regulate public policy, but what it has done in this decision is that we are very close to actually making public policy. Do you see the role of the government now to look at those acts again and perhaps amend them in order to come into the realities of where we are?

With regard to programming and content, which you said were going to be your major focuses, my riding of Toronto has not only a number of producers and artists that work for the CBC, but also independent producers. One of the things that concerns people in Toronto, and the independent producers in Toronto, is that the CRTC decision has asked that you employ producers 150 kilometres outside of Toronto, which is a significant area. In Toronto itself, programs such as Degrassi High, which was produced by an independent producer, actually embody the very cultural diversity the CRTC wants the CBC to bring to its programming. There's also some concern that the CBC has been starting to use a lot more in-house productions.

So if you want to concentrate on what you're good at, where do you see the role of independent producers as you now go into your re-engineering?

Mr. Robert Rabinovitch: You've asked me a lot of questions, and I'll start with the last ones first.

The independent producers are a critical part of CBC's operations and will remain such. The Canadian Television Fund is one of the major sources of funding for us. In my previous incarnation in government many years ago, I was one of the officials who helped construct that fund. The intent at the time was to have more production done by the independent sector, independent producers. The last time I was in this room was to attend a party for the Canadian Film and Television Production Association/Canadian Television Producers & Directors Association/Canadian Film and Television Producers' Association, and I think the success of that group speaks for itself. It is very much our intention to continue to use independent producers.

In many areas we do almost no in-house production, but at the same time I don't want to see the CBC just being a rental house. I think there's a line between the two. But right now there's no question that our focus is on, and will continue to be on, Canadian independent producers.

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With regard to whether or not the act should be amended, that goes beyond my purview. I can live with the Broadcasting Act as it is. It gives a comprehensive indication of what the policy of broadcasting should be.

It is designed to be technology neutral. There are some who question whether it is in fact successful in being technology neutral, especially given the basic changes that have occurred with the Internet, voice-over IP, and various distribution systems. From the point of view of the CBC, we want to use all the distribution systems that are available to us. We want to reach Canadians any way we can with production. We see the Internet, for example, as a unique way for us to relate to Canadians.

But with regard to the act itself, I can live with it one way or the other. Over time perhaps there will be a need for change, and other people will be looking at that.

What was not reported clearly from my point of view—I heard that I was misreported and things like that, which is not true, but I was not reported clearly—was that in most respects we were quite happy with the CRTC decision. We fully accept the direction the CRTC has set in terms of the importance of reflecting the regions in our programming.

Where we had problems with the CRTC was with regard to what I felt was micro-management in terms of telling us how to do, what to do, and when to do, but not with the general direction. I can easily live with the general direction.

We were concerned as well with the decision not to look at the fiscal realities. You have to cut the cloth to fit the suit and the person. Fiscal realities are an extremely important part of life, and we have to meet those realities. As I mentioned in my definition of where my head is today in terms of what a public broadcaster should look like, there was no discussion whatsoever of one of the areas important to me, which is very important, obviously, and that is the area of advertising and how advertising can pervert the agenda and schedule of a network.

The superb report McKinsey put together, which I believe was tabled last year at the committee—if not, we will send you copies—contained an analysis of public service broadcasting around the world, including the effect of funding upon a public service broadcaster, in particular the source of funds, and how that determines the programming grid you eventually come up with and therefore the distinctiveness of the programming schedule.

These to me are extremely important aspects of the broadcasting policy for Canada as written in the Broadcasting Act that I want to look at with my board in terms of defining where we want to go with the CBC as Canada's public service broadcaster.

With regard to the point you made on partnering with the CRTC, absolutely, and I think they're an extremely important source of information. They are a regionally based organization, and they can help us in many ways in terms of defining what and how to move in the area of public broadcasting. I very much see it as a three-way partnership among the private sector, the regulator, and the CBC. I think Canada would lose something if we didn't have all three participants. I think we can work with each other. In fact, when I talked to the CRTC before the decision came up, that was exactly what I suggested.

The Chair: I think it would be worth while if you would send the report to the clerk. Thank you.

Mr. Limoges.

Mr. Rick Limoges (Windsor—St. Clair, Lib.): Thank you, Mr. Chairman.

As was said earlier, your presentation today didn't deal a lot with your vision as to where CBC is headed. I know you tabled this financial review as well. I understand your concerns with regard to those issues.

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I would like to hear a little more from you with regard to an issue that's important to me regarding regional programming, in particular in the area I come from in southwest Ontario, Windsor. We've had to fight to keep, for example, a local news broadcast. We lost it for a while and got it back, but frankly, the timing of it is still a concern. People are having to stay up late to see local news, which is usually what they're interested in seeing first.

Can you tell us a little bit about how you see regional news and further regional programming evolving, and where you see it headed?

Mr. Robert Rabinovitch: The act is quite clear in terms of our responsibility to work in introducing and explaining one region to another region, and I know we will honour that. We believe that to be very important. Nowhere is it written that all programming will come out of Toronto. On the contrary, there has to be a head office somewhere and there has to be a programmer somewhere, but given our commitment to working with independent producers, I hope we can choose the best programs coming from locations throughout the whole country.

A lot of the programs we have right now, some of which unfortunately were cancelled and are going to be replaced with others, are very consistent with the idea that where the program is made is not so much part of the equation, but there is no dictation that only in Toronto can we make good programs. At the same time, we do make good programs in Toronto and we have some excellent producers in Toronto. But programs like Da Vinci's Inquest and Nothing Too Good for a Cowboy, the latter of which unfortunately has just been cancelled, come out of Vancouver.

We do, and we will continue to do, a lot of programming in the regions and a lot of programming about regional issues.

For example, the program we did on the farm crisis on Newsworld was in some ways a Toronto-based program, but it reached out and used and did work in all the regions and put it together in a package that helped to explain to Canadians the crisis in farming. You can define it as a regional issue, but it was a Canadian issue, and they made it into a Canadian issue in how it was done. It was received extremely well, as you know.

I'll do it by analogy. I think one of the things that unfortunately we have had to cut back at the CBC has been some of our foreign correspondents. It is one of my concerns that Canadians want a Canadian interpretation of the news. They don't want to just hear it through the screen of CNN. CNN is more interested in getting it out first; our interest is in getting it out right.

We have exactly the same situation with the regions. We must cover the regions and cover them well in terms of news, and we must explain what is going on in regions, from one region to another region, and we will continue to do that and put the time and money into that.

Mr. Rick Limoges: Could you also give us some comments...? In your opening remarks you were talking about mergers in the industry. Frankly, that gets to the point of concentration of ownership and lack of independence. We're seeing that a lot, in particular in the newsprint media and so on where there is virtually no independence. It's become a real issue that you're not getting independent news reporting; you're actually getting opinion reporting coming out in many areas.

I'm wondering how you see the CBC's role in terms of providing independent news, independent information, to Canadians without the spin.

Mr. Robert Rabinovitch: It would be inappropriate for me to comment on concentration of ownership, so I won't. I will suggest to you, however, that the CBC—I believe I'm right in this number—has more people collecting news than any other Canadian organization, and we intend to continue to be one of Canada's foremost news collection agencies and news dissemination agencies. I think with concentration not only of newspapers but in the media world—and it goes well beyond news, but we're talking news right now—it's all the more important that there be clear Canadian voices. I believe if we are to have a public broadcaster, surely this is one of its main objectives and main roles.

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The Chair: Mrs. Lill.

Ms. Wendy Lill (Dartmouth, NDP): Thank you for coming to see us today. I'd like to talk about money. I'd like to talk about your strongest asset, which I believe is your people, and the importance of quality regional programming.

I'd like to start with a comment I've heard from you that I need clarification on, and this is the idea that you are not going to ask for more government funding until “your house is in order”. I find that statement reminds me of Father Knows Best. It's a statement that I try to figure...when will that moment be? Will that moment be when your transmitters have been sold off? Will it be when all of regional programming is gone? Will it be when there has been another thousand cuts? What exactly is that magic time when your affairs will be in order? It indicates that there is something woefully wrong about the situation as it presently stands, that somehow it is all the CBC's fault and that we have to correct this.

I hear you talk about the BBC and the fact that they have massive amounts of resources and you envy them. It defies reason, as far as I'm concerned, why you're not asking for more money now for what you believe to be quality public broadcasting.

Further to that, I want to know whether there are more cuts on the way. I have the sense that Treasury Board may be telling you the severance costs, some of the costs related to wage settlements following the strike last year, may not be covered in supplementary grants. Are we looking at more cuts in the mix as well? That's a money question. Maybe you could answer that for me.

Mr. Robert Rabinovitch: I can try. I'd like to start by saying it's not the CBC's fault. The CBC has done a phenomenal job, and the employees of the CBC deserve very real credit for the quality of the service they've been able to maintain given the cuts we had to absorb. There is no doubt in my mind that they have done yeoman's service.

What I did say is it is fraying at the edges, and it doesn't take a genius to recognize that there are more repeats than there should be and that we've had to cut back on some of our international services. These are definitely areas we would like to improve upon.

I've been in the job for exactly three months, and I did not have a promise, nor did I ask for a promise, from the government that they would give me more money. I have taken it upon myself...if the government were to offer me money, I would surely take it, but I know the government has other priorities. The heritage minister has other priorities at the present time, and I know it is not a solution. Some people believe it is. I don't accept that. I accept and believe that the first objective is that we must do as much as we can to show the public and to show the government that we are running as efficient an operation as possible.

I also believe we have certain aspects that we have not mined to the extent that perhaps we could. We have a lot of property that the government has given and invested in us over the years. Some of that property, I believe, is underutilized and may be available either for sale or for a rental stream, but, to put it bluntly, it can be managed to create revenue flow for us. That is part of the work Jim is doing right now in looking at alternative sources from within our operation.

The cuts are extremely worrisome to me. I worry that we lose our best people. I worry, quite frankly, that we lose our young people. We lose the next generation with the reality of bumping, which is perfectly appropriate. It's in the contracts. The result is we lose very good young people, and it's important for us to train the next generation and bring them along. Where are they? They're there. They come, they go, and it bothers me immensely that we cannot and do not invest as much as we could in new young people.

• 1155

But we must also recognize a couple of other things. Aside from our fiscal problems, there have been radical changes in how we deliver our services already. There will be more, and that's what I'm saying—there will be many more.

We closed 10 studios last week in Montreal. We closed them because we don't need them. We closed them because there are much more efficient ways to produce radio product. Unfortunately, that results in workplace adjustments, but that is the reality of the 20th and 21st centuries: there will be workplace adjustments. To the extent that we can channel more money into programming, I think we have done our job. Our job is to run as efficient an operation as we can and to put as much money as we can into programming. Our bottom line is programming.

So I can't give any assurances that there won't be any more cuts. In fact, I know there will be more cuts. It's inevitable. It will be driven by the transformation we're doing in English television. It will be driven by changes in technology. Hopefully, the result will be a more efficient operation, and hopefully the result will be that we'll have better programming.

Ms. Wendy Lill: I guess the idea of programming and product—I keep coming back to the creator. You're laying off writers, sound people, camera crews, editors, and this has a huge human toll on the creative product. I hate to use that word. What is the morale in CBC Radio now? What is the morale in TV? What is the confidence level amongst your creators about their management? How do you keep this ship together?

I have one other question. I am very concerned about regional programming and how this is all going to be created, given the fact that we're looking at more cuts.

Your vice-president, Mr. McCoubrey, told the Toronto Star before Christmas that the outcome of your review may involve getting rid of the CBC transmission network. I want to know if you are planning to get rid of transmitters. I would like to know if you can guarantee us, right here, that the CBC will be available to Canadians without a monthly user fee for basic radio or TV in places where it's now accessible. With all of the regional programming now...within three years, are we going to still have that—that will be our right—or will we be looking at the price of a package of cigarettes per month?

Mr. James McCoubrey (Executive Vice-President and Chief Operating Officer, Canadian Broadcasting Corporation): We have no intention of doing anything that would make the CBC cost Canadians money to receive. Frankly, that's absolutely out of the question as far as we're concerned. There will be no ability from our end to charge Canadians, nor is there any desire to ever consider that.

You also asked a question about the morale. This is a difficult question to answer simply, but I will say the following. The employees understand the circumstances we're in, and they understand that the circumstances we're in lead to inevitable downsizing of the corporation. They're actually very pleased to welcome Mr. Rabinovitch, who has a very good grip on things and is decisive. They welcome that. They've encouraged me in this task force to look at ways where we can substitute cost savings for layoffs and find ways to do things better, smarter, make better use of technology, save money, and do more with the dollars we have.

I guess it's inevitable that we'll not be growing in terms of numbers of employees. People recognize that, but they're thrilled to know that the organization is now dealing with the tough issues ahead of it and looking at ways to save money, rather than simply cutting, cutting, cutting people.

The Chair: Mr. Muise.

Mr. Mark Muise (West Nova, PC): Thank you, Mr. Chairman, and welcome to Mr. Rabinovitch and Mr. McCoubrey.

CBC, to me, and I think to most Canadians, is a very, very important cultural icon or institution. I think, Mr. Rabinovitch, you said it very well when you said it is probably Canada's largest cultural institution.

• 1200

I know we've touched on finances and we've touched on other things. But I'd like to get your thoughts on what you see as the CBC's future when it comes to helping culture and helping the promotion of culture.

Another item that really concerns me a lot is the lack of regional programming. You say there will be regional programming. I think it's one thing to have regional programming that's based in a centre such as Toronto, Montreal, or Vancouver. Basically what you're doing is showing other Canadians what those centres are, instead of showing the rest of Canada what the smaller centres are. I think that's what part of the CBC was and that's how it started, and that's why it is the institution it is. If that doesn't continue, we're in jeopardy of losing what the CBC is all about.

You also mentioned—I think it was Mr. McCoubrey—that you have no intention of making Canadians pay to receive our product. But there are certain parts of the country now that are faced with that situation. In my riding of West Nova and in the southwestern part of Nova Scotia, CBC 2 cannot be received in all parts of the riding. The only way you're able to get CBC 2 in some of those instances is if you're part of the cable programming.

I'd just like you to touch on a few of those comments to start. Thank you.

Mr. Robert Rabinovitch: I believe very strongly that the CBC has an extremely important role in the promotion of Canada's cultures and that it has done this in a remarkably good way over the years. If you look at the role of CBC in the promotion of music and CDs and helping to give Canadians like Ben Heppner their first opportunities, CBC has been there, continues to be there, and hopefully will be there.

As an aside, I know it was one of the elements of the CRTC decision that we found disappointing but accepted—because we had no choice, we accepted it—but the whole intention of sponsorship was not to get a cent to the CBC; it was to get money to cultural organizations, to the Stratfords and various playhouses around Canada. Be that as it may, we will still continue to work with these organizations and hopefully put their shows on our networks and to promote Canadians.

That's why I said at the beginning that I have a very deep concern as a Canadian about the exposure of Canadian talent in the new narrowed world—it has not widened—of the mega-mergers.

I get very concerned about what might happen in the music world. Might they do the same thing as what happened in the book production world, in the book publishing world, where these same companies, for their reasons, and correctly so from their point of view, reduced the number of titles they turned out—in the case of Putnam, I think it was, from 475 titles to 75 titles. What happens to the others? What happens if those others are Canadians? What happens if a producer of a CD, a group, is automatically dropped if they don't sell 100,000 CDs? You have a cut point. Below that it doesn't pay you to produce. Somebody else has to produce them. Somebody else has to show them or Canadians won't get that exposure.

So I'm very worried about that. I think we have an extremely successful set of policies through the Canadian content rules on radio in terms of our music. I think we at CBC have played an extremely important role in the production of CDs from Canadian talent. I guess I can say I agree with you completely that the CBC is a critical element of the promotion of Canadian culture, and we should look at it within that context as well.

• 1205

On regional programming, I can't disagree with you. As I say, there has to be one place that makes the decisions, but I believe a lot of the programming must be done and will be done in the regions, and it's up to us to come up with systems that make sense and are economically viable, again, working within the budgets we have.

You're absolutely right. There is a yin and a yang; there is a showing of both sides. It's not just a one-way street.

With respect to paying to receive our product, what we are looking at in terms of transmission and distribution is, are there more efficient ways to do this? We are faced in the next few years with an unbelievable bill as we go to digital broadcasting. One of the things I would like to do is not go to the government for funds to go to digital broadcasting as it goes across North America, because I'd rather go to the government for funds for programming.

So is there a better way for us to do our transmission and distribution? Do we have to own our transmitters in order to be able to distribute? There may be, and there should be, different ways of doing it. Are there ways of using satellite distribution that are not being used today?

Those are the types of questions we have to look at. Those are the types of changes we may have to make, but as Mr. McCoubrey said, one of our guiding principles is that we will not charge for what Canadians now get for free. This is not going to be pay-per-view by the back door. Anything we do will be designed to be a more efficient, less expensive method of distribution that will get to more people.

We do have a problem. We have a bigger problem, quite frankly, with La Chaîne culturelle in terms of extension of service, and we are trying to extend it as we can afford to extent it, as we have the funds. There are definitely holes in the system, especially in the area of FM broadcasting, which we have gone through to such a great extent.

There's a hole in downtown Montreal with La Première chaîne, where, because of the way the transmitter is and our location on the transmitter, certain parts of Outremont do not get the signal. That's awful; that's just not right. We came up with a technical solution for that, and we are in discussions now with industry and with the CRTC in order to resolve that problem.

We will extend the signal as we can, but we must also look at new technologies, because they're there now, and look at different ways to distribute our signal more efficiently.

The Chair: Very briefly, Mr. Muise.

Mr. Mark Muise: No, I'll defer. I'll come back.

The Chair: Mr. Bélanger has ceded his place to Mr. Breitkreuz.

Go ahead.

Mr. Cliff Breitkreuz (Yellowhead, Ref.): Thank you, Mr. Chairman, and gentlemen, thank you for appearing here today.

Mr. Rabinovitch, I congratulate you on your appointment as president of the CBC. You have many challenges before you, and I commend you on taking some issue with the CRTC and its fiscally irresponsible demands placed on you and the CBC.

I would like to make a few points and perhaps ask a question or two.

The way I understand it, the CBC has approximately 34 stations across the country—I don't know if that's the exact number—not counting the French and aboriginal stations. According to the information I have, virtually all these stations run the same programs at the same time.

I can go through the list here: 7 p.m., Royal Canadian Air Farce; 7.30 p.m., On the Road Again; 8 p.m., This Hour Has 22 Minutes; and 8.30 p.m.... The list goes right down to the bottom, with virtually the same programs at the same time across the country.

I agree with your contention to scale back local programs to avoid duplication and overlap. I think you let the private sector do especially the local TV news and that sort of thing. So why not use the same format as A&E in the U.S., and probably PBS, of one national station televising the same program right across the country? After all, every month thousands of Canadians are buying Expressvu and Star Choice, if they do not already have cable. So they could tune in.

• 1210

That's one question. Another question is, why is the CBC wasting millions of taxpayers' dollars running English programs with virtually no English-speaking audience and French programs in areas devoid of French speakers? The 1999 fall survey showed the average quarter-hour audience in Toronto was 100 people for TFO, and certainly the numbers would be consistent with CBC French affiliates.

I think it's fair to say that in Toronto, probably most of Ontario, western Canada, and a lot of Atlantic Canada, almost a hundred percent of the population just do not watch French programming. The same holds true for English programming in Quebec, probably other than Montreal.

In my other life, I ranch and farm. I would love to establish a vineyard on our place in west central Alberta to produce fine-tasting grapes and make huge profits, but I can't. Grapes just won't grow in our area, for all kinds of reasons. So I say scrap your programs that nobody is watching and focus on programs that people will watch.

I wish you would stick to your guns regarding the Hollywood mega-hits. Of course Canadians want to watch them, and of course they produce huge amounts of revenue for CBC.

Thank you, sir, and good luck in your endeavours.

Mr. Robert Rabinovitch: But you do have great skiing.

I have a couple of points to make. The BBC basically does what you have just described, the one national service across the country. We're not at that point, and I don't think we will be at that point. I think we feel that there is a need for regional stations and regional programming for the regions. We will look at all aspects of our programming, but I don't believe personally we're headed to a one-station, A&E-type system.

By the way, PBS is slightly different. PBS local stations can pick and choose from the national grid. In fact, Montreal is one of those places that has two PBS stations. One serves the national programming schedule, almost to the letter, and the other does counter-programming within the PBS mould, both heavily financed by Montreal donations.

I don't think we're headed in that direction. We're going to look at everything, and look at it in detail, with the objective being a quality service.

With respect to the matter of extension of the service in the other official language, because you've talked about both, this was a government policy in the early 1970s, and the CBC was given the money explicitly for that purpose. Until such time as government changes its mind with respect to service in both languages, we have an obligation to honour that commitment and to maintain that service.

The Chair: Mr. Shepherd, and then Mr. Bélanger, Mr. de Savoye, and Ms. Lill.

Mr. Alex Shepherd (Durham, Lib.): Thank you.

I'm interested in some of your comments about restructuring and the reinvention concept.

I have a quote here from Patrick Watson. I presume you agree with this. He said:

...large publicly owned establishments of real estate and buildings and transmitters are no longer appropriate. Those facilities exist in a profitable private sector, which ought to be deployed, partly for pay and partly for public purpose, in the execution of a public television strategy.

Do you agree with that?

Mr. Robert Rabinovitch: I agree with it in direction, and that's what Mr. McCoubrey's group is looking at. I'm not sure we should sell it all off and then rent it back. I believe Mr. Watson is onto an important concept, that the CBC need not be the owner of everything it has and should look at alternative ways of distributing its programming, and this may as well be a source of revenue for us.

Mr. Alex Shepherd: I'm interested in you attaining a certain level of costing that is sustainable. In reinventing yourself and finding your niche market, you must first of all determine the cost of that. I guess what concerns me is that you're going to get the cart before the horse. You're going to start selling off assets, and then you'll follow things back into a system in which we haven't really ascertained where it's sustainable. In other words, you may be able to go down the road for five or ten years, but suddenly you're going to invariably come back to the government and say you ran out of all of your capital assets and you're still not sustainable.

• 1215

Now, when I use the word “sustainable”, I understand that you're going to be looking for funding from the government. I guess that base level of sustainability is that number we're looking at, one that matches your niche market that's established first before you start selling off assets.

Mr. James McCoubrey: Essentially what we're doing is presuming that we will not be receiving an increased appropriation from the government, and we're trying to live with the same level of expenditure that we have now, well into the future. We're looking at realizing efficiencies that would permit us to continue doing what we're doing now—and maybe doing those things better than we're doing them now—forever if our appropriation remains the same.

So, yes, we'd love to have more money, but we're not presuming it's simply going to be there to get. We're certainly going to make an effort to deserve a larger appropriation, but our plans going forward are to deliver the same quality of product that we have now, and maybe even a little better than we have now, within the funding we depend on now, forever.

Mr. Alex Shepherd: Let me ask a question then. If you're contemplating disposing of significant assets, yet you're living within the current funding restraints laid down by the amount we actually give you, what are you going to do with that extra money from asset sales?

Mr. James McCoubrey: The going-in position is to ask what assets we own now that we can make better use of so that they can also become a source of revenue for us. They'd be an increased source of revenue. At this point in time, we don't plan to just sell things, get the money, and then spend it. We're actually looking at ways of increasing our revenue from the existing assets. For example, if we could free up two floors in the Toronto broadcast centre, we would rent them, get that money in, and then have that as a constant stream of income. We're looking at that across the country, rather than just selling things and spending the money.

Mr. Alex Shepherd: As an accountant, I would suggest that you sell the assets and invest them somewhere. What you're telling me is that you're going to depart from your core business, which is broadcasting, and go into leaseholds as landlords who are renting equipment. These are all outside of your core area of expertise.

Mr. James McCoubrey: That's true, they are. I didn't intend to imply that we're going to convert from being a broadcaster to being a landlord, but where we also need to be a broadcaster, we'll need facilities. We're just suggesting that we can make better use of that physical space. What we can free up, we'll try and convert into a source of revenue. It's certainly difficult to sell two floors in the broadcast centre.

Mr. Alex Shepherd: Getting back to my original point, as a parliamentarian, I was hoping you would present us with a plan when you have that niche market established, in terms of what your base level of funding is going to be, possibly before you do massive asset sales.

Mr. James McCoubrey: Do you mean niche-market expenditure? Is that correct?

Mr. Alex Shepherd: Yes. Once you define what you believe in the future is to be your niche market, what will the expenditure for that be, and how you are going to sustain it?

Mr. Robert Rabinovitch: Quite frankly, I'm having a bit of a trouble with the words you're using, “niche market”. I don't think we've defined ourselves as being a niche player. We've defined ourselves as being...in fact, the Broadcasting Act says we're supposed to be, relatively speaking, a broad player, and we've rejected the concept of being a sort of PBS North.

• 1220

What we would like to do is perhaps narrow our focus in some ways and get out of some types of programming if we feel we don't have a major contribution to make. We will be a pan-Canadian service and we will hopefully be a quality Canadian service reaching, as we must and as we want to, as close to 100% of the population as we can.

In the process of doing this, the government has given the CBC a lot of money over the years to build a very large infrastructure. Some people, including Mr. Watson and others who have looked at it, believe that infrastructure is out of date. It's basically an analog structure and we're going to have to move it to digital. It's out of date in that there are other methods of delivering the services that may be more efficient.

For example, if the satellites of a high-powered nature in the 18-inch dishes that now exist existed in the 1960s, perhaps the CBC would be the owner of a satellite today and would deliver its signal that way. That is what we want to go back to and look at. How can we do it? Can we deliver our signals much more efficiently? At the same time, we have a very large accumulation of physical property around the country, both for transmitters and for program development and programming.

With the move to more and more independent production, the change in government policy to encourage independent producers, we do less and less in-house. It's not enough that we can get out of the building completely, as Jim said. We need parts of the building, and these buildings are very unique structures in many cases. They're wired, they're highly digital in certain cases, and they may be very useful to people in the private sector, such as in the telecommunications industry.

We've had some indications, for example, that if space were available in some of our buildings, some major telecommunications operators might be interested in renting it because of the extent to which you can link the building to major switches. This may be a much more efficient way to operate than what we do now.

I want to go one step further. We are in the building management business and we have been since the CBC was formed. My question to the task force is, do we do it correctly? Like you, sir, I believe it isn't a core competence. If we are going to be running buildings, we should have professionals running those buildings for us who have as their objective to maximize revenue for the corporation. That revenue may be maximized sometimes by sales and often I believe it will be maximized by setting up a rental stream.

[Translation]

The Chair: Mr. Bélanger.

Mr. Mauril Bélanger (Ottawa—Vanier): Mr. Rabinovitch, you stated earlier in relation to the task force set up that there were no sacred cows. One can imagine, however, that your mandate will remain intact. As part of this mandate, the CBC must ensure that Canadians from coast to coast can identify with the CBC's programming. How do you explain the phenomenon which seems unique to the CBC's French network, namely that programs are often broadcast across the full network, but not in Quebec?

Mr. Robert Rabinovitch: I really can't explain it. I'll have to verify that and get back to you either in writing or in person. Quite honestly, I can't answer your question at this time.

Mr. Mauril Bélanger: Fine. I'd like to explore something with you, if I may. Does the CBC have in place a policy respecting the broadcasting or production of French-language programs? Has the board approved such a policy?

Mr. Robert Rabinovitch: But of course. Two of the four vice- presidents in charge of radio and television services are responsible for administering the French-language production system.

Mr. Mauril Bélanger: Could you share the finer points of this policy with committee members?

• 1225

Mr. Robert Rabinovitch: Exactly which policy are you referring to?

Mr. Mauril Bélanger: I don't know if....

Mr. Robert Rabinovitch: At present, the CBC/Radio Canada has four vice-presidents in charge of radio and television programming: two on the English side, and two on the French side. Each year, the four vice-presidents make a submission, first to the senior officers like myself and then to the board of directors.

Mr. Mauril Bélanger: I understand. However, I'm interested especially in French television services and I'd like to know if there is a funding policy in place. I believe that when you appeared before the CRTC, you made a commitment to establish such a policy.

How is funding disbursed? Who is responsible for disbursing it? For instance, have clear objectives been set? The last time representatives of the Canadian Television Fund appeared before the committee, it was clear that they were making an effort to ensure French-language programming outside Quebec. This isn't quite as clear in the CBC's case, and even less so in the case of Telefilm and the relationship between Radio-Canada and Telefilm.

I'm trying to ascertain whether in fact there is a policy in place at the CBC governing this area of activity. In my opinion - and I'd like to get yours as well - the CBC has a responsibility to promote the development of expertise, talent and French language television production capability outside Quebec as well. There is a lingering impression of having to force things out of people, of having to try and move the immovable object in order to accomplish something.

I'd like to know how you personally feel about this and how you intend to assume this responsibility.

Mr. Robert Rabinovitch: I've already met with the Vice- President and his group to discuss this very subject. It always comes down to a question of money. If we can manage to find the funds, we can produce more programs outside Quebec.

However, it's a fact that the bulk of the francophone viewing audience is in Quebec. Currently, with the pressure to get revenues through commercials, we need to be present in Quebec and on the Quebec market and our programming must target Quebeckers. We need to strike a balance.

Mr. Mauril Bélanger: I believe there's a group representing people in the world of French language television production outside Quebec. Would you be willing to meet with their representatives?

Mr. Robert Rabinovitch: Certainly I would.

The Chair: Thank you, Mr. Bélanger.

Mr. de Savoye.

Mr. Pierre de Savoye: Mr. Chairman, I'd like to focus briefly on the matter of assets that could be put to better use. Specifically, I'd like to talk about your transmission services and transmitters.

Either two or two and a half years ago, back when Mr. Godfrey chaired this committee, we examined the possibility of the CBC divesting itself of its transmitters. There really was no consensus on this issue. The fact remains, sir, that Industry Canada is in the process of making available certain frequency ranges for digital transmissions. Transmitters will be required. Consequently, if I were fortunate enough to own your stock of transmitters, I venture to say that I would get rich rather quickly.

My concern is that you might divest yourself of these transmitters by turning them over to a commercial entity which in turn becomes rich off of something paid for by the public. I would be more open to the idea of a corporation acting on your behalf, one that you would wholly own and that would deliver this type of service. Which of the two scenarios is the more plausible?

Mr. Robert Rabinovitch: At this point in time, I can't say which direction we're going to take. We will try and weigh all of our options. Quite possibly, we will continue to manage our transmitter sites and lease the space under the towers. In other instances, this option would prove untenable. It's also possible that we might work out some kind of arrangement. In the United States, nearly all broadcasting companies have decided to sell their transmission networks, believing that it would be far more cost-effective for them to use a company that specializes in one thing and one thing only, namely transmission systems.

• 1230

Frankly, it comes down to a question of dollars and cents. We need to consider with the help of financial management experts whether it would be more cost-effective for us to continue managing these transmission systems ourselves, albeit differently, or whether we would be better off leasing them to someone, or better still - and this is a third option - whether we should sell the transmitters and lease them back for a period of 20 or 30 years.

You must remember that, as you alluded to earlier, we are facing a major change, namely the shift to digital transmission. The tab will be in the millions. We need to come up with a way to cover the expenditures that we will incur over the next 10 years. The problem has already arisen in the United States. As you know, pursuant to federal government regulations, all networks all required to convert to digital within the next seven or nine years. However, at the same time, we must continue to operate with an analog system to provide service to customers with analog televisions.

We may be able to absorb these costs by working out some arrangements with our transmitters.

Mr. Pierre de Savoye: Do you understand why I'm concerned?

Mr. Robert Rabinovitch: Yes, I do.

Mr. Pierre de Savoye: It would be unfortunate indeed if assets paid for by the public end up in the hands of persons who have an opportunity to make a quick profit. I would prefer to see the CBC benefit from this windfall.

Mr. Robert Rabinovitch: Any arrangement concluded has to be to our advantage as well.

Mr. Pierre de Savoye: Mr. Rabinovitch, I have another, more delicate question for you.

The CBC wasn't born yesterday. It's been around for decades and for decades, it has enabled communities from coast to coast to grow and achieve cultural emancipation. Both branches of the corporation have been a driving force in this process.

We noted in the corporation's strategic plan, which was presented several months ago to this committee, that the corporation intends to contribute to the attainment of certain key objectives of Heritage Canada, namely the promotion of pride in Canada.

It would seem to me that the corporation has been doing just that for decades now. What does the CBC intend to do to further the attainment of Heritage Canada's objectives? Can you, by virtue of the legislation governing your activities, associate yourself with the aims of a department which answers to the imperatives of a government the strategies of which are perforce partisan?

This brings me back to the issue raised by my colleague Mr. Limoges, who questioned whether there can be independent journalism or reporting without a spin. Just where will your desire to associate the CBC's mission with that of the Department of Canadian Heritage take you? Is independent journalism at risk?

The Chair: Could you wrap up please, Mr. de Savoye.

Mr. Pierre de Savoye: That's precisely what I was doing when you interrupted me.

The Chair: Mr. Rabinovitch.

Mr. Robert Rabinovitch: The CBC is governed by the Broadcasting Act which dictates its actions. The CBC and the news service are not state services, but rather public services. We will ensure that CBC production and news services continue to operate independently. It's as simple as that.

• 1235

Mr. Pierre de Savoye: In terms of your other operations, just how independent are you? I know that you have a reputation of being a straight shooter. Will the Corporation also acquire a similar reputation?

Mr. Robert Rabinovitch: If it's not too presumptuous of me, I hope it will.

The Chair: Ms. Lill.

[English]

Ms. Wendy Lill: I just want to ask another question about regional programming. I think a lot of the people around this table are very concerned about that because we are from the regions.

I have this idea in my mind of people running around in flak jackets, filing to some place, probably Toronto. No buildings any more but lots of people out there. Bodies on the ground, almost like a war zone. I have quite an imagination.

I'd like some clarification on what kinds of services are going to be available in Windsor and in Halifax and in Sydney. I want to know if you've planned cuts to staff levels at the local and regional CBC TV and radio levels. I want to know if you're going to honour the CRTC's instruction to have local weekend newscasts.

Mr. Robert Rabinovitch: There will still be buildings. We're not selling off the buildings. We will sell buildings that are redundant. We are going to try to manage our property in a more efficient manner. That may mean we share buildings with people. That may mean we do our work in a different way.

With respect to services in the regions, we are evaluating a fundamental transformation of the CBC English-language television service within the context of our fiscal realities and within the context of our need and our desire to define a quality, unique, different public service broadcaster. I reiterate that the regions will play a significant role in that. How and what exactly we will do is what we are now trying to decide.

As I said, I've been there for three months. Give me a little bit more time, not much but a little bit more time.

Ms. Wendy Lill: Will you respect the CRTC's decision that you maintain weekend newscasts?

Mr. Robert Rabinovitch: As I said before, we are evaluating all of the CRTC requests within the context of our own budgetary constraints. We have to look at it in terms of if we do one thing, what do we then not do. It's not an endless box; something will have to go. I'm not sure what is to go. I think it's part of the responsibility of anybody who makes recommendations and directions to an organization to also say what they'd rather they didn't do. Other than blockbuster movies, I'm supposed to continue to do everything with a budget that is decreasing.

The Chair: I have requests from three different people. Time is moving on, so be concise, please. Mr. Muise, Mr. Breitkreuz, and Mr. Mark.

Mr. Mark Muise: Mr. Chairman, I always try to be very concise. I think you recognize that.

The Chair: Yes, I do. I do recognize it very much.

Mr. Mark Muise: Mr. Rabinovitch, I'd like to touch on your fairly open criticism of the CRTC and some of the guidelines put out by the CRTC when it came to your licence renewal. I'd just like to get a feel from you. I have a concern that if you were to pursue that, we could effectively have two playing fields, one for the private broadcasters and one for the public broadcasters. I'd just like to get your opinions and comments on that.

Mr. Robert Rabinovitch: In reality there are two playing fields. It says so in the act. There are certain demands made on CBC Radio-Canada that are not made on the private broadcasters. There are certain demands the CRTC can make on private broadcasters. There is a playing field defined by the Broadcasting Act and the CRTC has the right and obligation to control and supervise and define it. They need not treat both components of the broadcasting system the same way.

Mr. Mark Muise: But if one has to abide by the rules of the CRTC and one openly challenges the CRTC, then.... Maybe my choice of words was not proper.

• 1240

Mr. Robert Rabinovitch: We have said that with almost all aspects of the CRTC decision, or many of the aspects, we are in complete agreement. We are very much in complete agreement with the direction. We were very concerned about the micromanagement, on the francophone side in particular. I was very concerned about that. And I was very concerned about the lack of fiscal reality embodied in the decision. As well, there were certain other aspects with respect to commercialization and its impact on the system that we wanted to review.

We will be looking at all of that. I can always go back. We can go back and ask for amendments from the CRTC. It's in there. We have seven years to try to implement all of these conditions. We will do what we can do and be fiscally responsible and try to define and develop for Canada a quality public service broadcaster.

Mr. Mark Muise: Thank you.

The Chair: Mr. Breitkreuz.

Mr. Cliff Breitkreuz: Thank you, Mr. Chair and Mr. Rabinovitch.

Yes, there is good skiing in my riding. The jewel of the Rockies, Jasper, is in my riding. You're welcome to come anytime.

I've noticed recently, maybe within the last few years, that often on English CBC TV in Alberta, specifically from Edmonton, you see a French movie with English subtitles, and you turn over to the French station and of course that's French. So you have both CBC televisions doing it in French in an English-speaking area. Can you explain that? That's one question.

The other one is that sometimes you see, usually internationally but also locally and nationally, at some pretty important event, the private sector television is there with just a warm body, and everything else is leased or rented from the local community. Yet you see a whole crew of CBC people, three or four people, and all the technology along with it. Is that because there's an unlimited supply of taxpayers' dollars funding that? What kind of management is that?

The other thing I want to mention is this. Could you imagine, for example, PBS, which is the public system down across the line, doing an international global sports event such as the Olympics and going to Washington to get taxpayers' dollars to do that? You'd never hear of it. Yet CBC outbids especially CTV, because they're limited in what they can bid and the CBC isn't, to broadcast these kinds of things. There really is no competition.

And do something about the bias of a lot of your commentaries on CBC, both television and radio.

Mr. Robert Rabinovitch: Some of these questions I'm going to duck. I'm going to ask Jim to talk about the Olympics, but I'll answer on the other two issues, which are important issues.

I'd like to check into the subtitles, because quite frankly, subtitles don't work in North America. It's a concept that works very well in Europe, perhaps because of the difference in attitude towards language, but subtitles don't work in North America. I'd like to find out when we've put on a program with subtitles, because I'm very surprised at that.

Mr. Cliff Breitkreuz: I agree. They certainly don't work, because they get switched off right away.

An hon. member: [Inaudible—Editor].

Voices: Oh, oh!

Mr. Robert Rabinovitch: Well, maybe it was just one guy speaking. Maybe the rest of the program wasn't with subtitles.

With respect to the warm bodies, this has been an attack on the CBC, and rightly so, for years. But I have the confidence that we have cut down dramatically on that, in terms of multiple crews going to situations.

The classic case is our foreign correspondents. We now use more and more foreign correspondents who can work extremely well in both languages, and therefore we have but the one crew and the one person who does his report and does the same report a second time in a second language.

Sometimes you see multiple crews because we are two English-language networks, two French-language networks, two radio stations in English, and two radio stations in French. We are working now at merging certain aspects of our news operation, and that will result in many more efficiencies, and you're going to see less and less of what you just described.

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The Chair: Mr. McCoubrey, could you comment briefly?

Mr. James McCoubrey: I will answer your questions as best I can, but in your earlier remarks and in these remarks, a point of view of yours came out, and I'd like to address that first.

I'm an anglophone, born and raised in la Mauricie in Quebec. My wife is a francophone, born and raised in Manitoba. So I reject completely your point of view that there should be no effort by the CBC to communicate in languages other than the majority language of the area in which the CBC is.

Factually, as far as the Olympics go, you made a serious mistake. If you'd done your homework, you would know CTV outbid the CBC for the Olympics. We were awarded the Olympics by the Olympic committee because we do a better job. They told us our job was so superior that unless CTV had really outbid us, there was no question in their minds. We do it in English, we do it in French, and we do it significantly better. That was their decision. The dollars on the table were greater from CTV than from the CBC. That's number one.

Number two, as you may know, sports does not use a single dollar of government appropriation. It contributes to the CBC. We've basically run sports at break-even. The cost of replacing sports would be an expense. CBC makes money on sports, and at minimum breaks even. No other programming we run breaks even.

I have no idea what you were talking about when you referenced the movies with subtitles. Your point was that there was a French movie on English with subtitles, and a French movie on the French. You thought this was excessive. Essentially, whenever we run movies that are foreign, we don't consider what language they are; they're just foreign. And they're there because people want to see them. As Mr. Rabinovitch has said, we recognize that subtitles are not preferred by people, so that happens very seldom.

On your comments with respect to CBC resources in local communities, I can't really answer that, other than to cite for you an example that I think makes the point the CBC wants to make. When we telecast a hockey game from Dallas, Texas, we do it with CBC crews and CBC trucks. Why? It's less expensive for us to drive the truck to Dallas and use the CBC crew in Dallas than to rent a truck in Dallas. That basically is why you'll see CBC trucks wherever you see them. Dallas is actually a long way from Canada, but for us, it's still much more efficient to take the truck and the professional crew down there, do the game, and drive the truck back than to rent a truck in Dallas.

The Chair: Mr. Mark.

Mr. Cliff Breitkreuz: But the CBC—-

The Chair: Excuse me, Mr. Breitkreuz. I think we'll give a chance to everybody.

Mr. Mark.

Mr. Inky Mark: Thank you, Mr. Chairman.

Mr. Rabinovitch, you certainly do have a huge challenge ahead of you. As you heard today, there are many differences of opinion right at this table. This past year the CRTC as well as the Standing Committee on Canadian Heritage of the House have travelled to listen to Canadians. I believe it's critical that you and the members of your board do the same thing—go on the road, listen to Canadians, and find out what they want.

Two questions need to be asked. First, what do they expect from a public broadcaster? And question number two is, how much are you willing to pay out of the public purse? Until you get that kind of data, we're always going to have many different opinions in terms of how a public broadcaster should operate.

Mr. Robert Rabinovitch: Thank you, sir. I accept your advice. It makes a lot of sense.

I should tell you our board of directors makes a point of holding meetings outside the golden triangle and tries to meet in various parts of the country. We will continue to do that. Our staff continues to travel.

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Hopefully we will engage the public in a debate about public service broadcasting. What is it people want, and are they willing to pay for it? Because at the end of the day, it is the public that will decide.

The Chair: Mr. Bélanger has asked me for a brief question, and I have a question for Mr. Rabinovitch too.

[Translation]

Mr. Mauril Bélanger: I simply wanted to thank the CBC for broadcasting this film on the English network. I hadn't managed to see this film from France and I appreciated the network carrying it, even though I didn't need the subtitles.

Thank you, Mr. Chairman.

Voices: Oh, oh!

[English]

The Chair: Mr. Rabinovitch, you were kind enough to come early in your mandate to give us an outline of the challenges before you, and we appreciate that. Obviously you don't have all the answers, as you pointed out yourself. All this is to come.

You have alluded to your re-engineering exercise, which will lead, I imagine, to some form of strategic plan for the future ahead. Could you tell us first of all how long this exercise will take? And once it's completed, whenever that is, if you could give us a date, would you be willing to come back and share it with the members then, so that we can question you on that part of it?

Mr. Robert Rabinovitch: I should elaborate on the exercise, sir, so that you understand what we're doing.

I have not asked the task group to come forward with a specific, all-encompassing report. I expect them to look at the problems, the four I asked them to look at, and to work on them individually. Each will work at a different pace, and as solutions present themselves and as we come to conclusions, we will be bringing them to our board and trying then to go forward and implement them. So there is no task force report per se.

As well, the work of the task force will be continuing. Hopefully we will be assigning other responsibilities to it once they've completed particular work.

Having said that, I am willing to come back at any time and discuss this work in progress, because what we are doing here is a work in progress.

The Chair: Would you say maybe in the fall would be a good time for you to come back? Would you have some notions for us then that could have answers?

Mr. Robert Rabinovitch: Yes, sir, I hope so.

The Chair: All right.

Thank you very, very much, Mr. Rabinovitch, for coming today. We really appreciate it.

The meeting is adjourned.