BRIEFING FOR THE INCOMING MINISTER OF BROADCASTING: DECEMBER 2011

Introduction This briefing discusses the issues you will need to consider over the next twelve months, and provides background information on your portfolio and the agencies and legislation for which you are responsible.

In addition, attached is a short paper on common challenges and issues faced by the cultural sector. This has been discussed with, and agreed by, agencies within the sector. Broadcasting organisations play an important part in creating and preserving audiovisual content that tells ’s stories, and ensuring that this reaches the widest possible range of New Zealand audiences.

A separate paper is also provided outlining the Ministry’s role, structure, staff, and financial provisions.

This briefing is structured as follows: Part 1: Portfolio background Part 2: Significant policy and delivery issues Part 3: Other important policy and delivery issues Part 4: Agency monitoring and performance issues Appendix: Broadcasting organisations.

2 Part 1: Portfolio background

Broadcasting policy is well‐established… The broadcasting portfolio is concerned with ensuring that New Zealanders receive high quality broadcasting content that informs, educates and entertains, and tells the stories that New Zealanders want to see and hear.

Since 1989, the broadcasting market in New Zealand has been open and largely unrestricted except for competition safeguards under the Commerce Act, statutory controls on standards and restrictions on advertising at certain times.

While particular arrangements are in place for Māori broadcasting, a key feature of New Zealand broadcasting policy is reliance on an independent funding mechanism, NZ On Air, to ensure that New Zealanders can see and hear programmes on television and radio that depict New Zealand identity and culture.

This framework is complemented by a regime for the management of radio spectrum that gives private right holders maximum say over how large parts of the radio spectrum are managed. Rights to radio frequencies used for broadcasting typically exist for 20 years.

…and there are clearly defined relationships with broadcasting organisations… As Minister of Broadcasting, you are accountable to Parliament for the operation of NZ On Air (formally known as the Broadcasting Commission) and the Broadcasting Standards Authority (BSA) which exists to regulate standards in relation to broadcasting content. NZ On Air is structured as an autonomous Crown entity (ACE) under the Crown Entities Act and operates at arm’s length from government in terms of its day‐to‐day funding decisions. The BSA is a quasi‐judicial body structured as an independent Crown entity (ICE) under the Act.

Your roles in relation to all the funded agencies are referred to in the enabling legislation of individual Crown entities, and in various Cabinet directives. Where an agency is a Crown entity, the nature of its relationship with the government is formally stipulated in the Crown Entities Act 2004. Under this Act, ministerial responsibilities such as appointing and removing board members, determining the remuneration of board members, reviewing each entity’s operations and performance, and participating in a process for setting the strategic direction for each entity are specifically identified.

The Act further addresses the power of Responsible Ministers to give directions to Crown entities. This power varies with the type of Crown entity an organisation is defined as being – whether it is a Crown entity company; a Crown agent (which must give effect to government policy when directed by the Responsible Minister); an ACE (which must have regard to government policy when directed by the Responsible Minister); or an ICE (which is independent of government policy with respect to its statutory functions).

3 You also have a close involvement with Television New Zealand (TVNZ) and (RNZ), both of which are structured as Crown entity companies under the Crown Entities Act. Formal accountability to Parliament for their operation is provided by the Minister Responsible for TVNZ and RNZ, typically the Minister of Broadcasting.

The editorial independence of these organisations is protected by their individual statutes, which contain provisions preventing Ministers from giving direction or dismissing board members with respect to programming, news presentation or standards. One of the amendments made to the Television New Zealand Act 2003 in 2011 was to extend this provision to encompass content placed by TVNZ to be accessed via new media, as distinct from conventional television programmes.

As Minister, you are responsible for the Crown’s interest in one non‐government broadcasting organisation – the National Pacific Radio Trust, which runs Niu FM.

The Crown also funds Limited, although the funding agreement is between the Chief Executive of the Ministry and Freeview. The company is an incorporated joint venture with shareholding broadcasters TVNZ, TVWorks (TV3 and C4), Māori Television and Radio New Zealand. Freeview is a platform that enables the broadcast of free‐to‐ air digital television and radio by means of direct‐to‐home (DTH, or satellite‐to‐dish) or terrestrial (DTT) transmission. Funding continues until December 2013, to coincide with the completion of digital switchover.

A relationship also exists with the Advertising Standards Authority (ASA). The ASA is an industry body, but maintains regular communication with you through the Ministry.

…as well as with related portfolios Issues in relation to Māori broadcasting are the responsibility of your colleague, the Minister of Māori Affairs. Your colleague, the Minister for Communications and Information Technology, is responsible for the management of the radio spectrum on which most current broadcasting services depend.

You also work closely with the Minister for Arts, Culture and Heritage. Two important shared responsibilities in 2012 will be screen sector interventions which are being reviewed jointly by the Ministry and the Ministry of Economic Development (MED) and arrangements for the management of audiovisual archives.

Broadcasting and arts, culture and heritage issues are inter‐related… There are strong links between the cultural sector and aspects of broadcasting and media. Television remains the primary vehicle from which New Zealanders source their cultural content. The film and television industries are closely interconnected. The New Zealand Film Commission and NZ On Air, and on occasion Creative New Zealand, collaborate on some funding projects.

4 The government’s interventions in support of music are also closely interrelated. NZ On Air’s support of recordings for radio play and of music videos is complemented by the New Zealand Music Commission’s backing of popular music as a viable local and export industry. In the classical music field, in addition to the Ministry’s support of the New Zealand Symphony Orchestra, Creative New Zealand provides funding for regional orchestras, the NBR New Zealand Opera, the New Zealand String Quartet and Chamber Music New Zealand. Many of these organisations – and other performers – are showcased by Radio New Zealand, which also features programming on various aspects of New Zealand’s popular music.

The Ministry’s policy interest in heritage also extends to broadcasting, through its funding of the New Zealand Film Archive, the new archived works provisions in TVNZ’s legislation and the current review of audio‐visual archiving arrangements.

Officials that support you… You are supported primarily by officials from the Ministry for Culture and Heritage (the Ministry), which assumed policy responsibility for broadcasting from the Ministry of Economic Development (MED) in 2000. You are also supported by officials from MED in respect of radio spectrum matters and from the Crown Operating Monitoring Unit (COMU) of the Treasury in respect of the financial performance of TVNZ and RNZ.

Key personnel are: Ministry for Culture and Heritage Lewis Holden, Chief Executive Roger Perkins, Acting Manager, Media Policy Greg Harford, National Manager, Going Digital.

Ministry of Economic Development Len Starling, Manager, Radio Spectrum Policy.

Crown Ownership Monitoring Unit James Cunningham, Manager, Sector Monitoring.

5 Part 2: Significant policy and delivery issues There are several largely procedural issues that will need to be addressed over the next few weeks (the 2012 legislation programme and the four‐year plan for the 2012 Budget, both of which are addressed in the next section).

Related to the four‐year plan is whether to provide a “help scheme” to assist with the roll‐out of digital switchover and, if so, how this should be funded.

As well as digital switchover, in the short to medium term other significant issues are:  possible changes to content regulation, including the possible rationalisation and/or consolidation of media standards bodies in New Zealand;  demand‐side competition issues in respect to ultra fast broadband.

Below is an outline of each issue. We would be pleased to provide any further briefing that you require on these and the other issues addressed in this briefing.

Analogue broadcasting is being phased out, starting in September 2012… Digital television has been available from Freeview, and TelstraClear for several years. In 2010, the previous Government determined that analogue services will be closed down by the end of 2013.

New Zealand will be “going digital” in the following phases:

30 September 2012 West of the and Hawke’s Bay

28 April 2013 Rest of the South Island

29 September 2013 Lower North Island and the East Coast

1 December 2013 Rest of the North Island

Similar changes have been or are underway in all developed countries, as analogue technology becomes obsolete. Digital transmission enhances television services by providing better pictures and sound, new services such as onscreen programme guides and, through the more efficient use of spectrum, space for more channels. Going digital also produces a “digital dividend”, as the greater efficiency of digital transmission also releases spectrum to be re‐used for other purposes, including fourth‐ generation (4G) mobile communication services. The process will also benefit broadcasters, who will achieve significant cost savings by ceasing analogue transmission.

There are three forms of digital transmission:  by satellite, which covers the whole country (DTH);  by terrestrial transmission from towers on high sites, which is available to over 86 percent of the population (DTT);  by cable television, which is available in , Kapiti and only.

6 During 2011, the digital terrestrial television (DTT) network was extended to reach Whangarei, Rotorua, Gisborne, Taranaki, Taupo, Whanganui, the Wairarapa, Nelson, Timaru and Invercargill.

The major population areas unable to receive a DTT signal are now the Far North, Marlborough, the Eastern Bay of Plenty, Central Otago and Wairoa. While regional lobbying for further extensions of DTT is possible there is no funding allocated to support further such extensions.

A “Going Digital” team was established in 2010 as a stand‐alone unit within the Ministry to promote digital switchover (DSO). Its national manager is Greg Harford.

For their part, the television broadcasters have set up the Broadcast Sector Group (BSG) to represent their interests during the DSO process.

…and decisions are required in respect of possible assistance for low‐ income households In July 2011, the previous Government agreed in principle to the implementation of a Targeted Assistance Package (TAP) to assist disadvantaged households with DSO. A tagged contingency of $20.670 million has previously been set aside for the TAP.

Based on similar schemes which have been used in other jurisdictions, including Australia and the United Kingdom, the TAP developed by officials is a 100 percent subsidy of the cost of a contracted supplier installing the conversion and reception equipment for DTT or DTH (where DTT is unavailable) for those on an Invalid’s Benefit, those on a Veteran’s Pension or those over age 75 with a Community Services Card.

Officials were directed to review the full range of TAP funding options to facilitate the transition to digital television for vulnerable households, and report to Cabinet on the best of options. This report back is planned for December 2011, with decisions required before Christmas to enable any scheme to be implemented by March 2012. This timeframe is tight. Should decisions not be made prior to Christmas, implementation of the TAP will be delayed and eligible people in Hawke’s Bay and the West Coast will have less time to opt in to receive assistance before their regions go digital.

An ongoing Digital Tracker survey is being used to measure household take‐up of digital television, including households in the above target categories. The latest quarterly results show that overall take‐up of digital television remains unchanged from the last quarter at 79 percent. Take‐up by the households in the targeted groups ranges between 73 and 74 percent. The margin of error of the results of the targeted groups is plus or minus 5‐6 percent.

Following direction from Cabinet in July 2011, a Request for Tenders (RFT) process was initiated by Going Digital in August 2011. This took the form of an open Expressions of Interest process followed by a closed RFT process. Negotiations are currently being held with the preferred provider of installation services. Discussions to date indicate that based on present assumptions about take‐up the $20.670 million tagged contingency will be sufficient to meet the cost of the TAP.

7 A review of the pilot regions in October 2012 will identify whether any additional funding is required. In this event, you will need to discuss re‐prioritisation options with the Minister for Social Development and Employment and the Minister of Finance.

While a technical issue, frequency “re‐stacking” is not without some risk… Realising the digital dividend requires the frequencies used for broadcasting the Freeview HD terrestrial service to be changed in many parts of the country – a process known as “re‐stacking”. Funding to support the technical aspects of re‐stacking is included in the Going Digital programme appropriation within Vote: Arts, Culture and Heritage.

Following a trial on the Kapiti coast, a timetable has been prepared to perform re‐ stacking in other regions by June 2012. The process has the potential to cause some consumer confusion, although MED, which is managing the process, is confident that with adequate planning and call centre support any problems with loss of service can be quickly and satisfactorily addressed.

Arrangements for regional television are well in hand… A scheme to assist regional television broadcasters to make the transition to digital transmission has been developed by the Ministry and is being administered by NZ On Air, in tandem with that agency’s other assistance for regional television.

…as are those for the recycling of old televisions DSO does not require analogue televisions to be replaced by digital sets. A set‐top box (STB) can be used to convert the new digital signal into analogue for reception by the existing set. Many households are choosing to upgrade their televisions to digital sets, however.

In October 2011, the Ministry for the Environment (MfE) funded a television recycling project (“The Great TV Take Back”) through branches of The Warehouse, aimed at those going digital by replacing their televisions. The project also facilitated the safe disposal of newer sets damaged in the Christchurch earthquakes. MfE is investigating opportunities for further recycling programmes, funded through the Waste Minimisation Fund.

A significant issue for 2012 will be the possible reform of content regulation… Earlier this year, a Cabinet paper was prepared by the Ministry to amend the jurisdiction of the Broadcasting Standards Authority (BSA) under the Broadcasting Act 1989. The BSA is able to receive complaints about programmes broadcast conventionally, but not about the content that broadcasters are increasingly making available only on their websites (such as longer versions of interviews featured during the news).

8 This paper was put aside in favour of a wider review of content regulation – in film, broadcasting, advertising and the print media – to determine whether there is scope for rationalisation and/or consolidation of the underlying regulation and the media standards bodies involved. Ministers of the previous Government decided to defer consideration until the New Year.

A related investigation is being carried out by the Law Commission. The Minister of Justice in the previous administration asked the Commission to investigate and report by the end of this year on:  how to define “news media” for the purposes of the law;  whether and to what extent the jurisdiction of the BSA and/or the Press Council should be extended to cover unregulated news media; and  whether existing criminal and civil remedies for wrongs such as defamation, harassment, breach of confidence and privacy are effective in the new media environment and, if not, what alternative remedies are available.

The Law Commission has very recently published a discussion paper on these issues. It is proposing the establishment of a converged regulator for news media combining the work of the Press Council and the work of the BSA in relation to “journalistic” standards (as opposed to “entertainment” matters). The Commission is proposing that such a body be recognised in statute but operate independently of the state and media organisations. News media providers would receive rights and privileges available to the press in return for adherence to codes which the converged body would promulgate. At the same time, the Commission is proposing that access to the justice system for those wronged by news media providers be enhanced and made more flexible.

Both the United Kingdom and Australia have begun reviews of their media regulation in the wake of the News International phone‐hacking scandal. Australia is also undertaking a “convergence” review of regulation, examining its fitness for purpose as formerly separate media converge.

…and a possible need to address competition issues in relation to pay television The Commerce Commission is undertaking a study of demand‐side issues, including the availability of content that may inhibit uptake of ultra‐fast broadband (UFB) by the public. A conference is to be held in in February 2012, following circulation of a discussion paper, and a final report will be issued in April. The Ministry is liaising with the Commission and will advise you as its work progresses.

9 Part 3: Other important policy and operational issues Other important issues requiring your attention in due course include:  possible implications of the previous Government’s decisions to focus TVNZ as a more commercial organization and to discontinue funding TVNZ 7 when current funding expires in June 2012;  the future of the Radio New Zealand Amendment Bill which addresses RNZ’s Charter;  the future of the 102FM block of nationwide radio frequencies;  the renewal of the voluntary code for New Zealand contemporary music on commercial radio;  various issues in relation to Māori broadcasting, especially the Government’s response to the recommendations of the Waitangi Tribunal in respect of the broadcasting aspects of Wai 262 and Wai 2224 claims;  disability issues, especially captioning services for the hearing‐impaired;  rationalisation and/or consolidation of audiovisual archives operated by TVNZ and RNZ;  the scope to review the allocation criteria for non‐commercial radio broadcasting;  screen sector interventions; and  the need to finalise bids for the 2012 Legislation Programme and any proposals under your portfolio for the Ministry’s four‐year budget plan.

A more commercial TVNZ will put pressure on NZ On Air to broaden its funding for commercially attractive genres… The two most significant developments in the previous Government’s broadcasting interventions in the past year have been the passing of the Television New Zealand Amendment Bill, amending the 2003 Act, and the decision to discontinue funding for TVNZ 7 beyond June 2012.

The most significant change introduced by the Bill has been the repeal of the TVNZ Charter, and its replacement with a much briefer set of functions. The new functions state that TVNZ is to be a successful national television and digital media company providing a range of content and services on a choice of delivery platforms and maintaining its commercial performance. They require TVNZ to provide high‐quality content that is relevant to, and enjoyed and valued by, New Zealand audiences, encompassing both New Zealand and international content and reflecting Māori perspectives.

The Act also allows the re‐screening of works produced by TVNZ’s predecessors and held in the TVNZ archive, while providing for compensation to be paid to rights‐ holders. Previously, these works, which are part of New Zealand’s audio‐visual heritage, were “locked up” due to the impracticality of locating and striking new agreements with the various people, other than TVNZ employees, who were involved in their production.

10 A more commercial TVNZ can be expected to put increasing pressure on NZ On Air to broaden the availability of funding for commercially‐attractive genres, specifically drama, comedy, entertainment and popular factual. TVNZ has already signaled as much in its Statement of Intent for the three years to 2014.

…longer‐term, a more commercial TVNZ may also make it more difficult for NZ On Air to meet the full range of its statutory functions Since its establishment in 1989, NZ On Air has proved to be a successful innovation for New Zealand’s circumstances. It has funded thousands of hours of local content that a market of New Zealand’s size would not have produced on its own.

The Broadcasting Act, under which NZ On Air is established, provides for an open and contestable funding model, with the expectation that funded programmes must be broadcast. Together with contestability, this simple expectation helps ensure that NZ On Air achieves maximum value for money in the use of its funds.

A downside of the contestable funding model, however, is that funding depends on the co‐operation of broadcasters, which effectively act as “gate‐keepers” in deciding which programmes are actually shown.

If the main television channels are intent on appealing to the portion of the audience that is of most interest to advertisers and on programmes that will achieve the highest ratings to that group, it might become difficult for NZ On Air to achieve its statutory remit, especially with respect to the interests of children, persons with disabilities, and ethnic and other minorities.

…and we can expect there to be an ongoing debate about public service television The previous Government took a platform‐neutral approach to broadcasting, essentially confirming the position generally followed since 1989 in respect of mainstream television that the government’s primary role in broadcasting was to support broadcasting, in the form of programming, as opposed to a particular broadcaster.

Access to new, specialized channels (whether pay or free to air), together with the availability of programmes via the internet has radically altered the broadcasting landscape.

Notwithstanding these developments, some commentators remain attracted to the traditional public service television model. There was lively debate on this issue at the recent conference of the Screen Production and Development Association (SPADA). There have also been a number of newspaper articles, blogs and other media commentary arguing the case for a public service channel.

11 In addition, the former MediaWorks executive Brent Impey has put forward a proposal for a general public service channel as part of the Māori Television Service, and the producer John Barnett and the Chair of Radio New Zealand, Richard Griffin, have proposed a service set up as an extension of National Radio. Both proposals would use the channel currently occupied by TVNZ 7. Business plans for these proposals have not been presented to the Government, but you may receive representations on these or other proposals from those wishing to see a continuation of a TVNZ 7‐like service.

We note that in the confidence and supply agreement between National and United Future New Zealand, the National‐led Government has agreed to “maintain at least current Budget funding tracks to TVNZ…to ensure they continue to fulfil their existing roles.” We would like to discuss with you at an early stage how this agreement can be given effect.

The Radio New Zealand Amendment Bill awaits its Second Reading… This Bill incorporates amendments to Radio New Zealand’s Charter that were agreed in discussion between RNZ and this Ministry and then refined following public feedback. The revised Charter was then submitted to the Commerce Select Committee, in fulfilment of the Act’s requirement that the Charter be reviewed by the House of Representatives every five years. The Commerce Committee approved it and a Bill was eventually introduced in June 2009, after a Part changing RNZ’s institutional form to that of an autonomous Crown entity was removed by the previous Government.

The Charter is in effect a statement of the statutory functions of RNZ. The revised text makes a stronger statement about RNZ’s role as a public broadcaster and is drafted and organised to make it more accessible to the general public and to clarify that RNZ now has a multi‐media role.

The Bill also incorporates language more clearly stating that RNZ’s services are commercial‐free, and defining this to exclude advertising and sponsorship.

This aspect of the Bill has delayed its progress, as the previous Government wished to be assured that, with no funding increase, RNZ could develop a financial plan that would not in fact require sponsorship. Such a plan was prepared (see the following section) and the Government decided not to amend the Bill further. It awaits its second reading.

As the Bill remains to be passed, the previous Minister was obliged to write to the Chair of the Commerce Select Committee to advise that the next five‐yearly review of the Charter is due. He noted that the Bill was before the House and that it incorporated a revised Charter resulting from the previous five‐yearly review. A further provision included in the Bill would amend the requirement for the five‐yearly review by stipulating that the five‐year period only begins when any changes to the Charter have been enacted.

12 RNZ’s financial situation will need to be monitored closely and again reviewed before June 2013… RNZ’s financial situation has been the subject of public discussion for some years. In November 2009, in view of the economic situation, RNZ was asked by the Government to develop a plan based on receiving no increase in public funding for three‐to‐four years, from 2010/11. A plan originally developed the following February was revised and approved by the Minister of Broadcasting in October 2010. The plan covers the period until 30 June 2013.

A key issue to be settled before the plan was finalised was whether sponsorship would be required to support RNZ Concert. Options for sponsorship were explored, but independent advice sought by RNZ was that few opportunities existed, and that potential sponsors would be wary of alienating audience members who might otherwise be customers. A charitable trust has been subsequently established for RNZ Concert, but this is to support additional activity, rather than the service’s operational costs.

RNZ was able instead to develop a financial plan that did not involve sponsorship or a reduction in services. It achieved this by reducing its costs in several areas, including:  ceasing to pay performers’ fees when broadcasting concerts by classical ensembles (including those funded through Vote Arts, Culture and Heritage); this measure has not been without controversy;  reducing the scope of its audience research; and  creating tighter controls on capital expenditure to reduce depreciation costs.

New or increased sources of income are also being explored, including the sales of news “feeds” to other broadcasters; the transmission of data from smart meters for power companies; and consultancy work, especially in the Pacific.

An early decision is needed on the future of the 102FM band… Nationwide frequencies were reserved by the Labour‐led Government of the 2000s for a youth radio network and a national Māori radio network. Decisions were not taken to establish such networks, however, and the previous Government also elected not to pursue either idea.

In the meantime, temporary use of some of the frequencies has been granted to Kiwi FM, a private network owned by MediaWorks that, in its programming of a diverse range of 100 percent New Zealand music, has played part of the role envisaged for a youth radio network. Kiwi FM currently has a licence agreement until 30 June 2012, which can be cancelled with six months’ notice if the frequencies are required for other purposes.

[Information in this section has been withheld under section 9(2)(f)(iv) of the Official Information Act].

13 The voluntary radio code for New Zealand contemporary music on commercial radio expires at the end of the year… Related to the future of the 102FM band is the continuation of a voluntary code for the broadcasting of New Zealand contemporary music on commercial radio. The code was originally entered into by the radio industry in response to the then Government’s contemplation of mandatory local content quotas and a youth radio network.

In talks between the Ministry and representatives of the radio industry in November, there was agreement that the present code, which sets a 20 percent target for New Zealand contemporary music across a range of genres, be continued. Various initiatives were discussed to help improve the operation of the code (recent performance is around 18.6 percent).

The Ministry has been working to foster a joined‐up approach to supporting New Zealand music across different funding agencies… Currently, New Zealand music is supported by three agencies: NZ On Air, which supports recordings, including videos, for broadcast; Creative New Zealand, which supports recordings and other projects of a generally more innovative or less commercial nature; and the New Zealand Music Commission, which concentrates on industry development projects.

During 2010 and 2011 the Ministry investigated whether a more consolidated approach to supporting popular music would be desirable, in which priorities could be more easily adjusted between recording, industry development and other goals.

In its reporting to Ministers, the Ministry noted that alternative institutional arrangements, including some consolidation between the three agencies and a rebalancing of resources, might more effectively achieve music outcomes in the longer term. For the short term, however, it recommended that the agencies be formally required to co‐operate more closely to deliver complementary programmes that collectively support the contemporary music industry. An exchange of letters between the Ministers and the agencies followed to give effect to this expectation. The three agencies advised that they had had preliminary discussions and were to meet again in late November to confirm terms of reference and a timetable for reporting to Ministers.

While Māori broadcasting and the Māori language strategy are the responsibility of the Minister of Māori Affairs, there are important overlaps with your portfolio… As noted, Te Pūni Kōkiri has responsibility for advising the government on Māori broadcasting issues. It monitors and funds the Māori Television Service and the funding agency Te Māngai Pāho. This Ministry has an interest in the relationship of Māori broadcasting issues to general broadcasting policy, however.

First, following an external review of the effectiveness of the Māori Television Service’s legislation – as distinct from a review of the broadcaster’s performance – drafting instructions are being prepared for a Bill to amend the Māori Television Service Act 2003. If the Bill proceeds, changes to the broadcaster’s statutory functions will tighten

14 its focus on its primary purpose, to promote te reo Māori. The effect of this renewed emphasis is likely to be that the Māori Television Service will move further away from being a de facto public television service for general audiences, which it has sometimes been called in contrast to the largely commercial direction of TVNZ.

Secondly, the freeing up of spectrum as a result of digital switchover in television has prompted a claim to the Waitangi Tribunal, Wai 2224, for the use of spectrum by Māori interests. The claim represents a new stage in a long‐running challenge by Māori interests that radio spectrum is a taonga under the Treaty of Waitangi. The Crown has consistently rejected this claim. The previous administration considered a middle option, in response to the claim, in which the Government would not revisit previous Crown decisions on the Māori Treaty right to spectrum but would commit to reviewing how the Crown‐Māori Treaty relationship should be reflected in the spectrum management framework.

Thirdly, twenty years after it was lodged the final report on the Waitangi Tribunal in respect of Wai 262 was received in July this year. Encompassing issues of intellectual property and the promotion of te reo Māori and mātauranga Māori, the report’s recommendations relate to broadcasting in several ways. The report finds that, for reasons of inclusiveness, “Māori culture must be prominent” on mainstream as well as “niche” channels (the latter including Māori Television). The Government “must accept that this will come with an associated cost”. TVNZ and Māori Television should also “co‐operate” to avoid scheduling clashes of publicly funded Māori programming. The Tribunal further recommends that TVNZ should develop a stronger set of guidelines for the use of archived material, based on consultation with Māori. The Tribunal also recommends the establishment of a bicultural “Crown‐Māori partnership entity” to “guide agencies in the setting of policies and priorities concerning mātauranga Māori”. It suggests that this entity would provide useful guidance for TVNZ in “reconciling [its] obligation to the community…with its commercial focus”.

Fourthly, an independent panel published its review of the Māori Language Strategy (MLS) in 2011, proposing a new focus on language transmission at the local and whānau level funded by pooling central government funding used for the promotion of te reo. We advised the previous Government of our concern that the review was counting Vote Arts, Culture and Heritage money, including for NZ On Air, that was used for Māori cultural purposes, rather than te reo specifically. The Waitangi Tribunal has meanwhile proposed a stronger role for the Māori Language Commission, in particular in approving mandatory language promotion plans to be prepared by government agencies, including broadcasters. Like the Tribunal’s recommendations in relation to mātauranga Māori, discussed above, this recommendation would involve TVNZ in activities that would cut against the largely commercial emphasis given to it by the previous Government. Based on decisions made towards the end of the term of the previous Government, the Minister of Māori Affairs is likely to be responsible for co‐ ordinating and reconciling the recommendations of the MLS review and of the Tribunal in relation to te reo.

15 Pacific Peoples in New Zealand have aspirations for a national television service… For several years, various proposals have been advocated for a national television service for Pacific peoples in New Zealand. The fiscal and economic situation has not been favourable, however. Earlier this year, the Ministry provided comment on a draft paper prepared by the Ministry for Pacific Island Affairs on options for increasing Pacific content on existing channels. The Minister of Pacific Island Affairs decided not to consider the issue further for the time being.

The Ministry believes that a more coherent approach to Pacific broadcasting, for Pacific peoples both within New Zealand and in the wider region, is desirable. It proposes, with your endorsement, to undertake some work in this area, for reporting to you in due course. NZ On Air has recently commissioned a study of Pacific broadcasting in New Zealand which will assist this process.

There is increasing dissatisfaction about broadcasting support for the disabled, especially the hearing‐impaired… The National Foundation for the Deaf is calling for the Government to require broadcasters to provide captions on most programmes, in line with the practice in most developed countries. The Human Rights Commission is also taking a close interest in the issue.

Currently, New Zealand relies on funding support for captioning via NZ On Air. NZ On Air is discussing with SKY the possibility of it supporting captioning on some of its pay channels and its free‐to‐air channel Prime.

The Ministry is investigating options for a “talking set‐top box” which guides blind users in navigating menus and in providing an audio version of the electronic programme guide. Such functions, which are available in some other countries, would complement television subtitling for the deaf.

NZ On Air does now fund audio description (AD) of programmes for the blind or those with limited vision. Following a successful trial of an AD track of Coronation Street in early 2011, NZ On Air has continued funding the service in 2011/12. A range of programmes, including New Zealand shows Shortland Street and Nothing Trivial, now feature AD when accessed via Freeview. The AD service is provided by Access Services (formerly TVNZ Captioning).

There is scope to rationalise and/or consolidate New Zealand’s audiovisual archives… Resources for New Zealand’s audio‐visual heritage are thinly spread across several archives. The Ministry believes there is scope to make better use of these resources through a more co‐ordinated approach.

Following discussion with TVNZ, RNZ and the New Zealand Film Archive, a preferred option was developed in which the archives of TVNZ and RNZ’s Sound Archives Ngā Taonga Kōrero (a subsidiary of Radio New Zealand) would be transferred or sub‐ contracted to a new consolidated entity based on the New Zealand Film Archive.

16 TVNZ eventually advised that it was no longer interested in exploring this option as it considers maintaining a separate archive to be still a valuable part of its business. There remains the question of whether there is scope for a consolidation of the RNZ Sound Archives and the Film Archive. The Minister for Arts, Culture and Heritage in the previous Government asked the Ministry to investigate this possibility. Meantime, funding for the Sound Archives is to be transferred from NZ On Air to the Ministry, to allow for possible consolidation via the Film Archive.

CTV () would like to have nationwide coverage… CTV’s headquarters were completely destroyed in the 22 February Canterbury earthquake, with the loss of over half of its staff as well as studios and equipment. The Ministry was involved in discussions about how to help CTV to get back on air. For the first three months following the earthquake Māori Television provided nationwide broadcasting capability at times of the day when MTS was itself not broadcasting. This nationwide coverage allowed people who had left Christchurch as well as other New Zealanders to follow CTV’s reports. Other broadcasters and transmission providers also helped CTV to resume broadcasting locally.

CTV would like to return to nationwide transmission on a digital licence. The costs of doing so would be well beyond CTV’s current capacity. However, CTV has discussed with Parliament TV a similar arrangement to its earlier agreement with MTS – that is, to use spare capacity in off‐hours. It is also, with other regional stations, potentially eligible for a grant from NZ On Air to assist in moving to digital‐only transmission.

There is scope to review the government’s support for non‐commercial radio broadcasting… While radio spectrum for commercial purposes is allocated by auction, spectrum for non‐commercial or regional purposes is allocated according to a policy framework and a set of criteria, which were established between 2000 and 2008. Eligible broadcasters must be locally based, and be able to offer “programming focused on the needs and interests of the audiences they serve”. They must be able to demonstrate that they are filling a real gap in the choice available to local audiences, and they are permitted to receive no more than 50 percent of their income from advertising.

This year expressions of interest were called for available non‐commercial frequencies in Hamilton, Tauranga and Invercargill. Competing applications for the northern cities were considered by a panel containing representatives of this Ministry, MED and NZ On Air and an independent member, and a licence was allocated to a Hamilton station according to the criteria. Tauranga applicants have been invited to collaborate to produce a satisfactory proposal. No satisfactory application was received for the Invercargill frequency and it is not proposed to re‐offer it for the time being.

As it has been some time since this policy was established, it would be appropriate to consider whether any change is required, especially whether new forms of radio broadcasting should be given more prominence in allocation criteria.

17 Interventions for the screen sector are being reviewed… Along with MED, the Ministry is reviewing the effectiveness of government’s current interventions to support the screen sector in New Zealand. This is a multi‐faceted work programme that stems from the recent Jackson/Court report on the New Zealand Film Commission (NZFC). It involves evaluations of the Large Budget Screen Production Grant Scheme and the Screen Production Incentive Fund as well as an assessment of the NZFC’s role in supporting professional development and training, and has the potential to affect the work of NZ On Air. Officials will be reporting to Ministers by the end of June 2012 on the outcome of their investigations.

The Legislation Programme for 2012 will need to be finalised in December… The 2011 Legislation Programme has the following broadcasting items:  Radio New Zealand Bill – to update the Charter, following the second statutory review;  Broadcasting Amendment Bill (No. 2) – to make any changes to the content standards regime for broadcasting.

As discussed earlier in this briefing, it is proposed that these Bills be carried forward into the 2012 Programme. Bids are normally finalised before Christmas, in anticipation of a requirement to lodge them in January.

…and the four‐year budget plan is due by the end of January The Minister of Finance requires departments to submit a draft four‐year forward plan by 31 January 2012. The responsible Minister for the Ministry is the Minister for Arts, Culture and Heritage. The main issue under your portfolio is whether any shortfall in the TAP (see Significant Policy and Delivery Issues) should be funded from NZ On Air. The current post‐October Budget outline for broadcasting allocations under Vote: Arts, Culture and Heritage is provided below.

Non Departmental Budgets: Broadcasting ($000) 2011/12 2012/13 2013/14 2014/15 2015/16 NZ On Air 129,926 129,926 129,926 129,926 129,926 Non‐commercial, Pacific 1,757 1,757 1,182 607 607 TVNZ. Digital tv 10,500 0 0 0 0 RNZ International 1,900 1,900 1,900 1,900 1,900 BSA 609 609 609 609 609 Freeview 5,028 5,000 2,500 0 0 Total 149,720 139,192 136,117 133,042 133,042

18 Part 4: Agency monitoring and performance issues

Funded agency operating costs are being reviewed The Ministry is reviewing the information produced by every funded agency to ensure there are accurate and up‐to‐date data that allow Ministers to see how costs relate to the business models of the organizations concerned. The initial focus is on the key funding agencies ‐ Creative New Zealand and the New Zealand Film Commission in the arts, culture and heritage portfolio, SPARC in the sports portfolio, and NZ On Air in the broadcasting portfolio.

Decisions and actions are required as part of the regular monitoring cycle… Your responsibilities in relation to broadcasting agencies are outlined above under Part 1: “Portfolio background”. The agencies themselves are described in the Appendix. This section summarises upcoming decisions and actions.

Letters of expectation of NZ On Air and the BSA for 2012/13 will need to be sent to the agencies by December/January.

Quarterly reports from TVNZ and RNZ on their financial performance to 30 September 2011 have been received. Briefings on these regular reports are prepared for you and your fellow share‐holder the Minister of Finance by COMU, with input from this Ministry. The two broadcasters’ results will be incorporated into a regular Crown Company Quarterly Performance report, which is provided to the shareholding Ministers. A quarterly report from TVNZ on TVNZ 7 has also been received.

The previous Minister received a report recommending that TVNZ be included in a continuous disclosure regime administered by COMU, and originally applied only to major state‐owned enterprises.

TVNZ transmission to the Pacific, Radio New Zealand International, the BSA, NZ On Air and Freeview have a six‐monthly reporting cycle. Their next report is due in February 2012.

TVNZ’s annual report has been tabled and published. The annual reports of RNZ, NZ On Air, the BSA and the National Pacific Radio Trust are required to be tabled in the House when the new Parliament meets.

The next six‐monthly report to the Ministry from Freeview is due in February 2012.

TVNZ has commissioned Cameron Partners to undertake a capital structure review. The review will cover TVNZ’s capital structure (also referred to as gearing), dividend policy (including the possibility and scale of a special dividend), and cost of capital.

19 Six‐monthly reports on the expenses of all agencies’ chief executives are required to be published on their websites and on that of the State Services Commission. The next reports are due in January/February 2012. Two sets of reports have been published to date without prompting adverse media comment.

Annual reports have been received from non‐commercial licence‐holders.

…and appointment decisions are needed in relation to the BSA and NZ On Air A replacement is required for the chair of NZ On Air, Neil Walter, who is relinquishing his role in March 2012.

Mary Shanahan completes her term on the BSA on 30 April 2012. It will be necessary to consult with relevant public interest groups as part of seeking her replacement.

Other appointments will need to be made to NZ On Air, the BSA and the National Pacific Radio Trust at the end of 2012 as existing members complete their terms.

20 Appendix: Broadcasting organisations This appendix provides a brief snapshot of key broadcasting organisations and is intended for reference only:

Television New Zealand Ltd Radio New Zealand Ltd NZ On Air Broadcasting Standards Authority National Pacific Radio Trust Freeview Ltd Advertising Standards Authority.

21 Television New Zealand Limited

Agency profile Television New Zealand Limited is a Crown entity company established under the Television New Zealand Act 2003. The Ministers of Broadcasting and Finance are its shareholding Ministers.

TVNZ’s statutory functions are set out in section 12 of the Act. Recent changes to these functions are discussed in the “Significant policy and delivery issues” section of this briefing.

TVNZ is currently funded to:  maintain television coverage in non‐commercial areas;  transmit news, current affairs and special interest programmes to the Pacific; and  provide one digital television service on the Freeview platform.

Performance summary and issues TVNZ reported a positive performance in the 2010‐11 year delivering a net profit after tax of $2.1 million and underlying earnings of $31.8 million, up 164 percent from the previous year. The board declared a dividend to the government of $13.8 million which is a significant increase on the previous year’s dividend of $4.9 million.

Funding for TVNZ 7 expires on 30 June 2012 and TVNZ has commenced work to plan for the closure of the channel. The channel is currently broadcast on TVNZ’s digital licence, which was provided free of charge until digital switchover in order to facilitate the transition to digital television. A condition of the licence is that TVNZ must broadcast at least four channels. Therefore, TVNZ is contractually obligated to broadcast another free‐to‐air channel once TVNZ 7 ceases broadcasting (at least until the digital switchover).

TVNZ is currently evaluating a number of options for use of the frequency post‐30 June 2012. No definitive plans exist at this stage, however. It is likely the frequency will be used to deliver commercial value for TVNZ.

Governance The board of TVNZ is:  Sir John Anderson, Chair  Joan Withers  Anne Blackburn  Alison Gerry  Roger MacDonnell  Barrie Saunders  Wayne Walden.

22 Board appointments to TVNZ are made by shareholding Ministers; the supporting administrative work is undertaken by the Crown Ownership Monitoring Unit of the Treasury. This Ministry provides advice on potential candidates, and participates in briefings and the due diligence process.

Chief Executive: Rick Ellis.

Funding TVNZ’s 2011/12 funding comprises a baseline appropriation of $10.5 million for the digital television service TVNZ 7 on the Freeview platform, $1.15 million to maintain television transmission to remote localities, and $607,000 to maintain transmission of news and current affairs programming to the Pacific. Funding for the digital channel expires in June 2012, while funding to maintain television transmission to remote localities will no longer be required beyond December 2013 when digital switchover is completed. TVNZ 7 is discussed further in the “Significant policy and delivery issues” section of this briefing.

2010/11 Total Working Vote ACH All other Net operating FTEs assets Capital revenue ($000) revenue result ($000) ($000) ($000) ($000)

TVNZ 228,690 43,432 36,020 341,876 2,080 919.2 Inclusive of $14,257 from MCH, $8,561 from NZOA and $5,561 from TMP

23 Radio New Zealand Limited

Agency profile Radio New Zealand (RNZ) is a Crown entity company established under the Radio New Zealand Act 1995. The Ministers of Broadcasting and Finance are RNZ’s shareholding Ministers.

RNZ’s statutory functions are to provide innovative, comprehensive, and independent broadcasting services of a high standard, as more specifically detailed in the Charter provisions of the Radio New Zealand Act. The Radio New Zealand Amendment Bill, which updates the Charter, is discussed in the “Significant Policy and Delivery Issues” section of this briefing.

RNZ also provides the Radio New Zealand International (RNZI) service to the South Pacific. This service is required to:  promote links between South Pacific communities in New Zealand and their counterparts in the region;  broadcast programming which encourages an awareness and understanding of New Zealand policies on regional issues of concern, foreign relations, development assistance, immigration, human rights, economic developments, the environment and trade opportunities;  broadcast innovative, comprehensive and independent news and programming of interest to the Pacific region; and  work with Pacific broadcasters and organisations that develop Pacific media by offering regional support and training.

Performance summary and issues RNZ assumed its required role as a designated lifeline utility in Christchurch under the Civil Defence Emergency Management Act. This affected RNZ’s regular operations and programming schedules as well as Charter programming levels.

RNZ surpassed all its qualitative measures targets for 2010‐11. A recent audience survey shows that 86 percent of the general public agrees RNZ broadcasts programmes of interest to a wide cross‐section of New Zealand and 89 percent of RNZ listeners are very satisfied or quite satisfied with RNZ programming.

RNZ has been required to maintain services at current levels in the face of static funding. While the board has developed a plan to live within its means for the next two to three years, the issue of funding levels beyond that timeframe will need to be addressed shortly. (See also “Significant policy and delivery issues” section.)

RNZI is currently updating a business case for capital funding in the region of $7.5 million for a second digital shortwave transmitter to replace its aging analogue transmitter. An issue to consider is whether funding for this service should be more properly sourced from Vote Foreign Affairs.

24 Governance Board appointments to RNZ are made by shareholding Ministers; the supporting administrative work is undertaken by the Crown Ownership Monitoring Unit. This Ministry provides advice on potential candidates, and participates in briefings and the due diligence process.

The board of RNZ is outlined below:  Richard Griffin, Chair  Rt Hon Paul East  Josh Easby  Sheena Henderson  Gary Monk  Jane Taylor  Tiwana Tibble.

Chief Executive of RNZ: Peter Cavanagh. General Manager of RNZI: Linden Clark.

Funding Public funding for RNZ’s domestic networks is routed through NZ On Air but direct funding for RNZI operations is provided through the Ministry.

2009/10 Total Working Vote ACH All other Net operating FTEs assets Capital revenue revenue result ($000) ($000) ($000) ($000) ($000)

RNZ 59,506 544 34,441 3,983 (65) 269

RNZI N/A N/A 1,900 379 41 13.5 (YTD figures from RNZI Report for the Quarter Ending 30 June 2011. RNZ Annual Report not yet received.)

The separate briefing provided by the Crown Ownership Monitoring Unit also provides information on RNZ and TVNZ.

25 Broadcasting Commission (NZ On Air)

Agency profile NZ On Air is an autonomous Crown entity established under the Broadcasting Act 1989. NZ On Air plays a major role in ensuring that New Zealanders are able to enjoy broadcasting services that would not otherwise be provided on a commercial basis, as outlined in its functions below:  to reflect and develop New Zealand identity and culture by promoting programmes about New Zealand and New Zealand interests; and promoting Māori language and Māori culture;  to ensure that a range of broadcasts is available to provide for the interests of women, youth, children, persons with disabilities and minorities in the community, including ethnic minorities; and to encourage a range of broadcasts that reflects the diverse religious and ethical beliefs of New Zealanders;  to maintain, and, where appropriate, extend the coverage of television and radio broadcasting to New Zealand communities that would not otherwise receive a commercially viable signal; and  to encourage and establish the operation of archives or programmes likely to be of historical interest in New Zealand by making funds available for broadcasting and the production of programmes to be broadcast; and the archiving of programmes.

Performance summary and issues In 2010‐11 NZ On Air exceeded its annual television funding targets to achieve 984 hours of total television programme funding at a cost of $84,116,000. NZ On Air’s Annual Report indicates that 99 percent of New Zealanders believe NZ On Air supports television programmes and activities important to New Zealanders.

NZ On Air did not achieve its target of 20 percent of New Zealand music content on commercial radio (set to match the 20 percent target of the radio code) but came close at 18.65 percent. However, a new funding model was launched in July 2011 in response to a review of NZ On Air’s music promotion and funding schemes. The MakingTracks funding scheme incorporates new funding criteria and decision‐making processes and it is anticipated that this will better reflect the changing shape of the music sector.

There is mounting pressure on NZ On Air to increase its support for initiatives in the disability sector, specifically captioning and audio description, while community broadcasting also considers itself the poor relation to mainstream television and New Zealand music support.

Governance Members of the NZ On Air board are appointed by the Minister of Broadcasting. The supporting administrative work is undertaken by the Ministry. The Ministry also provides advice on potential candidates, and participates in briefings and the due diligence process.

26 Position Date Appointed Term Ends

Neil Walter Chair 1 December 2006 30 November 2012 Chair 1 Jan 2007

Caren Rangi Member 17 May 2010 30 April 2013

Ross McRobie Member 10 August 2011 31 July 2014

Nicole Hoey Member 9 October 2006 30 September 2012

Michael Glading Member 1 January 2008 31 December 2013

Stephen McElrea Member 1 January 2010 31 December 2012

Chief Executive: Jane Wrightson.

Funding

2010/11 Total Working Vote ACH All other Net operating FTEs assets Capital revenue revenue result ($000) ($000) ($000) ($000) ($000)

NZOA 54,296 8,250 126,926 3,798 267 14.5

27 Broadcasting Standards Authority

Agency profile The BSA is an independent Crown entity established under the Broadcasting Act 1989. The functions of the BSA are as follows:  to receive and determine complaints about alleged breaches of a standard in a specific programme, from persons who are dissatisfied with the outcome of complaints made to broadcasters, and to impose appropriate penalties and costs;  to publicise its procedure in relation to complaints;  to issue to any or all broadcasters, advisory opinions relating to broadcasting standards and ethical conduct in broadcasting;  to encourage the development and observance by broadcasters of codes of broadcasting practice appropriate to the type of broadcasting undertaken by such broadcasters;  to develop and issue codes of broadcasting practice; and  to conduct research and publish findings on matters relating to standards in broadcasting.

Performance summary and issues The BSA received 250 complaints in 2010‐11 which is in line with the annual increase over the past four years. This is a 20 percent increase from the previous year and a 90 percent increase compared to four years ago. Officials are confident that, while BSA staff are busy and challenged, incoming complaints are being managed competently.

The BSA issued 236 decisions in 2010‐11 compared to 193 the previous year. Of the total decisions issued, only 29.2 percent resulted in a determination to uphold the complaint. 68 percent of decisions concerned news, current affairs, factual programming and . Decisions concerning news and current affairs programmes have occupied a large percentage of the total decisions issued by the BSA.

The BSA is currently under pressure from broadcasters which perceive some recent decisions as conservative and inconsistent with earlier rulings, evidenced by an increase in High Court appeals. At the same time, the BSA has been criticised by advocacy groups which consider some recent rulings to be too liberal.

The content standards review referred to in “Significant policy and delivery issues” and possible changes to the jurisdiction of the BSA are other issues facing the BSA at this time.

Governance Because the BSA is an independent Crown entity, appointments to its board are made by the Governor‐General (on the recommendation of the Minister of Broadcasting). The supporting administrative work is undertaken by the Ministry. The Ministry also provides advice on potential candidates, and participates in briefings and the due diligence process.

28 Position Date Appointed Term Ends

Peter Radich Chair 1 December 2009 30 November 2012

Mary Shanahan Member* 10 June 2009 30 April 2012

Leigh Pearson Member** 1 December 2009 30 November 2012

Te Raumawhitu Kupenga Member 13 December 2010 31 October 2013

* this position is subject to consultation with public interest groups. ** this position is subject to consultation with broadcasting interest groups.

Chief Executive: Susan Freeman‐Greene.

Funding

2010/11 Total Working Vote ACH All other Net FTEs assets Capital revenue revenue operating ($000) ($000) ($000) ($000) result ($000)

BSA 655 603 609 803 37 6.5

29 National Pacific Radio Trust

Agency profile The National Pacific Radio Trust (NPRT) is a private trust responsible for providing a national radio service (broadcasting as Niu FM) that will:  provide an authoritative, accurate, current and reliable information source to Pacific people, reinforcing their languages, values, beliefs and culture in New Zealand;  facilitate, contribute to and promote community development that is conducive to the education, employment, housing, health, immigration as well as the social and economic development of Pacific people in New Zealand;  harness and grow the best available Pacific broadcasting and management talent throughout New Zealand so that the network as a community‐owned platform is sustainable and delivers a quality service;  promote effective avenues for training Pacific people in broadcasting and advocating for and on behalf of Pacific people in the media; and  provide a window through which the rest of New Zealand can be better informed about the lives of Pacific communities throughout New Zealand.

From 30 June 2011, funding responsibility for NPRT has been transferred from the Ministry to NZ On Air.

Performance summary and issues A value for money review in late 2010 demonstrated that NPRT was fulfilling its mandate and enjoyed a good level of support from its diverse audiences. In 2010/11 it met the majority of its performance targets relating to broadcast hours, music and language content (including news in English and nine Pacific languages), technical quality of transmission and stakeholder and staff relationships. However, NPRT failed to achieve its budget for commercial revenue, which was not surprising given the economic downturn and reduced revenues for all commercial radio broadcasters.

With the impending expiry of its Ponsonby lease, NPRT has been negotiating to shift to new premises in South Auckland by year end. NZ On Air has been able to assist with the costs of the fit‐out and a technology upgrade, but NPRT will need to better manage its future revenue and expenditure to complete the work and to support future upgrades if it is to avoid seeking additional taxpayer funding.

Governance Board members are appointed jointly by the Minister of Broadcasting and the Minister of Pacific Island Affairs. The supporting administrative work is undertaken by this Ministry. The Ministry also provides advice on potential candidates, and participates in briefings and the due diligence process.

30 Position Date Appointed Term Ends

Uluomatootua Aiono (Ulu) Chair 1 October 2010 31 August 2013 Chair Feb 2011

Brian Chamberlin Member 1 January 2007 31 December 2012

Willy Johnston Member 1 July 2010 30 June 2013

Sandra Kailahi Member 1 October 2010 30 September 2013

Susana Lei’ataua Member 8 August 2011 31 July 2014

James Prescott Vice Chair 1 January 2007 31 December 2012

Chief Executive: Tom Etuata.

Funding 2010/11 Total Working Vote ACH All other Net FTEs assets Capital revenue revenue operating ($000) ($000) ($000) ($000) result ($000) NPRT 727 50 3,250 1,180 34 35

From FY2011 NPRT is funded through NZ On Air’s appropriation.

31 Freeview Limited

Agency profile Freeview Limited is an incorporated joint venture with shareholding broadcasters TVNZ, TVWorks, Māori Television and Radio New Zealand. Freeview is a platform that enables the broadcast of free‐to‐air digital television and radio by means of direct‐to‐ home (DTH, or satellite‐to‐dish) or terrestrial (DTT) transmission. The Freeview DTH service was launched in May 2007, while DTT transmission commenced in April 2008.

The Government announced its decision to support Freeview to the amount of $25 million over five years in November 2006. The Government’s primary aim in supporting Freeview is to encourage New Zealand to make the transition from analogue to digital free‐to‐air television transmission. For this reason an additional appropriation of $7.9 million was provided to support Freeview through to digital switchover at the end of 2013.

Television channels broadcast on Freeview include: TVONE, TV2, TVNZ 7, U, TV3, TV3 Plus 1, FOUR, C4, Māori Television, Te Reo, Prime, Parliament TV, CUE, Trackside, Stratos, TV Central, Shine, Chinese CTV8, TV Rotorua, Info‐Rotorua and TV33.

Radio stations broadcast include: Radio New Zealand Concert, Radio New Zealand National, George FM, and Base.

Performance summary and issues Freeview continues to research digital television uptake to focus the promotion of the free‐to‐air digital platforms and to accredit receiver brands and retailers in support of DSO and the Government’s Going Digital programme.

The additional funding appropriated this year will enable Freeview to continue to subsidise the simulcasting of digital and analogue services on the part of its network partners through to DSO in December 2013. Beyond that date the consortium is expected to maintain the Freeview digital platforms and electronic programme guides without a taxpayer contribution.

Freeview has been attempting to persuade SKY to provide electronic (on‐screen) programme information to Freeview for viewers in relation to those free‐to‐air digital channels that are only available on Freeview via the satellite used by SKY. Freeview has not yet been able to secure SKY agreement to provide this information, and this is hampering efforts to add additional channels to the Freeview satellite offering.

Governance The board of Freeview is:  Richard Friesen, Chair  Kenneth Law  Alan Witherington  James Mather  Rick Ellis

32  Rodney Parker  Roger Randel  Peter Crossen.

Board appointments are made by the shareholders.

Chief Executive: Sam Irvine.

Funding

2010/11 Total Working Vote ACH All other Net operating FTEs assets Capital revenue revenue result ($000) ($000) ($000) ($000) ($000)

Freeview 923 (875) 5,028 1,441 (10) 4

33 Advertising Standards Authority

Agency profile The Advertising Standards Authority (ASA) is an incorporated society which acts as a self‐regulatory body for the advertising industry. The ASA receives no government funding but falls under the Broadcasting portfolio with respect to its consumer‐rights function and its relationship with other public broadcasting agencies. About 50 pieces of legislation include advertising standards.

The three main objectives of the ASA are:  to seek to maintain at all times and in all media a proper and generally acceptable standard of advertising and to ensure that advertising is not misleading or deceptive, either by statement or by implication;  to establish and promote an effective system of voluntary self regulation in respect to advertising standards (primarily through advertising codes of practice); and  to establish and fund an Advertising Standards Complaints Board (ASCB).

Performance summary and issues In the year ending 31 December 2010, the ASA considered 1164 formal complaints about 792 different advertisements. Of these, 380 substantive complaints were dealt with by the ASCB with 105 upheld and 94 settled to the satisfaction of the parties. The upheld/settled rate constituted 52 percent of the total.

Television advertisements contributed 30.3 percent of the complaints, while consumer products at 17.3 percent and liquor at 14.4 percent were the items most complained about.

In 2010, the ASA appointed a Liquor Promotions Complaints Board to deal with complaints under a new Code relating to the packaging and promotion of liquor products. Changes in liquor laws and the high public interest in the liquor reform debate are likely to present significant challenges to the ASA in the future.

Governance The ASCB is an independent board which adjudicates on complaints about advertisements which complainants believe breach the advertising codes of practice. The board has a chair and eight members, four from the industry and four public representatives with no connection to the media or advertising industries.

The ASA confers with, and invites nominations from, the Minister and the Ministry on the appointment of the public representatives of the board.

The ASCB’s current membership is:  Jenny Robson (public representative, Chair)  Phil Broughton (public representative, Deputy Chair)  Dr Greg Simmons (public representative)  Margaret McKee (public representative)

34  Alex Handiside (public representative)  Susan Taylor (alternate public representative)  Rachel Prince (or Janine Chamley, alternate) – representing advertisers  Sharon Daly (or Dianne McArtin, alternate) – representing television and radio  Paul Elenio – representing newspapers and magazines  Nigel Keats (or Levia Esterhazy) – representing advertising agencies.

The ASA keeps the Minister informed of any important issues, particularly in relation to the review of existing codes or the introduction of new codes.

Executive Director: Hilary Souter.

Funding

2010/11 Total Working Vote ACH All other Net FTEs assets Capital revenue revenue operating ($000) ($000) ($000) ($000) result ($000)

ASA 747 (104) 5.8

Figures from ASA Annual Report 2010 (December 2010).

35