Thursday, 6 December 2012

CBC 'Factortions' at CRTC Licence Renewal (Part One)

The CRTC has completed an arduous two week hearing process to renew CBC licences, having heard from CBC senior management and many Canadians.  CBC is Canada’s most important cultural organization and its management, facing the most challenging period in CBC’s history, must ensure that it has properly weighed all the facts about its own organization and the role it plays in the broadcasting system as a whole.  These final comments are in response to the information that CBC management provided on the final afternoon of the hearing and serve to underscore some deficiencies in strategic planning at CBC. 

The term “factortion,” or the contortion and distortion of facts, was used in the Toronto Star earlier this year to describe an ailment that has afflicted CBC management in the past.  In the final day of the hearing CBC presented three serious factortions, each of which related to central issues at the hearing and demonstrate that current management have failed to incorporate some basic facts about the current broadcasting environment in their strategy.  There were other questionable statements made by CBC during this process, the most flagrant being that it was once the only radio operator in Canada.  Here is the first of three factortions CBC made at it final appearnce before CRTC:  

Factortion:  CBC’s efficiency compared to the private sector

Several interveners from private radio urged the Commission to consider that private radio is more efficient than CBC radio, providing evidence in the form of staff numbers per station and average salaries.  Their point was that rather than commercialize its radio services CBC should become more efficient.  CBC’s response was to dismiss this by first pointing out that the CRTC salary data contained overtime, benefits, etc.  CBC implied that overtime or benefits explain the high CBC salaries.

More importantly, CBC said on the last day that it was a large company and a fairer comparison would be to examine CRTC salary data for large private radio companies.  This is a valid point. It is true that CBC radio, according to CRTC data, only pays about $10,000 more per annum per employee when compared to Astral, BCE, Rogers, Corus and Cogeco, the largest private radio companies.  In fact, the CRTC data show CBC radio in total had far fewer staff than private radio stations in 2011, which had four times as many employees.  CBC radio had approximately 2,500 employees, about two-thirds of them in English radio.  Yet, in TV, CRTC data reveal that CBC/Radio Canada had as many staff, about 6,000, as all private conventional TV combined in 2011.  More importantly, the data reveal that the Radio Canada television service had more employees than CBC English TV.  CBC referred the Commission to the CRTC staff data and so we examined it and confirmed this important discrepancy in CBC radio and TV staff levels, which indicates that CBC can find more efficiencies, having done so in radio.

There are many good reasons why CBC radio and TV have a large number of staff: you can’t create quality programs without people. However, when the above-mentioned analysis of CRTC staff and salary data was published in the Star earlier this year one recently retired CBC staffer added some perspective: “I hate to disabuse you but what you say was the average salary last year was about one-third of what I was paid….Actually, as you know, averages are just that. The average would include all the low paid copy clerks and junior technicians, of whom there are many, and all of the high paid talent and producers, of whom there are few. Fortunately for public consumption that helps to bring the average down.” 

Those low-paid CBC clerks and technicians work very hard for their money and are worth every cent, providing an invaluable service to many, if not most Canadians.  However, the CRTC staff and salary data also reveal that CBC total salary expenditures showed a large annual increase in 2011, despite budget cuts.  The increase paid by CBC in salaries last year was just under $50 million, according to the CRTC data the CBC referred to in its final appearance. This is more than twice the amount CBC says it would generate from commercials on radio.

Some areas of CBC, especially management, may be over-staffed and paid more than the rest of the industry.  More than 600 managers, according to CBC, are in a category that makes them eligible for bonuses; this number has grown exponentially in the last decade.  Salaries of on-air staff and those of senior producers may be overly generous compared to the rest of the industry and CBC could find efficiencies. The Commission should carefully examine the staffing data CBC referenced in its final appearance to determine if efficiencies are preferable to further commercialization of CBC services, namely Radio 2 and Espace Musique.

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