Mags Canada urges budget support for PAP, CMF and government magazine advertising

Magazines Canada has recommended in a pre-budget consultation paper to the federal finance minister that his new budget and its expected economic stimulus package should

• Maintain current levels of federal investment in the support of Canada’s periodical policy including the Publications Assistance Program (PAP) and the Canada Magazines Fund (CMF); and
• Increase federal government advertising in Canadian-owned magazines.
  

In a release, the magazine association said that the PAP is a very efficient program with low administration costs and a proven track record in securing higher levels of access to Canadian-owned magazines and their content. It noted that it is supported with investments of $45 million from the Department of Canadian Heritage but that Canada Post has unilaterally decided that it will no longer contribute its $15 million share of the program after March 31, 2009.

A loss of one quarter of the program’s funding would result in an overnight increase in postal costs of 31 per cent. This will immediately result in negative impacts.This is further exacerbated by the introduction by Canada Post of “distance related pricing” which in short, discriminates against readers outside of major metropolitan centres. There has been no consultative process in these matters.

The submission also said the CMF is the "linchpin for the creation of Canadian editorial content" and that CMF funding of $15.5 million is used exclusively for editorial development.

Government advertising would provide an important, direct stimulus to the Canadian periodical industry, it said.

Advertising makes up 60 to 65 per cent of magazine revenue. Much of these expenditures come from sectors, such as the automobile industry, that are experiencing challenging economic times and have been forced to cut back on all discretionary spending, such as advertising.

Canadian-owned magazines maintain a close ratio of advertising pages to Canadian editorial pages with the former ‘paying the bills’ associated with the later. Canadian owned magazines average 80 per cent Canadian-created content. When advertising revenues decline, editorial pages also decline. In turn, investment in creative jobs declines.