Towering cheek: taxpayers get the bird from freeloading TV networks

by | Nov 28, 2016 | Business, Government

There’s no such thing as a free lunch, unless you happen to be a TV station or a secretive former Macquarie Bank operation known as Broadcast Australia.

The TV networks and BAI Communications (formerly Broadcast Australia) are refusing to pay rent to the state for the TV towers they have parked on public land. Telstra and Optus pay their fees. Government departments pay theirs. Even the NSW Volunteer Rescue Association pays.

Not the TV networks though; not the ABC, not SBS, or their proxy BAI. The TV networks haven’t paid licence fees to NSW Crown Lands
since 2012 and, in some cases, since 2006. A government source confirmed the spectacular freeloading to michaelwest.com.au this week.

Officially however the response was muted. A spokesman for Crown Lands confirmed there were “outstanding rents owed to the department” and that these were “being pursued” (See official responses below).

SBS and ABC outsourced their transmission to BAI many years ago. Both networks pleaded ignorance on the missing rents and pointed us in the direction of BAI.

BAI dived for cover. Its chief executive Jim Hassell refused to respond to questions, despite a number of approaches. Statements from government and regulators are below. BAI and the three commercial networks Seven, Nine and Ten all failed to respond to questions.

BAI makes hundreds of millions of dollars a year from our taxpayer-funded TV networks. We don’t know precisely how much. Both SBS and ABC have refused to disclose how much of their budgets they are showering on the secretive BAI.

There is a figure in ABC annual report of $198.1 million for “Transmission and Distribution Services” which provides some idea of the size of the payments to BAI. Does all this go to BAI? Not all, but most of it would, said sources.

Among other non-payers are the regional TV networks: Prime Media, WIN Television and Australian Capital Television.

STATEMENT ON BEHALF OF NSW CROWN LANDS FROM DEPARTMENT OF INDUSTRY

The NSW Department of Industry – Lands makes Crown land available under licence to a variety of organisations to construct and operate communication infrastructure.

In July 2014, the NSW Government adopted recommendations from the Independent Pricing and Regulatory Tribunal (IPART) into rental agreements for communication tower sites on Crown land.

Subsequently, land management agencies have been working together to implement the recommendations in a consistent manner and reconciliation of some of the tenancies is ongoing.

Outstanding rents owed to the Department are being pursued.

STATEMENT FROM IPART (WHICH PROP0SED THE RENT DEALS)

IPART doesn’t have an ongoing role in monitoring Crown Land rental arrangements. The 2013/14 review was completed under Section 9 of the IPART Act, so was a referral from the Premier for a specific task within a set time frame. In order to look at it again, we would need another referral.

To address ongoing monitoring and compliance, Recommendation 18 in the final report states that:

“The implementation of the rental arrangement should be subject to a review by the Audit Office of NSW twice in every 5 years. The review by the Audit Office of NSW should report on whether the rental arrangements have been implemented in accordance with the government’s decisions in response to this review.”

We also recommended that the published fee schedule should be subject to an independent review every 5 years to ensure it reflects fair market-based rental returns.

STATEMENT FROM SBS

“SBS has a long term contract with Broadcast Australia to supply transmission services. Broadcast Australia is responsible for ensuring it has the necessary rights and permits to provide these services, and SBS does not typically have visibility of Broadcast Australia’s expenses in providing these services. Any matters relating to Broadcast Australia’s operational payments are a matter for Broadcast Australia.

“Details pertaining to contracts with individual suppliers are commercial in confidence. SBS’s annual expenditure is published each year in its annual report.”

ABOUT THE AUTHOR

Michael West

Michael West

Michael West established michaelwest.com.au to focus on journalism of high public interest, particularly the rising power of corporations over democracy. Formerly a journalist and editor at Fairfax newspapers and a columnist at News Corp, West was appointed Adjunct Associate Professor at the University of Sydney’s School of Social and Political Sciences. You can follow Michael on Twitter @MichaelWestBiz.

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