News Media Bill Termed ‘Thoroughly Bad Law’

Press, Volume CIV, Issue 30880, 13 October 1965, Page 3

News Media Bill Termed ‘Thoroughly Bad Law’

(New Zealand Press Association) WELLINGTON, October 12. Submissions on behalf of 35 Auckland lawyers on the News Media Ownership Bill will be made tomorrow to the Statutes Revision Committee. It is expected the committee will wind up its taking of evidence at the sitting tomorrow morning.

Today, the committee heard four sets of submissions in two separate sittings.

At tonight’s committee sitting, submissions were made by a Wellington journalist, Mr D. Campbell, and by a university student, Mr J. D. Harlow. Both voiced objections to provisions in the measure.

Mr Campbell said he was making submissions on the bill as a New Zealand citizen and as a journalist. He said it was “thoroughly bad law."

He said the measure could tend to stultify rather than develop the local press, and would not prevent the establishment of an overseas-con-trolled newspaper. He contended the bill was unnecessary because the Overseas Take-over Regulations already gave the Government sufficient powers to prevent newspapers falling into overseas hands.

Mr Campbell said in any case newspaper proprietors could protect themselves by altering the articles of association of their companies to prevent more than a certain proportion of their shares being bought by overseas interests. Alternatively they could alter their articles to limit the percentage of share capital held by any one person or organisation.

“They could also alter their articles to prevent the transfer of their shares to any but a New Zealand citizen or company,” he said. Mr Campbell recalled that the editor of the “New Zealand Herald,” Mr 0. S. Hintz, had said in evidence last week it would cost about £5 million to establish a metropolitan newspaper in New Zealand.

"This figure in itself appears to be a sufficient hurdle to prevent overseas interests from attempting to establish new newspaper enterprises locally," he said. Mr Campbell told the committee that with any threat of overseas competition removed, a newspaper could lose the incentive to improve its services to the public, “secure

in the knowledge that the financial hurdle of establishing a new newspaper could be almost guaranteed to protect it from competition.” Mr Campbell said the bill limited private enterprise by preventing an individual from starting a newspaper unless he first formed himself into a company as prescribed in clause three of the measure. “This requirement inflicts a financial penalty on an individual, probably with limited resources, who perhaps starts a newspaper as a private venture but who may not wish to form himself into a company till he is sure his enterprise will give him a reasonable livelihood,” he said. He quoted the case of a Wellington journalist who bought an old press and started his own newspaper without first forming himself into a company.”

"Today, four years later, he publishes six newspapers of his own, prints more than eight other publications, and employs a permanent and part-time staff of about 25. Twj of his papers have circulations in excess of 5000. “He could not have done this had the contemplated clause been on the statute book four years ago,” said Mr Campbell. Large Loans Mr Campbell said the bill would not prevent an overseas company from gaining control of a New Zealand newspaper if it really wanted to do so. It could manage this by lending large sums to an existing newspaper. “Alternatively, it would be theoretically possible for two persons to start a newspaper company with a capital of say £lOO or less and to borrow the rest of the money they needed from an overseas company.” He told the committee the benefits of overseas shareholding were already evident. "The directors of the Wellington Publishing Company probably know less about newspapers than the directors of any other New Zealand newspaper company. It thus seems highly unlikely that they would have started a

Sunday paper but for the advent of Mr Rupert Murdoch and his 29.57 per cent shareholding in their company.'’ Mr Campbell submitted that journalists had for years been trying to raise the status and educational standards of their profession. “Encouragement from the majority of newspaper managements has been negligible.” Legally, he submitted that many of the bill’s clauses were “thoroughly bad and probably unworkable.” For example, he said a company was empowered to sell an overseas shareholders’ share in certain circumstances. “Having regard to the legal meaning of the word domicile, this could create a situation in which a New Zealand-born woman who had never been out of the country could have her newspaper shares sold. Exchange Rules Mr R. D. Muldoon (Govt., Tamaki) asked if the alterations suggested by Mr Campbell as steps New Zealand publishers could take to protect themselves would be contrary to regulations of the Stock Exchange. Mr Campbell said he was not certain of this. Questioned as to when he believed a national newspaper might be started in New Zealand, Mr Campbell told the committee: “If the ‘Dominion’ was on the ball it would be New Zealand’s national newspaper. It would lead the country.” Sir Leslie Munro (Govt., Waipa) asked Mr Campbell if he believed it was bad in law to provide that in a news medium there should be no greater interest than 10 or 15 per cent in overseas holdings.

Mr Campbell said there were other clauses in-the bill which hindered enterprise and put a limit on people, and it was to those he objected. Sir Leslie Munro: I don’t like them. I’m not really happy about the Crawford case (referring to submissions made last Wednesday by Mr B. W. Crawford, chairman of directors of the Nor-

them Publishing Company, Ltd.). Later, Mr Campbell said New Zealand should not necessarily discourage the idea of a new newspaper being started. “I think people can be fairly discriminating.” “Best Staff He told the committee the “Southern Cross” had opened with probably the best editorial staff in the country. Sir Leslie Munro: Oh, 1 would doubt that. Mr Campbell said the paper had been started with all the good will in the world, but instead of confining its opinions to editorials, it allowed them into the news columns and was dominated too much by “labour people.” Sir Leslie Munro raised the issue of Canadian apprehension regarding influence on news media from America. Mr Campbell said he believed Canada was a different case. Intensive questions and answers dealing with the influence of opinion followed. Sir Leslie Munro maintained a newspaper owner with an endless amount of money might get somewhere with his policy. “How many people read editorials?” said Mr Campbell. Sir Leslie Munro: Many more than people think. Mr N. E. Kirk (Opp., Lyttelton) asked: “Why are we so convinced New Zealand newspapers are so virginally pure when it comes to slanting news and overseas papers are so bad?” “Why Afraid?” Mr Campbell: Why are we afraid of overseas papers? Mr Kirk asked why restrictions couldn’t be made on circulation, rather than ownership, if some people were “so dreadfully afraid of being exposed to overseas ideas.” He then questioned Mr Campbell as to the j effect overseas interests establishing here might have on salaries and conditions for journalists.

Mr Campbell told the committee a newspaper established by overseas interests would put journalists in a stronger bargaining position. “It could even attract some public relations men back into the field.” Student Mr Harlow called on the committee to abandon the bill. He said the presence of overseas interests would stimulate healthy competition to give readers a better presentation of news and feature material. The competition to attract existing journalists and other people into the profession would result in better remuneration for journalists which could not help but raise the standards of journalism in New Zealand. Mr Harlow said clause two of the bill extended the provisions of the act to cover weekly newspapers. “This is a retrograde step. There is a need in New Zealand for a quality Sunday newspaper along the lines of the British ‘Sunday Times.’ “The Dominion ‘Sunday Times’ has endeavoured to fill this gap, but even with the assistance of Australian interests in the Wellington Publishing Company it has failed completely to satisfy demands for a quality paper.”

Mr Harlow claimed the bill violated two fundamental principles of economic liberty: Article 17 (2) of the Universal Declaration of Human Rights which says noone shall be arbitrarily deprived of his property, and clause six of the National Party constitution—“the object to maintain the growth of private enterprise and healthy competition.” “With so many newspapers firmly under the control of New Zealand domiciled family interests there is no likelihood of overseas interests monopolising the New Zealand newspaper industry,” he said. A petition of Mr Harlow and 274 others was read to the committee before he made his submissions. (Earlier submissions P. 10)