The federal government and its agencies have spent $15.8 million buying Canadian Broadcasting Corporation (CBC) advertising since 2019, even as private sponsors left the network.
British Columbia Conservative MP Tracy Gray asked, “How much did each department, agency, or other government entity spend on advertising with the CBC?”
Cabinet responded with an Inquiry of Ministry tabled in the House of Commons, according to Blacklock’s Reporter on June 28, which indicated the largest federal departments devoting ad dollars to the CBC included the Business Development Bank, which spent $4.9 million, and Health Canada, which spent $1.6 million.
Taxpayer-owned VIA Rail spent $1.3 million, Farm Credit Canada spent $1.2 million, and Employment Canada spent $945,000. The Royal Canadian Mint spent $919,000.
Revenues from government advertising were on top of an annual parliamentary grant provided to CBC of $1.3 billion, which is the broadcasting corporation’s largest revenue source.
Since 2014, CBC revenues have been on a downward trend, starting when the network lost what had been a 65-year monopoly on exclusive licensing rights to NHL hockey. Instead, Rogers Communications became the new broadcaster.
At the time, TV revenues for English CBC were $344 million. According to CBC financial statements, last year’s comparable revenues suffered a 25 percent decline, coming in at $248 million.
The CBC didn’t acknowledge losing the contract to hockey rights hurt the network. At a 2015 Senate communications committee hearing, then-CBC president Hubert Lacroix said, “We lost a few dollars.”
“When you look at the broadcasting rights and the cost to produce hockey, and the revenues on the other side, and when you look at it over six years, we didn’t make money on this contract,” Lacroix said.
Nova Scotia Senator Michael MacDonald replied at the time that the situation “was very poor management.”
“If you can’t make money on hockey in Canada I don’t know what you could make money on,” said the senator.
In 2016, Lacroix suggested the network could ban commercial advertising entirely, if the government increased the parliamentary grant by an additional $400 million. “You would have an ad-free environment,” suggested Lacrois.
CBC also made an unsuccessful effort to sell advertising on CBC radio following the drop in TV ad sales. In 2013, CBC management convinced government regulators to lift a ban on radio ads that had been in place since 1975. The network said it could sell up to $24 million worth of ad sponsorships a year. Actual sales ended up being $1.4 million a year.
In an interview at the time, Elmer Hildebrand, CEO of Golden West Broadcasting, a broadcaster with a chain of radio stations in western Canada, said, “It’s like they live in a fantasy world.” He said, “Why would [CBC] expect a lot of advertisers?”
“It was an illusion. The CBC wants to be all things to all people,” said Hildebrand. “I think they are irrelevant.”
