Commercial Broadcasting – Preserving the Public Interest
| Date | 01 March 2004 |
| DOI | 10.22145/flr.32.1.4 |
| Author | Lesley Hitchens |
| Published date | 01 March 2004 |
| Subject Matter | Article |
COMMERCIAL BROADCASTING – PRESERVING THE
PUBLIC INTEREST
Lesley Hitchens*
INTRODUCTION
During 1999 and 2000 considerable attention was focused on an inquiry conducted by
the broadcasting regulator, the Australian Broadcasting Authority ('ABA'), into the
commercial arrangements of a number of commercial radio presenters associated with
talkback radio. In May 1999, an Australian Broadcasting Corporation ('ABC') program,
Media Watch, alleged that, John Laws, a presenter with Sydney Radio Station 2UE, had
financial arrangements in place with an organisation representing the major Australian
banks, the Australian Bankers' Association. It was alleged that the effect of these
arrangements was that Laws would broadcast positive comments about the banks.
These comments were independent of any paid advertising run by the station for the
banks or the Bankers' Association. Following the Media Watch revelations, the ABA
announced that it would conduct an inquiry1 into the allegations in order to determine
whether there had been any breach of the Broadcasting Services Act 1992 (Cth) ('BSA') or
the licence conditions or codes of practice to which Radio 2UE was subject. Following
further allegations, the ABA, between July 1999 and November 1999, extended its
inquiry to cover another 2UE presenter, Alan Jones,2 and presenters from four other
radio stations: 6PR Perth, 5AD (also known as 5ADD) Adelaide, 5DN Adelaide and
3AW Melbourne.
The ABA concluded its inquiry in March 2000 with the publication of its final
report.3 As a result of its investigations the ABA found that each of the radio stations
(with the exception of 5AD) had been in breach of the Commercial Radio Codes of
Practice, Code 2 (regulating news and current affairs programs) and Code 3 (regulating
advertising). In addition, Radio 2UE was in breach of a licence condition concerned
with the broadcasting of political matter. In response to these findings, the ABA
imposed new standards applicable to the whole of the commercial radio broadcasting
industry. The standards require disclosure of commercial arrangements, separation of
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* Faculty of Law, University of New South Wales.
1 Referred to as 'the Inquiry', 'the Radio Inquiry' or 'the Commercial Radio Inquiry'.
2 In early 2002, Alan Jones moved to another Sydney radio station 2GB.
3 Australian Broadcasting Authority, Commercial Radio Inquiry: Final Report of the Australian
Broadcasting Authority (August 2000) ('Final Report'). The ABA had already published
reports at the end of the investigations of each of the radio stations: Australian
Broadcasting Authority, Commercial Radio Inquiry: Report of the Australian Broadcasting
Authority Hearing into Radio 2UE Sydney Pty Ltd (February 2000) ('2UE Report'); Australian
Broadcasting Authority, Commercial Radio Inquiry: Report of the Australian Broadcasting
Authority Investigations into 3AW Melbourne, 5DN Adelaide and 6PR Perth (August 2000).
80 Federal Law Review Volume 32
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advertisements from programming and the implementation of compliance training
and procedures.
In its 2001 Annual Report the ABA commented that the Commercial Radio Inquiry
had disclosed a systemic failure to ensure effective self-regulation and a lack of
commitment to the codes of practice by the commercial radio industry in relation to the
presentation of current affairs.4 The Inquiry was significant because it was concerned
not with isolated breaches but with breaches across a number of radio stations
broadcasting across Australia. It raised significant issues about the relationship
between commercial interests and broadcasting content, the overlap between
advertising and programming content, and political broadcasting. It also highlighted
deficiencies in the regulatory process itself. In essence, the Radio Inquiry was
concerned with whether commercial broadcasting services were meeting public
interest standards in the provision of news and current affairs coverage.
It might have been thought that as a result of the disclosures and the publicity
generated, the Radio Inquiry would have produced a change of attitude within the
commercial broadcasting sector. Yet, this may not be so. As a result of new disclosures,
made again by Media Watch,5 the ABA announced in November 2002 that it was
instituting an investigation into the disclosure of commercial arrangements involving
Telstra Corporation Limited (Telstra), Radio Stations 2UE and 2GB, John Laws (2UE)
and Alan Jones (now with 2GB) and whether there had been breaches of the new
program standards.6 The ABA's terms of reference for the investigation indicate that it
will be investigating matters similar to those before the Radio Inquiry.7 The
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4 Australian Broadcasting Authority, Annual Report 2000–2001 (2001) 10.
5 ABC Television, 'ABA "Active Monitoring"', Media Watch, 28 October 2002
<http://www.abc.net.au/mediawatch/transcripts/281002_s2.htm> at 19 January 2003.
Media Watch has also alleged that John Laws has failed on occasions to disclose his
commercial relationship with NRMA Insurance Ltd when commenting on that company:
ABC Television, 'Laws & NRMA Insurance', Media Watch, 28 October 2002
<http://www.abc.net.au/mediawatch/transcripts/281002_s3.htm> at 19 January 2003.
The ABA did not announce a formal investigation into this matter but Radio Station 2UE
later admitted that there had been on three occasions a failure to disclose the commercial
relationship between Laws and NRMA Insurance: Australian Broadcasting Authority,
Investigation into Radio 2UE Sydney Pty Ltd — Sponsorship of Mr John Laws by Telstra
Corporation Ltd and NRMA Insurance Ltd, Investigation Report (November 2003) 38.
6 Australian Broadcasting Authority, 'ABA Investigation into Telstra Commercial
Arrangements' (Press Release, NR 131/2002, 11 November 2002). The ABA found that the
licensee of Radio Station 2UE had breached the program standards and licence condition
which had been imposed as a result of the Radio Inquiry in relation to the commercial
arrangements between Telstra and John Laws. The ABA announced that it would refer the
matter to the Director of Public Prosecutions and impose a new licence condition requiring
Radio Station 2UE to engage an independent third party to monitor the John Laws
program: Australian Broadcasting Authority, 'ABA to refer 2UE Breaches of Disclosure
Standard to DPP' (Press Release, 4 December 2003). However, since that announcement, it
appears no further action has been taken: ABC Television, 'Laws and Chutzpah', Media
Watch, 8 March 2004 <http://www.abc.net.au/mediawatch/transcripts/s1061409.htm> at
3 April 2004.
7 Australian Broadcasting Authority, Terms of Reference for Investigation by the ABA into the
Disclosure of Commercial Agreements involving Telstra Corporation Limited, 7 November 2002.
It should be noted that there is apparently no direct contractual relationship between Alan
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