Blog by John Miller

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Honey, I shrunk CP

Just four years ago, a Senate committee examined the state of Canada's news media and made a prescient plea: Please support The Canadian Press wire service. It's vital to the country.

Since then, the country's two largest newspaper companies -- CanWest (in 2007) and Sun Media (this month) -- have pulled out of CP and that has triggered a radical restructuring that threatens the future of the 93-year old co-operative.

Under the plan announced this week, CP would be reborn as a for-profit company owned by CTVglobemedia, publisher of The Globe and Mail, Torstar Corp., publisher of the Toronto Star, and Gesca, which owns LaPresse in Montreal.

So Canada's only national news service, which was launched by public-minded publishers in 1917 to bring news of the First World War to all Canadians, would fall under the control of a few large newspapers in Ontario and Quebec. Worse, they would be free to walk away from it at any time, if they fail to win pension and wage concessions from the union representing more than 250 employees.

"We have been presented with no guarantees," the Canadian Media Guild said in a statement. "This would offer no stability to employees, the pension plans or the institution of our 100-year-old news service."

I, too, wonder how viable the new entity will be. How many newspapers and broadcasters will be interested in belonging to a news service that will suffer such a significant loss of its ability to collect news from all regions of Canada? The bulk of news does not happen only in a few large Eastern cities.

To survive, CP's new owners will need to convince the federal government to offer them a 13-year reprieve to pay off the $34 million shortfall in CP's pension plan. Federal legislation allows companies five years to pay back the pension contributions they owe, and industry analysts say a 13-year reprieve would be unprecedented and unwise.

The potential new owners of CP, don't forget, include some of the wealthiest families in the country, the Thomsons, the Honderichs and the Desmarais. None are promising to put any of their own money forward to replenish CP's pensions.

We don't need these owners holding such a venerable and needed institution hostage.

Here is what the Senate committee said about the importance of the news service: "If The Canadian Press or comparable wire services no longer existed, small independent news organizations would be less able to cover international, national and, at times, even regional stories. This would be detrimental to the existing diversity of news voices in Canada. The Commitee urges subscriber/shareholders to continue support for Canada's only national news service."