Investigation Report No. 3079

Investigation Report No. 3079

File No. / ACMA2013/935
Licensee / Hawkesbury Radio Communications Co-operative Society Ltd
Station / 2VTR
Type of Service / Community radio broadcasting
Issues /

Encouraging participation in operations of the licensee
Encouraging participation in the selection and provision of programs

Relevant Legislation /

Sub-paragraph 9(2)(c)(i) of Schedule 2 to the Broadcasting Services Act 1992
Sub-paragraph 9(2)(c)(ii) of Schedule 2 to the Broadcasting Services Act 1992

Date Finalised / 12 March 2014
Decision /

Breach of sub-paragraph 9(2)(c)(i) of Schedule 2 to the Broadcasting Services Act 1992[encouraging participation in operations]
No breach of sub-paragraph 9(2)(c)(ii) of Schedule 2 to the Broadcasting Services Act 1992[encouraging participation in selection and provision of programs]

The complaint

On 30July 2013, the Australian Communications and Media Authority (the ACMA) received a complaint that the licensee of community radio broadcasting station 2VTR, Hawkesbury Radio Communications Co-operative Society Ltd (2VTR),is in breach of the conditions of its licence,as:

2VTR is not encouraging participation in its operations; and
2VTR is not encouraging participation in the selection and provision of programs.

The service and licence area characteristics

2VTR commenced providing a community broadcasting service to represent the general community interest in the Windsor RA1 licence area on 1 October 1982. The current licence is due to expire on 3 October 2017.

According to the 2006 Census, the licence area population of the Windsor RA1 licence area was59,912 persons. Of the total licence area population, 90.1% spoke only English at home.

At 81.2%, the majority of the population in the licence area was born in Australia. Other major countries of birth were United Kingdom 5.0%; New Zealand 1.3%;Malta 0.7%; Netherlands 0.6%; and Germany, 0.5%. Aboriginal and Torres Strait Islanders constituted 1.9% of the licence area population.

The percentages for different age brackets were: under 14 years (23.2%), 15 to 24 years (14.6%), 25 to 39 years (20.5%), 40 to 54 years (21.9%), 55 to 69 years (13.3%) and over 70 years (6.5%).

Of the total licence area population, 73.3% identified as Christian, with the three largest denominations being Anglican (40.8%), Catholic (37.4%) and Uniting (6.8%). 14.7% of the population identified as having no religion and 9.6% did not state a religious affiliation.

Assessment

The ACMA’s assessment is based on submissions from the complainant (dated 9 and 30 July 2013) andthe licensee (dated 9, 19, 21, 22, 23 and 24 August 2013), the licensee’s response to the preliminary findings (dated 21 and 24 February 2014), as well as information provided by the licensee in its licence renewal application dated 11 November 2011.

Issue 1: Is the licensee encouraging participation in the operations of the licensee?

Relevant provisions of the Broadcasting Services Act 1992

Schedule 2 – Standard conditions

Part 5 – Community broadcasting licences

9Conditions applicable to services provided under community broadcasting licences

(2)Each community broadcasting licence is also subject to the following conditions:

[...]

(i) the operations of the licensee in providing the service or services;

Complainant’s submissions

The complainant stated that:

In its letter to 2VTR dated 16 July 2012, the ACMA requested that 2VTR amend its Rules to provide for open, accessible and transparent procedures for dealing with membership applications. 2VTR has made no effort to implement the changes to its Rulesas requested by the ACMA.
Since October 2011, at least 17 people from the local community have applied for membership, but have been prevented from joining. 2VTR has held their membership applications in limbo, neither accepting nor rejecting them.
Membership numbers are declining and 2VTR has failed to do anything to attract new members.Contrary to what was stated by 2VTR in its licence renewal application, there are no on-air announcements inviting new members, no mention of membership on the 2VTR website, no promotions within the community, and no advertisements in the local press seeking to attract new members.
A group of four Directors (including the Chairman and Deputy Chairman), has held office continuously for over a decade, operating governance of the station to retain control and obstruct democratic processes.
2VTR has no committees, contrary to what was stated by 2VTR in its licence renewal application. All decisions at 2VTR are made by the Directors.
2VTR has manipulated the members register in an attempt to maintain control, prevent members communicating with one another and to prevent Board nominees from contacting members.

The complainant provided statutory declarations from 15 individuals in support of the allegations made in the complaint.

Licensee’s submissions

In its response of 9 August 2013, 2VTR stated that:

it has considered 46 membership applications since July 2011, with 32 being accepted, none rejected and 14 pending,
it currently has117 financial members. A copy of the membership register was provided, and
it does not have a membership application form available on its website.

2VTR provided a list showing 13 committees and the members of each committee: sports, programming, marketing, sales promotions, presenters, community notice board, OB (outside broadcast) van, technical, website and master, special events, grants, OH&S and grounds security, grievance and complaints.

2VTR also provided a list showing meetings with the Hawkesbury Chamber of Commerce and Windsor Business Group that 2VTR members had attended and/or presented at in 2013. A list showing other functions attended by 2VTR was also provided.

In its three responses dated21 August 2013, 2VTR:

provided two parts of the Rules of Hawkesbury Radio Communication Co-operative Society Limited, and
stated that it had not made the changes to its Rules that were requested inthe ACMA’s letter dated 16 July 2012.

In its three responses dated 22 August 2013, 2VTR provided:

two further parts of its Rules, completing the Rules to be provided to the ACMA, and
a copy of minutes of the Board meeting of 12 October 2011.

In its two responses dated 23 August 2013, 2VTR:

reiterated that it had not made the changes to its Rules that were requested inthe ACMA’s letter dated 16 July 2012,
advised that when its website is redesigned, a section will be devoted to new memberships,
provided additional information about events attended by members of the 2VTR Board, and
provided a list of the names of the current Board of Directors of 2VTR.

In response to the ACMA’s preliminary findings,in a letter dated 24 January 2014, 2VTR stated that:

it refuted and rejected strongly the preliminary finding that it does not encourage participation in its operations.
it has in place sound corporate governance practices, value and promote membership and volunteering, and have an effective and transparent committee structure. It is a long-standing member of the industry body, the Community Broadcasting Association of Australia (CBAA) and has adhered to best practice articulated by the CBAA.
the Board has initiated changes to the 2VTR Rules requested by the ACMA and they will be adopted when the work has been completed. However, as was carefully explained in submissions made to the ACMA, there is only so much a volunteer organisation can undertake at any one time and there is only so much time that volunteers can devote to the formulation of new policies and procedures and the running of the station on a day-to-day basis.
in the last two to three years, the station has been inundated with investigations from Government agencies as a result of complaints and that this has been extremely time consuming and draining of volunteer efforts. Responding to potentially highly defamatory, deceptive and destructive press articles and other misleading and false information has been extremely taxing and time intensive for management.
it has operated extremely successfully and served its community exceptionally well and proudly for over 35 years with few issues. It is only in the last two or so years that a few members have suddenly found fault with the station and have set about making numerous complaints to Government agencies.
it disputes theinterpretation of the Rules, wherereturning funds submitted with a membership application constitutes refusal to accept the application. The Rules at Section 11(b) state that a person is not qualified to be admitted to membership of the Co-operative unless there are reasonable grounds for believing that the person will be an active member of the Co-operative. The station was accused of holding onto funds submitted with applications and, to avoid this accusation being levelled while the Board went through a process of establishing the requirements of Rule 11(b), funds were returned. Letters sent to the applicants pointed out that, should their applications be approved, then joining fees would be requested.
ensuring that Rule 11(b) conditions were being satisfied is not holding applications in ‘limbo’. Moreover, complying with its Rules, eg 11(b), cannot be construed as giving an appearance of trying to prevent an applicant from becoming a member. Given the Rules of the Co-operative, the Board has a responsibility to satisfy itself, and take all necessary steps to ensure, that the Rules are complied with. The pending applications are being processed by the Board and a procedure for doing so has been agreed.
the requirements to cancel a membership, as detailed by the NSW Department of Fair Trading,are quite onerous and the Board is in the process of writing to the list of inactive members to establish their status. It is the intention of the Board not to cancel memberships until it has been positively established that members no longer wish to remain members. It is incorrect to assume that 152 members have ceased being active members over the last two years.
the Board encourages community participation in the station’s operations at every opportunity, when ithands out application forms to anyone who wishes to have one. For example, the station has a site at the largest local event, the Hawkesbury Agricultural Show, for well over 15 years, and the station’s OB van has attended community events almost every weekend over the last 10 to 15 years.
the station has had a membership form on its website for as long as the website has been in existence, which is a very long time. The form was removed temporarily, as it had to be updated to comply with privacy laws by adding a provision to seek an applicant’s consent to have their personal and private details listed. The ACMA was previously advised of this and the updated form is now available on the station’s website.
the Board minutes are replete with committee reports from the Sports Committee, Programming Committee, Technical Committee, Marketing and Sales Committee, Community Relations Committee,OB Van Committee, Membership Committee, Grants Committee and Grievance Committee. If the ACMA wants more evidence of the existence of such committees, then the station is more than pleased to provide additional information.

Finding

The licensee is not encouraging participation in the operations of the licensee in providing the service, in breach of sub-paragraph 9(2)(c)(i) of Schedule 2 to the Broadcasting Services Act 1992.

Reasons

It is a condition of all community broadcasting licences that the licensee must encourage participation in its operations and in the selection and provision of programs. Compliance with these conditions is a key characteristic of community broadcasting services which distinguish this type of service from other categories of broadcasting service.

Licensees encourage community participation in their operations when they have sound corporate governance practices, value and promote membership and volunteering, and have an effective and transparent committee structure.[1]

Corporate governance

The complainant has alleged that 2VTR has failed to amend its Rules,as requested by the ACMA in July 2012. This is correct, as the ACMA did request 2VTR to amend its Rules within 12 months so that it is a more open, accessible and transparent service. It was evident to the ACMA at the time of the last licence renewal that 2VTR’s Rules would be more appropriate for community broadcasting purposes if the changes requested were made.It does not reflect well on a station that has not been able to amend its Rules some 18 months after being requested to do so.

2VTR has submitted that in the last two to three years, it has been ‘inundated with investigations from Government agencies’. The ACMA conducted one investigation regarding compliance by 2VTR in 2011-2012, no investigation regarding compliance by 2VTR in 2012-2013 and now this investigation regarding compliance by 2VTR in 2013-2014.

Community broadcasting licences are allocated and renewed by the ACMA, having regard to the matters at subsection 84(2) of the Broadcasting Services Act, which includes the capacity of an applicant to provide a service (including the management, financial, technical and compliance capacity of an applicant).

Community radio broadcasting licensees are required to comply with their licence obligations, including compliance with relevant provisions of the Broadcasting Services Act1992 (the BSA) and licence conditions, as well as the Community Radio Broadcasting Codes of Practice. The ACMA is required by the BSA to investigate complaints, unless it is satisfied that a complaint is frivolous, vexatious or not made in good faith.

In cases where community broadcasting licensees have been unable for whatever reasons to continue to provide a service, some have found a similar aspirant group in the licence area and applied to the ACMA to transfer the licence while others have surrendered their licence.

Members and volunteers

Membership is one of the primary ways of encouraging community participation in the operations of a service, as members can have a formal say in decision-making of the licensee.

2VTR submitted that it has considered 46 membership applications since July 2011, with 32 being accepted, none rejected and 14 pending. A review of the 2VTR Rules shows that they provide for the Board to either accept or refuse applications for membership of the Co-operative. The Rules state that upon refusal,an applicant’s deposit will be refunded. Seven statutory declarations from individuals, stating that they had applied for membership of 2VTR, were provided to the ACMA. In each case, the applicant received a letter from 2VTR returning their application fee. Each applicant was advised that if their membership application was accepted, the station would invoice them the application fee. It would be reasonable for the seven individuals to understand from 2VTR’s action, construed according to 2VTR’s Rules, that the return of their application fee constituted the refusal of their application. In this regard, it is noted that 2VTR’s Rules do not contain any provision formembership applications to be held for any period of time.

2VTR also submitted that it has not refused any applications but that it is merely trying to establish whether the applicants will comply with Rule 11(b) which requires there to be reasonable grounds to assume that the person will be an active member of the Co-operative. The ACMA does not accept 2VTR’s submission. Rule 12(b) of the 2VTR rules states that in order to establish active membership of the Co-operative a member shall‘pay a twenty dollar ($20.00) per year subscription.’ If a person submits an application for membership of the Co-operative that is accompanied by the appropriate application fee there would be sufficient grounds to assume the person will pay the annual subscription and therefore be an active member of the Co-operative as defined by the Rules.

The complainant has also alleged that the number ofmembers at 2VTR is decliningand that the station has failed to do anything to attract new members. 2VTR stated that it has 117 financial members and provided a copy ofits membership register. A review of the register shows that it contains the names of 269 individuals. The Rules of 2VTR require it to declare a membership cancelled if, for example, a person is not an active member and has not been so for two years. This suggests that, of the 269 individuals listed on the membership register, 152 individuals have not paid their annual subscriptions for two years (or more) and have therefore ceased to be active members of 2VTR. Inaddition, it is noted that 2VTR’s 117 members is well below the national average of 290 members for a community radio station in a sub-metropolitan area[2], bearing in mind that 2VTR represents the general community interest in a licence area with a 2006 population of close to 60,000 people.

In its 2011 licence renewal application, 2VTR stated that it had seven strategies in place for attracting and retaining members and volunteers: on-air announcements, attendance at local community functions, Chamber of Commerce meetings, OB van outings, local press coverage, attendance at local events and the 2VTR webpage. In its submission of 9 August 2013, 2VTRprovided a list showing functions at which it was represented, including meetings of the Hawkesbury Chamber of Commercemeetings and the Windsor Business Group. While this may be the case, 2VTR provided little evidence to demonstrate how it had implemented the seven strategies to encourage participation in the operations of the service, for example, a copy of a script or on-air announcement that it had broadcast, copies of articles that had appeared in the local press or community events that it had covered by outside broadcasts. All of these, and more, were requested by the ACMA, but were not provided.

2VTR has submitted that its membership application form was removed temporarily from its website. While the form was on the website when a check was made on 5 March 2014, it was not on the website when checks were made on 18 July 2013, 6 September 2013 and 10 January 2014. The ACMA had previously noted, during the conduct of its 2011/12 investigation that there was no 2VTR membership application form available on its website and accepted 2VTR’s submission that it was removed temporarily to incorporate changes.It appears that the membership application form has not been available of 2VTR’s website since late 2011. In addition, the website still does not appear to contain information encouraging members of the community to become members or volunteers at the station.

Volunteering is another important way that community broadcasters have of encouraging community participation in the operations of a service.However, 2VTR did not provide any evidence that it encouragesvolunteers to become involvedin the operations of the service. No figures were given regarding the number of volunteers and/or the roles they perform at the station.

Committees

Committees can be an important way in which members and volunteers are able to participate in the operations of a service. Community stations commonly have a number of committees, including in the areas of programming, membership, volunteers and fundraising.

Six statutory declarations from individuals were provided to the ACMA, stating that either 2VTR has no committees or they were not aware of the existence of any committees and that they have never been invited to join any committees.