Govt 'does not intend nor expect' restructuring to affect relationship between MCI and SPH newsrooms: Iswaran

The Government has said it backs the proposal to transfer SPH Media to a CLG, and provide funding support.
The Government has said it backs the proposal to transfer SPH Media to a CLG, and provide funding support.ST PHOTO: GAVIN FOO

SINGAPORE - The relationship between the Government and newsrooms should not be affected even as Singapore Press Holdings (SPH) restructures its media business into a model that can receive state funding, said Minister for Communications and Information S. Iswaran.

In a ministerial statement on Monday (May 10), he said the Government "does not intend nor expect" the transfer of SPH Media to a company limited by guarantee (CLG) to affect the relationship between his ministry and the SPH newsrooms.

"The Government is mindful that our local news media must remain credible institutions that are trusted by Singaporeans, and that it remains the responsibility of the editors and journalists in SPH Media to report news and diverse opinions objectively, and from a Singaporean point of view," he told Parliament.

The minister's statement follows SPH's announcement last Thursday that it plans to restructure its media business into a not-for-profit entity that can seek public and private funding, to free it from shareholders' expectations and place it in a more sustainable financial position.

The move has drawn concern and questions about whether the editorial integrity of newspapers in SPH would be compromised by receiving government funding after the restructuring.

Mr Iswaran said that within the framework of the Newspaper and Printing Presses Act (NPPA), the local media operate independently of the Government.

"They report and analyse the news fully and objectively, not holding back bad news, nor advancing any singular ideological view or agenda, but focused on Singapore’s interest. The Government and the media will not see eye to eye on every issue and incident – but that is to be expected," he added.

"That is how SPH, and Mediacorp, have operated hitherto. And that is how the Government expects the CLG to continue to operate after the proposed restructuring. The CLG must maintain the reputation and high level of trust that SPH has built with generations of readers, domestically and internationally."

The NPPA, introduced in 1974, imposes restrictions on the ownership and control of local newspaper companies. Mr Iswaran on Monday said it will apply to the news entities under the CLG.

The minister also said a high-quality, professional and respected media with Singaporean journalists reporting news for Singaporeans is essential to "the fabric of the nation".

He added that Singapore's media is keenly attuned to the country's unique circumstances as a small city-state with a multiracial society and an economy that is dependent on trade.

"They help interpret global events through a distinctively Singaporean lens, analysing their impact on our lives. This is ever more crucial in an era of heightened geopolitical contestation," he said.

Challenges facing media worldwide

Outlining the structural forces facing media groups in Singapore and abroad, Mr Iswaran noted that while the demand for quality news has not diminished, it is challenging to monetise digital initiatives, and the revenues of quality news platforms all over the world are falling sharply with little prospect of relief.

Most publications are running deficits, and many newsrooms are shrinking or even closing, he said.

Many media companies have resorted to cost-cutting to survive, he said. Some have received funding from wealthy financial backers or funds, such as The Washington Post which was bought by Amazon founder Jeff Bezos in 2013.

Others have received funding from non-profit organisations, such as The Guardian in the United Kingdom, which has been owned by the Scott Trust since 1936.

There is no universal solution, Mr Iswaran said, noting a few media companies "have succeeded, some are struggling, many have failed".

At this critical juncture, SPH has to similarly chart its own course to revise and reinvent its business model for the digital age, he said.

The company's challenge today stems from an inability to monetise its gains in attracting and retaining readers on digital platforms, he added.

The minister flagged the "serious risk" that SPH's media capabilities will be hollowed out under its current structure.

While SPH's restructuring proposal is "not a panacea" for the challenges it faces, it is "an essential first step if the media business is to adapt to the digital and commercial realities of the industry", he added.

Govt willing to fund digital innovation, capability development

The Government thus supports SPH's restructuring proposal and is willing to provide funding to the CLG, Mr Iswaran said, noting that the company's current model of a news media business within a listed company is no longer viable.

A CLG is one model to remove the news media business from the constraints of a listed company and allow it to invest in its newsrooms, he added.

He said the Government is willing to help fund the proposed CLG in areas such as digital innovation and capability development, while ensuring fiscal discipline and accountability.

"We already have a similar financing model with Mediacorp, our core national broadcaster, which has been working well," he added, noting media is a public good that benefits the whole of society.

Setting out the role and value of local media, Mr Iswaran said local media express the country's identity, values and priorities directly, "so that the world gets a perspective from Singapore itself, and not through the filter of others".

They also publish a balanced range of views on domestic events and developments, he said, to inform the national debate and help foster a national consensus, without allowing disagreements to deepen divisions in society.

In addition, they help sustain common ground in Singapore's multiracial and multi-religious society while preserving the voice of its various communities through vernacular media, he added.

"The local news media fulfil this role while upholding high standards of accuracy, objectivity and balance," he said, noting these traits are ever more scarce in the "raucous global information landscape, especially online".

As Singapore faces increasingly complex challenges and trade-offs, local media provide a highly credible flow of information and analysis to help shape collective decisions, Mr Iswaran added.

The Covid-19 pandemic has vividly exemplified this, he said, as Singaporeans looked to local newspapers and channels as their trusted sources of critical information.

The minister cited how a 2020 survey by British polling firm YouGov found seven in 10 Singaporeans trusted reporting by local media on Covid-19, compared with three in 10 people in the United Kingdom who trusted reporting by British newspapers on the virus.

He also noted that the 2021 Edelman trust barometer reported Singaporeans' trust in local media at 62 per cent, above the global average of 51 per cent, the 45 per cent in the United States, and 37 per cent in the UK and France.

"It is critical to maintain this trust," Mr Iswaran said. "Our local media industry has strived to do so, while adapting to changing industry trends and commercial imperatives."

The Government has been an active steward in the evolution of Singapore's media industry because of its importance to the national interest, he added.

He cited how SPH was formed in 1984 through a merger of the Straits Times Press group, Singapore News and Publications, and Times Publishing.

The primary aim of this merger was to preserve the vernacular media, which would face greater financial pressure over time with the gradual shift towards English, he said. The merger reduced the duplication of overheads and costs of competition, and allowed SPH newspapers to achieve economies of scale and greater commercial viability.

Mr Iswaran also recounted how SPH and Mediacorp were allowed to enter each other's main businesses - print and broadcast respectively - between 2000 and 2005.

The hope was that greater competition would spur both companies to develop better local content and retain local audiences, but ultimately the model was not viable and the industry was reconsolidated again in 2004.

Mr Iswaran also cited a letter to The Straits Times Forum by A-level graduate Keng Xin Yi, 19, who wrote about the importance of keeping SPH Media “alive and motivated to produce quality newspapers every day”.

“The success of this restructuring, and the future of our local news media, turns ultimately on our journalists’ commitment to this mission, and the support of our citizens like Xin Yi,” the minister said, assuring journalists and Singaporeans of the Government’s “abiding support for this critical national endeavour”.

MPs on both sides of the House raised questions about the restructuring, from whether it would affect SPH Media's editorial independence to how the Government arrived at the view that the CLG is the best option.

Leader of the Opposition Pritam Singh (Aljunied GRC) questioned what the Government would do to ringfence the CLG from possible government interference, and to foster a culture of editorial independence across SPH’s titles. 

In response, Mr Iswaran said he would venture that a culture of editorial independence already exists in Singapore’s news media. “We do a disservice to our journalists and editors to suggest anything to the contrary." 

Read key highlights of the ministerial statement on SPH media restructuring here