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MEDIA TAX CONCESSIONS
LAW
I. Duma to fight veto of media law.
The State Duma’s Committee
for Information Policy and Communications will try to persuade the lower
house of parliament in the week beginning 2nd November to override the
Federation Council’s veto of the law on tax concessions for the media,
the chairman of the committee, Oleg Finko, told ITAR-TASS on 30th October.
The agency quoted him as saying that “unless the law is passed, up to 40
per cent of media outlets will go out of business.”
ITAR-TASS news agency (World Service), Moscow, October 30, 1998
II. Paper discusses future of media tax concessions law.
Boris Yeltsin spoke [on 23rd
October] in defence of the draft laws on state support for the media.
Speaking to [Federation Council Speaker] Yegor Stroyev, the president explained
that this is “a forced measure, which is necessary in current conditions,
and a decision on the issue should be taken without delay.” Let us
recall that what is in question is the extension of tax and customs concessions
for the media for another three years.
It turned out that Oleg
Finko, the head of the State Duma Committee for Information Policy, is
totally in agreement with the president although it was on his initiative
that the Federation Council’s veto of both laws was taken off the Duma’s
agenda [on 21st October]. In an interview with your ‘Segodnya’ correspondent,
Mr Finko said that the situation will return to normal by the middle of
November since those who “stirred up all this trouble by blocking the laws
have driven themselves into a dead end, from a legal point of view.”
When asked the logical question
of why the point about overturning the veto was taken off the State Duma’s
agenda on his initiative, Finko replied: “Right before the session,
I learned that a fairly large group of deputies intended to oppose it and,
since more than 300 votes were needed, I decided not to take the risk.”
(‘Segodnya’ has learned that a sizable proportion of deputies from the
CPRF [Communist Party of the Russian Federation] and People’s Power factions
were prepared to vote against overturning the veto). . . . How will
events develop? In Finko’s opinion there are two options: Either
the veto will be overturned or a conciliation commission will be set up
with the Federation Council. Hearings on the veto will take place,
in the opinion of the head of the Duma committee, on 3rd-5th November,
no later . . . . In Finko’s opinion, the realization that the situation
is hopeless is gradually beginning to dawn on all the interested parties
and consequently, “the laws will be adopted in their current form or with
minimum amendments.” But let us wait and see.
‘Segodnya,’ Moscow, October 24, 1998
III. Duma set to overrule veto on media tax law.
Duma Speaker Gennadiy Seleznev
said that the lower house of parliament is ready to overrule the Federation
Council’s veto of the law on state support for the mass media.
Seleznev told ITAR-TASS
on [17th October] that the Duma has passed the law and now the mass media
should “put pressure on the Federation Council.”
Earlier, the speaker expressed
indignation at the senators’ refusal to support the law extending tax credits
and state support for the mass media. The upper house of parliament
returned the law for review.
He stressed that “the introduction
of censorship is impossible” in Russia now.
ITAR-TASS news agency (World Service), Moscow, October 17, 1998
IV. Federation Council vetoes media tax concessions.
The Federation Council—upper
house of parliament—on [the 15th] voted down amendments to laws on taxes
and customs tariffs that would provide concessions to the mass media and
book publishing.
State Secretary Valery Storozhenko,
who is deputy chairman of the Russian Press Committee, said in an interview
with ITAR-TASS that he hoped the Duma lower house would override the veto
of the Federation Council. He said the Federation Council on
14th October approved prolongation for another three years of a law on
state support for mass media, book publishing and book trade, only to turn
down on the next day the laws that would enact it.
The Federation Council has
undone its own decision, Storozhenko said. He said arguments against
the laws were anything but juridical considerations. “Anybody can
hardly be assured that the very fact of declaring the state support for
the mass media and book publishing can ensure it. Real mechanisms
for its implementation, which were contained in the draft laws rejected
by the Federation Council [on 15th October], are needed for this as the
very least,” he said.
Storozhenko said the situation
did not look hopeless. The Duma passed the law-prolonging decision
a week ago by an absolute majority of votes and this promised its returning
to the issue to override the upper house’s veto.
ITAR-TASS news agency (World Service), Moscow, October 15, 1998
V. Duma grants tax benefits to the media.
[On 30th September], the
Duma renewed tax benefits to the media until 1st January 2002 by adopting
appropriate amendments and additions to the law “On state support for the
media and publishing in the Russian Federation.” According to (LDPR
[Liberal Democratic Party of Russia]) Deputy Oleg Finko, who is chairman
of the State Duma Information Policy and Communications Committee, the
benefits will apply to profit taxes, value-added tax, customs duties, postal
service payments and to the leasing of premises.
The committee chief noted
that as before, the law applied “to all publications, including red and
pink but not the blue ones, because erotic publications are not covered
by this law.”
The Duma’s concern for the
media is unlikely to be confined to noble impulses. The granting
of benefits does not signal the abandonment of the intention to establish
control over the media and, above all, over television companies.
‘Segodnya,’ Moscow, October 1, 1998
PROPOSED AMENDMENTS TO MASS MEDIA
LAW
I. Protest against plans to increase media curbs.
If the draft changes and
additions to the law on the mass media which have been prepared in the
State Duma are adopted, this will have irreparable consequences for freedom
of speech in the country. This is stated in an appeal from the leaders
of a number of the mass media addressed to parliamentarians.
The appeal has been signed
by the chief editors of over 30 publications [and broadcasters] including
ORT, VGTRK, NTV, TV6, ITAR-TASS, Interfax and RIA-Novosti, the newspapers
‘Trud,’ ‘Kommersant Daily,’ ‘Nezavisimaya,’ ‘Izvestiya’ and ‘Segodnya,’
the magazines ‘Itogi’ and ‘Ogonek’ and the radio stations Radio Russia
and Ekho Moskvy.
Alena Stepanenko has
the details:
[Correspondent] The appeal says that the draft
law expands the list of grounds for closing the media and increases the
number of officials who have the right to do this. Moreover, it brings
in a whole range of restrictions on the activities of journalists which
are simply absurd. If the law is adopted, supervisory councils will
appear in the editorial offices and these will be, in essence, censoring
councils.
Moreover, under the pretext
of combating monopolies, the authors of the draft law propose restricting
the broadcasting of television channels and radio stations to one constituent
part of the federation which, the media chiefs say, will lead to the closure
of nationwide television and radio companies.
Overall the adoption of
such a law will mean an increase in the control exercised by state bodies
over the state media and possibly arbitrary control by bureaucrats over
the private media, the appeal says.
In view of this, the media
chiefs have called on the parliamentarians to halt the discussion of the
draft law and to carry out further work on it with the participation of
journalists and representatives of the very broad public. In our
turn, the chief editors say, we are ready to take part in this work.
Ekho Moskvy radio, Moscow, October 16, 1998
II. Draft law seen likely to destroy Russia’s media.
Russia’s lower chamber
of parliament, the State Duma, is planning legislation which will force
a small group of Russia’s media magnates to surrender part of their ownership
in broadcasting and the print media, the Russian newspaper ‘Segodnya,’
owned by media baron Vladimir Gusinskiy, reported on 13th October.
The Duma is to debate a draft law which will allow individuals to hold
just up to 25 per cent of shares in a major broadcasting company.
The paper suggested that if passed, the law would affect virtually all
of Russia’s large private TV networks. The following are excerpts
from the ‘Segodnya’ report entitled “The dekulakization of the media.
The State Duma has prepared a draft law to wreck the media” ; subheadings
added editorially:
Serious trouble is looming
over the Russian media market. The State Duma intends to pass legislation
which will wreck whatever is left to destroy, following the crisis [in
the advertising market].
New media law to abolish large media companies
The lower chamber is preparing
for the second reading of the new draft law “On mass media.” If passed,
the law will force many television companies, radio stations and publications
either to shut down or to look for new bosses. The authors of the
document have decided to do away with large media holding companies and
to strip banks and financial-industrial groups of their right to own controlling
blocks of shares in television and radio broadcasting companies, newspapers
and magazines.
The authors of the draft
law (Gabidullin, Nesterov, Finko, Sukharev, Tsoy and Shenkarev) have found
that the simplest way of achieving wider ownership in the media is dekulakization
[reference to private farmers, kulaks, who were forced to surrender their
wealth to the state in the 1920s].
New law to hit most broadcasting companies
The law will allow corporate
bodies and individuals to own up to 25 per cent of shares in broadcasting
companies which cover more than one region of the federation. Let
us note that virtually all large nonstate television companies will be
affected by this measure. The owners of several publications, if
they have at the same time acquired television and radio broadcasting licences,
will be subject to dekulakization. . . .
In other words, media magnates
are being asked to share their wealth with others. The question is
with whom? And who, generally speaking, can invest money in confiscated
media shares these days? It would be logical to think that it should
be the state. But not the state the way it is now, when the budget
is failing to cope with funding the state’s only company, the All-Russia
State Television and Radio Broadcasting Company [VGTRK]—something that
its chairman Mikhail Shvydkoy has been constantly complaining about.
Perhaps the state can own some prosperous newspaper, which is widely read
by the public. Absolutely not. ‘Rossiyskaya Gazeta’ (founded
by the Russian government) is known to be a “mandatory” publication for
all power structures (which are also its “mandatory” subscribers), because
it has monopolized the right to be the first to carry presidential edicts
and government decrees.
Incidentally, Duma deputies
have also concocted a similar “mandatory” publication for themselves:
‘Parlamentskaya Gazeta’[parliamentary newspaper] has been granted the unique
right to be the first to carry the laws adopted by the deputies.
But even despite the monopoly “jus primae noctis,” the aforementioned newspapers
are hardly making ends meet.
The new law a financial noose for private media companies
It is not only a financial
noose which is in store for the nonstate mass media. The draft law
has considerably expanded grounds for suspending or terminating a particular
media outlet, for example, if a media owner “has failed to share” his shares
or licences (see above). In other words, if you do not give away
some of them, you will lose them all. And this has nothing to do
with state (antimonopoly) interests. It has everything to do with
the desire to tuck into the airwaves and newspapers prior to the elections.
And preferably for free.
‘Segodnya,’ Moscow, October 13, 1998
III. Duma speaker denies plans for TV censorship.
[Presenter] Gennadiy Nikolayevich, I
cannot fail to ask you this because you have spoken on this subject [on
30th September]. Why have you taken up arms against television?
[State Duma Chairman Gennadiy Seleznev]
In the first place, we have taken up arms against television because television
put a totally unjust interpretation on the way we raised the question of
setting up observers’ councils at state television and radio companies.
There is not a single state television and radio company anywhere in the
world which does not have an observers’ council. This is obligatory
everywhere. Moreover, even many independent television channels throughout
the world try, themselves, to have observers’ councils or trustee councils
set up which, together with the editorial office, determine policy, decide
the fate of providing for these programmes and channels.
We do not wish simply to
influence the programme policy of the two channels. We want equally
to push through the budget money which the state does not allocate to these
channels. If it is owned by the state, it will get the state’s go-ahead.
Give it what is written in the budget. Therefore, when they took
up arms against the deputies, naturally there was a reaction. You
must recall how [words indistinct] they shouted: they intend to put
a muzzle on us. What sort of muzzle? What sort of collar?
What else? You are reviving the censorship bodies. This is
not what it is about at all. Read what it says. We have a clause
about an observers’ council which has, by the way, been approved for VGTRK
[All-Russia State TV and Radio Company] and its collegium and for ORT [Russian
Public TV].
NTV, Moscow, September 30, 1998
NEWS ON ORT
I. New ORT head rejects merger or nationalization.
The new Russian Public
TV (ORT) general director, Igor Shabdurasulov, has described as “absurd”
the rumoured proposals to merge ORT and the All-Russian State Radio and
TV Company (VGTRK). In an interview for Russian independent Television
(NTV), he also referred to the lack of federal funding for ORT in the last
three years, and dismissed the idea of nationalizing ORT. The following
are excerpts from the interview with Shabdurasulov, broadcast by Russian
NTV; subheadings added editorially:
[Presenter] Hello. This is the
“Hero of the Day” programme. Svetlana Sorokina is in the studio.
Our guest [on 15th October] is Igor Shabdurasulov who was elected general
director of Russian Public Television—ORT—the first channel. Hello,
Igor Vladimirovich. . . . There have been rumours about the possible
merger of the first and second channels, the ORT and the VGTRK [All-Russian
State Radio and TV company]. The rationale seems clear—there is no
money for the upkeep of both national channels. I have two questions
to this effect. First, has this idea finally died or not? Second,
is there any logic behind the merger?
[A] Judging by what Leonid Petrovich
Kravchenko [former head of USSR State Committee for Television and Radio
Broadcasting] is saying, and some other people as well, the idea is still
alive in many heads. I think this is an absurd idea. When you
said that it was difficult to maintain two channels, I would like to ask
you who is paying.
[Q] This is what people usually say.
[A] I think they say this deliberately,
to cloud the issue. Or, they just don’t understand anything.
ORT funding
[Q] Does the government allocate money
to ORT?
[A] Let me remind you that in 1996,
1997 and 1998 the federal budget did not have any provisions for—and this
means did not allocate—any money to maintain ORT financially.
[Q] The controlling interest—51 per
cent of shares—belongs to the government. Why doesn’t the government
take part in funding the company?
[A] This is a good question. I
have been asking this since March 1995 because I was to a certain extent
involved in the founding of ORT and was always aware of the company’s situation.
. . .
[Q] What about the idea of nationalizing
the company? It is being discussed now, isn’t it?
[A] Yes, it is another “great” idea.
This is what they say. The government cannot afford two channels.
The government has not given a single kopeck to the first channel, and
then they tell us to merge the channels and to give away the second channel’s
airtime and frequencies to regional companies or to put it out to tender.
One state TV channel is enough, they say. If so, why don’t we have
just one newspaper? Let’s close down all the newspapers.
[Q] Newspapers are cheaper.
[A] Yes, I agree. But before the
collapse of the advertising market, did ORT really ask for the government’s
money? I worked in a government office and I was in charge of the
media field, so I have a more or less clear idea about the real situation.
Officially, ORT has never asked the government or the president for money,
not even once, although the situation was very serious.
[Q] But it was quite sensitive because
it was not just funding that was involved.
[A] Yes, political motives. But
let us see. Perhaps, this is cynical but there is a saying—he who
pays the piper calls the tune. . . . The government has issued our
licence. The licence costs a lot, the government says. Perhaps.
A costing exercise should be done with the licence, but, perhaps, it is
expensive. The government is telling us to sort our problems ourselves,
but, however—and this idea has always been lurking in the background both
in the past and at present—it wants to tell us what to say, how, when and
to whom. Excuse me.
New supervisory council for television
[Q] I hear that the first meeting of
the supervisory council is to take place at Russia TV [RTV] tomorrow [16th
October]. The so-called council comprises representatives of the
government, the Federation Council and the State Duma and [regional] administrations.
What is your attitude towards the supervisory council?
[A] Very positive.
[Q] Will you be happy if they come to
you?
[A] They have come to us. We have
invited them ourselves. Let me remind you that as far back as March
1998 the government decided to set up supervisory councils both at ORT
and RTV.
[Q] How does it work at ORT?
[A] As far as I know, they have had
several meetings already. By the way the supervisory council comprises
very different people whose political views, likes and dislikes or some
other parameters are far from being homogeneous. For instance, [leader
of the Liberal Democratic Party] Vladimir Volfovich Zhirinovskiy, [Communist
deputy] Svetlana Goryacheva and [analyst Emil] Pain are members of our
council. I mean we have different people there.
[Q] What is the concrete result of their
work?
[A] They discuss the programme policy,
the state of the channel, the quality of information. They issue
recommendations. They may disagree with some of our positions, and
this is normal. We are ready to accept this. If we agree with
the essence of the problem and why it was raised, we are ready to carry
out their recommendations. There is one problem, though. It
is impossible for any supervisory council to interfere with the managerial
executive functions of any TV company or any of the mass media.
[Q] You mean they only have a consultative
vote.
[A] Indeed, and this is very valuable
and very important. However, functions should not overlap.
The supervisory council should not assume any duties which are beyond its
competence. By the way, this is something which is currently being
very actively incorporated into a draft federal law on television and radio
broadcasting. Excuse me, but it is not possible to agree with it.
Fate of the law on tax breaks for media
[Q] As for the law. The Federation
Council contradicted its own decision which it made [on 14th October].
They did not approve the law on extending allowances for the media and
the publishing industry. What consequences will this have for ORT?
I mean if they go back on their previous decision. A conciliatory
commission will examine the situation. If they go back, what will
happen?
[A] You know, I can only quote [Lev
Tolstoy who said] that everything got messed up in the home of the [family]
Oblonskiy. I cannot understand what is going on in parliament at
present. The State Duma, for instance, has many deputies who, mildly
speaking, do not like the mass media in general and television in particular.
Nevertheless, the Duma’s state interests prevail over their personal choices
and the Duma passes the law. In the Federation Council, [Samara regional
governor] Konstantin Alekseyevich Titov—whom I know personally and have
always thought of as a balanced and realistic man, a reformer—I cannot
understand what he is saying. I was watching him and could not understand
what he was saying. I am not even mentioning some other deputies.
They contradict themselves. Yesterday they passed the basic law and
today they rejected the main amendments to the law. They want to
discuss the supervisory council. OK, we can talk, no tragedy there
so far—but if they don’t agree on a decision and if they offer us the law
which is being currently prepared for a second reading in the State Duma,
the law on amendments and addenda to the law on the mass media, if they
offer us their current version of the law on TV and radio broadcasting,
just forget about the main achievement of our reform, about freedom of
speech, freedom of the mass media, the opportunity to objectively cover
events and be independent in covering exchanges of opinion. . . .
At the end of the day, it looks like we are going back to the
old times when we had to shut up. Those who think that these are
trifles, are very mistaken. Those who think that these are just minor
changes, just small amendments, are mistaken. There is a critical
line. I am deeply convinced—and not just me, as far as I know, but
the heads of quite a few mass media companies have signed a special statement—and
I hope that it will be published tomorrow. The statement is addressed
to the president [Yeltsin], the government and parliament because this
is not a trifle. This is an absolutely clear position: sit,
stand still, freeze, don’t move.
NTV, Moscow, October 15, 1998
II. Paper views effects on ORT of advertising crisis.
The Russian newspaper
‘Izvestiya’ forecasts a drop in the quality of Russian Public TV (ORT)
programmes following the collapse of Russia’s advertising market.
Earnings from advertising may fall by as much as 50 per cent, while state
funding has not been forthcoming ever since the government sold off 49
per cent of the company shares, the paper said. Moreover, ORT is
in serious debt to television producers. According to the paper,
none of this augurs well for the future. The channel’s management
is considering major reductions in staff. Wage cuts may also be in
the offing, the paper added. The following are excerpts from the
‘Izvestiya’ report; subheadings added editorially:
Endless classical music
concerts. Live broadcasts from theatres. Repeats of daytime
programmes late in the evening. And almost a complete absence of
good films and advertising. That is not the past of domestic television.
Rather, it is a forecast of what is to come. . . .
Decline in quality of ORT programmes predicted
Such pessimism is not unfounded.
As ORT [Russian Public Television] acting director Igor Shabdurasulov said,
the crisis in the advertising market is dangerous for television not only
because of financial losses. It could have an effect on the quality
of television programming as well.
“The first channel gets
almost all of its funding from advertising,” ORT press secretary Grigoriy
Simanovich explained to an ‘Izvestiya’ correspondent. “And in spite
of the fact that 51 per cent of the shares in the company belong to the
state, ORT has not seen a kopeck of budget money since 1996.”
Even according to the most
optimistic forecasts, the volume of advertising will half because of the
current crisis. Conclusions are clear. There will be no money
to spare for new programming. Even now ORT is in serious debt to
television producers. True, as our ‘Izvestiya’ correspondent was
assured by the company’s press secretary, ORT is conducting negotiations
with producers. Possibly, the company will manage to reach another
agreement with them.
Ways of reducing cost of programme-making explored
According to the information
received by ‘Izvestiya,’ the situation might be saved by reducing the cost
of programmes. The more so since there are reserves. Such companies
as VID, Ren TV and a number of others have been selling their products
at obviously marked-up prices. And a reduction in fees to stars would
mean that programmes could be made at 60 per cent of the cost. But
it is very likely that after the approval of a new broadcasting schedule
on 3rd October, some programmes will disappear from the air (mainly daytime
programming). The ORT management is also quite seriously considering
reductions in staff wages and in some of their engineering and editorial
staff.
Other channels face similar problems
Other channels are facing
similar problems. VGTRK [All-Russia State Television and Radio Company]
is planning staff cuts. In addition, Russian television is being
constantly disturbed by regular changes of management, which inevitably
lead to a high turnover of staff. NTV is considering temporary pay
cuts for workers as a possible measure. TV-Centre could do without
the services of at least one-third of its 1,500-strong team. Just
as in the instance of ORT, engineers will be the first to go. . . .
The bigwigs in the advertising
business are broadly hinting that with the current collapse of the market,
the only hope for television companies are the forthcoming elections.
When the battle begins for voters rather than clients, the income of the
viewing audience will be of no importance. And parties will find
money for the election campaign.
‘Izvestiya,’ Moscow, September 23, 1998
III. Berezovskiy comments on ORT “nationalization.”
CIS Executive Secretary Boris
Berezovskiy is convinced that “today any nationalization in Russia would
lead to civil war.” He said that to Interfax on [17th September]
while commenting on reports that the State Duma is drafting a resolution
to nationalize Russian Public TV [ORT].
Berezovskiy stressed:
“We have already been there once—in 1917.” “Today any nationalization
would lead to civil war. People who try to initiate such projects
must realize this,” he said.
Interfax news agency, Moscow, September 17, 1998
IV. Duma’s plans for the “deprivatization” of ORT.
Russia’s major newspaper
‘Kommersant-Daily’ reported on 17th September that parliament is planning
to “deprivatize” Russian Public TV in which the state currently has a 51
per cent stake. The paper said however that the legal procedure for
the state to reclaim the other 49 per cent was unclear. It was doubtful
that there is enough money in the treasury to pay off the private stockholders
or, in fact, to run another state TV channel. The following is the
text of report by the Russian newspaper ‘Kommersant-Daily’ web site, sub-headings
added editorially:
‘Kommersant’ has learned
that the Duma intends to deprive the present private stockholders in ORT
[Russian Public TV] of their ORT stocks. It proposes doing this as
early as October, when the draft law on deeming the privatization of Ostankino
[former name for ORT] as invalid comes up for consideration in the Duma.
The author of the law, Oleg Finko, who is the head of the Duma Committee
for Information Policy and Communications, is now confident that its initiatives
have a very good chance of being approved. Here is Roman Kostikov
with the details.
ORT to be “deprivatized” as opposed to being renationalized
As ‘Kommersant’ wrote [on
16th September], the committee has prepared a draft law which specifies
the “statification” of ORT. True, it is not a question of nationalizing
the first channel but of deprivatizing it. This considerably improves
the chance of the Duma approving the draft law.
The point is that nationalization
is in breach of the laws already in force. The opponents of Deputy
Finko have said it over and over again. If real (or imaginary) violations
are found in the privatization of the first channel, it can be quite legally
recognized as invalid and the television company itself can be deprivatized.
Procedure unclear for the state to repossess ORT stocks
Finko acknowledges that
the mechanism for returning the company to the state has not yet been worked
out in detail. For the time being, Finko proposes that the Duma Council
create a special commission to establish who has put in funds for ORT shares,
when and how much to return to whom. “The commission will find out
precisely who paid, who did not pay and who obtained shares for free,”
Finko threatened. “We will look into this. Just as we will
look into precisely how much the state should pay today’s owners.”
It will be proposed that
those who have registered their intellectual property under the charter
capital of the ZAO [private company] ORT reclaim the funds they paid for
that intellectual property, in accordance with the legislative procedure.
Uncertainty over the state’s ability to pay ORT stockholders
Despite Finko’s statements,
however, the money which the stockholders have invested in the development
of the television company will most likely not be returned to them.
At least, the draft law says nothing about it. Finko simply proposes
that [Russian media magnate who has a stake in ORT] Boris Berezovskiy “take
away with him” all the money that he invested in ORT.
Oleg Finko is not too worried
about the question of where the state will get the money for deprivatization:
“If money from privatization went to the state budget, then it should be
returned from there.”
The funds really can be
found to pay the stockholders, even in the present poverty-stricken budget.
It is more difficult to find funds to keep the television company going.
As the experience of the VGTRK [All-Russian State Television and Radio
Broadcasting Company] shows, state television is so expensive that it simply
demands more than the state can afford. But this does not disturb
the author of the draft law: “It is a myth that the state cannot
pay for ORT. The Finance Ministry pays for the signal in full.
And then, after all, no one will encroach on the channel’s earnings from
advertising. Those are your sources of livelihood.”
Half the deputies likely to support ORTV deprivatization
Oleg Finko has no doubt
that the law will be passed: “Right now, our law is absolutely passable.
I have an intuitive feeling for the atmosphere in the Duma today.
I am confident that half the deputies will support the bill. I do
not want to name the factions for the time being but many leftist deputies
are in sympathy with me and all the members of the LDPR [Liberal-Democratic
Party of Russia] faction will vote for the draft law.”
If nothing comes of this
undertaking, Finko has another surprise in hand for the ORT stockholders:
“I am quite a persistent person and if this law is not passed, then we
will introduce another draft law, almost the same, except that it will
be on the nationalization of ORT.”
‘Kommersant-Daily’ web site, Moscow, September 17, 1998
VGTRK SUPERVISORY COUNCIL
I. VGTRK watchdog creates “illusion of control.”
The VGTRK [All-Russia State
TV and Radio Broadcasting Company] supervisory council met for its first
session at the TV company’s premises in Leningradskiy Avenue. The
state TV company’s management and “representatives of the public,” some
of whom did not disguise their dissatisfaction with the VGTRK’s work, met
at the same table. As could easily have been predicted, no specific
decisions were adopted at the session. Council members merely observed
one another, reiterated their oft-stated views on the VGTRK’s activities
and went home after forming a working group which will meet in the near
future to finalize the statute on the council. . . .
CPRF [Communist Party of
the Russian Federation] leader Gennadiy Zyuganov’s September threat to
insist on the dismissal of VGTRK Chairman Mikhail Shvydkoy provided grounds
for a session of the supervision council to be held. Admittedly,
the TV company was not so much frightened by the actions of Gennadiy Andreyevich,
who does not have the right to independently regulate the VGTRK’s activities,
as by the critical situation in which the state TV company has found itself.
Apart from the now familiar underfunding by the treasury (the state only
has enough money for 1.8 hours of broadcasting a day), the VGTRK was poleaxed
by the total collapse of the advertising market and by the massive preparations
of the TV company’s trade unions to oppose continuing staff reductions
accompanied by a promise to publish yet more compromising materials about
the VGTRK management.
In the current situation
the concession to the Duma majority appears to be a lifesaver for the VGTRK.
It is no accident that at the first supervision council session Mikhail
Shvydkoy did not object, as he had done before, to intervention in the
TV company’s affairs, but asked for help. The VGTRK chairman even
plucked up the courage to declare that the council would not on any account
censor state TV. He admitted that the company entrusted to him had
serious economic problems, for example, it owes the communications sector
money. There is work to be done “to clear away the mountain of financial
problems and to create an efficient state television and radio broadcasting
system in the next year or year and a half.”
Valentin Zorin, who took
over the chair of the session from Mikhail Shvydkoy, tried to bring the
meeting to a more or less successful conclusion. He proposed that
they finally start work, allowed everyone who wanted to state their views
(even the representatives of the enraged VGTRK unions), and quickly formed
a council working group, which included, at the suggestion of Shvydkoy,
the most influential figure in the VGTRK, its first deputy chairman, Mikhail
Lesin. Now we can be sure that the public supervision council will
not inflict any particular damage on the VGTRK and may even really help
it to get through the crisis. The main thing the company’s management
has to achieve with the support of loyal council members is to create a
convincing illusion of parliamentary control and influence over the VGTRK
while retaining the maximum possible degree of inviolability, thereby obtaining
real parliamentary protection.
“They can see everything from their vantage point. VGTRK is
being rescued by public watchdog,” ‘Izvestiya,’ Moscow, October 21,
1998
II. VGTRK supervisory council holds first session.
[On 16th October] VGTRK’s
[All-Russia State TV and Radio Broadcasting Company] supervisory council
held its first session. The council is to be formed from seven people
from each branch of power: the president’s administration, the government,
the State Duma and the Federation Council. Also invited were representatives
of the [Russian] Academy of Sciences, Academy of Pedagogical Sciences,
the Olympic Committee, the Judicial Chamber and well-known cultural and
press figures.
Despite the fact that, as
VGRTK Chairman Mikhail Shvydkoy said, letters were sent to all interested
parties, including [State Duma speaker Gennadiy] Seleznev and [Federation
Council speaker Yegor] Stroyev, the State Duma had only two representatives
at the table: one from the LDPR [Liberal Democratic Party of Russia]
and the CPRF [Communist Party of the Russian Federation] while the Federation
Council had none.
There were disagreements
on procedure. A proposal was made to elect Deputy Prime Minister
Valentina Matveyenko head of the public supervisory council. But
she wasn’t here today, she is away on business, and without her the question
of elections fell by the wayside.
Also, the Duma deputies
decisively opposed an item on VGRTK in the charter on the supervisory council.
Yuriy Ivanov, a Communist who said he was speaking for all the left-wing
factions in the Duma, was even more decisive.
After the council—to its
organizers’ credit, they did not drive the press out of the hall—had reached
a dead end, a break was called for the tense atmosphere to subside.
[Yuriy Ivanov, Communist deputy, talking to NTV outside the session]
I am just depressed. Under the agreement between the executive and
the legislature, all political forces were represented so that some kind
of consensus could be reached on bringing order to television and so that
it could indeed be ensured that there is no censorship.
Instead of this, Shvydkoy,
a civil servant, is setting up this supervisory council with a decree,
including representatives of the president and the government—people whose
powers have not been revealed to us. Shvydkoy is starting confrontation.
[Mikhail Shvydkoy, VGTRK chairman, talking to NTV outside the session]
I don’t want procedural misunderstandings to replace the most important
point of what is happening today. We want the VGTRK supervisory council
to work normally; we have nothing to hide. We are ready to work with
all the branches of power, public organizations and religious organizations.
I think that today will not be useless.
[Correspondent] When the session started
again, they got down to business. The council members started to
set out their views on the council’s draft statute. It was decided
to set up a smaller working commission. It is supposed to work out
a compromise in the near future. Valentin Zorin, the oldest, was
elected head of the commission.
NTV, Moscow, October 16, 1998
III. Russia TV’s plans for supervisory council viewed.
On [28th September], VGTRK
[All-Russia State Television and Radio Company] Chairman Mikhail Shvydkoy
announced plans for setting up a supervisory council at the Russia TV channel.
This was the result of his meeting with Communist leader Gennadiy Zyuganov,
who had demanded three days earlier that state television be placed under
public supervision. . . .
The swiftness with which
Shvydkoy responded to the opposition’s categorical demands is unprecedented.
Calls to “restrain” and “monitor” television have been heard since the
days of [the Supreme Soviet chairman before 1992, Ruslan] Khazbulatov’s
Supreme Soviet and [right-wing party leader, Viktor] Anpilov’s marches
on Ostankino. But until now, top state television managers have not
been noted for rushing to satisfy parliamentarians’ endless demands.
So why hurry on this occasion?
“This is a false impression,”
Mikhail Shvydkoy said in an ‘Izvestiya’ interview. “The opposition
has now merely expedited the work we planned to carry out, anyway. . .
. Now we will finally implement what we planned long ago. I
am not opposed to a supervisory council. It is a normal civilized
form of contact between television and society. But this council
should not and will not control the television and radio company. . . .”
In Shvydkoy’s opinion, there
will be no introduction of political censorship. . . . “The council
is an advisory body. All decisions in this area are made by the government
and the president.” Judging by this statement, the communists’ desire
to remove troublesome presenters of political programmes from the airwaves
will not be met.
The VGTRK chairman’s optimism
is probably born of the experience of his ORT [Russian Public Television]
colleagues. In the spring a similar council, called the Public Council,
was set up there. Its members, who were full of ideas and enthusiasm,
held their first session several months ago. Since then they have
not met once.
‘Izvestiya,’ Moscow, September 30, 1998
IV. Communists moderate call for VGTRK changes.
[Presenter Sergey Dorenko] [On
28th September], the chairman of the All-Russia Television and Radio Broadcasting
Company [VGTRK], Mikhail Shvydkoy, met the Communist leader, Gennadiy Zyuganov.
As you know, last week Gennadiy Zyuganov was insisting that the channel’s
management be replaced.
[Correspondent] The Communists
are unhappy with the work of state television. This morning, Zyuganov
again criticized Mikhail Shvydkoy. So, this evening the VGTRK chairman
visited the Duma. Zyuganov and Shvydkoy held talks for over an hour.
. . .
[Zyuganov] Television, including
state television, has made a huge contribution to the destruction of our
country. In recent times state television has, as a rule, been dominated
by the views of the 3 to 4 per cent of people who believe in liberal, monetarist
theory.
[Correspondent] At the end of
last week, the CPRF [Communist Party of the Russian Federation] faction
demanded the replacement of the leader of the second channel. The
Communists believe this post could be held by Leonid Kravchenko [former
head of USSR State Committee for Television and Radio Broadcasting], but
personnel matters were not discussed at today’s meeting.
[Shvydkoy] The person [Zyuganov]
I was talking to is a good parliamentarian. He is also an educated
man. So he wouldn’t discuss the question of my resignation with me.
I reiterated that I am fond of my work. But I am prepared to accept
compromise to a degree. . . .
[Zyuganov] We will judge by what
actually happens. At the same time, we will not be insisting on a
change of leadership until these meetings are held.
[Correspondent] The Communist
Party leader noted that in many European countries, supervisory councils
have the power to appoint the head of state television. Zyuganov
would like the same thing to happen in Russia. Under the existing
law, the VGTRK chairman is appointed by the president.
Russian Public TV, Moscow, September 28, 1998
OTHER MEDIA NEWS
I. Communists call for state “media propaganda centre.”
Representatives of the
Communist Party of the Russian Federation faction in the Duma have sent
a letter to Prime Minister Yevgeniy Primakov proposing that an “organizational
propaganda centre for the state mass media be set up,” on the basis of
the RIA Novosti news agency. The letter suggests that the project
could be financed from the state budget, with additional private capital
and funding from the agency itself. The following is the text of
a report by the Russian newspaper ‘Izvestiya’; subheadings added editorially:
Representatives of the CPRF
[Communist Party of the Russian Federation] Duma faction, who have calmed
down somewhat since their unsuccessful attempt to remove VGTRK [All-Russia
State Television and Radio Broadcasting Company] Chairman Mikhail Shvydkoy
from office and to sort out the state media holding company in general,
have decided to attack from the rear by refocusing their attentions on
the subsidiary enterprise VGTRK-RIA Novosti. Gennadiy Seleznev [Duma
Speaker and prominent CPRF official] has sent a letter to Prime Minister
Yevgeniy Primakov proposing that an “organizational propaganda centre for
the state mass media be set up” on the basis of the news agency.
Seleznev’s letter was carefully
prepared from both a structural and an ideological viewpoint. This
was done communist-style, attributing the need for change in the state
mass media to “the lack of a clearly defined statewide ideal and the tendency
to pursue ephemeral news and propaganda campaigns reflecting the interests
of specific political figures or groupings.”
So thorough is the letter
that it even sets out a possible economic model for the news agency’s activities—it
would be financed “from the state budget, with additional private capital
and funds belonging to the agency itself.”
So as not to limit itself
to involvement in the VGTRK Public Oversight Council, the Duma majority
has proposed setting up a separate RIA Novosti Board of Trustees consisting
of representatives of the government, both chambers of parliament, and
even the Supreme Court, which would determine the “basic tenets and thrust
of information policy and specific propaganda campaigns for the news agency.”
Moreover, it is being proposed not only to draw on Duma and ministerial
experience in the work of the board but also on that of the Foreign Intelligence
Service and the Federal Security Service.
At this point the VGTRK
leadership absolutely reasonably pointed out that an oversight council
already exists—one for the company as a whole of which, incidentally, RIA
Novosti is part.
“Propaganda influence of the private mass media”
Gennadiy Seleznev considers
that the system devised by him should firstly counter and neutralize the
“constant propaganda influence of the private mass media in the regions,
which certainly do not promote national and federal interests.” Special
efforts are made in the letter to win over Yevgeniy Primakov as a former
foreign minister. Two paragraphs are devoted to reminding him of
the special significance of RIA Novosti’s foreign policy activities.
The letter notes that it is essential to set the news agency’s foreign
desk the “task of creating a favourable image in order to achieve Russia’s
foreign policy and foreign economic goals.” In general, there is
to be total propaganda.
The appearance of the letter
can be explained by the CPRF’s withdrawal to prearranged positions.
As is the established practice among genuine communists, two agendas are
always set before any revolution—a “maximum” and a “minimum” agenda.
Clearly, the “maximum” agenda entailed removing the VGTRK chairman from
his post and gaining control of the state media holding company.
As we know, the attack failed as a result of the unexpected cooperativeness
of the TV bosses, who agreed to the setting up of a public oversight council
for their company. We may consider the “minimum” agenda to be an
intention to control RIA Novosti.
Admittedly, this decision
also seems to evince exclusively individual aspirations in the guise of
an ideological party campaign. It has emerged that Seleznev’s press
secretary, Mikhail Belyat, who worked for RIA Novosti when it was still
called APN, set his hand (or pen) to writing the letter signed by the speaker.
Clearly he is not averse to returning to his old news agency. However,
from the day he moved into his office on Zubovskiy Bulvar, Aleksey Volin,
who was appointed chairman of the RIA management board under then Prime
Minister Sergey Kiriyenko, was chiefly occupied not so much with propaganda
projects as with the problems of its survival in the conditions of the
financial crisis.
Staff cuts at RIA Novosti
As in the majority of companies,
staff are inevitably being cut in RIA Novosti (600 out of 1,100 will remain).
The majority of RIA’s highly specialized departments have been amalgamated
to form the Main Information Directorate (GDI), which works in three main
areas—foreign news, domestic news and the provision of information to the
VGTRK media holding company, which was entrusted to RIA this summer and
is carried out without extra manpower or funding, while since the beginning
of the year the news agency has been allocated only 1.9m dollars from the
budget.
There are only a few opportunities
for making extra money, such as subscriptions and contracts for information
exchange. There is, however, one other solution—to transform RIA
Novosti into a news and advertising agency. But in that case there
is likely to be a new wave of accusations about “adherence to ephemeral
news and propaganda campaigns” for private gain. And even without
this, the new RIA management is only just managing to fight off the many
attacks of an ever-increasing number of malcontents—in this case communists.
‘Izvestiya,’ Moscow, October 28, 1998
II. Government objects to tough media controls.
The Russian government disapproves
of attempts to impose tough control over the mass media, Deputy Prime Minister
Valentina Matviyenko told a news conference on [27th October].
Matviyenko said the mass
media badly needed support from the state and promised that the government
would do its best to back the media in the current difficult financial
situation. She reported that President Boris Yeltsin had already
signed a law on state support for the mass media and publishers.
The deputy prime minister
believes that the key provisions of the law on broadcasting, which is now
being debated by the State Duma lower house of parliament, “contradict
the existing legislation” which allows for considerable freedom of information.
“We can contemplate monitoring
councils in television, we can discuss other ideas, but we should not impair
the existing laws on the mass media,” Matviyenko emphasized.
ITAR-TASS news agency (World Service), Moscow, October 27, 1998
III. Yeltsin concerned by delays to media bills.
Presidential spokesman Dmitry
Yakushkin told journalists upon completion of a meeting between President
Yeltsin and Chairman of the Federation Council Yegor Stroyev on [23rd October]
that during their long conversation Boris Yeltsin “expressed concern over
the Federation Council’s delay of bills supporting mass media.”
According to the presidential
spokesman, the president realizes that “the lengthening of a privileges
regime to the mass media is a forced measure, but indispensable under the
present conditions.” “Settlement of this problem shall not be delayed,”
the press secretary quoted the president as saying. “The president
expressed the hope that the parliament would do everything possible so
that the mass media be not devoid of state support,” the spokesman said.
ITAR-TASS news agency (World Service), Moscow, October 23, 1998
IV. Yeltsin signs law to extend state support for media.
Russian President Boris Yeltsin
signed the law “On amendments and addenda to Article 10 of the federal
law ‘On state support of the mass media and publishing in the Russian Federation’”
[on 22nd October]. This means that state support for the mass media
has been extended for another three years, till 1st January 2002. . . .
The fact that the Russian
president has signed the document on the addenda to the framework law ahead
of two other laws [addenda to the laws on taxes and on customs tariffs
regarding the mass media] shows his firm position in support of the Russian
mass media.
ITAR-TASS news agency (World Service), Moscow, October 22, 1998
V. Security official reportedly to oversee media.
According to information
received from sources close to the leadership of the Russian Federation
FSB [Federal Security Service], a new deputy chief is to be appointed any
day now in the “K” department. This apparently unremarkable personnel
change inside the power department in fact has huge significance.
The person who occupies this inconspicuous post has in recent times handled
on behalf the FSB all questions relating to the Russian mass media.
It is expected that the special service’s all-seeing eye on television
and radio and in newspapers and magazines will be Lt-Col Aleksandr Komelkov.
An order on his appointment has already been prepared. . . .
The recently created “K”
department has taken over many of the functions of the recently deceased
“fifth” “antidissident” KGB main directorate, including those relating
to the press, radio and television. These areas, among others, will
be Komelkov’s main field of activity. Under his command will be a
special department set up specifically to work with the mass media.
It has been officially stated
that the main interest for this subdepartment will be primarily extremist
publications: radical nationalistic publications preaching fascism
and the views of totalitarian sects . . . [ellipsis as published].
However, according to other information, the scope of its proposed operations
is far wider: all TV channels, radio stations and respectable and
influential publications. And work here will be conducted right across
the board: it will involve the collection of operational information,
including compromising information, the creation of dossiers, the recruitment
of agents and the performance of special operations.
It is difficult to underestimate
[as published] the real power that the person occupying this post could
acquire. The most powerful levers of influence both over ordinary
journalists and over the leaders and owners of mass media outlets are in
his hands.
‘Novyye Izvestiya,’ Moscow, October 8, 1998 |