‘Government must pay up advertising dues’, Indian Newspaper Society tells Supreme Court

The Indian Newspaper Society (INS), the central organisation for the Press in the country, has told the Supreme Court that governments should pay up the hundreds of crores of rupees it owes in advertisement money to newspapers.

It also blamed the governments for issuing “hypocritical and discriminatory” advisories asking private establishments to pay full salaries to their employees during the COVID-19 lockdown, especially when the State — a “model employer” — had itself cut salaries at a time of a calamity of global proportions.

“As per various industry estimates, Directorate of Advertising and Visual Publicity (DAVP) owes between ₹1,500 crore and ₹1,800 crore to various media companies. A large chunk of this, ₹800-900 crore is owed to the print industry alone. Such amounts have been outstanding for several months and there is little prospect of realising the same any time soon,” the INS said.

The newspaper industry organisation, which was replying to petitions from journalists’ unions objecting to some media houses’ introduction of salary and job cuts during the lockdown, blamed the government for the “drastically reduced advertising much prior to the crisis”. In fact, the INS submitted there had been “calls by political parties to stop government advertising altogether in order to save money”.

Broadcasters’ plea

“There have been no packages or measures announced for news broadcasters by the Government, even as their business has collapsed,” the National Broadcasters Association (NBA) submitted to the apex court, in a separate affidavit. “This despite news broadcasters continuing to provide responsible and credible real-time information every day to the country by keeping all operations open during this lengthy period,” the NBA added.

Both the INS and the NBA were criticising advisories by the Union Ministries of Home and Labour and some State governments that private employers should continue to pay full wages to their employees during the lockdown. The issue came up in the apex court when a joint petition was filed by the National Alliance of Journalists, Delhi Union of Journalists and Brihanmumbai Union of Journalists challenging salary cuts and even sacking of employees by some media organisations.

“This advisory (banning wage cuts and termination of employment) is merely a request,” the NBA contended. “The employers are at liberty to run their businesses as per their capacity, needs and requirements within the framework of the applicable employment laws,” it asserted.

Observing that the advisories only cast a moral or humanitarian obligation and not a legal liability on media houses, the INS argued that through these advisories, the governments had overreached and unduly assumed authority not granted under the Disaster Management Act, 2005.

Disregard to the employers’ plight could result in the breakdown of the media industry, the INS said.Noting that journalism formed the fourth pillar of democracy, the INS asserted that lack of business due to the lockdown, the impact on business due to the virus and the continued payment of salaries and wages could potentially drive media establishments into insolvency.

The print media, it said, thrived on the advertisement expenditure of industries like e-commerce, finance and automobile, all of which had been hit by the lockdown. Advertisement revenue had hit rock-bottom, the INS said.

“The newsprint cost of a newspaper establishment is about 40-60% of its expenses while wages are about 20-30% of the expense. The net circulation revenue, which is the cover price of a newspaper, covers only a small portion of the total cost. Hence, the lifeblood of a newspaper is revenue from advertisements,” the INS submitted.

Noting that the “newspaper industry can only pay as long as it has the capacity to pay”, the INS portrayed a bleak future unless suitable economic policies and financial measures were brought in by the government to safeguard the industry and the economy.

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Printable version | Oct 7, 2022 11:21:39 am |