The newspaper industry could lose up to £20m a year under Government plans to scrap the legal obligation on councils to advertise traffic orders in local newspapers.
The Department for Transport (DoT) wants to abolish what it describes as the ‘cost burden’on local authorities and believes they should be free to explore alternative means such as online-only advertising.
The Government has acknowledged the likely impact on local newspaper revenues but feels this concern is outweighed by the ‘substantial savings’for local authorities and the Highways Agency.
It believes present arrangements “can no longer be justified” and that local newspapers “cannot continue to expect to receive what is in effect, public sector subsidy”.
The DoT estimates that 80 per cent of councils will stop advertising in local newspapers if the proposals get the green light, costing the industry around £16.5m a year.
But if all advertising was to migrate away from the local press then revenue losses could rise to as much as much as £20m a year, according to the Government’s own figures.
The DoT, however, said ‘economic theory’suggested advertising rates would adjust and ‘demand will rise to fill the space available in the newspapers”.
‘Thus, the final change in revenue will be far less than this,’it said. ‘This impact on revenues is considered to be an indirect effect of this deregulatory change.”
It added: “The Government strongly favours the use of online publication, and of other lower cost options to communicate with interested parties.”
The DoT also claimed that by scrapping newspaper ads local people will become better informed because councils will have the ‘discretion to target the relevant audience in the most appropriate way”.
‘A serious threat to the public’s right to know’
The plans have been condemned by the Newspaper Society.
Communications and marketing director Lynne Anderson told Press Gazette: ‘These proposals are driven by a desire for local authority cost saving with scant regard for the reason the regulations were established – to ensure that traffic orders are publicised to the widest number of people possible.
“They represent a serious threat to the public’s right to know.
‘The last Government recognised the danger of this when it abandoned similar proposals relating to planning notices in 2009. Relying on site notices or council websites to advertise traffic orders would severely restrict the general public’s access to them and their awareness of important information affecting them.’
The National of Union of Journalists recently warned that similar proposals under consultation by the Welsh Assembly risked ‘imperilling the future” of the Welsh press and was roundly condemned by politicians.
The Highway Agencies has already taken steps to radically reduce its spend on newspaper advertising – in 2009-10 the figure stood at £4.2m, but by 2010-11 it had shrunk to just £1.9m.
This was done through slashing the length of adverts, combining notices and switching from daily newspapers to more local titles with lower rates.
‘Test of reasonableness’
Under current arrangements all local authorities and the Highway Agency in England must advertise traffic orders in local newspapers.
Councils also have to advertise orders in an additional form such as leafleting affected residents, while the Highways Agency is also required to take out a notice in the London Gazette.
The DoT also wants to remove the current requirement for local authorities to advertise temporary orders twice – once at the proposal stage and again when the works are about to get underway.
Alternatives suggested by the Government include advertising notices on local council websites, social networking sites like Twitter and Facebook, newspaper websites, leaflet drops, press releases and local radio.
They will be asked to apply a ‘test of reasonableness’in the methods they select, said the DoT.
A consultation document on the proposals said that while local papers had a wide reach they were also “high cost’and had a declining readership, though it also conceded that, in most cases, online publicity alone will not provide adequate coverage.
‘A significant proportion of people don’t have internet access, and are unlikely to check the relevant website with sufficient regularity to become aware of traffic orders,’it said.
One alternative could see authorities taking out much cheaper ‘sign-post’ads in local paper and providing the remaining information online.