Funding to support innovation in the news industry is desperately needed after Covid-19 exposed how much of the sector is still “too wedded to antiquated ways of doing things”, according to a new report.
Nesta, the innovation fund appointed by the Government to manage the Future News Fund, gave £2m to 20 news organisations seeking to find financial sustainability or diversify their readerships this year.
It said the innovation at these organisations, such as Tortoise testing new models for its open “Thinkin” meetings and Open Democracy creating an online database of politicians’ registers of interests, showed “creativity, passion, expertise and collaboration”.
This was already “needed to resurrect a struggling industry pre-pandemic” but is now “crucial for it to survive”, Nesta said.
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“There are many promising ideas, but to sustain public interest news we now need long term public investment into innovation in the news ecosystem,” it said.
It has now published a series of recommendations to the Government to help more of the industry innovate, which it said “has never been more necessary”.
Nesta asked the Treasury to extend its 100% business rates holiday, already given to retail, hospitality and leisure businesses since the Covid-19 crisis began, to news publishers for at least one year – something the News Media Association has called for repeatedly.
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The Treasury should also explore whether other financial holidays are feasible, such as continuing zero VAT ratings for online payments and waiving PAYE and/or National Insurance contributions, and ensuring accredited news organisations have access to low-interest lines of credit to prevent insolvency in the second half of this year, it said.
Nesta also brought back an idea recommended by the Cairncross Review and rejected by the Government for the creation of an Institute for Public Interest News, potentially funded through a 2% levy on tech giants, to ensure local not-for-profit publishers can continue to provide public interest reporting.
Other financial proposals include:
- widening the scope of news organisations permitted to register as charities in England and Wales
- the creation of a new scheme to provide financial support of between £125,000 and £5m to small and medium enterprises “at the cutting-edge of journalism” that are facing financial difficulties
- and piloting a fund that gives adults in a given community a voucher to spend on local not-for-profit news.
Nesta agreed with Dame Frances Cairncross’ recommendation that £10m per year is needed for the next decade to support the industry.
Nesta also said improving diversity was a “pressing and systemic issue and not one that is going to be changed with quick fixes” but urged the DCMS to establish a scheme supporting “an ambitious and diverse cohort of individuals and organisations to turn promising ideas into sustainable ventures”.
The report said: “Covid-19 has exposed the vulnerability of the sector. Not future-focused or interdisciplinary enough, much of the field has been too wedded to antiquated ways of doing things. It’s also drastically underfunded in some areas.
“The pandemic has forced everyone to adapt to try to survive, but the recent losses at Buzzfeed News, Quartz and others show how fragile independent advertiser-supported news is.
“So all organisations, even the industry’s poster children, are going to have to rely on a wider mix of revenues, and a more fluid set of responses.”
In response to the report, a Government spokesperson said: “A strong and independent press is vital for a healthy democracy.
“The Future News Pilot Fund has made a valuable contribution to the future of the sector, and this report will help inform our work to support and sustain our news industry.”
Recipients of Future News Pilot Fund grants of between £25,000 and £70,000:
- Axate
- Black Ballad
- Bristol Cable
- Courtdesk
- Entale
- Glimpse Protocol
- Hashtag Our Stories
- Manchester Meteor
- Media Trust
- My Society
- New Internationalist
- Open Democracy
- Omni Digital
- One Sub
- Our Economy
- Press Pad
- Shout Out UK
- Tortoise
- WT Social
- #ThisMuchIKnow
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