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Minister for Communications and Information Josephine Teo explained the government's stance on the SPH Media Trust's (SMT) circulation scandal during the Feb. 6 sitting of parliament.

Teo was addressing the 26 questions filed by Members of Parliament (MP) from the People's Action Party (PAP), Workers' Party (WP) and Progress Singapore Party (PSP) related to SMT's inflation and falsification of daily circulation numbers.

She explained the government's key concerns with respect to SMT's findings from its review of circulation data, and why there is no change to the decision to provide funding support to SMT, and why there is no change to the amount of funding for SMT.

Singapore Media Trust conducted a review

SMT has recently been revealed to have overrepresented its circulation numbers.

Teo began by recapping the context of why there was an internal review by SMT.

After Singapore Press Holdings Limited (SPHL) had transferred its media business to SMT in December 2021, SMT began to review the data it had received, including circulation data.

During this review, SMT reassessed the methodology for reporting circulation data, reviewing the period from September 2020 to March 2022.

During this review, they found that circulation numbers in some months were overstated by up to 90,000 daily copies.

Teo said that these events had taken place before the formation of SMT, that SMT's board was investigating the matter fully, and will "rectify what needs to be rectified and be transparent about how they proceed."

Government's three core interests

Teo said the government had three core interests in the matter

1. The usage of public funds;
2. Whether SMT's findings on circulation affected the government's assessment that SMT needed funding support;
3. And whether the amount of funding should be revised if funding support is needed.

Impact on public funds

Teo said that the government had not yet disbursed any funds, nor did it have a funding relationship with SMT before financial year 2022.

Hence, Teo said the findings of SMT's 2020-2022 internal review of circulation data would have no bearing on public funds.

Impact of government Funding

Teo then addressed whether SMT's internal review would affect the government's assessment of the need to provide funding support.

The Ministry for Communication and Information (MCI) started its own review on Jan. 9 2023, after SMT shared its internal report with it.

MCI re-examined its 2021 media landscape analysis, as well as its reasoning for committing public funds to support SMT's capability development.

Teo said that SMT's internal review had reinforced MCI's own assessment that the media landscape had become "highly unfavourable for news organisations", even those with substantial reach and public trust.

Circulation was under pressure because the free availability of news had weakened print and digital subscription demand.

However, she emphasised:

"This does not make it right for anyone to overstate circulation numbers. But it reaffirms the need for restructuring."

Saying that MCI had set out its reasoning for supporting SMT twice before, once by her predecessor S Iswaran, and once more in February 2022, Teo then reiterated the reasoning.

Disruption

Firstly, the media industry has been severely disrupted by structural changes, technological advances, and the internet.

The cost of running a professional newsroom, traditionally offset by print advertising revenue, was now outstripped by a digital advertising model where big tech companies took a large share.

Singaporean voices

Secondly, preserving the local news media served the long-term public interest.

It gave voice to Singaporean identity and perspectives, especially in a time when it was exceedingly easy for foreign news and content producers to influence domestic audiences.

Teo also said that vernacular news outlets, whose products had an "inherently" smaller audience, were difficult to sustain financially; but were critical in "preserving the voices of our multi-racial communities".

Trusted sources

The third reason Teo said was the Singaporeans "must have sources which they can trust to be accurate and objective".

Teo gave the example of the mainstream media conveying accurate and timely information during the Covid-19 pandemic, during which time public trust and use of SMT's products increased markedly.

Teo said that the public continued to "choose and trust" SMT's products based on an MCI survey and the Reuters Institute Digital News Report.

But in order for Singaporeans to continue to "benefit from the public good of quality journalism", required a deep investment in "tech, infrastructure, and capabilities."

The government's support of SMT's transformation "will give it a fighting chance in a highly competitive digital space".

For these reasons, Teos said the reasons for funding SMT "remain valid today".

Level of funding support

The third point was whether SMT's review should impact the government's level of funding - S$900 million over five years, starting from FY 2022.

She said that the money would be used on three main areas:

1. Technological development such as content management resources and data analytics
2. Talent development such as equipping journalist with digital skills and multimedia capabilities.
3. Preservation of vernacular media, including new content formats to reach younger generations.

Teo said that in initial years about 40 per cent of the funding would be spent on "tech investments and digital talent".

Circulation numbers had not been a key consideration in assessing funding levels, and the level of funding previously assessed for the purposes of investing in technology and capability development remain valid.

Accountability

Teo assured parliament that "when government funding is given, SMT will be held to account."

The government's focus was not circulation, which was about how many print and digital copies were sold or distributed.

Instead its focus was on readership and reach, or the number of people who consumed the content.

This data was collected through third party surveys, SPHL had previous commissioned surveys from agencies such as GfK.

MCI also independently verified readership and reach using "data sources outside of SPHL and SMT", including data from the Reuters Institute of Oxford University, and MCI's own News Consumption Surveys.

Teo said there were two main key performance indicators (KPI) that MCI would apply on SMT:

1. Total reach and engagement, focused on SMT's digital platforms
2. Specific reach indicators for vernacular groups and youth

Achievement of these KPIs would determine the amount of funding SMT received.

She also said "SMT's KPI performance and financial statements must be audited by independent external auditors before submission to the Government."

The government could also conduct its own audit of SMT, and would periodically asses funding utilisation and  future business plans.

It would then adjust funding and KPIs where necessary.

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Top image via MCI/YouTube