Does the British government hold the financial fate of newspapers in its hands? I would usually say no, but in the disputed territory of Northern Ireland it does appear to be the case. A Financial Times report highlights the problems faced by the Belfast Telegraph, the News Letter and the Irish News because of a change to the government's advertising strategy.
Until now, equality legislation in Northern Ireland required that employers had to demonstrate that recruitment and other key public notices reached both communities, Protestant/unionist and Catholic/nationalist.
To achieve this, government departments automatically placed job offers in all three papers, which guaranteed the titles a lucrative source of income because they were able to charge premium rates for the ads. In 2004-05, for example, the government spent £9.4m on classified and recruitment advertising in northern Irish papers, representing about 12% of the total amount of revenue earned by the region's press.
But, in a bid to cut costs, the government decided last year to end the practice. Instead it invited newspaper companies to tender for a contract. The owners - Independent News & Media (Belfast Telegraph), Johnston Press (News Letter) and the Fitzpatrick family who own the Irish News - responded with legal action, securing a judicial review against the department of regional development by arguing that all Belfast households should be aware of planning notices.
Now the three companies are going to the high court to block the proposed changes to the way the government plans to apportion recruitment and public notice advertising. But an advertising executive remarked: "The newspapers have had the government over a barrel for too long".
This situation will be watched with some wry interest by the Belfast Media group which closed its Daily Ireland title last September after failing to receive a slice of the British government advertising cake. Its managing director, Mairtin O Muilleoir, said at the time that the government's refusal to allow the paper to tender for official advertisements was a "bridge too far". Rival groups then appeared unsympathetic to Daily Ireland's plight. Now, of course, they find themselves in roughly the same position.
