On 30 April 2026 the Australian Treasury and the Department of Infrastructure opened public consultation on the draft News Bargaining Incentive (NBI) and a companion Statutory Payment Scheme, with submissions closing on 18 May 2026. The package is the government's answer to a structural flaw in the 2021 News Media Bargaining Code: platforms could escape the Code entirely by simply removing news, as Meta did when it declined to renew its Australian deals. The NBI closes that exit. But in doing so it makes two choices — how money is raised, and how money is distributed — and the second choice is where the policy quietly drifts from its stated purpose.
How the incentive works
The design of the charge is, on its own terms, defensible. Under the draft, an entity providing a significant social media or internet search service in Australia and with group consolidated revenue above A$250 million becomes liable for a charge of 2.25% of its Australia-attributable revenue (KPMG TaxNewsFlash, April 2026). Crucially, the liability can be offset, dollar-for-dollar, by entering commercial agreements with Australian news businesses. As the Prime Minister's office framed it, deals are 'the preferred model, with generous offsets provided to reduce their liabilities' (PM media release).
This is the right instinct. A charge that can be zeroed out through voluntary commercial dealing is closer to a backstop than a tax — it preserves negotiation, lets platforms and publishers price the value of content between themselves, and only bites when a platform refuses to engage at all. For a government trying to keep large platforms at the table without dictating the terms of every deal, an offsettable charge is a proportionate tool.
Where the design goes wrong
The problem is the distribution side. The draft Statutory Payment Scheme proposes to allocate any collected charge — the residual that platforms don't offset through deals — using a formula keyed to each outlet's number of full-time-equivalent (FTE) journalists, with a 1.1x weighting applied to journalists in regional and remote areas. The consultation paper's own worked example: an outlet with 15 FTE journalists, five of them regional, receives a weighted score of 15.5 (10 + 5 × 1.1) (Department of Infrastructure consultation paper). Additional weightings are floated for outlets serving First Nations, culturally and linguistically diverse, in-language, or LGBTIQA+ audiences.
The case for a headcount formula is genuine and should be stated plainly: journalist FTEs are an objective, auditable, gameable-resistant proxy for newsroom investment, far harder to manipulate than clicks or self-reported 'impact', and the regional multiplier is a deliberate attempt to push money toward the local reporting that has collapsed fastest. That is a coherent public-interest goal.
But headcount is not the same thing as journalism that readers value, and it correlates almost perfectly with incumbency. The largest legacy publishers employ the most journalists; therefore the largest legacy publishers collect the most money. Under the original Code, the four dominant groups — the ABC, News Corp Australia, Nine and Seven West Media — absorbed an estimated 60–70% of the deal pool, and those same players control roughly 90% of metropolitan print circulation (B&T, May 2026). An FTE formula doesn't disturb that distribution — it formalises it.
Funding inputs, not outputs
The deeper issue is that the scheme pays for an input (bodies on a payroll) rather than any output (reporting people read, trust, or could not get elsewhere). A formula that rewards headcount rewards the publisher who maintains 200 journalists producing aggregated wire copy over the publisher who runs 12 doing original investigative work. It is indifferent to whether the journalism is duplicative, whether the outlet is growing or shrinking, and whether readers are leaving.
That indifference matters because of what recipients of the first round did with the money. Industry analysis notes that the major commercial recipients cut more than 450 journalists in 2024 even as the deals flowed, while News Corp's parent ran a roughly US$1 billion buyback and Nine spent A$850 million acquiring QMS Media (B&T, May 2026). Headcount-based funding cannot distinguish a newsroom investing in reporting from a conglomerate banking the subsidy and trimming staff anyway. It simply assumes the two are the same.
A proportionate fix
None of this argues against the charge. The offsettable-levy structure is sound, and a backstop that prevents platforms from walking away cost-free is a reasonable response to a real market failure. The flaw is narrowly in the distribution formula, and it is fixable within the current consultation. Three adjustments would help: a per-recipient cap so the top four cannot re-absorb the majority of the pool; a floor or ring-fenced tranche reserved for small and independent publishers, who number in the thousands but capture almost none of the existing deals; and an output condition — funds contingent on maintaining or growing original local reporting, not merely on payroll size at a single point in time.
Australia got the harder half of this policy right by making the charge avoidable through genuine commercial dealing. It should not undo that proportionality by distributing the residue through a formula that quietly subsidises concentration with public-purpose money. The consultation is the moment to fix the formula, not the charge.