Heritage Minister James Moore has announced the two funds now supporting Canadian magazines will be replaced by a single fund that is more "modern" and "streamlined."

The new Canadian Periodical Fund caps the amount any single magazine can receive, but could provide more flexibility around how magazine publishers use government funding.

The new fund will be launched in 2010-2011, with funding of $75.5 million annually, the equivalent of the two funds it replaces, Moore said in a release Tuesday.

It is designed to replace the Publications Assistance Program, which subsidizes mailing costs of magazines and non-daily newspapers, and the Canada Magazine Fund, which supports business development and the creation of editorial content.

The subsidy on mail subscriptions, an important tool for magazines to reach readers, was scheduled to expire at the end of March. But the recent federal budget had funding to extend that program and Tuesday's announcement confirmed the money will flow until the new CPF is in place.

$72M to go to magazines, non-dailies

Full details of the new program, designed after consultation in 2008 with the magazine industry, were not yet available, the minister's office said.

Among the already announced provisions of the new CPF are:

• $72 million annually for Canadian magazines and non-daily newspapers. Publishers can use this money as they see fit.
• $1.5 million to both print and online magazines "which have limited access to capital, but which provide an important developmental ground for the industry."
• $2 million toward "industry-wide projects" facilitated by industry associations.
• Only magazines and non-daily newspapers with paid or requested circulation, and at least 80 per cent Canadian content will be eligible.
• The maximum amount an individual title can receive will be $1.5 million.

Moore promised more consultation on the fund over the next few months.

However, he said he wanted to ensure a program that tied support to readership, maintains jobs in publishing, and reallocates funding to small and mid-sized titles in an effort to encourage diversity.

There will also be separate funding to assist online publications, the announcement said, though no details were spelled out.

"It's nice to see funding didn't dip," said Marco Ursi, editor of Masthead, a publication for the publishing industry, but he added that the industry will be watching how the money actually flows.

"How they divvy it up will be a big question," he said.

Ursi said the $1.5-million cap on individual titles will affect the six largest Canadian magazines, including:

• Canadian Living.
• Maclean's.
• Western Producer.
• Reader's Digest.
• House and Home.
• Chatelaine.

However, it could be good news for small and mid-sized publications as some of the funding that now goes to the big six could be reallocated to other magazines.

"This $1.5 -million cap really speaks to the concerns of a lot of people at Heritage and in government who found it strange that big magazines get so much funding, when they're backed by companies like Rogers and Transcontinental.... and [that] small magazines get a measly sum," he said.

Specialty publications such as farm and minority language publications did not get a special fund, despite lobbying by the industry, so they will be competing with other small magazines for the funding.

The program will be delivered through a single department, Canadian Heritage.

Canada Post is currently providing half the funding to underwrite subscriptions, but will no longer be involved.