Budget 2018: Aunty feels Scott Morrison’s razor as $83.7m cut

Treasurer Scott Morrison has slashed the ABC’s funding by $83.7 million over the next three years in the federal budget.

ABC Managing Director Michelle Guthrie. Picture: Gary Ramage

Treasurer Scott Morrison has declared everyone has to live within their means, including the ABC, unveiling a freeze to the national broadcaster’s operational budget, which will see it lose $83.7 million over the next three years.

Communications Minister Mitch Fifield said the savings from the ABC freeze would be redirected to “other communications and the arts portfolio priorities” and to broader budget repair.

Key spending priorities for the department in this year’s budget include $48.7m over four years to commemorate the 250th anniversary of Captain Cook’s voyage to Australia and $140m over four years to attract international investment in the Australian film industry.

Mr Fifield said that while the national broadcaster would continue to be exempt from the government-wide efficiency dividend, the pause in indexation was necessary “to ensure the ABC continues to find back-office efficiencies”.

The freeze will see Aunty’s budget fall from $1.132 billion in 2017-18, with 4111 employees, to $1.122bn in 2018-19 with 4141 employees, showing the broadcaster is expecting to employ more staff despite a slightly reduced budget.

It will then further reduce ABC funding by $14.623m in 2019-20, $27.842m in 2020-21, and $41.284m in 2021-22.

ABC managing Director Michelle Guthrie slammed the cuts in an email to staff, vowing to fight the decision and said it would impact audiences and had come at a critical time for the organisation.

“Let me be frank with you: I am very disappointed and concerned that after the measures we have introduced in recent years to deliver better and more efficient services, the government has now seen fit to deliver what amounts to a further substantial budget cut,” Ms Guthrie said.

“This decision will make it very difficult for the ABC to meet its charter requirements and audience expectations.”

Ms Guthrie also indicated via an ABC statement her feelings that the ABC ‘is more important than ever’ to Australian audiences.

“The ABC is now more important than ever given the impact of overseas players in the local media industry and the critical role the ABC plays as Australia’s most trusted source of news, analysis and investigative journalism,” Ms Guthrie said.

“Our talented and dedicated content makers consistently deliver award-winning public interest journalism, regional services and critically acclaimed original Australian programs and content.

“Stable, adequate funding is essential if we are to continue to deliver for Australian audiences.”

As communications minister in 2014, Malcolm Turnbull imposed a cut to the ABC of $254m over five years, based on findings from the Lewis review into the ­efficiency of the ABC and SBS, which he commissioned earlier that year.

Mr Fifield said a further review of ABC and SBS efficiencies due to report later this year would assist the ABC in finding the savings required to meet the additional $83.7m freeze. “This will maintain the ABC’s significant base operational funding at 2018-19 levels, resulting in $3.16bn in government funding over the 2019-20 to 2121-22 period,” Mr Fifield said.

Minister for Communication Senator Mitch Fifield and Treasurer Scott Morrison, Picture: Kym Smith

SBS will meanwhile receive a $14.6m funding boost over two years to replace advertising revenue the government says it would have raised had legislation to allow further advertising flexibility passed the Senate last year.

An additional $3m will be provided to SBS in 2018-19 to fund local film and television content.

Despite the government funding boost, SBS is forecast to have a reduced overall budget in 2018-19 compared with the current financial year, due to a fall in sales of goods and services, including advertising revenue.

SBS’s 2017-18 budget of $408m with 1154 staff is expected to fall to $393m with 1149 staff in 2018-19.

Late last month, the ABC announced that up to 20 staff would lose their jobs in an overhaul of its eight capital-city newsrooms aimed at making the broadcaster’s news offering “fully fit for the modern media environment”.

Labor has accused the government of conducting a “stealth review” of the ABC and SBS through the current probe into the broadcasters’ efficiency. Labor communications spokes­woman Michelle Rowland told The Australian last week the inquiry showed the government was out of touch with Australians.

“This faux competitive neutrality inquiry is an ABC and SBS-bashing exercise, which is what you get when the IPA card-holding Minister for Communications does a backdoor deal with Pauline Hanson,” Ms Rowland said.

Senator Hanson, whose One Nation holds three crucial votes, last year threatened to block bills if the government did not slash the ABC’s funding in the 2017 budget.