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Huge cuts confirmed at ABC, SBS

Australian pubcasters the ABC and SBS face budget cuts of a combined A$308 million (US$265.9 million), the country’s government has confirmed.

Malcolm TurnbullThe ABC will see its budget slashed A$254 million over the next five years, while SBS is having A$53.7 million taken from it.

Communications minister Malcolm Turnbull attempted to contextualise the cuts as reducing government funding in the five years from 2014-15 to 2019-20 A$6.9 billion to A$6.6 billion.

The ABC will receive A$5.2 billion in that period as compared with A$5.5 billion, a 4.6% cut. SBS will have its overall budget cut A$25.2 million over five years, with changes in legislation that allow for it to create revenues through changes in its advertising arrangement bringing the savings to A$53.7 million, a 1.7% cut.

This comes after ex-Seven Network CFO Peter Lewis to review was commissioned to review operations at the ABC and SBS.

“After working closely with the broadcasters for the last eight or nine months it is clear that there is a great opportunity for them to modernise their businesses without reducing the resources they have available for programming; in other words without reducing the quantity or quality of what Australians view and listen to on ABC or SBS,” said Turnbull in a speech.

Mark Scott“This is what productivity is all about – getting the same, or ideally, a bigger bang for a smaller buck.”

Turnbull also recommended the ABC hire a chief financial officer and break Mark Scott’s position of managing director and editor-in-chief in two. “It creates the impression that the managing director is directly in charge of ABC News and Current Affairs which he is not, and given the wide range of his responsibilities, could not be,” he said.

Turnbull also warned the public broadcasting system that “[i]t is the Australian people who will judge whether or not they are getting value for money. It is the millions of citizens who tune in to ABC or SBS each week who will decide whether the Government should continue to invest billions of dollars in these two great national institutions on their behalf”.

“If the management of the ABC think they cannot find a 5% saving through efficiencies, they are selling themselves short and letting down the people of whose resources and trust they are the custodians.”

The government cuts are expected to result in significant number of redundancies and services cut. The ABC was already a 1% cut in funding, amounting to a A$43 million saving over three years, following the 2014-15 budget announcement in May, and a further 2% drop after losing the contract to programme the Australia Network,

“As I have stated previously, in its response to funding cuts the ABC will seek to serve audiences and protect content wherever possible. As we have in the past, we will look to find efficiencies in our operations and support services,” the ABC’s MD Scott said in response to Turnbull’s announcement.

“I note, however, that there are clear examples in the efficiency report commissioned by the Department of Communications which would impact on the kinds of content we can make and offer.”

“Over the next few days, the ABC Executive will finalise its work on the steps needed to make the savings required. Ultimately, decisions regarding how the funding is allocated, the shape of the services the ABC delivers, and how the ABC is managed and organised, rest with the independent ABC Board.”