Any objective inquiry into the efficiency of the ABC will find that it is an efficient broadcaster and probably underfunded for what it is required to do under its charter.

How do we know? Because that’s what the last two Coalition-initiated inquiries found.

In 1996, then-prime minister John Howard and then-senator Richard Alston sent businessman Bob Mansfield into the ABC to identify its inefficiencies. At the same time, Howard announced that, contrary to his pre-election commitment, ABC funding would be cut by more than 10% over two years. As it turned out, Howard was wise to slash the broadcaster’s funding before Mansfield finished, because Mansfield supported a strong ABC and suggested that the level of funding required by the ABC was rather higher than what it was after Howard and Alston made their cuts.

Nearly a decade later, the Howard government had another go, sending KPMG into the ABC to study the broadcaster and identify opportunities for efficiencies. But KPMG’s report, wrapped up in early 2006, concluded that the ABC needed tens of millions in additional funding to be able to provide the services required of it. “The ABC is a broadly efficient organisation,” KPMG concluded. It had “managed expenses tightly” and it produced a “high volume of outputs” for the funding it received.

Then-communications minister Helen Coonan — whose chief of staff was Peta Credlin — refused to release the report, and it remains confidential to this day, except for a summary leaked to Crikey.

By 2006, however, the Howard government had gone a substantial way to restoring the funding cut of a decade before. When the much-maligned ABC boss Jonathan Shier, under pressure from the government, reluctantly agreed to take on a revamped international television service under contract to Foreign Affairs, then-foreign minister Alexander Downer secured some additional funding for Radio Australia, a far more effective form of “soft diplomacy” than a TV service will ever be. Shier was also able to secure nearly $20 million in additional funding a year for regional programming, and Coonan obtained additional programming funding in her first budget as communications minister.

In announcing an efficiency review of the ABC and SBS yesterday, Communications Minister Malcolm Turnbull complained:

“There is limited transparency to the Australian public, the Government and the Parliament of the breakdown of costs of delivering the ABC and SBS Charter responsibilities and whether these could be more efficiently delivered by the national broadcasters.”

Well, gee, Malcolm — maybe you could help fix that by releasing the KPMG audit kept hidden by the Howard government?

The inclusion of SBS in the review, which will be done by the Communications Department and led by former Seven chief financial officer Peter Lewis, is a fig leaf — Turnbull himself admits that SBS, which has struggled to get any significant increased funding in recent years, is lean — it has had no choice. The real question for SBS is one that is ruled out in the review — whether it should continue to exist in its current form. SBS Radio still plays a very important role in helping immigrants settle in Australia and is great value for money — but SBS TV’s role is far less clear now.

“The way that broadcaster has handled budget cuts over the last 18 years is instructive about its level of efficiency, its priorities and, importantly, the political problems that face a Coalition …”

As for the ABC, the way that broadcaster has handled budget cuts over the last 18 years is instructive about its level of efficiency, its priorities and, importantly, the political problems that face a Coalition government looking to slash funding.

Its initial response to the 1996 cuts, put together by new chairman Donald McDonald and then-MD Brian Johns, was the “One ABC” strategy of merging functions regardless of platform. Shier then unwound this. Instead, the key long-term ABC survival tactic was to starve TV drama of funding, even to the extent of relying on The Bill and repeats in prime time, something that mortified Shier’s successor, Russell Balding. The ABC’s News and Current Affairs division, however, was kept going, even if foreign correspondents were recalled or sacked. At one stage in the early 2000s, NewsCaff (News and Current Affairs) exceeded its budget two years running and was in effect given a loan by the rest of the broadcaster.

Why was NewsCaff privileged? The ABC Charter is for it to provide “innovative and comprehensive broadcasting services of a high standard” that “inform and entertain Australians”. But the ABC Act also requires the broadcaster to specifically provide an independent news service and requires the ABC board to “to ensure that the gathering and presentation by the Corporation of news and information is accurate and impartial according to the recognized standards of objective journalism”. That is, there is a statutory obligation on the ABC to provide high-quality news, while the rest of its programming obligations are fairly general.

Moreover, the years of funding cuts coincided with the emergence of the internet, and to its considerable credit the ABC, which until the Rudd years never received any funding for online services, developed one of Australia’s most important online services off the smell of an oily rag — a testament to the vision of Brian Johns and his successors, who made sure online was funded even when the ABC was struggling.

The problem with prioritising NewsCaff over drama was that it meant that the ABC was spending less on producing local drama at its facilities across the country (it was also under pressure to outsource more drama as well) — and every time it cut production in a city outside Sydney or Melbourne, it faced the wrath of unions and local politicians, who accused the ABC of being too focused on the big cities. The same thing happened if the ABC ever rationalised any part of its massive regional presence — Nationals MPs would howl about the ABC abandoning the bush. So ABC management was permanently required to manage the tension between the Howard government demanding ever greater efficiencies and politicians (including many members of the Howard government) and the community demanding it retain less efficient regional and state capital functions.

So, will the “Lewis review” follow the pattern of previous reviews and find the ABC is doing a pretty good job? The key lies in the fact it is a departmental review — there’ll be no independent auditing firm involved this time, nor a high-profile business personality. That means that Turnbull will have tight control of the review and its outcomes.

I’ll venture two theories on Turnbull’s role in all this. One: that he’s merely playing good cop to Abbott’s bad cop in this Coalition war on the ABC, but ultimately they want the same thing, a weaker broadcaster. The other, more Machiavellian one, is that Turnbull indeed wants to protect the ABC and knows perfectly well an objective review will find it is broadly efficient or needs more money. The review will become his weapon against Abbott and his colleagues who want to gut the ABC. “We did a full-blown review,” he can tell cabinet, “and it said there were no grounds for cutting the ABC’s funding.”

And even if the anti-ABC crowd in the government get their way, history suggests they’ll discover that slashing its budget will do little to curb its journalism.

Peter Fray

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