The closure of the Australia Network will lead the ABC to review its entire international operations. The network’s foreign correspondents fear this will lead to the closure of some of its foreign bureaux, resulting in a loss of nuanced understanding of global events as well as greater dangers for staff who fly in and out of conflict zones.

Last night’s federal budget revealed that, from July 1, the ABC will be funded on $29 million a year less than current levels. Of this, $8.8 million will come from a 1% reduction in total funding, which also applies to SBS’ budget, totalling up to some $43.5 million from the two broadcasters over four years. The rest will come from the Australia Network, which the government is axing. Foreign Minister Julie Bishop last night said the network, awarded to the ABC for 10 years last year in controversial circumstances, had “failed to deliver a cost-effective vehicle” for soft diplomacy into the region.

ABC staff this morning are considering what this means for them. Few are optimistic. “There’s real concern among foreign correspondents that the ABC will use the loss of the Australia Network contract as cover to drastically cut its foreign bureaux,” a senior journalist told Crikey this morning.

Asked about the staff concerns, ABC managing director Mark Scott acknowledged some foreign-based journalists, though no bureaux in their entirety, were funded through the Australia Network contract. He told Crikey this morning the ABC’s entire delivery of international news had to be reconsidered as a result of the Australia Network’s axing.

“We will fight hard to provide as detailed and comprehensive foreign coverage as we can. But now, there’s less money available for that,” he said. “We need to look at how we deliver foreign services. But we also understand foreign bureaux are key to the ABC’s offering, particularly if you look at the decimation of commercial bureaux in television and print.”

The ABC’s charter requires it to be an international broadcaster. “As of yesterday, we had $35 million dedicated to that, and were doing it across radio, television and mobile. As of this morning we have $15 million to do that,” Scott said.

With $20 million less in international coverage, it’s almost certain that some of the journalists employed by the Australia Network will lose their jobs. But the significant cross-subsidies that exist between the network and the ABC’s broader operation makes it hard to quantify how many at this stage. It’s also why staff are so concerned about the broader impact on the ABC’s foreign coverage. “It impacts lots of people indirectly, not just in the [Asia-Pacific] region but around the world,” one said.

Communications Minister Malcolm Turnbull last night said he was confident the 1% reduction in total funding for ABC and SBS could be met from back-room efficiencies, with little noticeable reduction in services and programs for the ABC audience. But Scott says it’s not up to the government to decide where funding cuts will come from. “Under the independence of the ABC, it’s a matter for the ABC board,” he said. “And it’s quite hard to find savings that won’t have any impact on services.”

The 1% reduction in funding has been described as a “down payment” on future cuts. Scott says he doesn’t know what shape these future cuts might take, and fears the ABC will not be able to fund new services like iView or News 24 in the future if any savings in one part of its operation have to be handed back to the government.

“The ABC without iView or News 24 is a weaker organisation,” he said. “As the government contemplates that for the future, they should reflect on the evidence that finds the ABC is the most trusted and respected broadcaster in the country … There’s no clamouring from the vast majority of the public to cut funding to the ABC.”

As well as the feared cuts to its foreign coverage, several other areas of the ABC are likely to be targeted for savings. Already facing the axe is the ABC’s online disability website Ramp Up, which will not have its funding renewed at the end of this financial year. Like the Australia Network, Ramp Up was funded discretely, and the budget revealed funding for the website would cease.

Scott describes editor Stella Young, who established the site over the past three years, as “a rare talent” in Australia. “We’re keen to find a way we can continue to service audiences interested in those issues,” he said.