John Menadue

Jonathan Holmes: In real terms the ABC is still going backwards

Dave Sharma, the Liberal federal member for Wentworth in Sydneys Eastern Suburbs, is fighting for his political survival against independent candidate Allegra Spender, who supports a well-funded ABC.

In a recent election leaflet, Sharma claims that he has helped secure a record increase in funding for the ABC. But far from a record increase, its likely that the ABC will be worse off, in real terms, than it is now.

The figures, when you look at them closely, are stark.

The ABCs operational budget for this financial year, 2021-22, including the Enhanced Newsgathering Fund of $15m, is just over $880m. [A further $200m, give or take, goes to the entities that provide transmission services for the ABCs signal, and doesnt affect its output.]

According to the ABCs Portfolio Budget Statement in the budget papers (p.130), that operational funding will grow by about $5.6m in 2022-23, $17.9m in 2023-24, and $14.4m in 2024-25.

As former ABC executive Michael Ward (now at Sydney University) points out, thats an increase of 0.7% in the first year, 2.0% in the second, and 1.6% in the third.

Yet the Consumer Price Index (CPI) has grown by 3.5% this financial year, and is projected to increase at least as much next year.

So how is a 0.7% increase indexation?

Well, taxpayer-funded entities like the ABC are not indexed to the CPI but to a different measure, a weighted average cost index used by the Department of Finance, which generally produces lower increases than the CPI.

But the ABCs expenses wages, travel costs, equipment purchases, and all the other goods and services it buys are likely to increase by at least as much as the CPI, and perhaps more.

So in real terms, in all likelihood, the ABC will be worse off in three years time than it is now.

And remember, the indexation was paused for three years, from July 2018 to the end of June this year. So the new indexation is being applied to a substantially lower operational budget than the ABC would have had without the pause.

On top of that, cuts to the ABCs budget since the Abbott governments 2014 budget have cost it, in the intervening years, well over half a billion dollars. If we factor in the abrupt ending of the contract to provide the Australia Network to our Pacific and Asian neighbours, that cumulative shortfall increases to over $700m.

The Coalition is certainly not proposing to remedy any part of this. Nor, despite its welcome promise to fund the ABC on a 5-year rather than a 3-year basis, has the Labor Party. Five-year funding is all very well and its something ABC Alumni has been calling for but only if its adequate funding.

The promise of inadequate funding for five years rather than three is hardly a major advance.

As things stand, we cant see the ABC being able to extend its services. Weekly state-based current affairs? The restoration of Lateline? More Australian drama, better and more relevant Australian documentaries? Dream on.

As for that claim about a record increase well hardly.

Michael Ward points out that in 2009, the Rudd government increased the ABCs budget by $136m over three years, to pay for more drama and childrens programs. And it added an additional $30m for regional broadband hubs with indexation on top of those increases.

The Hawke government increased the ABCs funding by $55m in 1984, and a further $84m in 1985 way more than the current governments promised increase of $87m over three years, even in nominal dollars. In real terms, given the value of the 1984 dollar, the Hawke numbers dwarf the current record increase.

Fact: thirty years ago, ABC funding represented 0.4% of total government spending. Today, it represents a mere 0.14%. And for that, the public gets vastly more more television channels, more radio channels, a cornucopia of online offerings than it did in 1992.

The ABCs supporters need to push Labor to promise better, and do better, than the Coalitions measly record increase which turns out to be a real decrease in funding for our crucial national broadcaster.

NOTE: For comprehensive figures on ABC funding over the decades, see the appendix by Michael Ward to the just-published book by Matthew Ricketson and Patrick Mullins, Who Needs the ABC? See Greg Wilesmith review for P&I here.

 

Jonathan Holmes is Chair of ABC Alumni. Hes best known as a former presenter of ABCs Media Watch and as EP and reporter for Four Corners and Foreign Correspondent. This article was first published by abcalumni.net.

John Menadue

John Menadue is the Founder and Editor in Chief of Pearls and Irritations. He was formerly Secretary of the Department of Prime Minister and Cabinet under Gough Whitlam and Malcolm Fraser, Ambassador to Japan, Secretary of the Department of Immigration and CEO of Qantas.