RUBY:

From Schwartz Media, I’m Ruby Jones, this is 7am.

The ABC is facing hundreds of job cuts, as the organisation deals with a funding freeze.

At the same time, the government has commissioned another report into the ABC - closely mirroring concerns from Rupert Murdoch’s News Corp businesses.

Today - Senior reporter with The Saturday Paper, Rick Morton, on the degradation of the national broadcaster.

RUBY:

Rick, tell me about the problem News Corp has with the ABC.

RICK:

Where to begin?

I used to work in News Corp myself and, you know, there is an obsession within that company, across all levels of journalism - management, the editors - that the ABC is just sucking up all of their business, that it is kind of inhabiting this space that it doesn't have the right to inhabit, and that it's bloated and out-of-touch...

There is this perception within News Corp that they're all a bunch of latte-sipping inner city hipsters, basically.

Archival tape -- unknown:

The ABC remains stuck in the values, priorities and perspectives of the inner-city green left, the so called elites.

RICK:

So I mean, NewsCorp Australia essentially sees the ABC as an existential threat. They see this giant monolith, which straddles the entire country in every possible niche, performing, you know, news investigations, journalism, arts journalism, lifestyle content, marketing for digital readers online. They're in the regions. It's all of this stuff that NewsCorp does and has done for years.

Archival tape -- unknown:

There is a significant number of Australians who don’t feel that what Channel 2 talks about reflects ordinary Australians.

RICK:

And after the last decade in particular, or since 2006, really, when newspaper revenues fell off a cliff they have never been more concerned about the role of the ABC, according to them, plays in devaluing the content they produce and that people might pay for if the ABC wasn't already doing it and giving it away for free.

Archival tape -- unknown:

There is no reason whatsoever for you, the taxpayer, to be forking out money for this glorious castle in Ultimo, these people on these massive salaries, who are living the great life and feel that they are entitled to your money.

RICK:

So this is just one big ongoing war of attrition, really, against the public broadcaster. and they’re obsessed with it.

Archival tape -- unknown:

There is no reason for it. This is a fight that Scott Morrison could win easily by saying what we’re going to do now, gradually over three or four years, is make the ABC pay per service, because you should be able to pay for it if you want it and not pay for it if you don’t want it.

RUBY:

And what is the ABC's response been to this sort of criticism?

RICK:

I mean, the ABC has always been very clear about this, and they have a duty to find audiences wherever they may be, including online, and that they have to pay their top staff. Of course they do.

Archival tape -- ABC:

And we are, in fact, legislated to always look at efficiency, and we always do. But there is a trade-off here. Where we find efficiencies...

RICK:

And, of course, they have to advertise to seek out new audiences and fulfill their obligations to Australia. I mean, over its history, all of this activity has always looked different because technology has looked different. But, you know, Gardening Australia is not that dissimilar to gardening content on a lifestyle vertical online. It's just we're in a new era now.

Archival tape -- ABC:

We did look at the editorial content of ABC Life and how it related to audience…I think the majority of that audience is weighted towards women, and I think there is a large proportion that is younger…

RICK:

But, of course, as always, changes. And the attacks are upgraded against the ABC because they feel like commercial rivals feel like that's their turf.

RUBY:

And what sort of impact does all of this have coming, particularly from a company like News Corp? What's the impact on the ABC?

RICK:

Look, I think it's always been very hard to quantify. I mean, the ABC clearly makes decisions from time to time that show it to be wary of upsetting government or upsetting rivals - or upsetting rivals who have the ear of government.

Often it's one big circle. And, you know, it's clear across history that sometimes the policy of the pavement has not worked.

You know, I feel someone much more clever than I tweet over last week about, you know, the kind of concessions that the ABC has consistently made to coalition governments and to their rivals in commercial media. It's kind of a bit like saying, ah, if I give the bully my lunch money today, then it will finally be over. And that hasn't happened.

Archival tape -- reporter:

More details now on the changes at the ABC. Hundreds of jobs will be axed as part of the organization's five year strategic plan.

Archival tape -- reporter:

The ABC announced cost cutting measures yesterday, including 250 job losses.

Archival tape -- reporter:

The changes just have been announced to ABC’s staff by David Anderson...

RICK:

And, you know, last week something particularly significant happened. Two days before the ABC confirmed that up to 250 jobs will be cut across the organization.

The federal government finalized a two hundred thousand dollar offer for consultants to prepare a report on news and media business models looking specifically at the impact of public broadcasters on commercial operators. This is the clearest acknowledgment of commercial media concerns that we have had from this government. They could have written the terms of reference themselves.

An approach to market for this report was closed on Monday with the Federal Communications Department under the Minister, Paul Fletcher, requesting that the successful bidder evaluate failed, successful and emerging news media operating models from around the world. But the tender ARF and this is really important for consultants to examine the role of publicly funded, noncommercial media organizations in the production and dissemination of news and media content.

It asks particularly about the impact that these noncommercial outlets might have on commercial operators.

Now, obviously, there are not many noncommercial media outlets in Australia. In fact, it's pretty hard to see how this refers to anyone except SBS and the ABC. And in particular, the ABC, which has the largest footprint.

RUBY:

So in this new review, is the government sort of formally taking up News Corp’s concerns?

RICK:

Certainly. I mean, for as long as I've been writing in the media, and particularly since I've been based in Sydney from 2010, the chief concern from News Corp has been that it could be more profitable and more successful, and particularly under years of declining revenue, if the ABC wasn't consistently doing its job for it on taxpayer money.

So the government certainly appears to have listened to those concerns over many years and this report may well reflect them. I mean, it's a classic case of never commission a report that you don't know what the answer is going to be. And I suspect, given the way the terms of reference for this report are written, they know exactly what it's going to say.

RUBY:

We'll be back after this.

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RUBY:

Rick, we're talking about the ABC and its interaction with commercial rivals, especially News Corp. You mentioned the cuts that happened at the ABC last week. Can you tell me more about them?

RICK:

Yeah, they were significant. We knew the funding cut was coming.

Archival tape -- unknown:

Very difficult day for a lot of people at the ABC. But it is something that has been coming for a while now.

RICK:

But we didn't know where the ABC management were going to apportion them.

What we know now is that after years of cuts totaling a quarter of a billion dollars, the ABC operational budget will be more than 10 per cent lower in 20, 21, 22 than it was in 2013.

Speaking to staff last Wednesday, David Anderson, who is the managing director of the ABC, conceded the situation was pretty grim.

Archival tape -- Anderson:

We have done our best to convince the government to reverse the indexation freeze. There's only so much that can be gained through efficiency and in the end, content will be affected.

RICK:

Among other things, the 7.45am news bulletin is gone. I mean, this is seen as a key part of the ABC News slate - and particularly as a funnel for regional news. Probably the most listened radio bulletin at the broadcaster

Archival tape -- reporter:

ABC is flagship 7.45 AM radio news bulletin has been axed, as has a lifestyle website, ABC Life.

RICK:

The Millennial Focus Vertical ABC Life has been axed completely. After months of speculation and pressure, I might add, from commercial rivals.

The entire Melbourne team of ABC ME, which is a children's content arm of the broadcaster, were made redundant. There will be fewer episodes of Foreign Correspondent and Australian Story.

Archival tape -- reporter:

There'll be a reduction in original episodes of Australian Story and Foreign Correspondent, and spending on external television productions will be cut by five million dollars a year.

RICK:

And cuts to news and investigations will be shared across the major programs such as 7.30. And Four Corners, we're expecting up to 70 roles to go just from the news and investigation team.

So while the quantum of the cuts could not be avoided. The areas targeted for savings have rankled staff and audiences like, you know.

Communications Minister Paul Fletcher said on Wednesday the job cuts were the responsibility of the ABC board and management and that the government expects them to make do with very substantial, in his words, funding that is already provided.

Archival tape -- Fletcher:

So the ABC is very important. We back it strongly. But let's recognize that we're at a time when across the economy and across the media sector, these are tough.

RICK:

He rejected a push from the ABC in the public service union to lock in five year funding terms, which at the very least would have made for a more secure and stable pathway going forward. So that's out the window. The Media, Entertainment and Arts Alliance, which is the media union, accused the government of an act of vandalism.

Archival tape -- The Media, Entertainment and Arts Alliance:

The ABC is an even more critical source than ever. And these cuts are just an act of vandalism.

RICK:

And Opposition Leader Anthony Albanese said the broadcaster has literally saved lives through the bushfires, and condemned the cuts.

Archival tape -- Albanese:

The government surely should be stepping in and saying now of all times, is not the time to lose 250 jobs at the ABC.

RICK:

But, you know, all of that is noise and the decision has been made and here we are.

RUBY:

So what is the underpinning for this? What does the government point to when it's justifying its cuts?

To understand that more fully, I think you need to go back to the last major review of the ABC, which was completed in December 2018. And this brings News Corp right back into the picture. So in that year, in 2018, just a month after he left his position as chief executive of News Corp. Subscription television arm, Foxtel, Peter Tonagh delivered an efficiency review of the ABC and the SBS. Now that report journos asked for that report under way for almost two years.

It was finally released in a redacted version on Wednesday, the same day that the ABC cuts were announced, that we finally got a copy of it after all these years.

The report basically found that there was huge pressure on the media, no surprises. But it said that the ABC and the SBS could respond to the challenges facing them by leading substantive and meaningful change. It talked about creating lean and efficient organizations, but it also mentioned the benefit to the Australian public of these broadcasters.

In fact, it acknowledged that the ABC in particular would need a significant investment in digital platforms to modernise its content and delivery models. Essentially, the way that stories are put online and distributed. And it noted, quote unquote, it is unlikely to be possible without additional short term funding support.

RUBY:

And that was handed to government two years ago.

RICK:

That's correct.

RUBY:

And it was actually asking for more money, not less.

RICK:

Also correct, yeah, particularly in the short-term.

RUBY:

Right. So what about this latest review then, that the government has just commissioned? What will happen with that now?

RICK:

Well, it's a pretty quick turnaround. So the approach to market only closed last Monday. And it has to be delivered in its final form by the thirty first of August. So it's really a two month report. The worrying thing for the concerned parties is that the next federal budget is going to be handed down in October. So this report handed in August budget by October.

It may well be the case that this report is not just used to retrofit the latest cuts, you know, build an argument after the decisions were to be taken, but that the government might now have new material in front of it in which it can make the case for the next round of cuts.

I think given the history of this government and the way they've treated the ABC, as a persistent thorn in their side, and given the systematic erosion of the ABC over the last decade, I guess you'd be a fool to think that they'd be doing anything except trying to justify future cuts.

RUBY:

Rick, thank you so much for your time today.

RICK:

Thanks, Ruby. Thanks for having me.

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RUBY:

Also in the news —

A stay-at-home order will be imposed from 11.59 pm tonight, on ten Melbourne postcodes experiencing a spike in coronavirus cases.

People living in the affected suburbs have been told they should only leave home for work, to provide care, to get exercise or to buy groceries.

The Victorian government says the restrictions will be in place for the next four weeks, with on-the-spot fines being enforced.

The new restrictions were announced as Victoria reported 64 new cases of coronavirus yesterday.

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And China has passed new national security laws which critics fear will crush political freedoms and erode autonomy in Hong Kong.

The legislation, which was voted through by the Chinese Communist Party's standing committee, criminalises subversion, terrorism and collusion with foreign forces.

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I’m Ruby Jones, this is 7am, see you tomorrow.