ABC faces Senate Estimates on funding | radioinfo

ABC faces Senate Estimates on funding

Friday 21 February, 2003

At the Senate Estimates committee on 10 February the ABC Managing Director Russell Balding was put through the hoops on the ABC’s triennial funding submission and various radio issues.

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Here is some of what was said in the estimates hearing:

FUNDING SUBMISSION -

Senator CONROY—Can you give an overview of the ABC’s recent triennial funding submission?

Mr Balding—The submission was forwarded to the minister at the end of November of last year. You may
be aware that a summary of the submission was released publicly on 17 January. Copies were forwarded to all
members of parliament. We are currently having dialogue with the minister and his staff. There is a summary
funding table at the end of the triennial funding submission.

Essentially, there are three components of that submission. The first component is about continuation of
existing funding. There are two elements of that. The first element is $2.8 million, which was funding that
was provided to the ABC in August 2000 for Radio Australia short-wave radio transmission. It was provided
in August 2000 for three years, so it finishes of the end of this financial year. We are seeking from the
government continuation of that funding of $2.8 million. The second element, as you may also be aware, is in
respect of the national interest initiative funding of $17.8 million, which was provided for four years. There is
no commitment from the government at this stage that that funding will continue. In respect of the triennium,
that funding would run out at the end of 2004-05. We are seeking continuation of that funding from the 2005-
06 year.

The second component of the funding is in respect of new initiatives and activities... The third component is about extending existing services. We spoke about that the last time we were at
Senate estimates.

There are two elements of that. One is in respect of extending the reach of News Radio and
Triple J to populations of 10,000 and above. That, in a full roll out, would cost in the vicinity of another $18.8
million, but what we have proposed in the triennial funding submission is an incremental ramp up of that—in
other words, a gradual roll out—to pick up both News Radio and Triple J. That would take Triple J to an
additional 16 regional communities and News Radio to an additional 59 regional communities. A smaller
element in respect of extending existing services is Radio Australia. Essentially what we are looking for is the
use of FM relay transmissions overseas to expand Radio Australia’s reach.

I will now come back to the second component, which is in respect of new programs and initiatives. What I
outlined in the triennial funding submission and publicly when I released the submission was that, without
any additional funding for content, the ABC will have no option other than to cut programs and services. In
respect of the funds for programs and services, there are two main elements of this. One is in respect of the
multichannels, the opportunities that can come out of digital multichannelling and the ABC’s belief that the
use of compelling content on the multichannels—in other words, providing the audience with something that
they do not have now—will provide a catalyst to accelerate the take-up of digital. The second major element
in that is in respect of an industry production trust fund with a view to increasing our content, particularly in
respect of drama and comedy...

Mr Balding—We believe that it is a modest but essential ask. We believe that in the triennial funding
submission we have put forward measured and sensible proposals which have been properly costed and fully
justified.

PROGRAM CUTS -

Senator CONROY— ...How is the submission being received by the government?

Senator Alston—He is not in a position to answer that, as you well know...

Senator CONROY—Do you think there is merit in Mr Balding’s proposals?

Senator Alston—We will consider what has been put to us. I am not in a position to make any public
assessments of the merits of the case. As you know, we committed ourselves at the last election to at least
maintaining in real terms the triennial funding levels. That is designed to ensure that the ABC does not get
caught short if there is an inflationary increase in costs. I have not heard the proposition expressed publicly
before that there might be some threat to programs and services. I know David Hill was quite good at saying
those sorts of things.

Senator CONROY—It is a very serious problem.

Senator Alston—It was usually his first line of approach to somehow suggest that unless you got more
funding you might cut programs and services, but I do not offhand recall that being put in the submission. I will certainly look to see whether there was any suggestion along those lines made at the time of the last
triennial funding grant or, indeed, when we gave an extra $71 million over and above that as a one-off only
about 12 months ago.

Senator CONROY—You are in there batting for more funds for the ABC, aren’t you?

Senator Alston—I do not quarrel with any organisation that sees a market opportunity by approaching the
government for more funding to put a strong case... and Mr Balding has done that.

Senator CONROY—If the ABC does not have a champion in there barracking hard for them, they will
not get anything. Just tell us that you are their champion.

Senator Alston—The ABC is certainly entitled to put its best case forward and to indicate that it could do
a whole lot of new things with new funding. That is perfectly proper...

Mr Balding—I feel I have an obligation to make it very clear that this is the reality of the situation without
additional funding for content—as opposed to funding in respect of reach. There is an ask in the triennial
funding submission for reach, which is about equity and access to ABC services—that is, existing ABC
services. All Australians should have the same right of access to ABC services, and we have spoken about
that here before. If we are given every cent of that money in respect of reach, that will not result in one extra
minute of content being available for the ABC. So I am trying to communicate it in a non-threatening way,
but it is the reality of the situation that, if we were not to receive additional money for content, we would have
to have a look at our existing level and our mix of services and there would be a cut to programs and services.
We would not be able to sustain the same level of output that we currently provide...

RADIO AUSTRALIA AND NATIONAL INTEREST SPECIAL FUNDING -

Senator CONROY— ... Will the government extend the one-off funding for Radio Australia
shortwave radio transmission in South-East Asia which expires at the end of this financial year?

Senator Alston—I cannot give you any forward quotes on these things. These matters are normally
considered in the budget context. For the ABC, the $71 million was a one-off. The whole purpose of triennial
funding is that you do not get one-offs really.

Senator CONROY—Will you build it into the base funding then?

Senator Alston—You would expect that matter to be considered along with the rest of the ABC’s budget.

Senator CONROY—So it would be more likely to be included in base funding?

Senator Alston—It will be considered at the same time as the rest of its budget.

Senator CONROY—Will the government extend the one-off funding of the ABC National Interest
Initiative, which has increased the ABC’s regional presence, beyond 2004-05 to 2005-06?

Senator Alston—I think that has at least another two years to run so—

Senator CONROY—It goes, I think, to 2004-05. I am asking will it go to 2005-06? It is a one-off grant,
so I am just asking whether it is going to be part of the new triennial funding, because there is going to be a
gap at the end.

Senator Alston—If you are asking me whether it will be built into the base, I would think the answer is
no, because it was never a base funding allocation. Whether it gets extended is a separate issue, and it may. If
you extended it indefinitely it could be a de facto part of the base, but I think generally you would be reluctant
to just expand the base when funding has been sought for a particular purpose.

Senator CONROY—Even elections come around every three years.

Senator Alston—Just so we are clear, the ABC maintains vigorously and loudly and often that its base
funding is entirely at its own discretion whereas, if it approaches us with a specific request for funding, we
respond to it in those terms and that money is then tied up. It is given for a purpose; it is used for a purpose.
By that conceptual definition, it should not be included in base funding.

Senator CONROY—If you are suggesting that, as it is one-off, it is going to end...

Senator Alston—I am saying it was granted as a one-off—

Senator CONROY—We are talking about 50 full-time staff positions and 10,000 additional hours of
regional programs. I know the election has come and gone.

Senator Alston—I thought it was a four-year grant; it may have only been a three-year grant.

Mr Balding—It is four years.

Senator Alston—It was four years. So you are only halfway through; you do not normally consider things
that far out.

Senator CONROY—You do when you do triennial funding; that is the point.

Senator Alston—But it is not an integral part of triennial funding; it is not part of the funding base. It is a
separate and distinct initiative. If the ABC said to us that they would like it considered at the same time, and
they have, we will have a look at it. But that does not mean we will necessarily make a decision on it now. We
could just as easily wait one or even two years, or we might make a judgment now about its future. We could
certainly consider it now but that does not mean that it will just find its way into the base. It will remain apart
and it will be dealt with separately.

ABC BOARD APPOINTMENT -

Senator CONROY—I want to move onto one of your favourite topics, which occupies much of cabvarchar(15)’s
time, the ABC board appointments. When did Mr Kroger announce he would not be seeking a renewal?

Senator Alston—I am not sure.

Senator CONROY—Was it in November?

Senator Alston—I am not sure that he said anything publicly.

Senator CONROY—Mr Balding, does that ring a bell? There were a number of newspaper stories that
were very well sourced—

Senator Alston—It is not normally holy writ in our game, is it? As I am informed, the board itself
wondered whether December might have been Mr Kroger’s last board meeting. So I do not think he had—

Senator CONROY—But he had confirmed earlier than that.

Senator Alston—If you are asking me—

Senator CONROY—Well, he is a friend of yours.

Senator Alston—He was appointed on the basis of his—

Senator CONROY—No, I mean you must have chatted with him about it.

Senator Alston—I have talked to him, I have talked to a range of people. I thought you were asking
whether he has publicly announced that he is not seeking an additional term and I am not sure—

Senator CONROY—I am just trying to get a rough indication when it was that well-sourced speculation,
that I am sure was drawn to your attention, indicated that he would not be seeking to have his appointment
renewed.

Senator Alston—If you are asking me when did so-called well-sourced speculation first arise, it must have
been months ago...

Senator CONROY—When do you expect to announce a replacement for Mr Kroger on the board?

Senator Alston—In the not too distant future.

Senator CONROY—Has cabvarchar(15) considered it? Has it finalised its decision? I am not asking you what it
is.

Senator Alston—I cannot really tell you what cabvarchar(15) talks about and what it does not.

Senator CONROY—I am just asking you whether or not it has made a decision.

Senator Alston—There is no decision that I am in a position to announce.

Senator CONROY—Can you confirm whether Peter Reith, Tony Staley or Lynton Crosby are on your
short list?

Senator Alston—I think Mr Crosby ruled himself out. Other than that, I have not really ruled anyone in or
out. I think I indicated as much to one of your colleagues last year that we might rule out appointing a
majority of Labor supporters. We might rule out appointing a former South Australian Premier. Although as I
have said, I thought John Bannon did a pretty good job on that board. We might also rule out appointing an
adviser to the WA minister. We might also rule out Mr Cameron, an ALP pollster. But beyond that we really
have not focused on who we might rule in or out at all. The act prescribes the qualifications, and against that
background we will make our judgment.

Senator CONROY—Does Mr Reith meet the act’s qualifications?

Senator Alston—I have not looked closely at his qualifications—

Senator CONROY—You have known him well for years. You should be able to say, ‘He fits the bill.’

Senator Alston—Again, there are probably many people who would think they qualify. We have a lot of
offers of assistance from members of the public and others who believe they are qualified. At the end of the
day you have to make a judgment.

Senator CONROY—Did you get any public response? I think the Friends of the ABC put out an ad. Did
anyone write to you?

Senator Alston—I thought it would have been to them. I did not study it closely. Quite frankly, I assumed
it was an entertaining diversion. I have met with Terry Laidler, for whom I have considerable respect;
certainly during his time as a broadcaster I thought he was pretty fair and reasonable. But I do not think
anything has come to me as a result of that ad, so maybe the public saw it as an entertainment...

EXPANSION OF REGIONAL RADIO SERVICES -

Senator TCHEN—Thank you very much, Senator Conroy. Mr Balding, I know that in the submission for
your triennial budget you have on the agenda the development of the regional radio service, particularly News
Radio, and the extension of it. Congratulations.

Mr Balding—Thank you for your support for that, Senator.

Senator TCHEN—Thank you. It is a bit disappointing that it can only be provided with new funding,
which implies that in the ABC’s view it is less important than all your other existing services, but at least it is
now on the agenda.

Mr Balding—Can we just clarify that for you. The ABC receives specified amounts for transmission. You
might recall that a number of years ago—and Colin Knowles might be able to give you a bit more detail—the
ABC never paid for transmission services; they were provided by the National Transmission Agency. On
selling that transmission agency, the government then provided to the ABC a specified amount of funding for
transmission. At the time, that funding was to continue transmission at that current level of service. So the
ABC does not have the funds to take out of its operational budget to put into transmission, hence the
requirement to ask for that in the submission.

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