Abbott to break ABC 'no cuts' promise

In a pledge his colleagues are now wishing he never made, Mr Abbott said on the night before the 2013 election: “No cuts to education, no cuts to health, no change to pensions, no change to the GST and no cuts to the ABC or SBS.”

But the Prime Minister and his colleagues on the expenditure review committee – the powerful cabinet group responsible for finding billions of dollars worth of budget savings – are considering a number of proposals for trimming the ABC’s budget. All proposals involve cuts to the ABC and conversations are now being had about how deep to cut and what cuts are politically feasible.

Fairfax Media believes one of the options involves introducing an efficiency dividend to the ABC budget – an annual funding reduction used to achieve deep and continuous cuts to government agencies.

The ABC was allocated $1.03 billion in the 2013 federal budget. A 2.25 per cent efficiency dividend would see the broadcaster forced to strip around $22.5 million from its budget in the first year – a figure equivalent to almost half the ABC’s annual budget for TV drama.

Further cuts would then be applied in each subsequent year. The ABC is one of only three government agencies, along with SBS and Safe Work Australia, currently exempt from the efficiency dividend.

A spokesman for the Prime Minister referred questions about the ABC funding promise to the office of Communications Minister Malcolm Turnbull.

A spokesman for Mr Turnbull said: “We don’t speculate on the budget”.

It is believed the Abbott government does not consider an efficiency dividend on the ABC to be a broken promise, as nearly every other government department has one and savings need to be found across the board.

Despite Mr Abbott’s categorical pre-election promise, there are political precedents for such a reversal. John Howard promised to maintain existing ABC funding levels before the 1996 election but then proceeded to cut the broadcaster’s budget by $11 million and $55 million over the next two years.

The Prime Minister’s colleagues, including Treasurer Joe Hockey and the Communications Minister, Mr Turnbull, have refused to repeat Mr Abbott’s promise not to cut ABC funding. Mr Turnbull also refused to commit to maintaining ABC funding when asked directly by the ABC Friends lobby group in a meeting earlier this month.

Nationals senator John Williams said if the Coalition does cut the ABC budget it should spare regional radio services, which were “the heart of the bush”.

Liberal backbencher Craig Laundy, a vocal supporter of the ABC, said he would support plans by his colleagues to make the ABC “more efficient” even if it meant breaching Mr Abbott’s election eve promise.

“If we can run the ABC more efficiently while maintaining the quality of the product and save taxpayers money, we should,” Mr Laundy said.

ABC managing director Mark Scott told a Senate estimates hearing earlier this year that he could not guarantee any services would be spared if the broadcaster’s funding is cut. He also said that he – and the ABC audience – would hold Mr Abbott at his word not to cut funding.

But behind the scenes the ABC’s most senior executives have been planning how they would deal with major funding cuts. High-level working groups have met over recent weeks to investigate how ABC divisions could absorb budget reductions.

There is heightened concern within the ABC because of the May federal budget, the federal government’s commission of audit and a separate efficiency study into ABC and SBS operations. Foreign Minister Julie Bishop is also considering stripping the ABC of its $223 million contract to provide the international broadcasting service, the Australia Network.