Ministers for the Department of Communications and the Arts

National Broadcasters to implement efficiency measures

19 November 2014

The Government has released the final funding arrangements for the next five years, which will see the ABC and SBS eliminate inefficiencies in their back office operations ensuring they deliver Australians even better value.

The Government strongly supports the role of our public broadcasters in delivering the news and programs that Australians love and value.

An Efficiency Study was launched in January to identify how the ABC and SBS could find efficiencies in their back office operations—finance, property, IT, administration, corporate and marketing—without impacting on programming.

In total, including the 1 per cent down-payment announced in the May budget, the overall savings to the broadcasters is $308 million over five years or 4.4 per cent of taxpayers' investment.

For the ABC this means it will receive $5.2 billion over five years rather than $5.5 billion—a saving of $254 million or 4.6 per cent.

For the SBS this means its operating budget will be reduced by $25.2 million or 1.7 per cent over the five year period.  A legislative change to allow SBS to generate further revenue by changing its advertising arrangements will bring the total savings returned to the budget to $53.7 million or 3.7 per cent.

These efficiencies represent a modest saving in comparison to the Government's continued investment in national broadcasting of more than $6.6 billion over the same five year period.

Agreed Funding Arrangements for the ABC and SBS, 2014-15 to 2018-19

ABC Total - 5 years

Pre-Efficiencies Funding (including parameter adjustments)

$5.5 Billion

1% Efficiency Saving May Budget

$47 million

MYEFO Saving

$207 million

Total Efficiencies (Budget and MYEFO)

$254 million

Revised Budget

$5.2 Billion

% Reduction

4.6%
SBS Total – 5 Years

Pre-Efficiencies Funding (including parameter adjustments)

$1.44 Billion

1% Efficiency Saving and Budget savings

$10.5 million

MYEFO Saving

$14.7 million

Advertising Revenue

$28.5 million

Total Efficiencies (Budget and MYEFO)

$53.7 million

Revised Budget

$1.39 Billion

% Reduction – Operational

1.7%

% Reduction - Operational and Revenue

3.7%

The Government's highest priority is to repair the Budget and build a stronger and more prosperous economy. The ABC and SBS have been asked, like all other government agencies, to contribute to this effort.

It is a matter for the ABC and SBS Boards to determine how savings are achieved.

However, the Efficiency Study found that the ABC and SBS can reduce costs and modernise their businesses, learning from other broadcasters' practices in adjusting to rapidly changing technology and unprecedented structural change across the media sector.

The Government is confident that these savings can be achieved without affecting the diverse range and quality of programmes provided by the ABC or SBS. Suggestions that popular programmes or services are at risk because of Budget savings are not credible.

If the ABC or SBS want to make decisions to change or cease programming; that is their choice. The savings are not of a level that require any changes to programming. Programming changes are decisions for the Management and Boards of the organisations, not the Government.

Today the Minister made an address on the Future of Our Public Broadcasters.

The Executive Summary of the ABC and SBS Efficiency Study has been released.

Media contact:

David Bold: 0427 784 451

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