ABC shrinks its Great Ideas
Funding difficulties have forced the ABC to put on hold the second stage of managing director Michelle Guthrie’s signature policy, the $50 million Great Ideas Grant.
The Grand Ideas Grant was launched with much fanfare last year as an additional funding pool contestable by staff. But the second funding round, seeking pitches from ABC staff, has been delayed until next year, The Australian has learnt.
In July last year, the ABC said nine GIG projects would move forward, but only four have launched: ABC Kids Listen, an audio service aimed at young children and their families; Retrofocus, which features content from the ABC archives; ABC Life, a lifestyle content website; and Unravel, a true crime vertical that includes the Blood on the Tracks podcast.
Three others GIG projects were at pilot stage, two were under development and another was at proof-of-concept stage, the ABC said.
“GIG is one of a number of processes used by the ABC to fund content,” an ABC spokeswoman said. “The ABC is focused on delivering the first round of GIG pro- jects and as a result, the next round of GIG funding has been deferred to 2019.
“GIG is part of the ABC Content Fund announced in March 2017. At the time of launch it was anticipated that the Content Fund would rise to $50m per annum as quickly as possible. However, budget pressures mean that the ABC regularly reviews its activities.”
The content fund was announced with much fanfare by Ms Guthrie as a prime justification for axing 200 management and supervisor positions and streamlining ABC divisions from 14 to eight.
The money saved was to be poured into content projects. About $20m was earmarked for the first year, and the GIG was meant to increase to a $50m fund each year. Also, the ABC spent $15m, mainly in regional areas, on 80 new staff and $3.6m on equipment for regional teams.
Additionally, The Australian has learnt that the ABC management and board were left redfaced over the 2016-17 annual accounts when it was discovered that there was an unexpected $50m hole in the budget.
Three non-cash line items in the budget were queried by the auditors and caused consternation at the board level.
The government is generally forgiving of budget overruns for portfolio entities if it determines the circumstances were unforeseen, but if it decides the losses were avoidable, as it might with one of the budget line items, the Department of Finance can write to the ABC suggesting remedial action.
The three items were non-cash items and did not affect the operating budget, one source said.
An ABC spokeswoman said: “The usual and proper audit pro- cess was followed and the accounts have been signed off by independent auditors. The financial statements will be fully disclosed in the annual report. There has not been an accounting error.”
The ABC annual report, which is tabled in parliament, is generally released in October.
The annual accounts issue is separate to the funding issues surrounding the Grant Ideas Grant.
Staff were asked to vote on projects and a panel featuring managers and executives chose the successful pitches in July last year.
But several projects have proved controversial and been attacked by commercial media rivals who say the ABC is abusing its government funding to harm commercial rivals. Such accusations are the subject of a government inquiry into commercial neutrality, which closed its consultation period in June.
ABC Life was criticised for its multi-million-dollar budget and for replicating recipes and relationships advice found in women’s magazines and on websites such as MamaMia.
Helen McCabe, Nine’s director of digital content who launched the 9 Honey lifestyle website, said the decision to divert resources from newsgathering was “a little bit baffling and a bit disappointing”. Fairfax Media and Junkee Media said ABC Life was not needed.
ABC Kids Listen, an audio service aimed a working families, was attacked in a stinging submission to the competitive neutrality panel from commercial children’s audio service Kinderling.
Kinderling managing director Evan Kaldor said the company’s meetings with the ABC and the launch of ABC Kids Listen was a “troubling precedent”.
“A start-up decides to test the market for a new media space. The public broadcaster watches. The start-up proves the existence of an audience or the demand for a new programming format,” he said.
Kinderling said the ABC could give any new project a small innovation budget, but mask the true cost of its content and marketing budgets, due to its extensive resources.
“The public broadcaster adopts the same or similar format and enters at scale supported by a deep library of content and a substantial marketing machine,” it said.
“The public broadcaster has tremendous latitude based on the absence of an imperative for a commercial return. The ABC wins the space and takes all the audience.
“Kinderling asks — is this the type of competition the panel believes is in the public interest?”
This year Ms Guthrie faces government-led reviews into efficiency and competitive neutrality, and in next year’s federal budget the government will set the ABC’s triennial funding, including an indexation freeze of $83.7m.