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Tuesday, 18 November 1986
Page: 2432

Senator VIGOR(9.46) —I rise to make several points which arise from the Estimates committee hearings and answers I got from the Department of Communications. I can state definitely that the $2m saving this year from the proposed Special Broadcasting Service-Australian Broadcasting Corporation merger has been nailed as completely fatuous. Senior officers of the Department of Communications and the ABC made no bones about this during the Estimates Committee hearings. The Acting Secretary to the Department, Mr Payne, at page 541 of the Senate Estimates Committee C Hansard, was to the point when he said:

I think the savings envisaged by the Government in the decision were really projected for the future; they are not savings of immediacy in relation to this year's proposed appropriations.

So we are in fact being misled. Not one attempt at an accounting of the claimed $2m has appeared amongst all the various hopes for the future in statements by Ministers and the Public Service. In fact the Government appears to be cutting $1m off the budget of the ABC and another million off the budget of the SBS. They are separate organisations and, if the legislation to merge the two does not get through, the amalgamation will not happen.

Another point of interest is just how little has been spent-I think this is scandalous-on improving SBS reception in Melbourne and Sydney. Only $140,000 has been spent on rearranging the ultra high frequency transmitting antennas since 1982. Eighty per cent of that was spent in Sydney, and in a similar way $165,000 has gone towards infill translators between 1981-82 and 1985-86. I note with interest that $700,000 has been set aside for that purpose in the next two years and that there will finally be some coverage surveys carried out to identify the shadow areas of SBS reception for both those cities. The shadows are much worse with UHF reception than with very high frequency transmission. The fact that the Government has seen fit to spend so little on the problems in Sydney and Melbourne, while it has extended services elsewhere, shows that there are people who are quite content that SBS should continue to have major reception problems, which have been complained about in various areas. It is rather unfair when people are using the viewing figures for SBS as a means of assessing the effectiveness of that television channel.

I would like to refer to the disastrous policy mismanagement of the Department over the supplementary licence scheme, which has now basically folded. Millions of dollars have been poured down the drain because a number of independent applicants believed that they should be given a fair go in this particular area. Some excuses were related to the shortage of engineers in the Department, but there seems to have been a policy decision not to do anything over the long period when this supplementary licence scheme was operating. Now we are being faced by Government proposals which Senator Puplick so aptly debunked in a previous speech.

I would like to look at the problems which beset the Department of Communications, particularly the shortage of engineers in the Department. In September, 42 of 95 positions in the engineering department were unfilled. I believe that this is a major problem for the whole broadcasting industry. The communications strategy division and the radio frequency management division had half or less of their positions filled. This is a serious matter for the people of Australia. This may go part way towards explaining why the video and audio information and entertainment services issue was totally mishandled by the Department, and it seems to have overtaken it. It may also explain why the Department was asking the Attorney-General very plaintively whether it could put a moratorium on pay television under the current legislation. The record of that advice was that fresh legislation was needed. That was one interesting thing that the Estimates Committees learnt. If the Department itself was mystified by the meaning of its own legislation, what hope is there for the rest of us? I seek leave to incorporate in Hansard the answers I got about the engineering resources. They should eventually be drawn to the Minister's attention.

Leave granted.

The document read as follows-




Question asked by Senator Vigor (Hansard page 562)

``How many engineers do you have currently? . . . I see there are 23 new ones. I would like to get on notice the shortfall in each of the departments. If we could have that, it would be helpful.''

Answer: The Department currently has 53 of the 95 established engineer positions filled, with a shortfall of 42 engineers across the Department.

Details of the current situation in each Division is as follows:

Broadcasting Policy and Planning Division-Establishment 8, Positions Filled 4, Shortfall 4.

Communications Strategy Division-Establishment 10, Positions Filled 4, Shortfall 6.

Radio Frequency Management Division-Establishment 20, Positions Filled 10, Shortfall 10.

Broadcasting Services Division-Establishment 45 (Canberra), 12 (State offices), Positions Filled 35, Shortfall 22.

Summary: Establishment 95, Positions Filled 53, Shortfall 42.

Whilst no Department can expect to have its establishment fully staffed, the Department of Communications is facing a serious shortfall in engineering resources.

The Department is endeavouring to recruit and develop 23 base grade engineers to overcome the difficulties it, in common with all other Departments, has experienced in recruiting experienced middle level engineers.

Included in the numbers identified above are four base grade engineers who have been recruited since June 1986. It is planned that a further six will join the Department shortly. The remaining thirteen engineers will join the Department before the end of this calendar year.

Senator VIGOR —I thank the Committee. I add that the policy sections of the Department are really ripe for review by some type of efficiency scrutiny unit. Time after time the development of a client mentality in the Department takes over. Basically, the Department seems to respond and jump to attention to both the Federation of Australian Commercial Television Stations and the Federation of Australian Radio Broadcasters and ignore the services to ordinary Australians. We really have to do something about that rather quickly. For instance, we have a deep freeze currently on new public broadcasting and on commercial radio. This seems to be the case while the Government and the Department spend a few years sorting out the regional television shambles that seems to have developed. The Adelaide community broadcasting group, 5SKY FM, has written to me to indicate that it will be able to commence full time broadcasting by July of next year but that its application may not be handled by the Department until late in 1987 when it will then be dealt with by the tribunal's open public processes which can take an enormous amount of time. It is the same for other applicants, for public broadcasting and commercial radio licences. The policy sections of the Department have set their back on technological convergence and can expect to have events overrun them again in the future. I asked about what has happened to the Davidson Committee proposals that radio communications and wide communications be brought into a single Act based on common principles. The Department looked at the proposals and I quote from the reply. It stated:

The Department's assessment was that it was trying to deal with two incompatible subjects within one Bill and we did not favour at that time any amalgamation of the two principles of broadcasting and the general principles of radio communications.

I wonder when the Department will reconsider in the light of continuing developments which are starting to make the distinction between radio and television almost redundant. The Department runs the risk of again being caught with its pants down as economic pressures for new services develop.

The Australian Broadcasting Corporation has many excellent innovative broadcasters who struggle against all odds. I sincerely hope that the new Managing Director will be able to restore the levels of trust between management and other staff which are essential to revive the organisation. Mr Hill, who appears to be a political appointment, will have to find a way of dealing with the obstructive dead wood within the ABC. There does not appear to be very much help in this area. I want to go into some detail about one non-answer received by Senator Brownhill which is indicative of the brick wall against which heads are being bashed. Senator Brownhill asked for information about a Budget period publication from the ABC staff union which was accompanied by a media release that read:

The report prepared for the union by the economic consultant Mr Mervyn Smythe suggests that the ABC funding predicament had been grossly distorted by implicitly overstating the Corporation's capital expenditure by a total of $200m over the last 10 years and by $40m in 1985-86 and by $60m in 1986-87.

What the Committee received was not a detailed response to this report but to one prepared in April. I find it alarming to get such a mix-up. The material in the April report and in the ABC's response shows that the ABC is cutting its own throat. This is happening at a time when the Government's lack of imagination is calling it to wind back activities it once supported in that area with some enthusiasm. It is indeed fatal not to present a case in the strongest possible terms. This is what happened after the ABC fiddled with the figures on its expenditure. It actually abandoned what it had been putting in the annual reports from 1976-77 through to 1983-84. By using an index series system based on a spurious first figure which was understated it got into terrible problems with capital appropriations.

The issue involves the comparison of like with like. In 1976 to 1977 the ABC was given a consolidated Budget entry. Prior to that, the acquisition of land and the construction of buildings was done for it under other line items. To get an accurate comparison of capital funding, figures for 1975-76 and earlier need, in fact, to be adjusted for expenditure to be carried out by other sections of government including the Department of Housing and Construction-or the Department of Housing or whatever it was called then. This was done routinely in annual reports right through to 1983-84. If this is not done the figure for 1975-76 is about one third less than the true comparison. Put another way, one has to increase the inaccurate figure by 50 per cent. That of course completely swamps any time or index series which includes an inaccurate figure for 1975-76.

The Dix Committee of Review of the Australian Broadcasting Commission quite clearly made this point about capital cost comparisons in its report. It becomes somewhat of a mystery why the ABC submission broke totally with the accepted practice, and with what the ABC had previously put out officially. The only explanation, and the revised presentation in the 1984-85 annual report seems to bear this out, is perhaps that management wanted to emphasise capital expenditure of late and contrast it with spending on salaries. Perhaps it meant to demonstrate some new discipline within the ABC. I fear it is just likely to get the Department of the Treasury and the Department of Finance to seek to prune its capital expenditure. In the material supplied to the Committee this was the reason given for not adjusting the 1975-76 capital expenditure figures to get an accurate comparison. I quote:

It is true that making this adjustment makes the chart more graphic . . . However, it was considered at the time that the unadjusted figures provide a more unequivocal presentation of the basic case, with no room for argument about the validity of any adjustment.

We need to note that there was never any argument about the validity of the adjustment, so there is a real problem. I seek the Minister's view on how we handle the creative accounting of the ABC. The ABC having put on to the public record this type of self-swindle presentation, I seek from the Minister some understanding of what is being done about changing the accounting procedures the ABC uses to report to the Senate.