SBS managing director Michael Ebeid says the defeat of the SBS advertising bill in the senate this morning will impact upon programming and services.
The proposal, which would have allowed SBS to double its primetime advertising to 10 minutes, was defeated by the senate this morning at the second reading stage.
Both the Greens and Labor had previously flagged their opposition to the bill, with the decision on whether it would pass down to the crossbenches.
Ebeid said in a statement that with SBS having already created efficiencies at the back-end, that the bill would impact programming.
“The failed passage of this legislation is a setback and leaves SBS with a $28.5 million hole in its budget over the next four years,” Ebeid said.
“Given this legislation did not pass and SBS has largely exhausted back-office efficiencies, this funding cut is unable to be absorbed without impacting programs and services.”
Last year the Federal Government unveiled a cut of $53.7 million to SBS as part of an efficiency review into SBS and the ABC.
Ebeid said while there would be impacts to programming, he was not in a position to quantify what these would be.
He previously told AdNews that this year's programming would be safe, but was unsure over future years.
“SBS will now need to consider its contingency plans internally, provide an impact report to the Federal Government and review our overall funding,” Ebeid said.
“Once this process is complete, SBS will be in a position to outline further details about the impact the failed legislation will have on the organisation.”
The legislation was proposed by the coalition government as a partial offset to Government cuts to SBS' budget, allowing SBS to create advertising support around 'tentpole' programming such as Eurovision, the Tour de France, and Mardis Gras.
FreeTV chairman and key lobbyist against the bill ,Harold Mitchell, praised the senate for striking down the bill.
“It is a win for good public policy. It never made sense to turn SBS into a fourth commercial television licence, especially at a time when the television advertising pie is flat and we are facing increasing competition from global players who are unregulated and pay little or no tax in Australia,” Mitchell said.
"We understand that governments have to make difficult budget decisions. Our concern has always been that any savings should not be at the expense of privately owned companies subject to a range of rules and taxes which SBS does not face.
“We are grateful that the Parliament has decided to reject these changes that the public did not ask for and which would have damaged Free TV broadcasters at a critical time.”
There was debate on just how much the move would have netted SBS, with SBS saying it would have raised just $28.5 million over four years, while FreeTV analysis conducted by MediaCom had this figure was closer to $148 million.
Elsewhere, the Save Our SBS group which includes Margaret Pomeranz and Quentin Dempster thanked the senate for "saving SBS from itself".
“I’m very happy that the visionary concept of SBS has not been further diluted with more advertising," Pomeranz said.
"The onus now is on the Government to reinstate SBS’ depleted funding to enable it to deliver on its charter by producing programs that explore and celebrate our multicultural society in entertaining and significant ways, leading to greater social cohesion, a role that has been pivotal to the organisation.”
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