The federal government slashes advertising budget

By AdNews | 31 October 2022
Credit: William Isted via Unsplash

The new Labor federal government plans to spend significantly less on advertising than the previous regime, according to the latest budget papers. 

The cuts are part of an overall plan to cut expenses across advertising, travel and legal -- a total of $642.5 million in the current financial year and $809.2 million next.

Precise numbers for advertising aren‘t available but the government says it will achieve savings of $3.6 billion over four years from by reducing spending on external labour, advertising, travel and legal expenses.

One project known to have been cut is the $4 million Workforce Australia Advertising Campaign.

UM is the current holder of the federal government's media contract, which it won in from Dentsu X 2018 and has since been extended to 2024. 

State and federal governments spend nearly $450 million each year combined on advertising, more than large private companies such as Harvey Norman, Woolworths and McDonald’s, according to a study by the non-aligned public policy think tank the Grattan Institute.

Nearly $50 million of almost $200 million spent each year by the federal government on advertising had been spent on politicised campaigns.

And Standard Media Index (SMI) numbers show government category ad spend grew 74% in February this year as pre-federal election spending surged along with continued COVID messaging.

But the new government wants to rein that in. “The savings from this measure will offset the government’s election commitments,” according to budget papers.

“This measure will be implemented using a staged approach, with only the 2022–23 financial year impact allocated to general government sector agencies.

“The allocation of the remaining financial year impacts in the 2023–24 budget will be guided by the government’s broader Australian Public Service initiatives, including the Audit of Employment. This measure delivers on the government’s election commitments as published in the Plan for a Better Future.”

Labor had been critical of the former Coalition government’s spending on advertising.

In the Plan for a Better Future: “Key examples of the Liberals’ rorts and waste include … $1 billion in government advertising.”

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