Managing director Russell Balding had a strong message for us. He urged the ABC’s Friends not to get caught up in minute detail, but to stay on the high ground. He urged us to encourage public debate. He named independence, funding, program comprehensiveness and digital broadcasting as the main areas of concern facing the ABC.

On funding he had this to say: that since 1985-86 there had been a 30% reduction in funding. The Government argued it gave funds back, but this didn’t make up for the loss compounded since the first cuts. ‘No private sector corporation could survive that sort of injury.’

Asked if the National Interest Initiative program's $17.8 million a year funding might continue past its four year life, Mr Balding said that without a commitment from the Government in the next Budget to extend it, steps would have to be taken during 2004‑05 to discontinue the wide range of activities and services established under the NII project. That is because redundancy and other termination payments would need to be made from within the current funding provision.

‘Additional cost pressures that have been absorbed or taken from one-off sources have been ignored by the Federal Government. Government has never funded ABC OnLine, or the $2m per year for NewsRadio The $4m p.a. caption service for the hearing impaired has never been funded by the Government.

‘Senator Alston has said that the ABC should not be doing the sort of programs the commercial channels do. This is an attack on the comprehensiveness that the ABC charter requires, and would lead to the ABC becoming a niche broadcaster.

‘Without an increase in funding, the ABC has no option but to cut content. It's not a case of which show should be cut, but that none should be cut. The ABC needs to be as broad as possible’, said Mr Balding. ‘A problem with dropping services is that things are sacrificed: the digital multi-channels were serving the future audience. Fly TV had been growing in popularity, and would have produced the next generation of adult ABC fans. It hurts that the ABC had to choose between present audiences and future audiences.

‘One of my genuine frustrations as Managing Director, as one devoted to long term strategic issues, is that the ABC is not being allowed to reach its full potential in the sense of creativity and innovation.’

On the digital revolution Mr Balding said the ABC needed to be in the lead, but to do anything the funds had to be there. He pointed out that the government was paying the transmission cost of digital - some $60 million per annum at its peak, and a total $700 million all up, but this was only for transmission, with nothing for content. Yet only 100,000 people had taken up digital.

‘The larger issue is about the level of ABC funding. Is the ABC properly funded to fulfill its Charter obligations?’ Russell Balding says it is not.

On independence, Mr Balding seized on Gerard Henderson’s suggestion that an ABC more sympathetic to government might find funding a lot easier. He said this would be a threat to the ABC's editorial independence. ‘That has to be protected at all cost. ABC journalism is not for sale!’

‘The ABC needs journalists that work with a spirit of inquiry. The role of the Managing Director is to protect the ABC’s independence, and it is a role of Parliament to protect the ABC.’

Mr Balding asserted that the threat to the independence of the ABC was even greater than the threats to its funding.