Our national public broadcaster is both efficient and much appreciated

From 1996 there was a clear decrease in operating expenses and employee numbers. There is also a capacity for an organisation such as the ABC to benefit from the distinctive sense of purpose of its employees - which manifests in a willingness to work for less than commercial rates in many cases.

A further output measure relative to cost is ratings (audience) per dollar expended. The ABC is required by its Charter to be comprehensive, providing a balance between broadcasting programs of wide appeal and specialised broadcasting programs. Commercial broadcasters have no similar constraint upon their imperative to pursue mass audiences. It is notable that despite this, the ABC is highly efficient in achieving ratings.

For 1997-98, on a full-service expense measure, ABC and Ten Network costs per rating point are quite similar and both are well below the Seven and Nine Network costs per rating point. Even if fees and commissions that apply only to commercial stations are excluded, the ABC is quite comparable in cost to the Seven and Nine networks, though it becomes higher in rating cost than Network Ten.

ABC television cost per rating point has not always been on par with that of commercial networks. The relative expenditure position has been stable since the mid 1980s, with the commercial networks remaining on the higher expenditure trajectory established in the early 1980s and with ABC outlays constrained at a lower level.

The same cost per ratings unit is not available for radio but it would be likely to show an even stronger outcome, as ABC radio audience share has increased substantially to higher levels over the past decade.

The ABC also reportedly is quite successful in relation to the comprehensive "reach" that can lie behind these ratings in turn. An AC Nielsen survey conducted at the end of 1998 is reported as finding that 70 per cent of the population use the ABC television service each week, 24 per cent use an ABC radio network each week and 2.4 per cent use the ABC website each week.

The ABC also reportedly is quite successful in relation to the comprehensive "reach" that can lie behind these ratings in turn. An AC Nielsen survey conducted at the end of 1998 is reported as finding that 70 per cent of the population use the ABC television service each week, 24 per cent use an ABC radio network each week and 2.4 per cent use the ABC website each week.

Both national public and commercial sectors have restrained television cost growth substantially since the late1980s. For the ABC, once the basic national public broadcasting infrastructure for comprehensive service was in place, this allowed annual marginal cost of maintaining and extending its services to fall from $92 million in the early 1980s to $9 million in the early 1990s. In recent years the real marginal cost of providing ABC programs, services and outlets has become negative.

If this ABC pattern is compared with the commercial sector a downward trend in marginal cost is also observed there, though with continuing cost efficiency advantage evident for the ABC.

For the ABC a reduced marginal cost has been consistent with growing radio and television audiences, 24-hour broadcasting in both radio and television, expansion of regional studios, substantial expansion of Triple J radio across Australia, Open Learning programs, and establishment of both Newsradio and ABC Online. A past capacity to extend service at low cost, building on basic core capability, has therefore been demonstrated - though it is not necessarily inexhaustible, as declining ability to maintain Australian content and deliver local services demonstrates.

Finally, in terms of efficiency, it is useful to avoid the problem of comparing "apples and pears" that bedevils commercial vs public broadcasting comparisons, and to move instead directly to comparing like with like. A useful application of this approach is to compare the ABC with public broadcasters in countries such as Britain and Canada. A range of measures can be chosen. But all point in a similar direction - that the ABC has a lower overall public expenditure share and expenditure per capita per day than the CBC and BBC.

Public Valuation

Efficiency measures are partial indicators of good use of national resources in public broadcasting. But in the end it is the users of ABC services and the tax payers who fund these services, who are the appropriate arbiters. And, in this context, standard qualitative survey techniques have found widespread and consistent support for the ABC contribution.