News

Two recent controversies at the ABC – the handling of the secret cabinet files and treatment of chief economics correspondent Emma Alberici – have left senior staff furious at what they see as incompetent managerialism. By Mike Seccombe.

Furore at the ABC

There are still some senior managers at the ABC prepared to drop the management speak and arse-covering and tell things with brutal, even profane, honesty.

Says one of them, surveying events of recent weeks in the national broadcaster’s news operation: “It’s been a clusterfuck. A statistically random clusterfuck.”

It’s fair to say he would not get much argument from senior journalistic staff about at least half of that statement. Two issues – first, the way the organisation dealt with a huge trove of sensitive government documents that fell into its hands; and second, the controversy over a couple of stories by chief economics correspondent Emma Alberici – have played out disastrously for the national broadcaster and seriously damaged staff morale.

The manager might get more argument, however, over his qualification that the matters can be dismissed as a statistically random coincidence, as one of those occasions that crop up every now and then, in which multiple things go wrong at the same time.

These people, including some of the broadcaster’s most senior staff, as well as significant media figures outside the ABC, see them as a consequence of the way the place is run under managing director Michelle Guthrie. The most recent staff survey carried out by the corporation, at the end of last year, found faith in senior leadership – which was already low when Guthrie took over two years ago – plunging further. Just 18 per cent thought the leadership inspired confidence for the future. Only 17 per cent believed senior management valued staff.

Some among the dispirited troops see such results as consistent with a diagnosis of managerialism, a kind of corporate disease whose symptoms, according to the definition of economist John Quiggin, include: “incessant organisational restructuring, sharpening of incentives and expansion in the number, power and remuneration of senior managers, with a corresponding downgrading of the role of skilled workers, and particularly of professionals”.

Although the two cases in point went wrong for different reasons, they are widely seen by journalistic staff as being joined by a common thread of poor management. We’ll take them sequentially.

The month of January is usually a thin time for political news. January is when senior press gallery people take time off, when the news is usually about bushfires and cricket and yacht races.

But not this year. This year a relatively junior ABC reporter in Canberra broke a succession of strong stories, going back years, across a number of governments and a range of policy areas.

Among them was the revelation that in 2013, then immigration minister Scott Morrison, having learnt from his department that up to 700 asylum seekers “must” be granted permanent protection under existing legislation, agreed to a devious plan to stop them.

“Mr Morrison agreed his secretary should write to the director-general of security to request ASIO delay security checks so that people close to being granted permanent protection would miss the deadline,” said the story, which carried the byline of the gallery reporter, Ashlynne McGhee, as well as that of the ABC’s freedom of information editor, Michael McKinnon.

The story of Morrison’s tactic to subvert legal process was all the stronger because it linked to an actual government document, marked “protected” and “sensitive cabinet”.

It was a good “get”, as they say. But it could also have been much more than a 370-word news piece. Importantly, the story left hanging the question of the consequence of Morrison’s move, acknowledging: “… it is not known whether ASIO complied with Mr Morrison’s request”.

Nor did the story attempt to explore the human consequences of his subterfuge.

“Why,” asks one of the ABC’s senior investigative journalists, “wouldn’t you have put the information in the hands of someone like [Four Corners investigative reporters] Michael Brissenden or Linton Besser, and let them work their contacts to establish whether it was acted upon by ASIO?

“Why didn’t they get out and find people who might have been affected? Why didn’t they build it into something bigger? And what was John Lyons, the new head of investigative and long form, doing?”

All good questions, and relevant not only to the Morrison story, but also to a number of the other stories culled by McGhee and McKinnon from the leaked documents, which might have been developed more fully.

Only one of these questions is easily answered. John Lyons wasn’t there. In the middle of last year, when the ABC got the trove of documents on which all the reports were based, he was still working for The Australian. Furthermore, it is understood he played no part in assessing the documents. His role in the whole process was very limited and very late, confined essentially to writing about how the cabinet files were obtained, for both his new employer and for his former one, The Australian.

It was a remarkable story. The ABC’s source, Lyons told his readers, was a “bushie” living near Canberra, who bought a couple of locked, heavy former government file safes in mid 2016 for $10 each. When the bloke drilled out the locks on the cabinets he found they were full of hundreds of highly classified cabinet documents. And he rang McKinnon.

It was a most unorthodox way to get a break on a big story, and from there things proceeded in a most unorthodox way, according to those with experience in investigating major document dumps. The work was done under the oversight of Gaven Morris, the ABC’s director of news.

“Speaking from experience,” says one source who has a long history as an investigative reporter, “I can tell you one of the first things you do is copy the whole lot, and put copies in safe places. Then you get a team to investigate.

“The ABC has people who do that. We have this new investigative unit set up. We’ve got Four Corners there. My understanding is that though they had those cabinet docos a long time, they were not shared with people who had the skills to deal with them.

“Here we had hundreds of documents relating to five governments, and they were never given to any of those people. Instead it was left to the FOI guy [McKinnon] and a relatively junior person from the [Canberra] bureau, and Gaven, whose skills are as a manager, not a journalist, and certainly not as an investigative journalist.

“And then they gave it all back to the government. WTF? A lot of people are very disturbed by the process.”

Not Morris, though. Having been given what the ABC website describes as “Hundreds of top-secret and highly classified cabinet documents… obtained by the ABC following an extraordinary breach of national security”, Morris was happy with the nine shortish news stories his team produced.

“In the end there were potentially more stories in those files, but I don’t think any of them were any more interesting than the ones we put out there,” he tells The Saturday Paper.

Indeed, he reckons the biggest of the yarns was the one about how the government lost track of the documents.

We can’t know that for sure, of course, because they’ve been given back. Certainly, there are strong grounds to suspect it wasn’t.

As Quentin Dempster, former senior ABC journalist and staff-elected board member, noted, the broadcaster itself boasted that “nearly all” the documents were classified, some as top secret or “AUSTEO”, meaning for Australian eyes only. Surely, Dempster argues, there was much more substantial material in there than the “domestic embarrassments or interesting discussions” that were published.

For his part, Morris says: “These weren’t the Pentagon Papers, and the source wasn’t Daniel Ellsberg. This was a member of the public who found some files and wanted to know they were going to be dealt with in a secure and responsible way. We were as mindful of that as anything else when we thought through how to handle the files…”

It was out of concern that the source be protected, he says, that the corporation entered into negotiations with the government to hand back the material.

A few points might be made here. First, the source contacted them, when he could have gone straight to the government. Ergo, he made a decision to make the matters public. Second, the government had no idea where the documents were, so there is a question of how they would have found the source if the ABC didn’t tell them. Third, as some commentators noted, the ABC could have driven a harder bargain over what could be published, perhaps by cooperating with authorities to publish with agreed redactions.

To add further embarrassment to the snafu, the ABC was forced to apologise to former prime minister Kevin Rudd over one of the stories, after he threatened legal action. This, however, was not the journalists’ fault: sources tell The Saturday Paper the story was legalled as “good to go”, but when Rudd made his threat a commercial decision was taken not to fight it.

The well-respected journalist and editor Brian Toohey spoke for many within the organisation and many without when he thundered in The Australian Financial Review that the ABC’s treatment of the whole issue was “a disgrace”. It had put a source’s identity at risk, and failed in its role as watchdog on the public interest.

All in all, it was a disaster for the broadcaster, one that damaged its public credibility and demoralised its staff.

But worse was to come. At 5.30am last Wednesday, two pieces by the ABC’s new chief economics correspondent, Emma Alberici, were put up on the broadcaster’s website.

One was a news story, the other a piece of analysis, and the subject matter of both was politically touchy, in that it related to the Turnbull government’s policy proposal to cut the corporate tax rate for big companies from 30 per cent to 25 per cent.

The news piece cited official statistics showing most corporates already paid nothing close to the nominal 30 per cent rate. The average rate paid by American companies in Australia was just 17 per cent, and one in five of Australia’s big corporates had paid nothing for the past three years at least.

The accompanying analysis piece went to the government’s claim that lowering rates would lead to higher investment, which would lead to more demand for workers and ultimately to higher wages. Alberici cited evidence from other countries, where the real-world evidence had defied the theory, and quoted economists who questioned the assumed link between lower tax and higher wages.

There were some problems in the two pieces, as even some of her supporters in the ABC conceded. The news story, says one of them, cited a bad example of corporate non-payment in choosing to focus on Qantas.

While it was true the airline had not paid tax for the better part of a decade, said the source, it was acting “quite transparently” within the accepted rules.

“They have made serious losses in recent years, and they can legitimately carry forward losses against future earnings.”

Alberici’s facts were not wrong, but her news story would have been stronger had she cited a resources company, or maybe one of the big global technology companies, which are notorious tax dodgers. Perhaps oil company Chevron, whose operations amounted to “a classic example of tax manipulation”, said the ABC source.

More problematic for ABC management was the analysis piece, which was very strong.

“There is no compelling evidence that giving the country’s biggest companies a tax cut sees that money passed on to workers in the form of higher wages,” Alberici wrote.

The stories brought the wrath of the powerful down on the ABC. Qantas chief executive Alan Joyce gave a vigorous on-air defence of his company. The Business Council of Australia, Treasurer Scott Morrison and Communications Minister Mitch Fifield weighed in. The prime minister bagged Alberici’s work in question time, calling it “one of the most confused and poorly researched articles I’ve seen on this topic on the ABC’s website”. Turnbull wrote to the ABC’s managing director, as did Morrison and Fifield.

The next day, the stories were taken down, although after some re-editing, the news piece went back up in clarified form. The analysis stayed down.

Alberici’s ultimate boss, Gaven Morris, the same man who oversaw the reporting of the leaked cabinet files, denied it was due to political pressure and said he had concerns before the complaints were made.

And it’s entirely possible that he did. As a journalist, Morris was never edgy. As a manager, his principal claim to fame was that he oversaw the setting up of the broadcaster’s News 24 service, and did it on the smell of an oily rag. His other big move was the junking of the ABC’s opinion website, The Drum, which he believed too opinionated, and also too much in competition with commercial media that trade in more opinionated journalism. Morris believes that journalists should not be credited as experts, that their job is to report accurately and keep their opinions out of it.

And that brings us to the essence of the problem with Alberici’s piece, which was not that it contained inaccuracies, as suggested in a tweet by the media manager for the ABC’s news division. Various heavyweights within the ABC and without – Dempster was again among them – argued there was nothing fundamentally wrong with it. They were bolstered by a series of economic experts, including the major source of her piece, Saul Eslake – arguably Australia’s most respected independent economist – who testified that it was factually sound.

The problem was one of tone. ABC editorial guidelines allow for reporters, particularly senior reporters, to engage in “analysis”. They do not permit comment.

On the broadcaster’s own Media Watch program on Monday night, host Paul Barry quoted from the guidelines: “Even specialists should stop short of prescriptive conclusions or overt advocacy of one position over another.”

And although he thought her piece should have been more balanced, Barry concluded that with some tweaking it could go back up. More importantly, he agreed with the complaints of senior staff that the current guideline amounted to a “straitjacket”, and that they should be relaxed.

“Because,” said Barry, “in the current system, to avoid straying into opinion is almost mission impossible.”

As a number of senior staff told The Saturday Paper, “a great deal of what we do straddles that blurry, subjective line between analysis and commentary”.

There was, he said, nothing wrong with “prosecuting a case”, provided it was built on a firm base of evidence, which Alberici’s analysis was.

Still, Morris and management resisted reinstating her analysis, even in modified form. And so it became ugly between them and their chief economics correspondent. There’s no other word for it.

On Monday, Alberici went to her lawyers. Four days later, as I write, an agreement has been reached.

The analysis questioning the link between tax cuts and wage rises will go back up, albeit in less strident form.

And, importantly, it has been posted with an editorial statement at the top: “This analysis has been revised and updated by our chief economics correspondent. Passages that could be interpreted as opinion have been removed. Our editorial processes have also been reviewed. Emma Alberici is the ABC’s chief economics correspondent and is a respected and senior Australian journalist.”

It’s a somewhat pyrrhic victory for Alberici, perhaps, won at considerable financial and emotional cost. But it is an important win for all those journalists at the ABC who believe that long experience and diligent marshalling of the facts entitles them to reach a conclusion when they tell a story.

And, perhaps, the two cases provide a salutary lesson for the managerialists: respect the talent.

This article was first published in the print edition of The Saturday Paper on Feb 24, 2018 as "Frank and fearful". Subscribe here.

Mike Seccombe
is The Saturday Paper's national correspondent.

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