It may be petty of me, but I’m slightly amused by this news:
Guardian News & Media, publisher of The Guardian and The Observer, is expected to announce this week how many jobs are being axed in the latest round of cuts at the troubled newspaper group.
Up to 100 staff from the company’s 900-strong commercial and advertising department will be made redundant in the latest attempt to stem losses which currently run at £100,000 per day. Most of those affected have already been told their fate, but the deadline for the company to confirm individual redundancies passes today. (…) But there are already predictions that the job cuts will not be enough to return the company to profit following a disastrous year in which revenues have fallen by £33m.
Industry analysts have said the company needs a “root and branch” restructuring programme, with a much bigger reduction in staff numbers, if it is to have any hope of returning to profit, while Carolyn McCall, the chief executive of parent company Guardian Media Group (GMG), has already said losses at the newspapers are “not sustainable at their current levels”.
(It’s interesting how much of this description also applies to the country that The Guardian’s favourite political party has been governing for the last 12 years.)
There are signs that 2010 could be even worse than 2009. A change in Government after next year’s general election is likely to be disastrous for the Guardian’s revenue from public sector job adverts, on which it has long depended, as the Conservatives have strongly hinted they will save money by moving much of the advertising online.
GNM, which is heavily unionised, is owned by the Scott Trust, a charitable institution set up in 1936, and has never imposed compulsory redundancies on its editorial staff, resulting in what one insider described as “bed blockers” clinging on to highly-paid jobs.
The Scott Trust recently varied its agreement with editorial staff to allow compulsory redundancies “in dire economic circumstances”.
In August GMG reported that it had lost £89.8m, compared with a profit of £306.4m the previous year, though the 2008 profits were inflated by the one-off proceeds of selling 49.9pc of Trader Media Group, publisher of Auto Trader.
To quote Fawlty Towers, there’s enough material here for an entire conference, but I suppose that’s what happens when you try to run a business in line with even vaguely socialist principles: inefficiency; dead wood; and unsustainable dependence upon private and public subsidy. It is really quite delicious that George Monbiot’s eco-rants and Seamus Milne’s socialist clap-trap are partly funded by the profits made by the thoroughly environmentalist and Marxist-Leninist Auto Trader. What is less amusing is the effective taxpayer subsidy of The Guardian:
The Guardian currently dominates this market and, according to research by Reed Personnel Services, advertises two-thirds of public sector jobs. Its Wednesday Society section carries more than 30 pages of job ads each week, which could effectively disappear if the Tories got into power. The move would also hit titles such as Third Sector, Young People Now and Regeneration & Renewal, published by Brand Republic owner, Haymarket Publishing.
The government is being criticised for placing the majority of its recruitment advertising for public sector jobs with left-wing newspaper The Guardian.
A study by Nielsen Media Research showed that 26,175 out of 42,914 public sector jobs placed in national newspapers between January and September were advertised in The Guardian.
The government’s relationship with the Society supplement is already being closely watched by Labour critics, because the publisher is Benjamin Wegg-Prosser, former special adviser to Peter Mandelson, when he was a cabinet minister. Wegg-Prosser’s role, however is not an editorial one.
The COI Communications department handles advertising for public sector jobs and is responsible placing all 42,914 jobs. The 26,175 ads it places with The Guardian compares with Scotland’s Sunday Herald in second place with 7,586 ads and ethnic minority newspaper The Voice with 2,719. The Times newspaper takes 1,269, plus 1,255 in The Times Education Supplement and 802 in the Sunday Times. The Guardian’s rate card price for a full-page colour ad is £10,762, and a black-and-white page £7,762.
The Guardian has dismissed the criticism and called it unfounded. The paper pointed out that any talk of collusion with the current government was ridiculous and showed a lack of understanding of how the recruitment market, and the government’s involvement in it, worked.
A spokeswoman for The Guardian said: “So far this year, thousands of individual clients, with individual budgets, have advertised in Society Guardian. Those decisions are made independently and are based entirely on value for money and response rates. Those clients include Conservative and Liberal Democrat-controlled local authorities.”*
Hmm. I’m not buying it, especially given that Mr. Wegg-Prosser eventually went from the Society Guardian to work with Tony Blair at No.10. (Looking at Mr. Wegg-Prosser’s Linked-In profile for some reason makes me think of Lord Turner’s ‘socially useless’ comment about the banking industry – not sure why.)
If it isn’t a conspiracy, it’s certainly a cock-up and a massive waste of public money. Needless to say, the Tories have already proposed the following:
The Conservative Party has promised to overhaul advertising for public sector jobs in a move that could potentially hit The Guardian newspaper. Shadow chancellor George Osborne has vowed to move all public sector job ads from newspapers to a new official website if his party comes to power after the next general election. This plan could result in newspapers, particularly The Guardian’s Wednesday Society section, losing around £790m spent by local and central government on job ads each year. The dedicated public sector website would only cost an estimated £5m.
If anything, £5 million is a bit on the high side when services like madgex exist, which provide a ready-made and scalable job board system that powers such notable online portals as, you guessed it, Guardian Jobs. It’s actually quite scandalous when you consider how much public money was unnecessarily diverted to subside The Guardian; no wonder they don’t fancy the idea of public sector cuts.
Oh well, I suppose at least The Guardian pays tax on any profits it makes out of all this. After all, its been pretty vociferous in its criticism of tax havens and those evil tax dodging corporations.
Tax Justice campaigners had a small demonstration outside the Guardian’s offices today to protest at the hypocrisy of the Guardian campaigning for FTSE 100 companies to pay more corporation tax when, despite GMG making £300 million in profits last year, it paid none itself. GMG took advantage of a perfectly legal loophole to avoid paying taxes on the capital gains made on the sale of Auto Trader. Without exploiting the law they would have had to pay more than £50 million in tax!
The final insult from the newspaper that attacks the fat cats and their ‘rewards for failure’?
The newspapers have been in financial turmoil since the Guardian’s editor in chief, Alan Rusbridger, decided to move the papers from broadsheet to the current medium-sized Berliner format in 2005.
Despite the losses, Mr Rusbridger received an 11pc pay rise last year to £445,000.
(* – Apologies for the age of these articles. I tried in vain to find more up-to-date information. If anyone has more statistics on this let me know; however, I don’t think a great deal has changed, although one would imagine the number of public sector appointments might have fallen in the last year.)