Three former Observer editors have written to the Scott Trust expressing their “profound concern” over the proposed sale of the newspaper to Tortoise Media.
Will Hutton, Roger Alton and John Mulholland have together racked up 20 years editing the UK’s oldest Sunday newspaper.
They claim that safeguards about the Trust’s commitment to The Observer, made when it was bought in 1993, “are plainly being abrogated”.
They note that then-chair of the Scott Trust Hugo Young said at the time of the purchase: “The trust safeguards will be fully extended to The Observer, which will be edited independently of The Guardian and retain its separate character.”
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The Scott Trust has owned The Guardian since 1936 when it was set up to safeguard the future of the title and protect it from death duties. The Scott Trust’s purpose, as defined in 1992, is “to secure the financial and editorial independence of The Guardian in perpetuity”.
Press Gazette understands that Guardian management believe the Hugo Young quote related to the editorial independence of The Observer, not about it being covered by the trust’s core responsibilities.
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The three editors wrote that members of the Scott Trust and Guardian Media Group board may choose to “put aside” the “commitment” that was previously made to The Observer, but said: “…we would dispute that it can be done so readily and still honourably – so the reasons need to be unambiguously compelling, and the due diligence undertaken to ensure the Observer has the best prospect of surviving must be of the highest order.”
They wrote: “It has survived for close to 250 years: there is a heavy responsibility on those involved in current discussions to ensure that any decision best protects The Observer, and not just for the next five years.
“Here there are clear deficiencies. Tortoise Media’s interest in the title and belief it could quickly be made to flourish is testimony to its standing with readers and beyond.
“The Observer is valuable media real estate, and an important means for ensuring liberal journalism has a significant presence on Sundays.
“Despite considerably less investment than its principal rivals, it has recently posted an increase in market share. Its presence in the Guardian group, with its distinct character, gives the group a breadth and depth it would otherwise lack as well as carrying costs that The Guardian will carry alone if the sale proceeds.”
The Observer’s current circulation is kept secret by GMG but is believed to total around 100,000.
According to a financial statement seen by Press Gazette, The Observer newspaper made a contribution of £3.4m to Guardian Media Group for the year to August 2024 if you subtract its direct revenue of £16.4m from directly-attributable costs of £13m. These figures do not include any shared Guardian resources which include: editorial, marketing, technology and office. They also don’t include any digital revenue driven by Observer journalism.
The editors have raised concerns about the sustainability of the Tortoise Media plan for The Observer.
They note: “We admire Tortoise’s journalism and respect its achievements together with its high regard for the Observer, but its promised £5m a year additional investment over five years will be significantly eaten up by the costs of underwriting the Observer’s operation as a stand-alone Sunday newspaper – unless it has other undisclosed ambitions for the title. And does Tortoise have the resource to weather unexpected uncertainties – another pandemic or geopolitical tensions?”
The letter concludes: “It is surprising that the trust and board have moved straight to a potential sale to an enterprise backed largely by venture capital whose business model is not long-term ownership but periodic exit – more likely in adverse circumstances.
“Have options for repurposing the Observer under the Trust’s ownership been considered and evaluated? What editorial and financial framework for the Observer’s continuing editorial independence and financial viability is the Trust negotiating?
“The entire exercise seems to have scant respect for earlier commitments or ongoing responsibilities to staff, readers and wider stakeholders. Surely our shared aim is as far as possible to protect The Observer’s long-standing tradition of upholding liberal values as a great Sunday paper? We are not resistant to change, but is this change the better for The Observer and even The Guardian – or worse for both?”
The Scott Trust met on Monday (7 October) but has yet to issue any response to either this letter or an open letter written by around 80 leading UK cultural figures calling on it to reject the “ill-considered” Tortoise Media offer which it described as a “betrayal”.
Separately, the joint NUJ chapel for The Guardian and Observer has passed a vote of no confidence in The Scott Trust and begun the process of balloting members to ask if they would be prepared to go on strike in protest against the deal.
One well-placed Observer source said: “The atmosphere is terrible. The Guardian management are effectively saying to us that if the Tortoise deal doesn’t go ahead then you have no future here.”
When The Observer’s future was last called into question in 2009, the senior Observer team were given the opportunity to prepare a new-look, scaled-down, lower-cost Observer which ended up performing well commercially and editorially. This time, no other options appear to be currently on the table.
A spokesperson for the Scott Trust said: “The Scott Trust believes it is right to engage with Tortoise Media over the potential sale of The Observer and negotiations are ongoing. We appreciate that it is a time of uncertainty for staff.”
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