The Guardian-owning Scott Trust appears to be pressing ahead with plans to sell The Observer to Tortoise Media.

The 12-person board of the Trust, which is a non-profit-making company, met on Monday 25 November to discuss a bid made by Tortoise Media to acquire The Observer.

Tortoise has funding of £20m to invest in turning the Observer into a standalone newspaper with a paywalled website.

Following yesterday’s all-day meeting of the Trust a spokesperson said: “Today the Scott Trust met to discuss the potential sale of the Observer and the proposed terms.

“Talks continue to progress and there are a few outstanding points. All parties will continue detailed discussions to ensure the proposed agreement is the best it can be for staff, readers and the future of liberal journalism.”

The Trust has said it may keep a stake in The Observer after its sale to Tortoise and the Financial Times has reported that it may also offer additional investment in the new Tortoise/Observer business.

The ongoing talks mean strike action in protest at the Observer-Tortoise deal is still set to go ahead with the first 48-hour strike from Guardian and Observer journalists set to take place on Wednesday 4 December.

The Scott Trust has been sent a series of questions about the Observer deal by a consortium of press freedom groups which has asked for written answers.

These include: “Why is the sale of The Observer being discussed only with one preferred bidder instead of through an open, transparent and fair process?”

And: “What is the Scott Trust’s responsibility if this [the Tortoise Media] plan fails?”

The 70 Observer journalists who would transfer across to Tortoise have concerns about job security and editorial independence.

Tortoise Media said yesterday: “We want to save The Observer, both for today’s readers and the generation to come. We have heard from a lot of Observer journalists who are excited about our ambition for the paper – and the people we bring with digital skills in podcasts, data journalism and newsletters, the investment that means new staff jobs, a much bigger editorial budget and a real plan for growth.

“We believe we can strengthen liberal journalism, adding to the range and reach of progressive voices; we can enable The Observer to reach new readers, as a Sunday newspaper with a digital life of its own; and we can renew the paper as a powerful voice in the world.”

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The chair of the Scott Trust has offered to meet a consortium of press freedom groups which has raised concerns over the sale of The Observer.

The board of the Trust, a limited company which owns Guardian Media Group, was expected to meet on Monday 25 November, to discuss proposals to sell The Observer to Tortoise Media.

With Guardian and Observer journalists set to hold a 48-hour strike on 4 December in protest at the deal, the Trust is under pressure to make a decision.

The Scott Trust has received a letter co-signed by the European Centre for Press and Media Freedom, the European Federation of Journalists, Index on Censorship, International Press Institute and OBC Transeuropa demanding answers to six key questions about the sale of The Observer.

Tortoise Media is believed to have funding of £20m to invest in turning The Observer into a stand-alone newspaper and paywalled website. According to the FT, The Scott Trust may also provide additional investment in the deal and the body has already said it plans to retain a stake in The Observer.

The letter sent by the press freedom groups to the Trust and Tortoise Media asks the following questions:

“The Observer is the leading liberal, progressive Sunday newspaper in the UK. Given the Scott Trust’s commitment to safeguarding freedom of the press and liberal journalism, what protections will be included in any deal to protect its editorial independence?

“What safeguards regarding future ownership will be written into the sale?”

The groups also asked a question about whether the Trust has properly vetted all the potential investors, including looking at foreign business links.

The letter says: “Individuals we spoke to described Tortoise’s business plan as ‘unconvincing’ and ‘seriously under-financed’. What is the Scott Trust’s responsibility if this plan fails? Are any safeguards being included in the deal?

“Why is the sale of The Observer being discussed only with one preferred bidder instead of through an open, transparent and fair process?

“Will you allow Observer and Guardian staff to speak out freely about the impact of the deal on press freedom and UK media plurality without fear of sanction or recrimination? At present, they report being unable to voice their opinions freely or have been warned against doing so.”

Scott Trust chair Ole Jacob Sunde has written back to the groups saying: “Thank you for your letter and the questions that you raise. We will happily respond to your points. Perhaps, in the first instance, we could arrange a call so I can better understand your concerns.

“As you will know, The Guardian has been a partner to your organisations on various vital journalistic endeavours – including the anti-SLAPPS coalition. We hope you know us to share values on many areas in the media landscape.

“We take our obligations to safeguarding the future of liberal journalism very seriously and would welcome you sharing more about where you believe there’s misalignment.”

Press Gazette understands the groups have asked for written answers and cannot offer a meeting until early December.

Observer journalist Carole Cadwalladr has been told by Guardian management that her public statements about the proposed Observer deal may be in breach of her contract and has been ask to “desist” from saying anything publicly which brings Guardian News and Media “into disrepute”.

Cadwalladr was the keynote speaker on Friday 23 November at a Malta conference on media freedom run by the Organisation for Security and Co-operation in Europe during which she denounced the sale of The Observer to Tortoise as an “existential threat to our journalism”.

A spokesperson for Tortoise Media said: “We want to save The Observer, both for today’s readers and the generation to come. We have heard from a lot of Observer journalists who are excited about our ambition for the paper – and the people we bring with digital skills in podcasts, data journalism and newsletters, the investment that means new staff jobs, a much bigger editorial budget and a real plan for growth.

“We believe we can strengthen liberal journalism, adding to the range and reach of progressive voices; we can enable The Observer to reach new readers, as a Sunday newspaper with a digital life of its own; and we can renew the paper as a powerful voice in the world.”

On the subject of the letter, Tortoise said: “We have not received a letter from these bodies, but we are happy to provide assurances on editorial independence. All of our investors are fully committed to the robust principles of editorial freedom that are enshrined in our articles of association and overseen by an independent editorial board chaired by former FT editor Richard Lambert.”

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Guardian and Observer journalists have agreed to a 48-hour strike in protest at the planned sale of The Observer to Tortoise Media.

Meanwhile, Tortoise has come out punching and issued a statement insisting that it has a plan to save The Observer from irrelevance and closure under its current owners.

And Guardian Media Group management has issued an update to staff saying Observer journalists who don’t want to join Tortoise may be offered voluntary redundancy.

The strike will take place on Wednesday and Thursday 4 and 5 December – the earliest point at which it is legally allowed to happen. Press Gazette understands that a second 48-hour stoppage has been pencilled in for the following week.

Journalists have opted for 48 hours, rather than 24, to maximise disruption and the stoppage would be likely to disrupt print production.

The decision to stage the walkout came after a union meeting on Wednesday attended by several hundred staff. Press Gazette understands the vote was overwhelmingly in favour of a strike.

Press Gazette understands that around 500 journalists at The Guardian and Observer titles are members of the NUJ and around 400 took part in the official strike ballot which took place ahead of today’s meeting.

Some 93% of those voting agreed to strike action, suggesting overwhelming opposition amongst staff to the Tortoise Media bid for The Observer.

Staff remain concerned about job security for the 70 Observer journalists who would transfer across to Tortoise Media and questions remain over funding for the bid.

Tortoise Media majority shareholder and founder James Harding has promised £25m of investment in The Observer over five years to turn it into a self-funding, paywalled newsbrand. The plan is to attract 100,000 new digital subscribers.

However, Observer insiders have now been told that the planned investment in place is £20m.

According to a Tortoise Media spokesperson the situation with investment is as follows: £25m will be invested over five years (with more near the start), £20m is to come from new investment and a further £5m will be invested from profits which Tortoise expects to make in the latter part of the business plan.

Journalists question whether this will be enough to cover the gaps in Observer coverage of sport, business and foreign news that would be left by departing The Guardian, and they see loss-making Tortoise as a precarious owner.

NUJ representatives met Guardian Media Group management in ACAS-brokered talks on Thursday and were told that due diligence for the Tortoise Media bid has now been completed.

One Observer insider said the mood is “very dark” and there is an expectation that the deal looks likely to go ahead. Guardian editor-in-chief Kath Viner, who also sits on the Scott Trust board, is understood to have power of veto over the deal and one insider said journalists are hopeful she will block it.

The GMG board is now putting the offer to the Scott Trust board for a decision in principle at its next meeting next week. The Scott Trust is the not-for-profit company which owns GMG and has the ultimate say over whether to sell The Observer.

Press Gazette understands the deal will need 75% approval from the 12-person Scott Trust board in order to go ahead.

NUJ representatives on The Guardian and Observer believe that under their house agreement with management, the proposed deal should be suspended whilst the matter is in dispute. They have also questioned why there is apparent haste to push the deal through before Christmas under what is seen as a Tortoise-imposed timetable.

GMG is currently in a period of exclusive negotiations with Tortoise Media to buy The Observer, but Press Gazette understands at least one rival consortium has expressed an interest in buying the world’s oldest Sunday newspaper, which is believed to sell around 100,000 copies per week.

GMG chief executive Anna Bateson has hinted at cutbacks and changes to The Observer if the Tortoise deal does not go ahead, warning staff in a letter last month that if the deal does not proceed there would be “a strategic audit of The Observer which would involve some difficult choices – and that would need to happen urgently”.

Guardian management: Talks with NUJ continue

A spokesperson for Guardian News and Media said: “We recognise the strength of feeling about the proposed sale of the Observer and appreciate that NUJ members wish to make their views heard. While we respect the right to strike, we do not believe a strike is the best course of action in this case and our talks with the NUJ continue.

“Our priority is to serve our readers and support our staff, so that the Guardian and the Observer can continue to promote liberal journalism and thrive in a challenging media environment.”

Tortoise Media: ‘We want to save the Observer from closure’

Tortoise Media issued the following statement following the strike vote:

“We want to save The Observer. Everyone can see it is heading down a path to irrelevance and, probably sooner rather than later, closure. In the last 15 years, sales on a Sunday are down 70 per cent, the staff has shrunk by more than 60 per cent, the paper no longer has foreign, business or sports coverage of its own; home news is likely to be next; how long do you think The Guardian will keep two sets of critics reviewing the same plays, films, art and music? The Observer is a print-only brand in a digital age, its journalism lives, briefly and unloved, on The Guardian website.

“We have heard from a lot of Observer journalists who are excited about our ambition for the paper – the people with digital skills, the money for new staff jobs and a bigger editorial budget and the plan for growth that we bring. They also know the Guardian’s plan for ‘an urgent audit’ of The Observer if the deal doesn’t go ahead is code for folding it in or closing it down.

“We want to work with the unions, but we don’t think they’re right to defend things staying as they are. The path of managed, accelerating decline is not the answer. The majority of people who have voted in this ballot don’t work on the paper and this deal doesn’t directly affect them.

“We hope the NUJ will listen to the growing number of voices on The Observer looking to see it given a new lease of life, investment in journalism and a plan for the future.”

Following the Tortoise Media statement Press Gazette spoke to an Observer insider who said it was wrong to suggest the strike does not have strong support inside the Observer team. They said support for the strike was, if anything, stronger at the Observer than it was across Guardian/Observer chapel as a whole.

Guardian CEO Bateson says Observer staff may be offered voluntary redundancy

Guadian CEO Bateston has issued an update to all staff confiming that the Tortoise bid for the Observer will now go to the Scott Trust for final approval.

She said: “There was a GMG board meeting last week. They reviewed the current state of negotiations, the strategic position of the Observer and the due diligence that has been undertaken. The board gave its support to management to continue to pursue the proposal from Tortoise. The proposal will now be considered by the Scott Trust.

“In terms of the due diligence process, while we have completed much of this work, we continue to negotiate on some of the transitional services. I hope to be able to outline more on this in the next couple of weeks.

“We have been holding regular meetings with Observer staff and the NUJ for the past seven weeks to discuss the potential sale of the Observer. Yesterday, we continued our talks with the NUJ at ACAS. It was a further opportunity for both sides to exchange views, hear different perspectives and try to find common ground. That process is ongoing but we are able to update you on some of the areas we were able to make progress on.

“We have listened to requests from Observer staff and, at ACAS yesterday, we informed the NUJ that we are considering offering voluntary redundancy to Observer staff if the deal goes ahead. This would be on the same terms we offered to editorial colleagues in the summer. Suzy Black, HR Director, will be writing to the Observer team to explain this in a bit more detail.”

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The body which owns The Guardian has changed its membership as it approaches a crunch decision over whether or not to sell The Observer.

The Scott Trust is a limited company which owns Guardian Media Group (the publisher of The Guardian and The Observer).

Update 15/11/2024: The appointment of former investment banker Jonathan Paine to the Scott Trust board appeared to bring the membership of the Scott Trust board to 13. However, although 13 members of the Scott Trust board were listed on its website and were named in a press release this week, the Guardian has issued a clarification and said there are only 12 directors of the Scott Trust because Stephen Godsell, GMG company secretary, is not a director.

Press Gazette understands that 75% of the 12 directors of the Scott Trust would need to give their approval for the disposal of The Observer to go ahead.

The Scott Trust has already given GMG the green light to negotiate exclusively with Tortoise Media over the sale of The Observer and the transfer of 70 staff.

Press Gazette understands it is now considering at least one other offer for The Observer brought by a rival consortium.

According to the latest Articles of Association for the Scott Trust Ltd, 75% of the directors must agree to a “decision in relation to the disposal, directly or indirectly, of the whole or a significant part of the Guardian”.

Given the 70 editorial staff of The Observer contribute significant amounts of content to The Guardian website it would appear that this clause will be enacted.

Two Observer insiders spoken to by Press Gazette said there was unease amongst staff about the unusual appointment of a 13th Scott Trust member at this time. Some staff feel there is a lack of transparency over how and why Scott Trust members are recruited.

Asked to explain the recruitment process for the extra Scott Trust member, a spokesperson for Guardian News and Media said: “Non-executive director roles are advertised and follow an open and rigorous recruitment process.”

Update 15/11/2024:The Guardian press office has since issued its clarification noting that there are still only 12 voting directors on the Scott Trust board.

Press Gazette has asked The Guardian press office to clarify how the voting over the future of The Observer will work and it was unable to elaborate.

Observer insiders have also noted a piece written by new Scott Trust board member Paine on the Oxford University website in which he described his former job at managing director at Rothshchild: “My job was, essentially, to polish, publish, promote (and occasionally create) the stories of the companies my clients wanted me to sell for them, or alternatively to go out and find a target which conformed to a previously written narrative. In bankers’ language this is called ‘M&A’ – mergers and acquisitions – acting as auction-master for companies being sold or as search agent for purchases. The core skill required is neither economic nor financial. It is an understanding of how a good narrative can, quite literally, create value.”

What is The Scott Trust?

The object of the The Scott Trust is to “preserve the financial position and editorial independence of The Guardian in perpetuity and, subsidiary to that, to promote the causes of freedom of the press and liberal journalism both in Britain and elsewhere”.

The body has come under huge pressure since news emerged that it was looking at selling The Observer to Tortoise Media in September.

The journalists of The Guardian and Observer passed a vote of no confidence in the Scott Trust board and are currently holding an official ballot over whether to take industrial action in protest at the Observer sale.

More than 80 leading UK cultural figures have signed an open letter to the Trust accusing it of betraying liberal journalism.

Many Observer journalists fear for their futures under loss-making Tortoise Media. Founder and chief shareholder of Tortoise James Harding has promised £25m of investment in the Observer over five years but insiders question whether this will be enough.

Given declining print sales, The Observer’s future is far from being assured if a sale does not go through. GMG chief executive Anna Bateson has warned that there will be an urgent strategic audit with a “difficult decision” ahead if The Observer stays under its current ownership.

Who sits on The Scott Trust?

The 12 current Scott Trust members who will have the final say over The Observer’s future are as follows:

• Chair Ole Jacob Sunde (former chair of Schibsted Media Group).
• Katharine Viner (editor in chief of The Guardian)
• Tracy Corrigan (formerly chief strategy officer of Dow Jones)
• David Olusoga (historian, writer, broadcaster and filmmaker)
• Dr Jonathan Paine (former managing director of investment bank Rothschild)
• Stuart Proffitt (publishing director at Penguin Books)
• Matthew Ryder (barrister and founder member of Matrix Chambers)
• Vivian Schiller (former head of news at Twitter)
• Russell Scott (chief commercial officer of video platform Mavis and the Scott family representative)
• Haroon Siddique (Guardian legal affairs correspondent and journalist representative)
• Margaret Simons (journalist, author and journalism academic)
• Nabiha Syed (chief executive of The Markup, a journalism non-profit)
• Update 15/11/2024: Stephen Godsell is company secretary of The Scott Trust Ltd and not a director (he was previously described as a director on the Scott Trust website but this appears to have been a mistake).

Scott Trust directors are paid £14,000 per year and chair Ole Jacob Sunde is paid £68,000 per year.

Who owns The Scott Trust?

The Scott Trust is itself owned by David Olusoga, Russell Scott, Haroon Siddique, Ole Jacob Sunde and Kath Viner who each have equal shares. The Scott Trust’s shareholders do not receive a dividend and cannot sell their shares.

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Observer staff have been warned that “difficult decisions” lie ahead if the Tortoise deal to buy the title does not go ahead, according to the latest sale update.

Guardian Media Group chief executive Anna Bateson said The Observer is loss-making when shared costs are taken into account and that it is forecast to become loss-making regardless within three years.

According to a financial statement for the year to August 2024, the Observer newspaper made annual revenue of £16.4m meaning it made a “contribution” to GMG of £3.4m, excluding shared costs.

In her email to staff, Bateson said GMG was already “beginning to think about the future of the title, given its financial situation and the fact it is a UK-only, Sunday print newspaper” before Tortoise Media made its bid for the title just over a month ago.

Tortoise Media has promised £25m of investment in The Observer over five years. No additional purchase price has yet been mentioned publicly.

Bateson described this as “a serious offer” which would “create a more sustainable business strategy for The Observer”.

Sale latest: The Observer would become main Tortoise Media brand

Talking about the detail of the Tortoise bid, she said: “Tortoise Media propose that they would continue to publish the Observer as a Sunday newspaper, with business, sport and international coverage and an emphasis on original journalism.

“The Observer would be the brand for the media organisation and all the existing sections – Observer Magazine, New Review and OFM [Observer Food Monthly] – would be retained. In addition, Tortoise would invest in creating a dedicated digital presence for the Observer, as well as newsletters, podcasts and events.”

Observer insiders question whether Tortoise has the funding in place to cover business, sport and international news – all of which currently come from Guardian journalists.

Bateson said a final decision on whether or not the deal will go ahead is expected before Christmas. Insiders question why there is such haste to get the deal done to what appears to be a Tortoise-imposed deadline.

The Scott Trust, which owns The Guardian, has been accused of betraying The Observer and its journalists by seeking to sell the title.

But Bateson said: “If the deal goes ahead, ensuring that there will be an ongoing alignment of values is extremely important. The Scott Trust believes that considering the offer is entirely consistent with its responsibilities to liberal journalism.

“The Observer would become the sole title and focus for Tortoise, thus enhancing liberal journalism and increasing plurality.”

Insiders maintain that statements from The Scott Trust had given the impression that The Observer was subject to the same protections as The Guardian. For example at the time of its purchase in 1993 then-Scott Trust chair Hugo Young said The Guardian’s “trust safeguards will be fully extended to The Observer”, although management believe this related only to the newspaper’s editorial independence.

Observer staff warned status quo will not return

Bateson warned that life would not go on as before for Observer staff if the Tortoise deal is abandoned.

She said: “If the deal does not go ahead, the status quo is not an option. Kath [Viner, The Guardian editor], in her email at the beginning of the summer, committed to a strategic audit of the Observer which would involve some difficult choices – and that would need to happen urgently.

“We want to be plain about this because we all have a responsibility to be honest about the growth prospects of a UK only, Sunday, print title when it is competing with investment in the future of the Guardian.”

One Observer insider said the title was no more print-only than the The Guardian given the fact all its content was published online and contributed to the digital side of the business.

On the Observer’s current financial position, Bateson said: “We have shared an Observer-only P&L (profit and loss statement) with staff. Although the Observer has performed well in terms of its market share, its circulation is, like all newspapers in print, in continual decline and the title is forecast to be loss-making within three years, if not sooner.

“If shared costs, such as technology, ad sales, marketing, rent, finance and HR as well as sport, international and business journalism, were allocated, the Observer would already be loss-making.

“This is why we talk about needing to make difficult decisions if the deal does not go ahead. In other words, the Observer is likely to have more freedom to be financially sustainable if it is separated from the Guardian.”

One insider said that the tone of this felt “quite bullying” because it was effectively telling Observer staff “things will be horrible if you stay”.

It is still unknown who exactly is financially backing the deal, but Bateson said: “An initial assessment of Tortoise Media’s existing investors found them fit and proper to proceed to this point.”

Tortoise editor in chief James Harding is the largest single shareholder in the business with a 32.5% stake.

Scott Trust would retain Observer stake

If the deal goes ahead, the Scott Trust will retain a small stake in The Observer which would be “a sign of confidence in the future success of the title”, Bateson said.

The Observer would be covered, she said, by Tortoise Media’s existing commitments to editorial independence.

The existing NUJ “house agreement” would transfer across with The Observer. This means staff would be protected from compulsory redundancies (but not from losing their jobs if the standalone business were to fail).

Journalists at The Guardian and Observer have backed possible strike action in protest against the sale in an indicative vote.

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Former Observer editor Roger Alton has given his backing to Tortoise Media‘s bid to buy his old title.

Alton was one of three former Observer editors to accuse Guardian Media Group owner the Scott Trust of abrogating its responsibilities to the title by putting it up for sale.

But writing to Press Gazette, Alton has made clear that he supports Tortoise Media’s bid. Meanwhile, the NUJ is currently balloting Guardian and Observer staff over potential strike action in protest against the deal.

The 70 Observer journalists who would transfer across to Tortoise have concerns about job security working for a stand-alone title.

Roger Alton: Tortoise would offer Observer ‘a massive new shot in the arm’

Alton writes: “I had the great privilege of editing the paper for nearly a decade from 1998 (though I had also spent a fantastic few months working there as a teenager in the 1960s, which convinced me that this was the life everybody should want, and that newspapers were the lifeblood of a healthy society).

“So I feel great loyalty and affection for the paper, which is after all the oldest Sunday paper in the world (b 1791) and has not just been responsible for some of the bravest and best campaigns of recent years, but is also a source of great fun and entertainment and some of the best writing around.

“This is why I am so cheered by the arrival of Tortoise media. Clearly the Scott Trust, owners of the Guardian, wants to wash its hands of the Obs, which it has always seemed to view as an unwanted and charismatic neighbour arriving at a sedate family dinner.

“In my view, Tortoise would clearly be an ideal new owner. It too has a proud record in major campaigns, its journalism is widely admired, its podcasts pioneering too. And it has on its staff some of the best journalists in the country. It is also utterly committed to preserving the newspaper as a print product, as well as developing a substantial digital presence.

“My belief is that Tortoise would not just be an ideal custodian of the traditions and qualities of the Observer, but would also, as a highly-skilled multi-media organisation, offer a massive new shot in the arm.”

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Some Observer journalists say they have been left with more questions than answers after a series of meetings with Tortoise founder James Harding about his proposed deal with Guardian Media Group to buy the title.

A mandatory Guardian/Observer NUJ chapel meeting is set to be held on Thursday at 11am to “decide on our next steps”. Internal scepticism about the Observer deal is reflected by the fact NUJ chapel officers said they “will be recommending that the chapel puts the matter into dispute”.

Journalists at the Guardian and Observer passed a vote of no confidence the titles’ owners, The Scott Trust, after it was announced on 17 September that Tortoise is in exclusive talks to buy The Observer.

Since then, Press Gazette understands Harding (who is also the largest single Tortoise shareholder) has met various Observer staff to discuss their concerns about the deal. But key questions around finance for the acquisition and future business plans remain unanswered by the Tortoise team and Guardian management.

One Guardian insider summed up the mood saying: “If the deal doesn’t go through then what is future of The Observer? The whole issue has weakened security for staff as they think either now there is a ‘for sale sign’ over The Observer or they limp on with dubious commitment from the owners.” 

Questions remain among Observer staff as to how Tortoise deal will be financed and its effect on jobs

Staff concerns appear to centre around three main areas: finance, quality and job security.

Harding has said £5m per year will be made available for investment in The Observer over and above the title’s usual runnings costs for a period of five years. But insiders fear this money could be quickly swallowed up paying for things which currently do not appear on The Observer accounts such as: online editing and production; sports, business and international coverage; coverage of Scotland and north of England; legal support; and IT and content management systems for both print and digital.

Staff have also yet to be given any information about who is providing the finance for the deal and whether any additional purchase price is being offered for The Observer, beyond the promised investment. Press Gazette has previously detailed the current Tortoise Media shareholders.

Insiders say they have yet to see a business plan or even a Powerpoint presentation providing detail about Harding’s plans for The Observer. Press Gazette has previously reported that Tortoise plans to grow The Observer with the help of an online paywall.

Staff fear that journalistic quality will suffer under the new owners without the support of the wider Guardian team (which comprises more than 1,000 editorial staff).

Job security appears to be the biggest concern among the 70 Observer staff who would transfer across with the deal. One insider said simply that staff are happy working for Guardian News and Media (GNM), which is the trading name for the combined Guardian and Observer business, and they do not want to move.

GNM has never made compulsory redundancies so its staff have some of the most secure jobs in UK journalism. Press Gazette understands that staff frequently move between The Guardian and The Observer, so they feel there are more career opportunities within the wider organisation. GNM owners the Scott Trust also benefits from a £1.3bn trust fund which is there to support the journalism of The Guardian in perpetuity. And, unlike most UK news businesses, GNM’s primary focus is on producing journalism (rather than turning a profit) free from commercial pressure and true to founder CP Scott’s liberal values.

Press Gazette understands that Harding wants to adopt an Atlantic-style model. The US monthly went from losing $20m per year to profitability and now has more than one million subscribers in print and online.

But insiders fear this will be hard to replicate in the smaller and more crowded UK market.

Guardian editor Kath Viner is understood to have told staff that any deal has to be a good one for The Observer as well as The Guardian.

A Guardian spokesperson said: “We announced last week that we are in talks with Tortoise Media about their offer to buy the Observer. Those exclusive negotiations have only just begun. It is important to be transparent with staff because it is a potentially significant investment that needs to be looked at in detail. We are engaging with staff and welcome every opportunity for internal discussions on this.”

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The post ‘Sad’, ‘disrespectful’, ‘un-Guardian’ – but not a huge surprise: Insider reaction to the ousting of Alan Rusbridger appeared first on Press Gazette.

Former Guardian editor Alan Rusbridger is set to face challenging questions from journalists at the paper when he steps into in his new role as chairman of the paper's owner – the Scott Trust.

Five Guardian journalists are in the running to be the staff representative on the trust and at least two of them have made forthright criticism of the way the title has been run.

Some Guardian staffers believe that editorial expansion (into the US and Australia) in recent years laid the ground for the paper to make an operating loss of £58.6m last year and for its savings to reduce by more than £100m. Rusbridger stepped down as editor in May 2015 handing over to Katharine Viner. He is set to take over as chairman of the Scott Trust this summer.

In the year to the end of March 2015, Rusbridger's last full year in charge as Guardian News and Media editor in chief, the paper reported underlying losses of £19.1m, which – with £838m in the bank – were seen at the time as being sustainable.

Hustings were due to be held today for the staff representatives seeking election to the Scott Trust board (see update below for report from hustings).

Columnist Polly Toynbee, cartoonist Steve Bell, Guardian economics correspondent Phillip Inman, Guardian financial editor Nils Pratley and the paper's defence and intelligence correspondent Ewan MacAskill are in the running for a position on the body, which meets four times a year.

In his election address Pratley raised concerns about operating losses for the paper of £300m over the past decade and "cash outflow" of £80m in the past 12 months.

And he said: "I share the concerns, aired in the recent staff and chapel meetings, about accountability on the Scott Trust's board. Standard principles of good governance have not been followed and shortcomings need to be addressed."

Pratley declined to comment further on this, but Press Gazette understands that some staff are concerned about Rusbridger moving from editor to Scott Trust chairman.

MacAskill said in his election statement: "I am gobsmacked that we went through a painful round of redundancies in 2012, reducing the editorial staff to 500, only to take on another 450 and now beginning another round of cuts. How did we end up in this mess? And how are we going to get out of it?

"We have a £740m pot, with another £200m still be to added, and we cannot allow that to be squandered."

As of last year, Guardian News and Media had 968 people defined by the company as "core editorial staff". The £200m MacAskill mentions may be a reference to the profit Guardian Media Group could make from the sale of its stake in Ascential (formerly Emap).

MacAskill also talks in his address about "tough decisions ahead" which include the possible "eventual phasing-out of the paper, with maybe only the Saturday Guardian and the Observer left". And he talked about the search for a new business model: "…a paywall that is not called a paywall, new deals with Facebook, philanthropists, crowdfunding and the creeping growth of native advertising".

MacAskill said there is also the "hint of a move towards compulsory redundancies for UK staff hovering in the distance that would require to be met with fierce resistance".

Guardian Media Group said last month that it is looking to cut 100 editorial jobs.

Beth Rigby in The Times reported staff "anger" over Rusbridger's return as Scott Trust chairman.

One un-named insider told the paper: "Stepping down as chief executive and becoming chairman is something that is not approved of in business management and you can see why, because in effect Alan is going to become Kath Viner’s boss when she is reversing some of the decisions he made.

"It is ludicrous. It is an unsustainable relationship with him as chairman and Kath as editor. It is not going to prosper in these circumstances."

The Scott Trust's main remit is to protect the journalism of The Guardian, it also approves Guardian Media Group's business plan. It is far less directly involved in the running of the business than the Guardian Media Group board.

UPDATE: 22/4/20165

Guardian poliitical reporter Michael White, who chaired the Scott Trust election hustings, spoke to Press Gazette after the meeting. He said: "Staff had a constructive 90-minute session today with the five colleagues seeking to become their next representative on the Scott Trust.

The post Guardian-owning Scott Trust faces challenge from journalists over losses, governance and redundancies appeared first on Press Gazette.

The Journalism Diversity Fund has sponsored 200 minority trainee journalists since its launch in 2005.

The fund has provided four more students, who lack the means to pay for an NTCJ-accredited course and are socially or ethnically diverse, with a bursary that pays for their course fees and supplies a subsistence allowance for the year.

This year the following four students recieved the award:

· Beth Baldwin, Press Association Newcastle

· David Laniyan, Lambeth College

· Mantej Mann, Press Association London

· Abiola Olanipekun, News Associates London

The interviews for the 2015 award were hosted by The Daily Telegraph last friday with NCTJ chief executive Joanne Butcher, BBC social mobility executive Cheryl Varley and Guardian leader writer and columnist Hugh Muir on the interviewing panel.

Varley said she felt priveleged to be a part of the scheme: “The diversity fund is a wonderful initiative that practically tackles the economic and cultural issues that have led allowed the profession journalism to become infamous for its social exclusion. It was an inspiring experience to meet the applicants, I wish each of them every success for the future.”

To mark its 10th anniversary, the Journalism Diversity Fund recieved £100,000 from NLA media access, who have now provided over £1 million towards the scheme.

A reception for the fund's 10th anniversary was held last month, presenting the winners with their awards and revealing the new Thomas Read bursary helping disabled journalists.

Gemma Louise Hogson, currently studying at St Mary’s University, was the first recipient of this award.

The post Journalism Diversity Fund bestows its 200th NTCJ bursary appeared first on Press Gazette.