New Zealand On Air says it was unaware that its funding of the new 3D Investigates programme would lead to TV3 cutting half an hour off 3News on Sunday nights.
The unexpected effect of taxpayer funding leading to a cut in daily news production illustrates one of the issues facing the state-funding agency as it gets more involved in news and current affairs programming.
How much do its decisions play into the strategic and financial strategies of TV Networks?
MediaWorks is aiming to boost revenue to shareholders by socialising the costs of a genre that was traditionally funded by commercial revenue.
NZ On Air spokeswoman Allanah Kalafatelis said that the agency learned on Friday that 3D Investigates would run at 6.30pm on and that 3News would be cut to make room.
Its forerunner 3rd Degree - which undertook the Teina Pora Investigation - had effectively been canned last year after having made a financial loss, according to news boss Mark Jennings.
The public announcement on the change was delivered on Sunday.
Kalafatelis said New Zealand On Air was not concerned about the loss of the half hour of news to fit TV3's demands for a prime time spot.
Indeed TV3 is looking at the whole 6pm to 8pm timeslot and over the years has talked about dropping back to a half-hour show seven days a week.
Others will back its decision since Sunday nights are traditionally quiet for news, although as a result there will be less sport and international news. Kalafatelis said NZ On Air had no problem with the late advice and that it was not consulted on the implications.
The decision came amid the uproar over a MediaWorks review of the 7pm current affairs show Campbell Live with speculation about whether it will see out the year.
According to a source the options for a replacement include a Jono and Ben- style show, a version of Hard Copy as well as renewing Campbell Live with an amended format.
Officially TV3 has dismissed suggestions it is planning to replace Campbell Live with a daily soap opera.
The threat to Campbell Live has prompted a groundswell of support for the show and led to a debate about the funding of television current affairs, and journalism in general.
In today's Herald columnist Fran O'Sullivan suggests an arrangement where a NZ On Air type organisation supports journalism in more mediums.
MediaWorks has kept NZ On Air apprised of its plans to develop a soap and in return we have given them a clear message that a substantial new drama project will be challenging for us at this time with a constrained budget.
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NZ On Air is restricted to giving the bulk of its funding to broadcasters but says there are possibilities for accessing funding for journalism from its digital allocation.
As it stands that would not go far though - that is currently limited to $3.2 million.
With the exception of a round of funding for 60 Minutes NZ On Air has in the past largely ruled out current affairs but its NZOA Platinum Fund has increasingly been used to fund current affairs such as TV One's Q&A and TV3's The Nation.
In 2013 TV3's The Vote - with Duncan Garner, Guyon Espiner and Linda Clark - extended the role of taxpayer funding in the genre through NZ On Air.
The question now is how much funding agencies like NZ On Air should pick up the slack and act as a facilitator for networks commercial strategies and whether we want to have a Wellington-based state funding agency getting more involved in the oversight of current affairs.
NZ On air issued a statement on its approach to a proposed TV3 soap.
"MediaWorks has kept NZ On Air apprised of its plans to develop a soap and in return we have given them a clear message that a substantial new drama project will be challenging for us at this time with a constrained budget.
The show is being developed by the Warner Bros owned production company Eyeworks, which was founded by Julie Christie.
NZ On air said: "When MediaWorks first raised the idea of a soap NZ On Air suggested an open tender process to find a project, in the interests of transparency and getting the best idea on the table.
"However we have not been involved in their decision to do this, or the selection process to determine the project and production company. To have been involved in this process might have implied funding was guaranteed, and it is not.
"We will be considering an application for development funding at our May meeting. We do not release details of development funding due to commercial sensitivity although information on all development funding grants is released in retrospect in our Annual Report.
TV3 has said any new soap was not planned to screen in the 7pm timeslot.