Putting the SBS and the ABC under one roof would lead to the eventual death of the multicultural broadcaster, says former prime minister Malcolm Fraser, whose government created SBS almost four decades ago.
The federal government's efficiency review into public broadcasting has recommended SBS vacate its premises in Sydney and Melbourne and move into ABC headquarters.
The report has been handed to Communications Minister Malcolm Turnbull and the managing directors of ABC and SBS in draft form. It will be discussed by the boards of both broadcasters in June.
"This would be the first step towards the abolition of the SBS," Mr Fraser said. "They are fundamentally different broadcasters with different audiences and different needs.
''If SBS has to move in with the ABC then the ABC will swamp it."
If the recommendation were accepted, SBS would depart its headquarters in Artarmon and in Federation Square in Melbourne. The ABC would have to find space for almost 1000 extra employees.
The two broadcasters would share studio facilities, cameras, equipment and other resources for the first time.
The move would rake in millions of dollars through property sales and merged back-office operations.
In a speech last month, the immediate past chairman of SBS, Joseph Skrzynski, said merging the two broadcasters would be ''wrong in principle, bad economics and even worse politics''.
''For those of us in business, we know there is a very simple law that applies to mergers: the larger culture smothers the smaller,'' he said.
The efficiency review was led by former Seven West Media chief financial officer Peter Lewis. The 146-page study has identified greater co-operation between the ABC and SBS as a key area for savings.
The review is expected to recommend increasing the amount of advertising SBS television is allowed to sell each hour, selling off the ABC's fleet of outside broadcasting vans and outsourcing payroll, human resources and legal functions to the private sector.
Mr Fraser said he feared shared facilities would act as a precursor to an eventual takeover of SBS. "These people looking for efficiencies have no understanding that governments have to do things you can't put a dollar on.''
Following a week in which Mr Turnbull had to quash suggestions ABC cuts would force popular children's TV program Peppa Pig off screens, the Communications Minister said: ''Suggestions that popular programs or services are at risk because of budget savings are not credible.''
The ABC and SBS have argued any savings should remain with the broadcasters to reinvest them in new programs and services. But the government's description of $44.5 million in budget cuts as a ''downpayment'' on the efficiency review has sparked fears this will not happen.
The government cannot force the broadcasters, which are independent agencies, to accept any of the review's recommendations. But it hopes the spectre of further budget cuts will encourage the broadcasters to make difficult savings decisions.