Tough times are coming for Canada's public broadcaster, CBC president Hubert Lacroix told employees Monday afternoon, though he also rejected a newspaper columnist's allegation that CBC is "looking to the government for handouts" amid the current economic downturn.

A column published on Sunday by the Sun newspaper chain's Greg Weston "horrendously distorted the facts," Lacroix said in a memo to staff.

A CBC release issued Monday rejected a host of Weston's claims, including that the CBC would be "in the red" at the end of this fiscal year and that the broadcaster's parliamentary appropriation was increased by eight per cent this past year.

The broadcaster will break even in this fiscal year, which ends March 31, and has had the same parliamentary appropriation, "save for a 1.5 per cent salary increase that Treasury Board allotted to all Crown Corporations and a carry over of some funding originally projected for the previous year," Lacroix said.

The statement also denied that the CBC asked the federal government "for a handout, an increased subsidy or an increase to our appropriation."

Weston's column drew from a leaked, working draft of Lacroix's note to staff.

Situation 'worse than anticipated'

Despite these clarifications, Lacroix's update delivered the sombre news to employees that as the senior executive team completes its budget-planning for the next year, "the situation is worse than anyone could have anticipated and is not expected to improve anytime soon."

The corporation is projecting a shortfall in advertising revenue in the $55-$65 million dollar range for the year ending March 31, he said.

Despite cutting spending and other measures to save money enacted since November, "we have used all of our reserves as well, and the entire surplus we carried forward from last year," Lacroix said.

Though the 2009-2010 budget still remains to be finalized before it is submitted to the CBC board in mid-March, the broadcaster will be faced with "tough choices that will affect, in one way or another, jobs, services and programs," because of the slump in commercial revenues and the rising costs of production.

"We are exhausting all possible avenues for financial flexibility to find a way to spread the impact of this crunch over more than one year, including the sale of some of our assets to balance this budget," Lacroix said.

He added that more details will be revealed at the end of March and promised further updates "periodically as things evolve between now and then."

Layoffs affecting media outlets across Canada

Other media outlets across the country have made major job cuts since the fall, in reaction to the worsening economy.

In November, media giant Canwest announced it was cutting 560 jobs, while broadcaster CTV revealed it was eliminating about 100 positions. Rogers Communications announced an unspecified number of cuts to its media division in December.

Canada's print media have also suffered, with significant layoffs already announced at papers such as the Chronicle-Herald in Halifax, Sun Media eliminating 600 jobs in Ontario, Quebec and Western Canada, as well as cuts at national newspaper the Globe and Mail.

In the U.S., public broadcaster National Public Radio also announced in December it was cutting seven per cent of its workforce and eliminating shows to save money.