One of Fairfax’s most distinguished journalists let a rather ominous cat out of a rather small bag on Saturday. Jack Waterford, the highly regarded editor-at-large of the Canberra Times, revealed the likely shape and direction of The Sydney Morning Herald and The Age as they enter a downsized world of fewer journalists and reduced editorial investment.

The model for the dismantlement of the two Fairfax flagships, suggests Waterford, is the Canberra Times itself — which runs on one-third of the editorial staff of either The Age or SMH, yet still carries 80% of their volume of content and is seen by Fairfax management, in Waterford’s words, as “a model of how efficiency could be improved without affecting quality”.

Those newspapers, wrote Waterford, will “lose some of their ‘middle’, retaining, perhaps indulging, a relatively few top-name writers while employing on average more young journalists”.

Rural Press, which has owned the Canberra Times for the past 11 years, is the largest shareholder in Fairfax and its managers are now demonstrably in charge of affairs at Fairfax.

Under Rural Press, the Canberra Times has been through “a strict regimen of management efficiency drives over the past decade”, according to Waterford, which is believed to have made it more profitable than ever before, achieved in part by purging most of the older, experienced journalists with corporate memory and replacing them with younger (and much cheaper) journalists, through attrition.

The SMH and The Age have 300+ editorial staff because, until last week, they regarded themselves as important platforms for Australia’s “public trust” journalism. If and when their resources shrink to the size of the Canberra Times they will still publish hundreds of thousands of words every day to fill the space around the ads. And then they will be as important to Australian democracy as the Canberra Times.