The Star, 5 October 1998

Presently, a Broadcasting Bill is being debated in Parliament that will alter the way that the South African Broadcasting Corporation is structured. This Bill will replace the apartheid legislation that founded the SABC as a state broadcaster, and also will set objectives for the sector based on universal access for all South Africans. These developments are most welcome, but will the specific proposals around the SABC realise these objectives? Very possibly, they may have the opposite effect of sidelining of the SABC’s public broadcasting mandate. The Minister of Communications will also have greater financial control over the SABC, which does not bode well for its independence.

The plans for the SABC involve corporatising the broadcaster with the state as sole shareholder, making it subject to the provisions of the Companies’ Act. Services will be separated into public service and commercial operations, with the former being governed according to a statutory Charter. The latter will indirectly cross-subsidise the former by declaring a portion of its profits as dividends to the state, and the Minister may then decide to redirect some of these dividends back to the public services. These plans may go ahead in spite of the fact that there are practical alternatives that could be implemented with some imagination and political will.

Public enterprises are usually corporatised to set them free from government control, forcing them to adopt market principles. Corporatisation is often a prelude to privatisation. The subtext of the SABC’s corporatisation seems to be that ongoing state funding will not be forthcoming, something that has been called for since the transformation of the broadcaster began. Many have argued that state funding is necessary for the SABC to deliver on its public service mandate, as a commercially-driven operation will be geared mainly towards servicing the needs of audiences that are attractive to advertisers.

We are hearing that continuing to call for state funding is out of step with the reality of fiscal constraints the country is facing. If one accepts this logic, then the government’s plans to corporatise the SABC make perfect sense. Or do they? Part of the problem is that these plans contain an internal contradiction, with the government seeking to set the SABC free and retain control over it at the same time.

For example, the SABC will be unable to buy land or borrow money without the permission of the Minister. The Minister’s role in redirecting funds to the public service arm is also questionable. This degree of financial control contradicts one of the basic principles of company law, namely a strict separation between ownership and control, and undermines the basic effects of corporatisation. It is also not consistent with the degree of independence that a broadcaster like the British Broadcasting Corporation enjoys, which is an obvious parallel to draw given that ten of the sixteen clauses contained in the Charter are taken virtually verbatim from the BBC Charter. This desire for more control is a key feature of the new broadcasting policy, in that the Minister will now be empowered to make policy and issue policy directives to the Independent Broadcasting Authority. Strangely enough, the government wants more control to have less control, as greater power will help it to direct the process of liberalisation more effectively.

Dialectical contradictions aside, is corporatisation of a public broadcaster a good or a bad thing? The problem is that there is a social price to pay in corporatising state enterprises. Another public broadcaster that has been corporatised in a similar way, and that has a similar funding base to the SABC, is to be found in New Zealand. In line with the country’s aggressive liberalisation policies in the 1980's, the radio and television services were corporatised, with the former being divided into public service and commercial arms. The commercial arm was privatised soon afterwards. Since then, New Zealand radio has become increasingly cash-starved and fragile, as corporatisation killed off the internal cross subsidisation arrangement between the more successful and less successful operations by forcing the broadcaster to return dividends to the fiscus. These developments precipitated ongoing litigation by Maori groups on the basis that broadcasting in Maori languages would be marginalised even further. Television on the other hand has become fully commercial, with the result that local content programming has diminished, especially minority and special interest programming. In fact in 1996, one of TVNZ’s own board members described it as the most degraded television in the English-speaking world.

Corporatisation makes it too easy for governments to privatise public broadcasters in ways that compromise their public service mandates. The White Paper on Broadcasting which preceded the Bill suggests that the SABC’s commercial arm may be privatised in future, subject to a review of the impact of Midi TV on the market. This move would put paid to the government’s cross-subsidisation plans once and for all. This proposal is amplified by the fact that the Bill seeks to give the Minister the power to determine all matters relating to privatisation of state-owned broadcasting enterprises. Given the privatisation mania currently sweeping the country, important services could be sold off. For example, if the SABC’s four main profit-making stations are privatised as proposed, the remaining services may well broadcast in only 10 of the 11 official languages.

But is there an alternative? Surely the government is merely acknowledging the reality of its fiscal constraints by restructuring the SABC in this way? It seems to be a obvious thing to say that reality looks different depending on where you are standing. The reason that the government is not funding the SABC has more to do with specific political choices it has made rather than a genuine lack of money. In terms of the Growth, Employment and Redistribution Programme (GEAR), it has committed itself to a home-grown structural adjustment programme to reduce the country’s debt largely inherited from apartheid. Currently this debt stand at R311 billion. As a result, social services such as education, health, welfare, housing and communications have suffered budget cuts: in fact for this financial year, the repayment on the debt’s interest is the second highest item on the country’s budget. Small wonder that anger is growing about the fact that those who bore the brunt of apartheid are now being made to pay for its legacy.

What is disturbing about this situation is that practical alternatives have been developed for cancelling the debt, much of which is owed by the government to itself in any event. Also, recently, there has been an acceptance in international law of the ‘doctrine of odious debt’, whereby debts incurred by undemocratic governments can be cancelled legally by the democratically elected government that replaces it. Cancelling the debt would unlock considerable resources for social services, including funding for the SABC. Some very crude number crunching should put the matter into perspective. This year, R39 billion was allocated in the budget for interest repayment on the debt. The SABC’s current annual budget amounts to R1.2 billion, so approximately one fortieth of the interest repayment would be sufficient to cover all of the SABC’s expenses, not that this would be necessary if the broadcaster had other sources of income as well. Money could also be unlocked for the establishment of a statutory Media Development Agency, which would facilitate media diversity, and fund projects where necessary to achieve this ideal. Given the growing struggles in the country around GEAR and the debt, should we really close the book on the possibility of state funding in our policy and legislation? If we do, then whose version of reality dictates our actions? Self-censorship is a very powerful tool, especially if it involves tailoring our very thinking to suit a range of artificially-developed constraints. In doing so, perhaps we willfully give away the most powerful weapon in our transformation arsenal: our belief in our capacity to bring about real change.