MultiChoice, the pay-TV company that operates SA’s largest direct broadcast satellite service, DStv, has called on the government to park a legislative proposal meant to enhance the SABC’s governance structures and finances pending a comprehensive review of the country’s broader broadcasting policy framework.
The department of communications has this week been holding public hearings on the draft SABC Bill, which was published for comment in July. In its submission on Wednesday, MultiChoice said dealing with the SABC funding model now would be putting the cart before the horse.
“We first need a policy decision [not legislation] on what the SABC mandate is in 2021, not 1999, and what its scope of work will be in the new environment,” MultiChoice said.
Such a review will also clarify the position of bigger players such as Netflix in the current broadcasting environment.
The public broadcaster, which remains the main source of news and commentary for many locals, especially in far-flung areas, is desperate to boost its finances as government funding has all but dried up while advertising and licence fee revenues are under pressure, partly due to the Covid-19 crisis.
MultiChoice said the focus should be on finalising a separate but related draft white paper or broad statement of government policy on audio and audiovisual content services. The white paper that was published in October 2020 details, among other proposals, that the statutory definition of broadcasting services is too narrow and too platform-specific, ignoring streaming services such as Netflix.
It is suggested that the TV licence fee regime should consider devices such as tablets and smartphones as they are able to receive broadcast content.
“SABC funding is a much bigger issue which requires careful policy consideration and clarity. Do not make any changes to the TV licence fee provisions at this stage pending finalisation of [the] white paper process ... policy must be settled before legislation can be drafted and takes years to do properly,” MultiChoice said in its submission.
The bill has been criticised by various stakeholders who say it is outdated and will not do much to address the public broadcaster’s financial woes. If approved, the bill will replace the Broadcasting Act, which regulates the SABC and the role of the minister of communications & digital technologies in its affairs.
The current bill does not explicitly address the pressing issues facing the broadcaster: revenue generation and entrenching the independence of the board, which are crucial considerations in the drive to mend the company after years of political meddling that led to the collapse of previous boards. This contributed to the acute governance and financial crises the SABC has suffered in recent years.
The bill largely maintains the current licensing regime, with the reduction of the size of the SABC board from 12 non-executive directors to nine as the biggest proposed change.
In its submission earlier this week, the SABC reiterated its call for the scrapping of the current TV licence system, saying it should be replaced by a public broadcasting household levy. It wants a device-independent, tech-neutral household levy for public broadcasting, which would levy all households, with an exemption for the indigent and discounts for pensioners.
The SABC is heavily reliant on advertising and revenue from licence fees to stay afloat. It receives about 80% of its revenue from advertising and sponsorships, 14% from TV licence fees and 3% from government grants.
It has proposed that MultiChoice and online players such as Netflix help it collect licence fees from the public.
MultiChoice said it remains opposed to this proposal, referring to it as a “non-starter”.
“We remain firmly opposed, it’s not best practice internationally, it is a non-starter. It is unreasonable for a private entity to be forced to bear a burden which should be borne by the state, especially when there are more effective mechanisms available,” MultiChoice said.
In its submission, the Organisation Undoing Tax Abuse (Outa) said the SABC should receive a government subsidy.
“We are advocating for the SABC to be funded with a government subsidy, so we don’t need TV licences which are uncollectable,” said Stefanie Fick, Outa’s executive director. Fick said a regular annual grant to the SABC from the fiscus could be used to cover at least part of the public broadcaster’s costs.
“It will provide a more stable revenue stream and, in conjunction with good governance and management, will avoid the irregular and disastrous last-minute bailouts.”
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