SABC's survival is crucial for democracy

The SABC Bill should address the funding crisis for the public broadcaster by regularising state funding.

There is no doubt about SABC’s value as a public broadcaster and OUTA believes this role needs support.

OUTA believes that while SABC was badly affected by state capture, with both financial fallout and attempts to control the content, the current board has overseen considerable efforts to turn the broadcaster around.

OUTA believes that the television licence is effectively a tax and should be treated as such, which would strengthen this revenue stream.

OUTA says this in a submission to the Department of Communications and Digital Technologies on the SABC Bill, which has been out for public comment.

“OUTA is of the opinion that television licence fees amount to a tax or revenue in terms of section 77 of the Constitution. The mere fact that a person has to pay a fee for being in possession of a television set whether it is used or not amounts to a tax or levy. One might still argue that where the set is used there is a benefit which accrues to the possessor but to pay for mere possession is akin to paying duty tax,” says OUTA’s submission.

TV licences should thus be covered in a money bill instead. This would also mean that the Minister of Communications and Digital Technologies should not be responsible for setting the licence fees.

“SABC’s annual report 2019/20 points out that only 2.5 million licence fees were paid, out of a database of 9.5 million licence holders, providing revenue of just R791 million. This is a significant failure which needs addressing,” says OUTA.

The television licence fees are meant solely to fund the SABC’s public broadcasting services, not the commercial services. However, OUTA raises concern that SABC does not separate these revenue and spending streams in the annual finances, as legally required.

OUTA also suggests considering a regular annual state grant for the SABC’s public broadcasting services. “This would avoid the irregular and disastrous last-minute bailouts but provide a more stable revenue stream particularly for the public broadcasting sector,” says OUTA.

“This could be seen as a grant in the furtherance of democracy. OUTA suggests cutting funding to wasteful programmes and diverting some of this to the SABC. For example, the National and Provincial Legislatures could provide some funding in the furtherance of democracy. These institutions manage to provide hundreds of millions of rands to political parties to support democracy. OUTA believes that some of these funds could be more usefully diverted to the SABC.”

“OUTA is pleased with the majority of the proposed Bill as it seems to focus on reinforcing provisions for operational and financial accountability. OUTA strongly opposes bailouts of state Institutions which squander taxpayer money, but recognises that the SABC is a public broadcaster and should get a certain amount of guaranteed funding from the state. Sufficient guaranteed funding, plus improvement of other sources of revenue, should help avoid the unpredictable bailouts,” says OUTA.

More information

OUTA’s submission is here.