SABC, Multichoice deal must be probed - leaked Parliamentary inquiry document

2017-01-18 12:12
SABC head office in Cape Town. (Duncan Alfreds, News24)

SABC head office in Cape Town. (Duncan Alfreds, News24)

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Cape Town - The deal between the SABC and pay-TV channel company MultiChoice had various defects and the contract was suspicious.

And the new SABC board, when appointed, must institute a forensic audit into the agreement that resulted in the transfer of part of the archives to a private monopoly, with the "specific aim of considering annulment of the agreement in the event of evidence of any improper activities".

This is according to the leaked working document following a Parliamentary inquiry into the SABC board’s fitness to hold office.

The 2013 deal between the SABC and MultiChoice was to give the pay-TV company the right to air two of the public broadcaster’s channels.

The deal was a R533m contract, to be paid over five years.

In December 2016, it was revealed that, after the deal was finalised in 2014, the SABC’s Hlaudi Motsoeneng scored an alleged R33m bonus, R11.4m of which he has already been paid.

According to the document, the deal between the two was surrounded by controversy from the start.

READ: Charges on the cards for failed SABC bosses

'Unlawful'

Three main issues were raised: The lack of transparency around how the deal was processed; the sale of SABC archives; and the extent to which SABC Encore and the SABC 24 News Channel would be accessible to citizens.

According to the document, board members raised concerns around the legal aspects of the contract between the SABC and MultiChoice, drawing attention to section 8, read with section 2 of the Broadcasting Act 4 of 1999, which related to the powers, objectives and parameters within which the SABC could operate, in particular.

"Based on these provisions, it was suggested that the deal was unlawful," the document reads.

Former SABC executives and board members testified that the contract was purportedly an agreement whereby MultiChoice would use the SABC’s archived material, on condition that they took up a particular position on set-up control.

"This condition rendered the contract unlawful. Secondly, the person who signed off on the agreement on behalf of the SABC was not authorised to do so. There were other defects too," the report reads.

These defects included the downturn in the economy, which led to less revenue.

"That debate around whether prescription of debts happened after three years went on for a year before the prescriptive period was determined at three years, which meant that SABC had to write-off R2bn in debt."

Contradictory testimonies

It was clear, the report found, that a significant section of the country’s population had no access to DStv, and therefore no access to two channels of the public broadcaster - namely SABC Encore and SABC News.

"This (was) particularly problematic because these channels are funded directly from the public purse – 3% of SABC’s appropriation is from the publics purse - but also because the SABC has a public mandate to educate, entertain and inform."

There were also contradictory testimonies regarding who owned these archives.

"Per the former Company Secretary MultiChoice has purchased the right to air the material, but does not own the archives. This contradicts most testimonies by former executives and board members," the report said.

The report will be ironed out by committee members on Thursday and Friday, before a formal draft report is sent to the affected executives.

The committee would then work on a final report, to be presented to the National Assembly in February.

Read more on:    sabc  |  parliament 2017  |  media

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