#Sugartax: IRR climbs into media over Coke funding

In this opinion piece to Fin24, Frans Cronje, CEO of the South African Institute for Race Relations (IRR), responds to what he calls a media slur campaign against the think tank. This followed a story published by Fin24 revealing that the Coca-Cola Company funded a research policy paper produced by the IRR on taxing sugar-sweetened beverages (SSBs).

Weighing in, Prof George Claassen, the ombudsman of Media24’s Community Press Division, in this opinion piece, looks at how credible and reliable science should work and how trustworthy and credible media should function.

Dissection of a media slur campaign - by Frans Cronje

While I have been away on leave our ideological adversaries in the media attempted to launch a series of attacks on the IRR around work we are conducting on the proposed Sugar Sweetened Beverages (SSB) tax.

First off the mark was Media24, which published what they called an “exposé” based on the undisputed fact that Coca Cola funded some of our research on the subject. To be clear, there was no ‘exposé’. What Media24 and its News24 website editor Adriaan Basson called an ‘exposé’ was an interview with our media staff. During that interview, we were asked who funded our SSB research, and we answered: “Coca Cola”. On the strength of that answer, Media24 claimed its “exposé”.

Let us deal with that issue directly, as Media24 was both dishonest and sensationalist in suggesting there had been no disclosure of the funding arrangement. At a meeting I attended early in 2016 it was unanimously agreed that the IRR and Coca Cola had no problem with disclosing their relationship. That is why both parties disclosed it on the spot to journalists who asked about it. This detail was not specifically included in the SSB policy paper for the simple reason that it was not at any stage considered exceptional, noteworthy or controversial; the source of the funding was neither confidential nor influential in determining the scope of the research or the thrust of the findings. It was, in short, a non-issue. In my experience there are funders who for various reasons prefer anonymity, but Coca Cola is ironically not one of them.

What Media24 partly relied on in attempting to exploit the point of non-disclosure is that we would not reveal pricing or other details. This, we think, is fair – and, again, uncontroversial – as the policy-funding field is competitive and we do not want our competitors to know how we finance our work. It is the equivalent of asking Media24 to reveal in detail the extent to which its newspapers (and associated companies) rely on government funding (or regulatory protections) in order to suggest that it is dependent on the state and needs to take a pro-government line on certain policy matters. We know that Media24 receives extensive state income, both directly and indirectly, though not how much – but we also know that its editorial policies should prevent such funding from influencing the content of its journalism.

Media24 did not disclose that its own chairwoman, Rachel Jafta, had tendered through her private consultancy, Econex, to do work on the SSB tax – and found against it. If it was truly concerned about corporate influence over the shaping of public opinion, it should surely have disclosed that information. It also did not disclose that its journalists had been in close contact with anti-SSB tax advocates at the time that it drafted the attack on the IRR.
When my colleague Gwen Ngwenya penned a rebuttal of the Media24 attack, News24 chose not to give that response the same prominence as its original ‘exposé’, choosing instead to conceal it deep in their website. When Ms Ngwenya raised the urgency of the IRR’s response and that it be given equal prominence, she was accused of being aggressive by the News24 editor.

Next up was news website BizNews, which republished Media24’s article, together with commentary on whether or not it was a coincidence that our views were the same as those of the sugar industry. Of course it was not a coincidence. The IRR knows full well that secondary and backdoor taxes are not a solution to South Africa's fiscal woes, which is why we approached the sugar industry to work on the SSB policy in the first place.

BizNews, however, chose not to disclose, first, that it has a financial relationship with Media24 via Fin24, and, second, that BizNews had led the media defence of Dr Tim Noakes and his anti-carbohydrate (and sugars) dietary advice. Further, BizNews did not disclose that it did not even bother to conduct an interview with the IRR before publishing its claims.

Then came the Financial Mail, which suggested that there was an ethical problem in accepting funding from a group likely to be negatively affected by a policy. This is complete nonsense. The IRR has rigorous internal editorial guidelines. Funders have no say at all over policy recommendations or how funding is used. There is an impenetrable Chinese wall between our sales and fundraising staff, and our policy writers and researchers. The Financial Mail, however, went ahead and printed its incorrect and misguided assertions despite our staff having explained to its editor, ahead of publication, that he had misquoted IRR staff on a number of points. His response was that “that is what you said”, or words to that effect – yet how could this be when IRR staff had made it clear the quotes were wrong? The editor is known to us for having in the past published false and misleading assertions about the work of the IRR. Needless to say, the Financial Mail was silent about this.

The Financial Mail alleged that the IRR engaged in the SSB tax work knowing what the outcome of its research would be, and approached funders on those grounds. Of course we did. We have extensive experience of secondary taxes and know how they harm economies and delay the structural reforms that are necessary to secure real economic turn-arounds. That is why we approached the sugar industry in the first place.

There is a great degree of hypocrisy at play here, as all three media entities fail to disclose their financial relationships with funders. In the case of Media24, those relationships extend all the way to China through Nasper’s holding in Tencent. That should not be a problem given the conventional separation of interests between editors and financiers. The hypocrisy is that those same editors deny that such principled separation of interests could or ever would exist in non-profit policy groups. In effect, what all three news outlets have done is to say that the government is correct in claiming that the private sector media cannot be trusted. On what grounds will they now defend themselves when the securocrats and censors and enemies of free speech come for them? If funding must necessarily determine content, then Media24 has essentially admitted it is a Chinese propaganda front.

But the funding argument is in any event no more than a red herring, as in all three cases no serious attempt was made to engage with the content of our SSB work or the arguments we raise against the tax. The reason is that our arguments are unassailable. The tax is a VAT increase by stealth and a most ineffective public healthcare intervention. Even if our critics were to insist (wrongly) that our arguments were made at the behest of the sugar industry, they would still have to counter those arguments and show them to be wrong. The most telling outcome of this whole saga is that not one critic has been able to do so.

Read more on the sugary tax

EXPOSED: Coca-Cola bankrolls IRR research on sugary tax in SA
IRR responds Fin24 story on its sugar tax report
Treasury: Sugary beverages tax is not a stealth tax
Coca-Cola explains the sour side of a sugary tax on SSBs
Why is SA ignoring the abundance of sugary substitutes?
LEAKED: Coca-Cola's global sugar tax warfare
Why SA should resist power of Big Sugar to undermine public health
Sugar tax alone can't solve health problems - expert
How sugar tax will create future taxpayers
Sugar tax flaws – ‘Mathematical model’ based on speculation, assumption
Sugar tax could cause over 70 000 job losses - report

Read Fin24's top stories trending on Twitter:

Brent Crude
All Share
Top 40
Financial 15
Industrial 25
Resource 10
All JSE data delayed by at least 15 minutes morningstar logo
Company Snapshot
Voting Booth
Do you think it was a good idea for the government to approach the IMF for a $4.3 billion loan to fight Covid-19?
Please select an option Oops! Something went wrong, please try again later.
Yes. We need the money.
11% - 911 votes
It depends on how the funds are used.
74% - 6060 votes
No. We should have gotten the loan elsewhere.
15% - 1230 votes