SABC inquiry chair 'dismayed' by document leak
18 January 2017
Cape Town - The chairperson of the parliamentary ad hoc committee looking into the SABC board is "dismayed" that a working document from the inquiry has been leaked.
The document was meant to aid MPs during deliberations about the inquiry process on Thursday and Friday, ad hoc committee chairperson Vincent Smith said in a statement on Wednesday.
"The working document was prepared as a foundation upon which a constructive meeting of the committee and deliberations will commence, and it was drafted for that purpose only," Smith said.
"It has no standing as an official document of the committee until deliberations are exhausted, possibly by Friday."
He did not say who he thought was responsible for the leak, or its consequences for the committee's work.
ACDP MP and ad hoc committee member Steve Swart told News24 on Wednesday that the working document had no legal standing yet. He expected it to be amended substantially when the committee met on Thursday.
DA MP Phumzile van Damme said in a statement on Wednesday that the party was studying the working document. The draft was a "good start", but more work was needed, she said.
The working document contains recommendations of forensic probes into allegations that several witnesses at the committee had made about deals between SABC, MultiChoice, and the Gupta-owned The New Age.
How the SABC board failed the public broadcaster - leaked document
Cape Town – The leaked document from the parliamentary ad hoc committee looking into the SABC board has detailed how it failed the public broadcaster.
These failures range from failure to prevent irregular, unauthorised, fruitless and wasteful expenditure, to failing to implement the remedial actions of the Public Protector report titled When Governance and Ethics Fail .
The working document was leaked on Tuesday, and is subject to substantial changes when committee members will deliberate on its contents on Thursday and Friday.
The draft document is expected to be completed by Friday by Parliament’s adhoc committee probing the SABC board’s fitness to hold office.
"The Board of the SABC failed to discharge its duties as contemplated in the PFMA by failing to take effective and appropriate steps to prevent irregular, fruitless and wasteful expenditure, as well as failing to act against employees that incurred these expenditures.
R34.7m of fruitless, wasteful expenditure
"The Board failed to ensure that an appropriate procurement and provisioning system which is fair, equitable, transparent, competitive and cost effective exists as required by Section 51(1)(a)(iii)," the document reads.
An amount of R34.7m of fruitless and wasteful expenditure was incurred in 2016 and a total of R92.5m of fruitless and wasteful expenditure still awaits condonation.
The document states that the board also failed to ensure that the SABC maintained an effective and transparent system of financial and risk management, as well as internal control.
The board had also failed to submit necessary documents to the auditor-genera,l which limited the scope of the audit into irregular expenditure.
According to the report, the board and/or its sub-committees failed to exercise effective oversight over the administration, specifically in relation to adherence to Financial and Human Resource management.
Along with the failing to take the Public Protector’s report seriously, the board "also failed to take the report on review if there was disagreement with recommendation stipulated in the report".
List of failings
Other failings noted in the report include:
- The SABC board made no meaningful intervention in, or at worst were unaware of, the intimidation and threats experienced by the "SABC 8";
- The scheduling of board meetings, preparations and timely issuing of meeting documentation - which included the agenda notices - was inconsistent with normal acceptable practices;
- The regular scheduling of "special board meetings" and the practice of decisions taken through the "round robbin" method was a further indication of the dysfunctionality of the board;
- The company secretary actively and deliberately acted in an obstructive manner when required to provide documentation as requested, citing that there was a lack of board and/or chairperson’s authority to comply with the request;
- Certain executives managers of the SABC changed the reporting lines of the administration in order to render the SABC’s governance structures weak. "This is blatant abuse of power. This had the added effect of creating an environment of intimidation within the SABC," the document states.
SABC, Multichoice deal must be probed - leaked Parliamentary inquiry document
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.
'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.
Alleged Gupta, SABC deals should be canned, if true - leaked document
Cape Town - Alleged improper deals between the SABC and the Gupta-owned The New Age Media should be probed and, if there has been wrongdoing, be terminated.
This is according to an official working document leaked on Tuesday night, following the parliamentary ad hoc committee’s inquiry into the SABC board’s fitness to hold office.
The SABC must review the business case of entering into an agreement with rival TV stations, to ensure that the public broadcaster is not involved in any cross-subsidisation to the competition, it states.
"In all instances where such deals are in essence diverting resources from the SABC, such deals must be terminated," it said.
Former SABC group chief executive of technology, Sipho Masinga, told the ad hoc committee in December that a meeting had been arranged between himself and a representative of TNA Media, the parent company of ANN7.
"During the meeting attempts were made to 'sell' an agreement which would effectively allow New Age Media to take over SABC news and rebrand it," the working document reads.
Veteran journalist Vuyo Mvoko testified in December that resources were being diverted from the SABC's Morning Live show to host the New Age breakfasts on air.
Former board chairperson Dr Ben Ngubane testified on Friday that a business plan regarding the breakfasts was brought to him, and that the SABC had incurred no costs at all.
Contradictory evidence
The committee could not establish beyond doubt whether the distribution of the New Age newspaper was still the norm at the SABC. Nor could it establish the financial value of the agreement with TNA Media.
It did say it was obvious that the SABC, while it was facing financial difficulties, appeared to have signed exclusive contracts to distribute a newspaper subscription on a national scale.
"All potential misleading or contradictory evidence relating to SABC board minutes, commercially sensitive documentation not provided, costs incurred by the SABC in hosting the TNA breakfast show... must be further investigated by the SABC interim board/Parliament and sanctions applied where proof of perjury is proven," the document reads.
Ad hoc committee member Steve Swart told News24 on Wednesday that the working document had no legal standing yet. He expected it to be amended substantially during the committee’s meeting on Thursday.
Swart said contradictions during testimonies regarding the alleged Gupta/SABC deals deserved a forensic investigation.
Democratic Alliance MP Phumzile van Damme said in a statement on Wednesday that the party was studying the working document. It was a "a good start" and needed more work, she said.
SABC spokesperson Kaizer Kganyago could not be reached for comment at the time of publication.
