Black firms’ AUM almost doubles

There has been almost a doubling of assets under management (AUM) by black-owned fund managers over the past year, thanks largely to the restructuring of the Sanlam group. The 13th annual BEE.conomics survey shows that total assets managed by black-owned firms surged to R1.15-trillion by June 30 2021.

MultiChoice, the pay-TV company operating 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, 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,” said MultiChoice.

Such a review will also clarify the position of bigger players such as Netflix in today’s broadcasting environment.

The public broadcaster, main source of news and commentary for many, especially in farflung areas, is desperate to boost its finances as government funding has all but dried up while advertising and licence fee revenues are under pressure, due partly to Covid-19.

MultiChoice said that 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 published in October 2020 asserts 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 can 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 submitted.

Various stakeholders have criticised the bill, saying it is outdated and will not do much to address the public broadcaster’s financial woes. If approved, the new legislation 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 pressing issues facing the broadcaster — revenue generation and entrenching the independence of the board — that are crucial considerations in the drive to mend the company after years of political meddling led to the collapse of previous boards. This contributed to the SABC’s governance and financial crises in recent years.

The bill largely maintains the current licensing regime, with the reduction in size of the SABC board from 12 nonexecutive 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.

The SA BC wants a device independent, tech- neutral household levy for public broadcasting, which would levy all households, with an exemption for poor people and discounts for pensioners. The broadcaster relies heavily 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, calling it a “nonstarter”.

“We remain firmly opposed, it’s not best practice internationally, it is a nonstarter. 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,” said MultiChoice.

In its submission, the Organisation Undoing Tax Abuse (Outa) said the SABC should receive a government subsidy. Outa advocated funding the SABC 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.”

MultiChoice has called for policy on the SABC’s mandate and scope to be decided before new legislation on the public broadcaster is drafted. /Reuters