South Africa

Introduction

Like many public institutions in South Africa, the South African Broadcasting Corporation (SABC) has undergone a number of changes in recent years to bring it into line with the new democratic dispensation and to ensure that it serves the needs of all the citizens of South Africa. A completely new Broadcasting Act,'" the key legislation governing the SABC, was adopted in 1999 (the 1999 Act), replacing the former 1976 Act, and the changes introduced by the new law have yet to be fully implemented. Formally, under the 1999 Act, the SABC has been transformed into a limited liability company with a share capital and subject to the Companies Act, although Section 7 recognises that the normal rules for companies will need to be modified to take into account the special nature of the SABC as a corporation. In particular, to begin with at least, the State will own one hundred percent of the shares of the SABC, a deviation explicitly authorised by Section 19(1) of the Act from the normal rule requiring at least seven shareholders. Section 9 provides for the effective division of the SABC into public service and commercial operations, to be separately administered under a single corporate structure. The latter is to be treated like any other commercial broadcasting operation while the former is subject to special statutory obligations.

The Independent Broadcasting Authority (IBA), established by a law passed in 1993 (the IBA Act).107 The IBA has broad regulatory powers over broadcasters, particularly in relation to licensing, and the 1993 law completely restructured the regulation of private broadcasting. The IBA also has some powers in relation to the SABC. As a result of these significant changes, the SABC is very much in a state of transition. The full effect of many of the changes remains to be seen. At the same time, financial pressures have meant that the SABC, unlike the other public service broadcasting organisations surveyed herein, receives most of its funding from advertising, rather than the public purse. The longer-term goal is to divide the service into public and commercial operations, with the latter subsidising the former. Whether this will be a success, and to what extent, remains to be seen.

l. Services Provided

As noted above, the 1999 Act provides for the effective division of the SABC into commercial and public service operations. At the moment, it remains unclear which of the services presently offered by the SABC will form the public service wing and which will be regarded as commercial. Indeed, Section 1 of the 1999 Act contributes to this confusion, defining 'public service broadcasting' as any service, including a commercial service, operated by the SABC, while Section 9(1) provides for a distinction between the 'public service' and 'commercial service' operated by the SABC. In terms of licensing, the IBA is required to distinguish between 'public', 'commercial' and `community' broadcasting services. 11'8

The SABC currently offers three televisions channels, SABC 1, SABC 2 and SABC 3, providing over 80% geographical coverage of South Africa, although a far smaller proportion of the population actually have access to television, due to low rates of television set ownership and lack of electrification in some rural areas. In 1998, the total daily SABC television audience was estimated at approximately 14 million viewers, out of a total population of over 40 million,'°° with SABC 1 having the largest share, SABC 2 the next largest and SABC 3 the smallest. It would appear that the plan is to retain SABC 2 as a public service broadcasting operation while SABC 1 and 3 will be run on a commercial basis.

SABC also provides 19 radio stations through its national network. These include eleven stations
one in each of the eleven official languages (9 African languages, as well as English and Afrikaans) an international service, a couple of regional stations and a number of English language stations broadcasting primarily music. Together, the SABC radio stations attract about 14 million listeners daily, the bulk of which tune in to the 9 African language stations."°

ll. Public Service Mandate

Section 8 of the 1999 Act sets out the objectives of the SABC as a whole, which by-and-large govern both its public service and its commercial operations. Sections 10 and 11 set out more detailed obligations relating, respectively, to the public service and commercial operations. Pursuant to Section 8, and in line with obligations on many public service broadcasting organisations, the SABC is required to make its services available throughout the territory of South Africa, on a free to air reception basis, and to provide programming that informs, educates and entertains. Pursuant to Article 8, the SABC is also obliged to maintain libraries and archives of materials relevant to its objectives, to collect news and information, to establish and subscribe to news agencies, to carry out research on new technologies, and to nurture South African talent and train people in production skills.

Pursuant to Section 10, the public service must make services available in all official languages, reflect both the unity and cultural and multilingual diversity of South Africa, and enrich the country's cultural heritage, both traditional and contemporary. The public service must strive to be of high quality in all languages, providing significant amounts of news and public affairs programming that meets the highest standards of journalism, and is fair, impartial, balanced and independent from government, commercial and other interests. In addition, the public service must provide significant amounts of educational programming, national and minority sports programming, as well as services targeting children, women, the youth and the disabled Finally, the public service must broadcast both its own programmes as well as those commissioned from the independent sector.

Governing Structure A. Internal Governance

As noted above, under the 1999 Act, the SABC is a limited liability corporation with a share capital, subject to the Companies. Act, with appropriate modifications. It is governed by a Board and an Executive Committee, formed from a subset of the Board, both of which are subject to the objectives and other binding rules set out in the legislation. Section 6(2) formally guarantees the freedom of expression, and journalistic, creative and programming independence, of the SABC and the Board is explicitly tasked with protecting this freedom and independence."'

Section 17 provides that the Board shall consist of 12 non-executive members, along with the
Group Chief Executive Officer, the Chief Operations Officer and the Chief Financial Officer. The12 non-executive members are appointed by the President on the advice of the National Assembly in a manner, which ensures transparency, openness and public participation in the nominations process, after publication of a shortlist of candidates. 112 Pursuant to Section 14, the Executive Committee is appointed by the Board and consists of the Chief Executive Officer, along with six other Board members. It is accountable to the Board and performs such functions as may be determined by the Board.

Viewed collectively, Section 13 requires members of the Board to have suitable qualifications, expertise and experience in various broadcasting areas, to be committed to fairness, freedom of expression, the objects of the SABC and accountability, and to represent a broad cross-section of the population. Individually, Board members must, pursuant to Section 16, be citizens and permanent residents of South Africa, not be determined by a court to be mentally ill, and not have been convicted of a serious crime, a crime of dishonesty or an offence under the Act. The appointing body has the power under Section 15 to remove a Board member on account of misconduct or inability to perform his or her duties, after due inquiry and upon recommendation of the Board. The Act also sets out strict conflict of interest rules at Section 17 and, if a conflict of interest issue arises at any point, the Board member involved must leave the proceedings and let the remaining members determine the appropriate course of action.

The Act simply states that the Board controls the affairs of the SABC 113 and that the Executive Committee is accountable to the Board."' It would appear from this that the Board, and the subset thereof which comprises the Executive Committee, effectively exercise direct control over the affairs of the SABC. It is unclear how this relates to the general guarantee of freedom of expression and of journalistic, creative and programming independence which it is the duty of the Board to protect. Presumably, the latter would prevent the Board from interfering in day-to-day activities of the SABC and, in particular, in programming and news choices, but allow it to set policy and overall direction and goals for the SABC.

B. Regulatory Mechanisms
The SABC is clearly subject to regulation by Parliament, which may amend or even repeal its enabling legislation. Other persons or bodies with some power over the SABC include the Minister responsible for the Act (the Minister of Communications) and the IBA. Other relevant bodies include the Frequency Spectrum Directorate and the South African Broadcast Production Advisory Body, both established by the 1999 Act.

The Minister has overall responsibility for broadcast policy development under Section 3(2) of the 1999 Act, as well as a number of specific responsibilities in relation to SABC. The Minister has the power to approve the extent of the subsidy provided by the commercial to the public service operation, as recommended by the Board, 115 as well as to approve any financial regulations drawn up by SABC, after consultation with the Minister of Finance, and to approve surplus fund investment."' Significantly, the Minister, with the concurrence of the Minister of Finance, must determine the total value and number of shares in SABC117 and must, along with the Minister of Finance, approve any borrowing by the SABC. 118 The Minister may also direct the SABC as to how to draw up its annual statements and Annual Report. 119

The IBA has significant powers in relation to the SABC. Section 6(2) gives it overall responsibility for ensuring compliance with the Charter, which comprises most of the significant provisions in the 1999 Act relating to the Corporation. Pursuant to Section 3(5)(f) of the 1999 Act, all broadcasters, including the SABC, must comply with the Code of Conduct, set out in Schedule 1 of the IBA Act, which is enforced by the IBA. The Code deals with matters such as obscenity, violence, accuracy and impartiality in relation to news and so on. According to Section 21, the SABC is required to obtain a license from the IBA, although the IBA is required, upon payment of the license fee, to issue such license.

Section 37 of the 1999 Act provides for the establishment of a Frequency Spectrum Directorate (FSD) within the Department of Communications. The FSD is responsible for policy development in relation to the radio frequency spectrum and for ensuring that the spectrum is used in an efficient manner to meet the needs of all users. Inasmuch as the SABC is a significant user of frequencies, the work of the FSD affects it. At the same time, the FSD must co-operate with relevant bodies, presumably including the SABC, in the performance of its functions. Pursuant to Section 38 of the 1999 Act, the Minister must establish the South African Broadcast Production Advisory Body to advise him or her on how to develop local television and radio production. This clearly overlaps with the role of the SABC in developing local talent and in providing programming in all official languages.

The SABC must provide the Minister with an annual financial statement and with an annual report. The latter must include a report on the work of the Corporation during the previous year, along with certain financial information, such as a description of the value of all property owned by the Corporation. The Minister must table these reports in Parliament, within seven days in the case of the annual report. 12°

lV. Financing

Pursuant to Section 8 of the 1999 Act, the SABC may fund its activities through advertisements, subscription, sponsorship, licence fees or any other means. The Act does not clarify whether a less extensive list of types of funding is applicable to the public service operations but does provide that the SABC shall include free to air programming within its total services. 121 In addition, Section 11(d) of the Act provides that the commercial services, shall subsidise the public services. As the separation between the various services is not yet formalised, it remains unclear precisely how this will work.

Section 27 of the 1999 Act also provides for a licence fee to be levied on all private owners of television sets, as well as certain categories of businesses. In practice, this contributed a scant 13.5% to the operating costs of the SABC in 1999, due to a combination of high rates of piracy and low fees. A further 206 million rand, or about 10% of total revenue, came from general government funding sources while the remaining 76.5% of revenue came from advertising and other commercial activities .122 SABC would thus appear to benefit from only a very meagre level of public contribution.

 

REFERENCE

 106 No. 4 of 1999, assented to 23 April 1999. On the web at: http://www.parliarnent.gov.za/acts/1999/act4-99.html.

107 The Independent Broadcasting Author/ty Act No. 153 of 1993, assented to 18 October 1993. On the web at http://iba.org.za/actaaa htm t" Section 5(1) of the 1999 Act.

109Presentation by Enoch Sithole, Senior General Manager: Audience Services, SABC. 110 The above information comes from the SABC website, http://www.sabc.co.za.111

 Section 13(11).

112 Section 13.

113 Section 13(11).

114 Section 14(3). 15

115 Section 11(d).

116Section 18.

117Section 19(2).

118Section 23.

119Sections 20(2) and 28(1)(g).

120Articles 20 and 28.

121Section 8(g).

122 Group Chief Executives' Statement, on website, http://www.sabc.co.za