Good morning to Honourable members.
Allow me to first indicate that all Department of Communications (DoC) Entities (South African Broadcasting Corporation (SABC), Film and Publication Board (FPB), Brand SA, Government Communication and Information System (GCIS), Media Development and Diversity Agency (MDDA) and Independent Communications Authority of South Africa (ICASA) are present here today represented by the Board and Top Management.
We are here as the DoC and our entities to present on the 2014/15 quarter 1, 2 and 3 performance information.
I must say upfront that, in the interest of time entities will in their presentations focus on quarter 3 performance and should members want to raise issues for quarter 1 & 2 they should do so.
During the period under review the department and its entities experienced mixed performances. Without wasting much time, allow me to highlight the following issues:
South African Broadcasting Corporation (SABC)
We are particularly encouraged by the performance of the SABC during the period under review. At the end quarter 3, the SABC showed a healthy financial position and it was able to honour its financial obligations, including the payment of royalties. It had cash and cash reserves of R1 011 billion. A sum of R978 millions of these funds were invested with the big 5 banks. We are encouraged by these financial position of the SABC.
Revenue and income earned for the quarter under review fell short of budget by 9% to R207.3 million. These can be attributed to the unfavorable performances in revenue from advertising, sponsorship, trade exchanges, license fees, content & commercial exploitation, other revenues and other income.
Expenditure was maintained below target as the result of the cost containment measure that were implemented.
During the quarter under review the SABC continued to deliver on its public service mandate. Of importance to note is the fact that the SABC has during the month of October 2014 issues its Television Request for Proposals Book with a total value of more than R600 million making it the largest RFP book issued by the SABC for local content.
The SABC struggled to improve TV audience share during the period under review and it remained at 49% against a target of 52%. The 24 News Hours channel continued to improve its performance during the period under review. The Channel’s audience share continued to grow with a daily average audience of 7,428 viewers. It is now the second most watched news channel on the DSTV bouquet. On the other hand, the Corporation was able to achieve radio audience share target of 68.8% and the actual achievement was 69.7%.
Media Development and Diversity Agency of South Africa (MDDA).
During the quarter under review, the MDDA has a leadership vacuum at Board and Management levels. To address some of the management challenges, the department intervened by seconding an Acting Chief Executive Officer to the MDDA, which has somewhat assisted in stabilising the environment.
Although MDDA has been operational for more than ten years now and has been receiving clean audit reports, the Agency seem not to have impact on the ground as the media is still not transformed to date. We are therefore working with the MDDA to ensure that we measure the impact of the MDDA’s interventions in bringing about media diversity in the country. Part of the interventions to be undertaken is the need to create a balance between sustaining the existing funded projects and supporting the new ones.
Independent Communications Authority of South Africa (ICASA)
ICASA could not achieve most of its targets. Key deliverables that were not achieved include the licensing of additional free-to-air television broadcasting services (applicants requested an extension to 31 March 2015), issuing regulations in the provision of subscription broadcasting television services, position paper on retail tariff transparency, compilation of a draft research report covering factors that affect the cost of Digital Terrestrial Transmission (DTT) in South Africa and the gazetting of HDI/Broad-Based Black Economic Empowerment (BBBEE) regulations in the Government Gazette.
With regard to financial performance, ICASA was only able to spend funds that were earmarked for the normal operations of the Authority and these mainly included personnel costs, travelling, accommodation, stationery, audit fees, etc. ICASA was unable to spend funds that were earmarked for ring-fenced projects during the three quarters of the 2014/15 financial year. These ring-fenced projects mainly include the acquisition of broadcasting and postal monitoring equipment, Head Office improvements, replacement of spectrum management software system, amongst others.
A sum of R24.1 million remained unspent at the end of the 3rd quarter. As the result of under-spending on ring-fenced projects, ICASA has applied to the National Treasury for the retention of unspent accumulated funds amounting to R85 million. These funds have been accumulating over the past three financial years and lack of required skills to execute these projects seem to be the main challenge that is facing the Authority.
Brand South Africa
Brand South Africa was not able to achieve almost all key deliverables that were planned for the three quarters of the 2014/15 financial year. These targets were deferred to the 4th quarter of the 2014/15 financial year. Key deliverables that were not achieved include branding and messaging, Pride & Patriotism and active citizenship amongst South Africans as well as positioning SA positively as a business destination amongst domestic and international target audiences.
This entity was also not able to spend all funds that were earmarked for the 3 quarters as the result of non-delivery of key deliverables that were earmarked for the three quarters. A sum of R46.3 million was still unspent as at 31 December 2014.
Brand SA seem to be concentrating and spend excessive resources outside the country and not paying sufficient effort to the domestic branding.
Films and Publications Board
FPB was able to achieve the majority of the key deliverables that were planned. These deliverables include classification of all (100%) content that were submitted to the entity, review of Classification Governance Framework, identification of 2000 unregistered distributors, accreditation of approved Classifiers Training Program, review of classification guidelines, implementation of automated processes as well as the implementation of reviewed governance framework. The only deliverables that were not achieved include the conduct of OSS industry adults and the development and implementation of the Labelling systems.
I thank you.
Enquiries:
Mish Molakeng
Cell: 082 469 3997
