James Aguma put in a valiant effort to rebut damning findings made by the ad-hoc parliamentary committee that wrapped up its inquiry into mismanagement at the SABC this week.
The acting CEO of the SABC submitted a 140-page document to the committee last week in response to its interim report, adopted in January. He accused the committee of being biased, adopting an “adversarial tone”, engaging in “Hlaudi Motsoeneng bashing”, and taking the side of disgruntled former board members, executives and managers with an axe to grind.
He said the committee’s finding that the SABC had deviated from its mandate as public broadcaster under Aguma and former COO Motsoeneng should be treated “with the contempt it deserves”.
This was probably the last straw. Aguma and former chairman Mbulaheni Maghuve have treated the committee with contempt since its proceedings kicked off in November. Committee chairman Vincent Smith told parliament last week that Aguma had turned up his nose at the chance to testify and wouldn’t be given a second bite at the apple.
The committee’s report, released on Tuesday, is scathing of Aguma. It points out that he’d gone to great lengths to discredit witnesses who appeared at the hearings, but “provided very little information” to contradict their evidence. It recommends that he should be disciplined for defying parliament.
Aguma and Maghuve only submitted requested documents when forced to, but did so in a garbled format. The committee describes this as “malicious compliance, aimed at frustrating the committee’s progress”.
Maghuve failed in a bid to interdict the hearings, then staged a walkout on their first day. The committee recommends he be held “personally liable” for the SABC’s legal fees.
The problem, as the committee quickly understood, is that Aguma — whose job appears to be to do the bidding of Motsoeneng and communications minister Faith Muthambi — lies at the heart of the rot. As CFO he, often together with Motsoeneng, signed off on many of the questionable contracts and board resolutions the committee and its witnesses were so critical of.
These included audit services provided by PwC and SekelaXabiso that witnesses said should have gone out to tender but didn’t, and a dubious debt collection deal with LornaVision, a firm whose co-director,
Kuben Moodley, was formerly an adviser to mineral resources minister Mosebenzi Zwane and, according to former public protector Thuli Madonsela, has business links to Gupta entities.
Aguma even drafted the motivation for Motsoeneng to be paid a bonus of at least R10m for negotiating a controversial contract between MultiChoice and the SABC.
The secretive contract came under fire from the committee both for leaving uncertainty about whether the SABC’s archives will remain accessible to the broader public, and for being conditional on the broadcaster reversing its original support for set-top box encryption that would have given it a competitive edge over its biggest rival, MultiChoice’s DStv.
The report says one of the first jobs for an interim board must be to launch an independent inquiry into questionable contracts awarded while Aguma and Motsoeneng were in charge, including with Gupta-owned media company TNA Media. Those found responsible should be disciplined and held personally liable for losses or charged criminally.
Former CEO Phil Molefe said TNA’s business breakfasts, broadcast on the SABC’s Morning Live show, amounted to sponsoring a competitor. While the SABC carried substantial production costs, TNA “earned the revenue exclusively”, including lavish sponsorships by state-owned entities the Guptas do business with. This was confirmed by e-mail correspondence that also showed the briefings continued despite concerns raised by the committee.
In its submission, TNA conceded the SABC picked up the tab for broadcast costs but argued the content the show generated — mostly sunshine interviews with politicians — formed part of the SABC’s public mandate.
But the committee isn’t buying this. It wants the interim board to evaluate the TNA and MultiChoice deals. If they don’t make business sense the contracts must be renegotiated “or terminated”.
The committee found mismanagement by the board and executive have left the SABC at risk of becoming technically insolvent. Decisions such as imposing a 90% quota for local content led to declining audience share and revenue. It recommends that treasury should review its funding model, which relies almost entirely on advertising revenues and licence fees.
The inquiry made it clear that Muthambi played a key role in the mess that the SABC finds itself in. Taking decisive action against her would be a crucial step on the road to recovery.
The report says Muthambi had irregularly amended the SABC’s memorandum of incorporation to centralise power in her ministry and stripped the board of its oversight powers.
She displayed “incompetence” in carrying out her duties, including by appointing Motsoeneng as permanent COO after the public protector had ruled against him. The report says she should be reported to parliament’s ethics committee and President Jacob Zuma should consider firing her.
This would be a good start, but it won’t solve the problem by itself. In the past two decades a long line of board members, executives and ministers have come and gone at the SABC, all of them promising to stop the rot. The crucial test will be if the interim board and its permanent successor is populated with individuals who possess the guts and skills to turn the SABC around — or another set of lackeys deployed to do the ruling party’s bidding.
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