Defend Truth


Road to recovery: State-owned enterprises can take a lesson from the SABC board


Wayne Duvenage is a businessman and entrepreneur turned civil activist. Following former positions as CEO of AVIS and President of SA Vehicle Renting and Leasing Association, Duvenage has headed the Organisation Undoing Tax Abuse since its inception in 2012.

With the recent announcement of the SABC’s first profitable month in five years, could this be the proof that profitability can return to SOEs after their political masters have been told to wait at the door?

Given the political meddling and the Hlaudi Motsoeneng era, one can be forgiven for thinking that the SA Broadcasting Corporation (SABC) is just another basket case of a failed state-owned enterprise (SOE). But it’s time to think again. The SABC of today, although still far from showroom condition, might very well be on its way there, largely because of one fundamental activity — a board that is intolerant of the destructive forces of political meddling.

SOEs are much like any business and they need to be run efficiently, with the best people and systems, if they are to succeed. More often than not the worst people to give advice, interfere or make appointments are Cabinet ministers. More so when the focus of cadre-deployment practices have converted many SOEs into de facto employment agencies, with managers instructed to employ relatives and friends of the politically connected. 

With the new board having been appointed as the Ramaphosa administration came to power, the SABC turnaround strategy required some tough decisions, one of which was to drastically cut its employment costs. By 2018 the SABC salary bill had risen to R3.1-billion — 42% of its total expenses — from around R1.8-billion in 2010. 

Notwithstanding the enormous task of undoing the damage wreaked by Tornado Zuma-Motsoeneng, the board had to endure the whims of a new and inexperienced Minister of Communications, Stella Ndabeni-Abrahams, who shunned the SABC’s plans to retrench about a quarter of its 3,300-plus employees. Ndabeni-Abrahams was breaking all the rules by interfering with the operational affairs of the SABC, even ignoring her executive management and engaging directly with unions and staff about the looming Section 189 plans to reduce the headcount.

Fortunately, the board pressed ahead, and despite the resignation of four board members by the end of 2018, the remaining members did not capitulate. Instead, they remained resolute and used precedent-setting court cases to force the state to back off and appoint the remaining board members, ensuring that the SABC board was quorate again by April 2019.

The toughest job in a leadership role is that of having to retrench staff and dispense with salary increases. But it is a very necessary one if a company is severely overstaffed, a problem that had besieged the SABC (and others, including Eskom, SAA and Transnet), following the Zuma-era mantra of “employ and party like there’s no tomorrow”.

Politicians, on the other hand, generally don’t possess the necessary strength and courage to reduce the headcount. They bend to the pressures of their labour and social alliances, without giving much thought to the need to balance the books, not realising the pain and job losses that occur when these entities collapse.

Despite Ndabeni-Abrahams’s constant moaning and spats with the SABC board, the board has soldiered on, focused on its strategic intent of reducing the bloated salary bill while filling critical vacancies and replacing acting positions with permanent appointments who are fit for purpose. In addition, it has improved the quality of output and competitiveness, reduced operational expenses, improved the SABC’s public mandate and grown its revenue base.

Furthermore, the board has laid charges against Motsoeneng and others to seek accountability and claw back pensions and monies owed. It has also cancelled dubious contracts (the likes of Lorna Vision) and worked hard to undo connected crony-based decisions.

Sanity is beginning to prevail on the TV licence issue. I have no doubt that the new board and executive team at the SABC realise the current TV licence model is outdated, inefficient and will need to find a new journey. The vast majority of viewers are not paying and there’s little the board can do about it. They are surely wise enough not to think about replacing dwindling TV licence revenues with taxes on the sale of tablets and cellphones; however, shooting from the hip in this direction by others in positions of power does no favours for the SABC’s already bruised relations with the public.

With the recent announcement of the SABC’s first profitable month in five years, could this be the proof that profitability can return to SOEs after their political masters have been told to wait at the door? Could the last R2.3-billion (Zuma damage repair) bailout be the final one? Could this be the start of a new era, free of political interference for the SABC? Could this also be the birth of a truly world-class public broadcaster, as it goes about informing, entertaining and educating millions of citizens, most of whom have only the SABC (TV and radio stations) to thank for their services?

Maybe it’s too soon to tell, but reading between the lines, the SABC may just be in the final stages of its hangover. It may be time for the public to shed its understandably entrenched mindset of the SABC as a decrepit, blundering edifice. Let’s hope and pray it can stay the course and that Ndabeni-Abrahams can come to terms with the fact that the SABC is not hers to control. It never was.

In the game of criticising and exposing state-owned enterprises that get it so wrong for the state and its citizens, I’ve come to realise that when they get it right, there is very little praise or recognition of the tireless work carried out, often against all odds. I also have no doubt they have made some mistakes along the way, and probably will make more in the years ahead. 

But if every SOE board had to conduct itself in the manner of the new SABC board and its executive directors, we’d be much better off as a nation. DM


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