Scrap TV licence fees in South Africa – Outa

The Organisation Undoing Tax Abuse (Outa) has called for the scrapping of TV licences, arguing this funding model for the SABC has failed.

This formed part of Outa’s feedback on the Department of Communications and Digital Technologies’ Draft White Paper on Audio and Audiovisual Content Services Policy.

The draft white paper proposed the amendment to TV licence fees to broaden the definition and collection system for television licences.

The paper further proposes changes to strengthen enforcement mechanisms and penalties for non-payment.

These proposals are not surprising considering the dwindling TV licence fees over the last year.

The SABC’s annual report for the 2019/2020 financial year revealed that less than a quarter of TV licences were paid.

The SABC collected payments from only 2.9 million of the 9.4 million TV licence holders on its database, resulting in an estimated revenue shortfall of R2 billion.

TV licence revenue declined by 18% year-on-year to R791 million, which the broadcaster said was due to the delayed use of debt collection agencies in this period.

Instead of trying to improve TV licence collections, Outa said the system should be scrapped completely.

“Incompetence, maladministration, and corruption at the SABC should not become a burden to successful private industries or South Africans,” it said.

“Any tax or levy that fails to achieve its purpose due to failed administration or unenforceable mechanisms should be closed down.”

It added that the proposed regulations have far-reaching implications for South Africans, including that owning a smartphone or tablet would require them to have a TV licence.

Outa added that content from on-demand services, like Netflix, would be regulated to ensure South African content is given airtime or face being blacklisted.

“This is a blatant rebuttal of freedom of choice, the democratisation of information and universal access,” said Outa executive manager Julius Kleynhans.

He added that whichever way you look at it, citizens once again have to pay for government’s incompetence and failure to run state-owned enterprises like the SABC.

“We fear that this will be another method of getting more money from citizens to fund the corrupt,” Kleynhans said.

Reviewing the SABC’s business model

Instead of trying to increase revenue from TV licences, Outa is suggesting reviewing the SABC’s business and revenue model.

This should include reviewing the current content to help the SABC to become financially viable as a broadcaster of choice.

The state should also determine how much of the SABC’s funding needs to come from levies or general tax, and where oversight of this will lie.

“The focus should be on providing more access to the internet and devices at lower cost to the public, as an enabler to society,” Kleynhans said.

Kleynhans said the minister should consider the greater environment of the policy and address areas of concern.
“It is impractical to recommend policy changes in one sphere, essentially plugging a hole, without fixing the broader systemic issues,” he said.

OUTA opposed any new revenue streams for the SABC until all holes are plugged.

“South Africans are tired of SOEs which fail to provide services, while taxpayers are expected to pay more and more to stabilise them,” Kleynhans said.

Department of Communications and Digital Technologies’ Draft White Paper on Audio and Audiovisual Content Services Policy

Outa submission on the draft white paper

Now read: Asking Netflix and DStv to collect TV licence fees a “crazy suggestion”

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Scrap TV licence fees in South Africa – Outa