Some animals more equal than others?: MultiChoice, ANN7 and influence peddling

This week the #Guptaleaks emails revealed that MultiChoice is paying ANN7 – an alleged “news” channel supportive of President Jacob Zuma’s faction of the ANC – at least R50 million per year to carry its channel on DStv, and that a contract for R150 million per year was drafted but apparently never signed. If MultiChoice entered the deal (and indicated that it was open to a new R150 million deal) in order to buy influence with the government, it would, of course, look and sound very much like an indirect form of state capture.  But strangely enough, it is far from clear that in terms of our law such influence peddling would amount to corruption.

It must have been late on a Wednesday night in 1986 or 1987 that I found myself at the headquarters of Naspers on the Cape Town foreshore, where the page proofs of Die Burger were being prepared. These were in the days when “strippers” manually grafted the printed text onto the page according to the layout provided by the sub-editors. I was the deputy editor of the Stellenbosch student newspaper, Die Matie, and we were busy preparing the last pages of our own newspapers, while the sub-editors of Die Burger were putting their propaganda sheet to bed.

We had a bit of a scoop for Die Matie that night. We were going to report that the leader of the Stellenbosch SRC (who was also an important National Party youth leader) had acted beyond his powers and we were quite giddy with excitement. (Interestingly enough, that SRC chairperson and staunch supporter of apartheid is today an ANC MP and the chairperson of the portfolio committee on Police.)

It was then that I overheard two sub-editors congratulating themselves for managing to include three articles about the George region (where State President PW Botha used to have his constituency) onto page 2 of the paper. “PW Botha is going to be very happy,” one joked. “Yes,” said his friend, “at least he won’t phone the editor to complain about us tomorrow morning.”

This was in no way remarkable. Die Burger was then formally the mouthpiece of the Cape National Party, and we had all heard stories about how the State President dictated its content (as well as the content of the SABC television news), sometimes phoning editors late at night to instruct them to change stories to suit his agenda. Die Burger’s advertising slogan was: “Lees Die Burger en gesels saam” (read Die Burger and join the conversation), which we changed to: “Lees Die Burger en wees saam skaam” (read Die Burger and also become embarrassed/ashamed”).

It was around the same time that the apartheid government was deciding on the awarding of the contract (which turned out to be extremely lucrative) for the first pay television channel called M-Net. Hennie van Vuuren recently wrote about the donations made at the time by Naspers to the National Party and how Naspers Managing Director, Ton Vosloo, lobbied PW Botha to secure the M-Net deal. He then concludes:

This lobbying had its desired effect and the government awarded Naspers a 26% stake in the country’s first commercial TV service, M-Net. Vosloo was quick to thank PW Botha. In a July 1985 letter that also discussed strengthening support for the pro-government Citizen, Vosloo wrote: ‘Thank you for your leadership on the TV matter and your quick decision. I appreciate it. The decision now places the matter in a more certain trajectory.’

MultiChoice South Africa grew out of the subscriber management division of M-Net. It has been embroiled in a battle relating to the digital migration of television, which will shift free to air broadcasters from analogue to digital signals. Set top boxes will be needed by many owners of older television sets to allow for this. The fight is whether to encrypt these boxes or not.

MultiChoice, along with former Communications Minister Faith Muthambi, earlier this year successfully challenged a Supreme Court of Appeal (SCA) judgment which declared her policy of non-encryption irrational. Critics of MultiChoice and the non-encryption policy argue that MultiChoice is cosying up to the SABC and is using (or abusing) its influence over the Jacob Zuma faction of the government to ensure the set top box would be so basic that it could not later be used to launch pay TV services to compete with MultiChoice. In other words, they say that MultiChoice is trying to keep any competitors out of the market to secure its profits.

If, for the moment, we ignore ethics and the criminal law prohibitions on corruption, it would make perfect business sense for MultiChoice to pay ANN7 an inflated price to carry its channel on DStv. This is because it is in the commercial interest of MultiChoice to demonstrate to the Zuma factions within government that it is prepared to support ANN7 to ensure the channel’s financial viability. ANN7 and its “analysts” are closely aligned to the Zuma faction and openly promotes its interests (and its candidate for President of the ANC) while denigrating opponents of President Zuma (much like Die Burger promoted the National Party and vilified and smeared opponents of apartheid).

I disagree with people who are lobbying MultiChoice to drop ANN7 from its bouquet. After all, it is not a crime to be bad at what you do. In any case, it is good to have a range of voices and opinions represented in the media. Unfortunately, ANN7 (and its print equivalent, The New Age) are so unsubtle about their political loyalties and political agenda, and their political “analysts” sometimes so uninformed and clumsy, that they have lost credibility among a large section of citizens with access to DStv. Other television channels or publications also have their (often unspoken and unacknowledged) preferences, but mostly attempt to be fair and to appear to be impartial, which enhances their credibility and effectiveness.

But what if ANN7 is only staying afloat because MultiChoice has offered it a sweetheart deal in order to buy favour with the government? I have no idea whether this is indeed the case or not. It appears to be rather difficult to get information about the various deals made by MultiChoice with various content providers.

One report suggests that the SABC was also getting R50 million from MultiChoice. But this was for both a 24-hour news channel and an entertainment channel. According to AGB Nielsen Media Research, SABC News on DStv last year had a 14.7% viewership share (this must not be confused with SABC’s share of the free to air viewers who do not access the SABC via DStv). ANN7 had an 8.83% viewership share, almost half that of the SABC. eNCA’s audience share on DStv for the same period was 56%.

In the absence of full disclosure by MultiChoice, it is not possible to say whether it has offered to carry ANN7 at an inflated rate. If evidence were to emerge that MultiChoice concluded a contract with ANN7 at an inflated price, or that it was offering to enter into an even more pricey deal with the channel, one would inevitably turn towards the Prevention and Combatting of Corrupt Activities Act of 2004. This Act is far more comprehensive than the anti-corruption legislation that existed during the apartheid era. And in any event, it is unthinkable that the apartheid police would ever have investigated corruption involving funding of the National Party.

But even so, it is unclear that the Act would cover such a form of influence peddling. Section 3 of the Act prohibits anyone from giving or offering to give “a gratification” to any other person to persuade that person to act (or to influence someone else to act) in a corrupt manner. A gratification is broadly defined to include any inflation of the price of a contract. But here the gratification would not have been given to ANN7 try and get ANN7 to do something corrupt or to get ANN7 to persuade somebody else to do something corrupt. So, as far as I can tell, it would not fall within the ambit of section 3 of the Act.

If this is correct, the Prevention and Combatting of Corrupt Activities Act does not prohibit various forms of influence peddling that allow the private sector to buy influence with the government of the day and to influence its policies and the actions of government officials. Instead it targets cases where money is given or offered to a person with a view of getting that person him or herself to do something corrupt.

For example, if developer X donates a large sum of money to the Democratic Alliance and that developer is later granted permission by a City of Cape Town official to wave zoning restrictions for a building being developed by developer X, this would be a clear case of influence peddling. (Rumours about such influence peddling by developers in Cape Town are rife, but because the DA has refused to identify those who donate to it, we have no way of knowing whether these rumours are true.) However, such influence peddling may well not amount to corruption.

Similarly, if a big bank gives away a sizeable chunk of its shares to influential ANC leaders in the hope of influencing the ANC NEC and the Minister of Finance (none of whom were given any of the shares) to draft a business friendly budget, this would be a clear form of influence peddling, but would probably not amount to corruption.

This alerts us to the fact that those with economic power potentially have a far better chance of influencing government policy than the rest of us. It alerts us to the fact that if one is clever enough and subtle enough (not something one would ever blame the Guptas of) one can potentially buy enormous influence over government policy and even over decisions by government officials without making yourself guilty of corruption as defined by the law.

As George Orwell wrote so many years ago: “All animals are equal, but some animals are more equal than others”.

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