The SABC's acting CEO James Aguma says the South African public broadcaster wants the news that it broadcast to be sponsored although the SABC is actually prohibited from doing this by the broadcasting regulator.
The SABC as South Africa's public broadcaster is mandated, according to its editorial policy and according to its licence conditions from the broadcasting regulator, the Independent Communications Authority of South Africa (Icasa), to provide news that is fair, balanced and objective and not commercially sponsored.
The SABC own editorial policy states that "we do not allow advertising, commercial, political or personal considerations to influence our editorial considerations" and that the SABC is required to "report news truthfully, accurately and objectively".
"Sponsorship of television news and current affairs has been prohibited by Icasa, and is therefore not allowed by the SABC," states the SABC’s editorial policy.
"Weather forecasts and sports bulletins that form part of TV news bulletins may be sponsored. Any product placement within news and current affairs programmes is strictly forbidden".
James Aguma told parliament's portfolio committee on communications about "the serious problem" if SABC news isn't sponsored, saying that "it implies that we are going to run an operation without funds".
"That explains – and there's been a lot of talk about the SABC MultiChoice channels contract – why SABC News (DStv 404) is funded through a strategic partnership".
"Because it's those funds that we need to cover that [news] operation. The SABC's normal news department is sustainable. What we need to do, is to ensure that the revenue growth and the cost – the growth is higher than the cost," said James Aguma.
"Unfortunately, if 85% of your revenue arises from advertising, then you are open to market forces. And we know that market forces are changing consumption patterns. People are consuming content now on digital."
"Those are some of the reasons why certain contracts were signed because we realised its time now to shift aggressively towards the digital space. And that's something that we prefer to keep, you know, keep under wraps. But the issue is it's a strategic choice because we are seeing a funding gap on trying to sell content on this traditional platforms," he said.
In late December 2016 parliament's ad hoc committee investigating maladministration at the SABC heard several allegations of how the Gupta-owned The New Age wanted to take over the running of the SABC's news operations.
The committee heard allegations of how the SABC is bleeding cash on production costs to run the controversial The New Age sponsored "breakfast briefings" broadcast on Morning Live on the SABC2 and SABC News channels.
The inquiry's final report, adopted last week Tuesday by parliament, found that all of the SABC's "questionable transactions" should be investigated and probed by forensic audit like the SABC MultiChoice deal, and for a review of the feasibility of The New Age breakfast briefings.