There is an outcry over parastatals paying extortionate amounts to sponsor political breakfasts put on by the New Age newspaper, with the suspicion that this is a backdoor way of sustaining a government-supporting newspaper. This, though, is not the real issue here.
More serious is that these bodies – and other advertisers – are probably in contravention of the rules and laws that govern their expenditures because they have no way of evaluating New Age’s advertising and sponsorship proposition.
Let’s start at the beginning. Advertisers measure the audiences they reach through newspaper’s circulation figures (or the equivalent for other media), published via the Audit Bureau of Circulation. No sensible advertiser will work with a publication which does not have an ABC certificate.
Any advertiser will weigh up the cost of an advert against the audience it reaches, a figure usually measured as cost-per-thousand readers or viewers. Since state and parastatal bodies have strict rules on how to spend their money, they would need to be able to show why they chose one advertising outlet over another through an effective cost-per-thousand.
It is not a case of simple numbers: the context and type of audience also matters, so it may be justified to spend more money reaching fewer people if they are your target audience. But if you don’t have the audience numbers, you cannot measure this at all. There is no way to justify your expenditure to your auditors, your board, or the auditor-general’s office.
New Age does not and has never audited its circulation or published its circulation figures. This can only mean that the numbers are embarrassingly low and releasing them would cost them credibility and advertising, and may even force them to refund money to advertisers.
I see free copies of the New Age being handed out all over the place, a sure sign that they are desperate about getting copies into readers’ hands, and unable to sell them.
This might be expected in the first year or so of a newspaper, and advertisers and agencies may show some goodwill, and a desire for a new newspaper to succeed, by overlooking the lack of audited figures. But after a while, it can’t be justified.
It means that if the auditor-general, or parliament, or company boards, ask for justification for the decision to spend this money on the New Age, it cannot be produced. The evidence is just not available.
That would contravene the relevant Acts which are meant to ensure that state and parastatal bodies can properly account for their expenditure. As things stand, they are vulnerable to a challenge.
When the Eskom spokesperson justified the millions they paid for some New Age bacon and eggs, she could not even say how big an audience they had reached, through the newspaper or television coverage. This told us that they did not give a hoot about the value of their sponsorship, the bang for their big bucks. They must have been doing it for reasons other than the commercial.
It would be a tragedy if the New Age failed, as it adds to the diversity of choices we have in the marketplace. There are those who are hostile to the New Age because its owners are close to the president and the ANC. True, it is better for media owners to have a measure of independence, but the New Age owners are not alone in having their biases, relationships, friends, allies and favours owed and offered. All of the media owners have these things in some form or another (though perhaps with less crudity than the New Age’s Gupta family).
Party or political affiliation is not the test of good or bad media.
But honesty is. And a newspaper that does not publish its circulation figures is not honest.
Honesty is not an issue, obviously!
Anton, the parastatals are contravening the Public Finance Management Act, and Treasury should be investigating these sponsorships. The Act stipulates that public bodies should be accountable for how they spend their budgets, provide details of how this is spent, and eliminate waste and corruption. From everything I have read, it seems there has been no explanation of the value that was expected to be derived from these sponsorships, given that New Age does not have an ABC or release any other information.
What isn’t explained by anyone is what was the money used for? Normally a sponsorship covers the costs of the event and then some margin for the organisor. In this case the amounts appear to excessive given that the SABC didn’t charge for broadcast. Unless each breakfast really cost R1,4m. So is it really just parastatel’s using taxpayers money to prop up the New Age and the Gupta’s. Smells like “Infogate” to me.
Is there any point in asking the public protector to look into this? Wimpy and Steers are going head to head over the R20 breakfast, while those nice Gupta people are raking in R10700 a helping, if they have 1000 people at each breakfast. And twice that if they have half the number. And how many of the attendees — who must fork out R700 a plate — pay with private money? It stinks, like The New Age’s failure to come clean on sales.