The state of governance in some entities within the Department of Communications and Digital Technologies (DCDT) portfolio remains a pain point, says minister Solly Malatsi.
The DCDT portfolio comprises 11 state-owned enterprises: Broadband Infraco, Film and Publications Board, Independent Communications Authority of SA, NEMISA, Postbank, the South African Broadcasting Corporation (SABC), SA Post Office, Sentech, State IT Agency (SITA), Universal Service and Access Agency of SA and .ZA Domain Name Authority.
In an interview with ITWeb, Malatsi spoke about some of the lingering issues and provided updates on the entities within the DCDT portfolio.
“The state-owned enterprises in the portfolio have their own unique set of challenges, from leadership instability and governance challenges, to liquidity risks for many of them. This shows how we constantly need to think of better ways of securing their sustainability.
“I’ve been consistent in underscoring the hard reality…that the state no longer has the means or the capacity and it shouldn’t be promoting the aspect of saving unsustainable entities. For far too long, the leadership within entities have invested too little in terms of maximising their commercial sustainability and exploring revenue means, so that they are less reliant on bottomless state funding. The reality is that the state doesn’t have that capacity.”
Balancing scales
Despite some of these challenges, Malatsi noted the progress made in filling key executive roles and ensuring stability at board management level.
He added that governance progress has also been reflected within the boards.
“Save for one entity – the Film and Publications Board council’s term is coming to an end and we will be appointing a new council in the next few months – we now have full boards across the board, which wasn’t the case previously. One of my key areas was around stabilising leadership at a board level.”
Turning to government IT procurement arm SITA, the minister said it was and continues to be one of the “bugbears”, particularly around its capacity to constantly meet government’s ICT needs.
“I believe we now have a capable managing director there; I believe we’ve got the right board there and it’s only fair to give them a chance, to see how they best steer this institution forward.”
He noted there are some old conversations which have been happening in government, even prior to his appointment, which are moving expeditiously. This includes looking at the business model for SITA, for instance, which is a process that is underway.
In terms of broader aspects in the portfolio, he said what is recognised is that they are starting to have much clearer policy direction on several matters.
“For example, in terms of our promotion for establishing this sector as being pro-competition, leading towards a much clearer and stabler policy environment, which is critical for helping with the attraction of investments that we need.”
SABC funding?
The SABC’s financial quagmire to fund public broadcasting has been a long-standing issue, with it recently noting the need for additional funding in preparation for coverage of the local government elections.
The public broadcaster reported a net loss of R253 million in the 2024/25 financial year, up by 28%, compared to reporting period in 2023/24. The SABC has also been at loggerheads with state-owned signal distributor Sentech over non-payment of services.
Last September, the department announced the appointment of BMIT Knowledge Group to conduct research and develop a funding model for the public broadcaster.
The research and advisory firm was tasked withcharting sustainable solutions to secure the SABC’s long-term financial stability.
According to Malatsi, work on the SABC funding model, which is instrumental to finalising the SABC Bill, was finalised a couple of months ago.
“That [funding model] has been with National Treasury, and rightfully so, because it’s a decision we must make in consultation with National Treasury for their feedback, given the potential impact it has on the fiscus and the allocation of funds.”
While the minister would not go into the specifics of the funding model, he indicated that several options have been presented for the most practical, financially-sustainable way of funding the public broadcaster.
However, he vehemently said he doesn’t believe in the idea of a compulsory household levy, which has previously been floated. “A household levy is not viable in a South African context.”
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