Policy changes could directly affect journalism’s bottom line in South Africa

By Styli Charalambous

Daily Maverick

Cape Town, Western Cape, South Africa


My previous article explained the policy response required to address the market failure of journalism and summarised measures most likely to have a significant impact.

Now, I’d like to explain each measure. 

1. Compensation on assets or fines

The U.S. has laws to compensate whistleblowers on a percentage of assets recovered from whistleblower events or fines imposed. Compensation ranges from 10%-30% of assets recovered or up to 50% of penalties imposed. As a result, tip-offs have surged, and a more robust whistleblowing culture exists.

In South Africa and other countries, whistleblowers face risks ranging from job losses and financial ruin to murder, so there is little incentive for whistleblowers to take the risk associated with doing the right thing. 

Often, they need to work with investigative journalists to get the story corroborated and further developed, taking months of work and sometimes involving life-threatening risks. These investigations can cost hundreds of thousands of rands, often with little return other than legal threats or worse. 

Similar legislation could compensate whistleblowers and investigative media for their work that leads to recoveries by the state and/or fines imposed. These acts and the associated rewards are: 

A look at the acts in the U.S. and what penalties they impose.
A look at the acts in the U.S. and what penalties they impose.

This benefits the state, as compensation is linked to recoveries, which would not have been possible without this work. The only cost would be processing and verifying claims, but the upside is enormous, as evidenced in the United States, which is seeing record recoveries and penalties. 

2. Tax-incentivised funding sources

The need for more available funding in the media ecosystem is clear. But it is a complex issue as funding has been used to take over and then compromised some media houses.

The Independent Newspaper Group was once the largest newsprint publisher in South Africa before a series of owners stripped the assets and the editorial integrity of once-esteemed titles. This is a prime example of what can go spectacularly wrong when profit and political agendas hijack newsrooms.

Our proposals relating to funding cover a range of suggestions:

These tax laws could benefit the news media industry.
These tax laws could benefit the news media industry.

Additionally, for a relatively small subsidy of an essential service sector, the National Treasury could stimulate investment in the media sector to breed a host of new and diverse media start-ups and support existing ones.

3. Job creation

According to the Wits Journalism Project, South Africa lost over half of its permanently employed journalists and media professionals in the past decade. Pew Research found that newsroom employment at newspapers in the United States decreased by 53% over a similar period.

Not only is an entire generation of journalists being lost to industries offering more pay for less risk, but attracting entrants to the field takes work. The South African media industry is attempting to reconstruct the loss of talent whilst determining how to fulfil the demands of the new skills required in modern-day media organisations.

How can we reclaim lost editorial skills, build capacity and talent pipelines, and aid the continuous development of media professionals in countries like South Africa?

We must attract editorial staff back into the industry, ensuring a pipeline of new talent and the economic means to afford the talent in new skill sets.

Tax relief that helps companies afford skilled staff may help. Temporary employees’ tax holidays, similar to those offered during the pandemic to aid cash flow, could be offered to accredited media houses for, say, their most senior editorial staff members. It could offer more competitive salaries to skilled editorial and technical staff, thereby attracting people back into the industry.

To attract new talent, a media studies bursary programme would allow an appropriate number of students to join accredited media houses after completing their studies on government-funded “community service” programmes, like the medical fraternity.

4. Professional development

The news media industry has failed at innovation. To address the need for more innovation, the relevant industry leaders need to be upskilled.

Leadership teams must establish innovative, robust, and thriving media companies. Failure to innovate is a failure of leadership since it is ultimately their responsibility to build a culture and the requisite frameworks to keep delivering new editorial products and revenue streams.

To reduce the risks associated with innovation and experimentation, organisations must migrate to a product design mindset and culture that includes newsroom operations.

However, this requires leaders who understand what the future looks like for journalism. CEOs and editors should be upskilled in innovation and leadership training.

Some established journalism schools in the United States have created courses to teach these skills.

Online learning has become accessible, and making funds available for professional development is necessary for South African media. Tax relief related specifically to professional development and training in the industry could help.

5. Technology

Media organisations compete with larger business rivals, social media giants, and streaming video-on-demand operations with bigger technological teams and resources. This challenges ‌smaller organisations and even South Africa’s biggest media companies.

The above points rely on the successful use of data and technology. How can the appropriate technology be accessed and funded to deliver the best service to audiences?

Research and development rebates for the news industry can play a significant role. Efforts by the Google News Initiative and South African Media Innovation Programme, for example, have helped fund projects that would otherwise not have been pursued.

Tax rebates against qualifying investments would help the industry invest in innovation projects which are currently being overlooked due to financial pressures.

6. Data-free browsing of digital news

Internet data costs in South Africa remain exorbitantly high for most people who can only access it via mobile data networks. If legislation made public interest media Web sites free, it would encourage members of the public to visit trusted news sites.

Looking to the future

In the last decade, investigative journalism and whistleblowers’ sacrifices have helped the South African state recover billions of rands worth of assets. Now is the time to formalise this symbiotic relationship and show the world that South Africa is serious about reversing the diabolical treatment of whistleblowers and that it can be a leading light in progressive media support efforts.

This is the projected impact that each recommended law would have on the industry.
This is the projected impact that each recommended law would have on the industry.

These proposals could quickly be adopted by other willing nations who view media freedom as critical to a functioning society.

South Africa is impacted by corruption at national and local government levels. The time is right to empower the most significant lever we can pull from the outside by creating a supportive and encouraging environment for whistleblowing and public interest journalism to prosper.

About Styli Charalambous

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