NAWAAL DEANE, Johannesburg | Friday
THE South African Union of Journalists (SAUJ) is facing a financial crisis that may lead to its demise if drastic measures are not implemented to cut costs and restructure its office expenditure.
Financial statements for last year indicate that the union office has been depleting funds held in the Joint Journalists Unemployment Benefit Fund (JJUBF), which is intended for “journalists in need”, contravening a resolution that the union is not allowed to spend more than 10% of the fund each year.
Unemployed members of the union may apply to the fund for a portion of their salary for up to six months.
SAUJ president Sechaba ka Nkosi confirmed that the union is not on a sound financial footing. He says that there have been a number of legal battles and that travel costs have increased. “But the national executive committee (NEC) has put measures in place to get the finances under control.”
The JJUBF was started by a number of media organisations that initially contributed about R1-million to safeguard journalists who were unemployed. The money was later invested on behalf of the union, with funds growing to approximately R4-million.
As membership dropped, so did revenue from members’ subscriptions. Four years ago the NEC decided that some of the union’s operating expenses could be paid by the fund. It allowed access to the fund through “interest free” loans that could not exceed 10% of the previous year end’s market value of the fund; now the money, initially intended for welfare, education and training projects, could also be used to supplement operating expenses. They also decided that the congress of the union could “write off” the loans as well as look at allocating funds for each year. One of the stipulations was that the yearly 10% needed to be distributed between various other funds, such as the education fund for bursaries and the benevolent fund. But over the past few years up to 80% of the funds have gone to office expenses.
Last year the crisis became evident when the union’s yearly congress did not accept the financial statements because of the rocketing expenses. A committee was appointed to investigate these finances.
“In the past few years salaries, staff benefits and travel costs have risen by up to 100%,” says Joel Avni, acting treasurer appointed at the congress in September.
He says that basic financial controls are almost non-existent.
“There is no record of where petty cash is spent and blank cheques were being issued.”
He says that the union has two sets of books because the staff did not know how to use the computer system and that neither set of books corresponded with the other. One set of records was being presented to the auditors and the other to the NEC.
In September last year the financial investigating committee found that there had been a “cavalier” approach to union finances and instituted a plan to cut costs and bring expenditure under control.
“We could not sustain the level of expenditure. We determined that we had broken the JJUBF rules and had eaten into the capital by about R500 000, money that we are not entitled to,” says Avni.
Financial statements for 2000/2001 compiled by auditors show that the office running costs for 2001 were R682 000, almost R60 000 a month. Travel expenses for the president and national organiser were R37 000, an increase of R20 000 over the previous year. Avni says these figures understate the office expenses.
But Motsomi Mokhine, the general secretary, says that after the NEC investigated these figures, it was clear that the national organiser could not have used this amount of money and the audit was incorrect.
The statement also showed that expenses in 2001 had increased by R70 000 over the previous year. Telephone bills and faxes average R6 000 a month. Mokhine says that the rise in expenditure can be attributed to a decrease in budget allocations and to inflation. He also attributes the crisis to high legal costs and travelling costs for the president were for international conferences.
Sven Lunsche, principal officer of the fund, confirmed that the expenditure has exceeded the 10% limit, but is confident that the NEC has a plan to rectify the situation. He says if the fund continues to be used for office expenses it will eventually be eroded and the union will be forced to close down.
Avni says the April NEC meeting also found that financial controls were “negligent” and certain other expenses were questionable. It was decided that Mokhine would have six weeks to try to raise the additional funding the union would need to sustain the current head office for the rest of the year.
“If I succeed the problem will be sorted out. If not, the NEC will have to decide the next step,” says Mokhine.
“Every NEC member at this stage recognises the gravity of the situation and everyone is committed to preserving the union,” says Avni.
Mokhine says he is confident that they are on the right track even though the picture is gloomy.
“We have to derail the gravy train,” says Avni. “The industry is going through a tough period and journalists are going to need a union with strong representation in the workplace.”
He says he feels that the way forward is to restructure the union in a manner that would get members more actively involved.