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Detailed, forensic audit and investigation for Elections 2013

i. In the context of a completely transformed media sector which, despite its low international ranking, is widely seen by the people of Pakistan as a reflection of extraordinary new freedom and vibrancy, it is unfortunate that the Commission is obliged to consider the issues of media-related corruption.

ii. In doing so, the Commission is taking note of the several allegations and statements about media-related corruption contained in the petitions considered by the Hon’ble Supreme Court which then appointed this Commission to study the aspect of media-related corruption as part of the nine Terms of Reference (TORs) given to the Commission.

iii. On the basis of questions posed to the representatives of different sectors associated with media in Pakistan, a contrasting set of responses was received.

iv. Officials of the Federal and Provincial Governments and of all Government-controlled entities did not accept that corrupt practices exist in their respective institutions or departments. They stated that when and if corrupt acts occur in their domains, these are promptly taken notice of and punitive and corrective action is taken.

v. In contrast, virtually every single office-bearer of the representative bodies of the private media as well as individual media specialists, journalists, broadcasters, media entrepreneurs, members of civil society and senior representatives of leading political parties stated that corrupt practices do occur in inter-actions between Government and media, between the private sector and private media, and inside both private and State-owned electronic media. Further, that virtually no punitive, corrective action is taken by Government or by regulatory bodies or by representative bodies of private media and of journalists.

vi. It was stated that corrupt practices exist in a variety of forms and that most of such practices are obviously difficult to prove with speed and ease, but that they do exist.

vii. It was claimed by the non-official persons that the State-owned and Government-controlled media institutions and organizations, ranging from the Press Information Department and the Audit Bureau of Circulation under the Ministry of Information and Broadcasting to Pakistan Television Corporation, from all the Provincial Departments of Information to APP were all parts of the broad, corruptive process.

viii. Representatives of civil society and of journalists stressed that the very presence of the State and Government in the media sector was itself a fundamentally corruptive act because the coercive resources of the State were/are being used to benefit either the ruling political parties and public office-holders, or Government officials at various levels.

ix. It is claimed by some that in the inter-action between Government institutions, journalists and private media houses, secret funds are used in a corruptive manner to influence media content.

Note: It is necessary to stress at this point that the term “secret funds” has sometimes been incorrectly applied and used, resulting in a misrepresentation of the facts. For example, the annual grant given by the Federal Government through the Ministry of Information and Broadcasting to Pakistan Broadcasting Corporation Limited (PBC) amounting to over Rs.2 billion was/is perhaps inadvertently included in the classification of “secret funds”. Similarly, grants given to PTV for development projects and APP as grant-in-aid and a research organization, are also incorrectly/inappropriately placed under “secret funds”. Whereas most of such grants are itemized in the Annual Budget and are publicly declared grants which are the subject of audit each year by the Auditor-General of Pakistan.

x. The viewpoint of the Federal Ministry of Information and Broadcasting about this subject of secret funds is reproduced as under Click here to read about Secret Service Expenditure in Intelligence Bureau (IB)

Thus, excluding the grant given to a research organization, the total present annual “secret fund” amounts to Rs110.201 million, and not “billions of rupees” as is sometimes alleged.

xi. The Commission is of the opinion that:-

(a) The allocation of sums under the Head “secret funds” is done as per the law.

(b) That said, the use of secret funds, particularly in the realm of media and information can only be justifiable if it meets extremely crucial and unavoidable needs from the perspective of national security.

The application of the “national security” or “public interest” perspective to the use of secret funds should be subject to scrutiny and approval by a forum such as the Parliamentary Committee on National Security or the Parliamentary Committees on Information and Broadcasting.

xii. In a de facto sense, any discriminatory allocation of advertising contracts of Government-controlled entities to advertising agencies and media is prone to being misused as a “non-secret” method to potentially achieve “secret” objectives.

(End of Note)

xiii. It is stated that the selection of advertising agencies to create and place Government advertising in media is marked by corrupt practices to favour one, or a few agencies, at the expense of all others. That influence is extended from some of the highest levels of State office to favour individuals who enjoy specially close relations with such holders of high public office.

xiv. It was also said that in the placement of advertising in media, in the invoicing process and in payments, some documents are fabricated and other malpractices are used to achieve corrupt aims.

xv. That such corrupt practices include under-the-table, up-front payments made in advance to secure such advertising contracts from Government entities.

xvi. It is said by non-officials that the budgets for advertising by various Government organizations increased disproportionately in the period between 2008 and 2013 with the intent of manipulating documents, procedures and payments in such a way so as to channel substantial sums to secret, private political campaign funds which will be used in the Elections 2013 phase.

Whereas Government representatives ascribed reasons for the increase to the simple need to inform the public about new projects and programmes for the welfare of people and for national development.
For instance, as per the data provided by the Pakistan Broadcasters’ Association to the Commission, total expenditure on advertising on TV and FM Radio channels by Government-controlled entities reflected increases, in individual cases, of between 5 percent to 30 percent while the composite figures given by PBA are as below:-

2006-07 Rs.1.52 Billion
2007-08 Rs.1.51 Billion
2008-09 Rs.1.41 Billion
2009-10 Rs.2.08 Billion
2010-11 Rs.2.09 Billion
2011-12 Rs.2.04 Billion

It is notable that, whereas the rates charged by print media for Government advertising are notably lower than the rates charged for private commercial advertising, in the case of electronic media, the rates charged for advertising by Government-controlled entities is often significantly higher than the rates charged for commercial advertising by private firms.

xvii. It was claimed that relevant persons in print and electronic media including some proprietors, editors, news directors, TV anchors, producers etc. have already been persuaded by material, illicit means to extend covert support to certain parties and candidates.

xviii. It was also stated that certain large private enterprises e.g. one or more firms in the construction and housing sector, use their vast financial resources to inhibit and discourage private media from presenting independent critical analysis of the vested interests of such private firms due to the volume of advertising time and space bought by such firms, which bring financial benefit to proprietors of print and broadcast media.

xix. Some prominent persons in public life who appeared before the Commission were of the view that irresponsibility and malice on the part of some media persons is also a form of corruption. They complained bitterly about the slander and defamation they have faced both through incorrect, unverified reports published in certain newspapers and through unfounded allegations made by certain TV anchors. They emphasized that if they were to file cases in court to seek damages and justice, the legal process would take several years and require high financial costs. Retractions and corrections by media, especially by TV channels is virtually non-existent. The Councils of Complaints under the PEMRA law are slow and ineffective. They called for independent mechanisms to hold errant media accountable in a prompt and effective manner.

xx. In this particular Report which focuses only on TOR No.F, the Commission has deliberately restricted most of its Observations and all of its Recommendations to the relationship between media and Elections 2013. The Commission will deal with non-election-related aspects of corruption in the second part of its Report which will deal with the remaining eight TORs.

xxi. As stated elsewhere in this Report i.e. in para No.4 of the section titled: “Working methods used by the Commission”, the scale, nature and complexity of the different types of media-related corruption require the application of specialized, professional investigative skills preferably by independent, non-official specialized firms of auditors, etc., backed by adequate resources, the force of law and other legal means to obtain all related documents, examine/cross-examine both those making allegations and those who are the subject of the allegations in order to determine the veracity of the allegations. The Commission does not possess such required resources or the time before the deadline/s and therefore decided to meet with every relevant sector associated with media, and with particular individuals to make preliminary observations and recommendations to the Hon’ble Supreme Court.

xxii. The Commission is of the opinion that sufficient grounds exist for forensic audits and detailed investigations of several transactions and aspects referred to in the petitions admitted by the Court and aspects of media-related corruption in this Report.