NGO news

Unscheduled audit of Georgia’s public broadcaster

by | Nov 19, 2012

TBILISI, DFWatch — Georgia’s Revenue Service November 6 started an unscheduled audit of the financial activity of the Public Broadcaster.

Finance Minister Nodar Khaduri November 7 stated that Georgia’s Public Broadcaster has about USD 2.2 million in debt to the state. He further announced that there was started an audit of the broadcaster, and explained that the reason was that unpaid fees had been hid, but the Revenue Service had never reacted.

GPB chair Gia Chanturia said audit officers demanded that there was no filming of the audit process with video cameras, but the finance minister denied this.

In a statement, Chanturia said there were two audit processes at the company at the same time, and that he had suspicions regarding what was going on. First, since the 1990s, revenue bodies have never checked GPB and never entered the office; only a planned revision was carried out by the state audit bureau and the next planned audit was scheduled in a few months.

Chanturia thinks it is interesting that the minister’s order to start an audit was issued November 6, while the same day, revenue service employees started the audit, but none of them informed society that they had started the process.

He says he was asked not to publish information about the revision, and questions why this was necessary.

Finance Minister Khaduri rejects Chanturia’s claims that the audit is an attack on freedom of speech and freedom of expression or an intervention in editorial policy.

The minister then noted that there are no tax payers which revenue service won’t check.

The finance ministry explained in a statement that since there have been raised questions about dates, who gets singled out for audit is selected by a computer program, which then is prepared into a plan for audits.

“The Finance Ministry understands that in this case it is audit of a media outlet, but we shouldn’t forget that this media outlet for years has spent public money, received over the budget. That’s why it is the duty of the Finance Ministry to find out how reasonably that money has been spent, when it is being spent for the development of GPB and for the public interest.”

The minority in parliament considers the audit interruption of the activity of the public broadcaster, while President Saakashvili said it is unacceptable.

But the GPB chair says they do not have problems with the audit, but want the process to be transparent. That’s why they decided to record the audit process with cameras.

A few days ago, the Revenue Service entered TV Channel PIK, which belonged to GPB and which had its funding cut after the results of the parliamentary election became known. Audit officers will check information from 2010 until today.

November 12, GPB ended its contract with PIK, the only Russian language Tbilisi based television station, aimed at an audience in all former Soviet countries.

It is still unknown how the TV station will continue functioning.

Institute for Development of Freedom of Information (IDFI) has argued that the case raises questions around the responsibility of the chair of GPB. The reason is a USD 2.2 million debt, which is not the only debt the broadcaster have.

IDFI published documentation obtained in previous years, according to which the company brought in three million in 2009, 6 million in 2010 and seven million in 2011 on its own. In addition, it received money from the state.

The organization reveals that GPB had debts to the government’s reserve fund in 2008, but due to the war with Russia in August that year, the deadline for paying 4.2 million was rescheduled for December 2012, although 50 000 lari of it had to be paid in 2009. This money was not paid. The Finance Ministry went to court against GPB, but with no results.

In the beginning of October, the GPB chair told then Finance Minister Alexandre Khetaguri that the company couldn’t pay the debt in time and asked to pay 3 million lari by the end of 2012, but in mid-October 2012 the Chair of GPB contacted the Finance Ministry again to ask to abolish the debt or at least reduce it.

The amount of the debt is 4.2 million lari, plus a 900 000 penalty, which wasn’t paid.

The IDFI report speaks also says GPB has additional debts, including fees in the amount of USD 2.2 million.

The organization has published all the documents about the debt of GPB on its website including letters to the ministry.

In 2012, the state allocated USD 29 million for the public broadcaster from the budget. The new government reduced the financing to USD 19 million, but the new budget draft is not yet confirmed by parliament.

In his statement, the finance minister drew attention to steps by the previous government, which attempted to reduce the debts of national broadcasters; however they didn’t manage to reduce the GPB’s debts, like it did for Rustavi 2, Imedi and Real TV, all controlled by the previous government. They had their debts reduced by about USD 12 million in total.



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