In addition to the forecast that by the end of this year the losses will amount to DM11 million, the report states the following: "From the economic-financial management point of view, in this year TV Montenegro found itself in a very delicate situation." However, the financial director of TV Montenegro, Miljenko Filipovic, does not think that the situation is so dire. "Losses do exist and have always been present during the last ten years. This is nothing new."
"The main reason for such losses of TV Montenegro are too many part-time employees, low price of the mandatory TV license and limited support from the state budget," said the financial director of the Montenegrin state-controlled TV station in a conversation with Monitor. Then he explained that the TV Montenegro leadership believed that it would get out of crisis by reducing the number of employees, increasing the mandatory TV license fee and funds allocated in the budget. However, the only weapon at their disposal at this time are mass dismissals of part-time workers, reduction of salaries and savings, above all on telephone bills.
That is why on November 26, 180 employees, mostly part-time workers, were dismissed from TV Montenegro. The position of those who stayed is also not enviable. Their salaries have already been reduced, and new dismissals have been announced. For example, an average monthly salary in TV Montenegro was DM428 in September, while in October it was reduced to DM360. Besides, during the last year, the employees had from time to time their paychecks reduced, at first by "symbolic" DM100. The justification was found in "too high phone bills". The management hasn't paid bonuses and food assistance for months.
Already in 1997, as a guest in a Morning Program of TV Montenegro, Milorad Djurkovic, at the time the acting editor-in-chief of the TV Montenegro program, said that "somewhere around 900 people are employed by the station, but the exact number is not known". Only three years later, the station had 300 employees more. At that time there were 687 full-time employees and 522 part-time employees. The dismissals initiated the downsizing that should result in 35% less part-time employees.
"Soon we'll put together a list of technological surplus that will include the people who have been on a sick leave for a while and who do not come to work," says Filipovic. Whether this action will, finally, result in dismissals of those who, although unofficially, lost their jobs three years ago, remains to be seen. In any case, the leading people from TV Montenegro calculated that they ought to save DM1.5 million per year with these dismissals.
However, one has to wonder why the station has so many employees and why their number has been growing inexorably with time in spite of financial losses that were recorded one year after another. Permanent job adds, new job openings, new faces and names have been a characteristic of the state-controlled TV for the last few years.
One of unofficial explanations is that after the break up of the united DPS and especially after the coming into power of the "reform-democratic" block there was a perceptible need for a "new" TV. Some of the old employees did not fit in the new editorial policy. Young people were employed instead of them. The "unsuitable" employees were not active anymore but continued to receive their salaries. According to rumors, the intention of the management to get rid of the surplus employees was stopped because of the expectation that that could produce negative political effects ("Do you know how many votes that is!?"). That is how the station ended up in absurd situation that, despite of 600 full-time employees, the main TV Montenegro news program is edited and anchored by part-time employees.
But that is not all. New people were hired for other jobs, outside the news program. Therefore, the Third Channel, envisaged as a mainly entertainment channel has, according to unofficial data, about 200 full-time employees and about 100 part-time employees, while in 1997, only 27 people worked at that channel. Thus the explanation that the loss amounting to DM7,010,080 "was the result of the enormous increase in the amount of produced programs and the lack of revenue from the mandatory TV license fees and advertising," is included in the TV Montenegro financial report. Unfortunately, there is no explanation why the station management failed to reduce the costs. Or, perhaps, such an explanation is not needed because the extreme lack of profitability is characteristic of many state-owned and private companies in Montenegro. However, that is another, already worn out story. Let us go back to TV Montenegro.
The mandatory TV license fees, the second mentioned reason for the station's losses, still haven't been resolved. The governing board of TV Montenegro last year demanded that license fees be increased to DM5 a month, but they remained at DM0.47 until October 1, 2000. Now, through their phone bills, citizens of Montenegro pay DM1.5 a month for TV license fees. If the requested increase to DM5 a month were approved "TV Montenegro would obtain more than DM4.5 million only from the TV license fees," says the financial report.
The issue of mandatory TV license fees opens numerous dilemmas, regardless of the amount charged. Some of them are: why would the citizens of Montenegro pay TV license fees only to TV Montenegro, and not to other, local and private electronic media? Besides, unlike the state-controlled electronic media, the private media are not financed from the state budget, and as far as the advertising revenue is concerned, exactly the state-controlled TV is responsible for extremely low commercial rates for advertising on the local electronic media. It will remain recorded that TV Montenegro was at one point probably the only medium in the world that would allow you to seek buyers for "a cow and a calf" over a satellite-TV channel for about DM10...
Finally, we reach the state budget, which earmarked DM8.7 million for the station in year 2000. In percentages, that amounts to 74.68% of overall revenues of the station, while the rest comes from TV license fees and advertising. However, Filipovic claims that this year TV Montenegro actually demanded DM11.8 million from the state budget and that, among other, the three millions that were not approved added to the problems. "We reduced the initial 14 million to 11, but we failed to get even that amount," the financial director of TV Montenegro said.
One has to wonder how it is possible to spend funds that haven't been approved in the budget and are not covered by the revenues of TV Montenegro. It remains to be seen who will and how pay the debts and cover losses. However, how is it possible that the state-controlled TV station failed to pay various contributions to the state budget, such as social security, for example? The pension fund and the state health insurance funds haven't received any payments although these amounts are included in the TV Montenegro accounts. "We are trying to reach an agreement regarding the payment of these obligations to the funds," explained Filipovic, claiming that they had already made some deals to pay the debt in installments.
It is understandable that the TV Montenegro expenditures have significantly surpassed the planned expenditures because of intensive foreign policy activities of the Montenegrin state leadership, extremely long sessions of the Montenegrin Parliament, daily press releases of political parties, the process of "democratization of Serbia" through the program "Lens"... All that had to be covered by image and sound. However, the question remains; why, in that case, the Montenegrin Parliament did not rebalance the TV Montenegro budget and approve additional funds, sufficient to cover the expenses? They did not know, or did not want? That remains to be seen.
Whatever the case, now TV Montenegro is waging a battle to save money and, according to Miljenko Filipovic, "all expenses are now under a magnifying glass". And while the management is implementing measures of "general expenditure cutting" the workers are protesting, although rather quietly and in a disorganized manner. Their only public protest had to do with the distribution of about 30 apartments owned by TV Montenegro. They expressed their dissatisfaction in a letter sent to the President of the Parliament, Svetozar Marovic.
The Montenegrin Parliament, the legal owner of the station, as far as we know, has not received any complaints regarding the enormous losses in TV Montenegro. Whether the Parliament will still look into the station's management policy, remains to be seen.
"The Action Plan for Changes" is a voluminous document that contains a precise description of the current situation, as well as urgent steps that needed to be taken during 2000 in connection with the reconstruction of management, program development, organization structure, human resources policy and a series of other fields. The development of financial control took a distinguished place in the action plan.
The second highest priority for the current year, immediately after the reduction of the number of employees, was "the establishment and improvement of a system of financial management and control of balances through reduction of the budget". The description of the current situation in that field includes the following:
"Financial management, planning and control are under total control of the Finance Department. No one in the TV station, Radio or among technical staff knows how much they are allowed to spend and what their financial priorities are. All requests for expenditure must be approved by the financial director. The basis on which these decisions are made is known only to the Finance Department and the financial director."
The financial director of TV Montenegro is Miljenko Filipovic, while Goran Rakocevic is the director general. The British TV demanded from TV Montenegro full access to the complete financial records so that its experts could as easily as possible implement decentralization of the budget and its distribution to different sectors. The governing board rejected the BBC's request, justifying its decision by a legal act that puts the Oversight Board, the body appointed by the Montenegrin Parliament, in charge of the financial control. The mentioned body has so far never met, and the identity of its members is another secret, as we found out from a well informed source from TV Montenegro.
"The Action Plan" was presented to the Montenegrin state leadership. The leadership characterized it as acceptable, and it was proposed to the TV Montenegro Governing Board to accept it as a mandatory document. That was done. However, the expected deficit for the next current year according to the BBC should be DM1,146,000, which does not even compare with the actual losses of TV Montenegro in the first 10 months of this year.