With expenditure consistently overshooting earnings by a wide margin, public broadcaster Prasar Bharati is in danger of a complete erosion of its reserves, making it a financial liability for the government. In the past four years, against average annual earnings of R1,100 crore, Prasar Bharati has posted an average deficit of R1,500 crore, prompting a parliamentary panel to demand steps to raise revenues to meet operational costs and set its house in order.

          As a result, Prasar Bharati has initiated several steps under its new CEO Jawahar Sircar, sources said. These include hiving off the archives divisions of All India Radio (AIR) and Doordarshan (DD) into a special purpose vehicle (SPV), sharing infrastructure of AIR and DD including towers, land and buildings with private operators including telecom players on a licence basis and providing value-added services like IVRS and SMS to consumers, among others.

      Even though Prasar Bharati is an autonomous body formed by an Act of Parliament, it survives on government grants and loans. In 2010-11, actual revenue earned by the public broadcaster was 20% below its own projections. The situation was no better in the two previous fiscals either. However, expenditure has hovered at over R2,500 crore for the past three years, building up the deficits.

       “While it is appreciated that Prasar Bharati is a public service broadcaster, the mandate does not restrict it from generating adequate revenue to meet its operational cost. The Parliamentary panel is seriously concerned over the increasing gaps between revenue projections and revenue receipts,” said the parliamentary standing committee led by Rao Inderjit Singh which looks after the functioning of Prasar Bharati among other government units. The 31-member panel has taken a serious view of the financial viability of Prasar Bharati and its inability to raise revenues.

       The government has full responsibility for salaries and related expenses of Prasar Bharati's over 34,000 employees for the next few years. Earlier, a group of ministers had recommended that half of the expenses be borne by the broadcaster from internal revenues.

       Prasar Bharati has blamed the implementation of the Sixth Pay Commission recommendations for its rising expenditure. “Even though our revenues have shown an increase over the past several years, expenditure too has ballooned, increasing the deficit,” said a senior Doordarshan official. “The archives can unlock a large value for us. Efforts are on to market it properly. One option is to hive off the archival wing into some sort of SPV which will help us monetise it,” the official said.

         Recently, DD's DTH service also started auctioning channel slots to private broadcasters and earned around Rs 70 crore from two dozen channels, almost thrice the pre-auction fixed earning formula. However, that revenue source has virtually dried up for now due to non-availability of Ku-band spectrum as no new satellite transponders are available.
 

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