Without bank bail-out SABC 'could soon battle to pay suppliers, staff'

2016-07-10 14:20
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(SABC website)

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Johannesburg - If the SABC does not get some financial bail-out from the banks, the state broadcaster could soon struggle to pay suppliers and staff, reports the Sunday Times.

More than R500m has allegedly been written off the SABC's bank balance in the past three months.

The Sunday newspaper said this is revealed in internal documents of the SABC it has obtained. These internal documents include an e-mail from SABC treasurer Arrie Thomas and excerpts of an SABC treasury report for the end of May.

The SABC plans to ask Nedbank, FNB, RMB and Absa for financial help totally R1.5bn in the next two weeks, according to Thomas' e-mail, the Sunday Times reported.

SABC spokesperson Kaizer Kganyago, however, told the Sunday newspaper that the SABC denies that the information it claims to have belongs to the SABC, while Thomas declined to comment.

In 2014 the SABC showed a profit of R358m, but is now expected to show a loss of R500m for 2016, the Sunday newspaper alleges. Apparently the SABC had R1.2bn in the bank two years ago. By March 2016 this was down to R874.6m and has changed to R537m over the past three months.

The SABC needs a cash balance of about R650m to continue operations, yet, according to Thomas' e-mail, the balance could be heading to below R300m.

In April Fin24 reported that Hlaudi Motsoeneng, chief operating officer (COO) of the SABC told the parliamentary oversight committee that the broadcaster is not there to make a profit, but it’s a public broadcaster that serves the people.

READ: SABC not there to make a profit, says Hlaudi Motsoeneng

Motsoeneng told the committee the SABC lost more than R120m, for example, when it covered the funeral of the late president Nelson Mandela. He said the SABC would apply to National Treasury for an exemption, as its performance should not be based on profit.

A senior SABC source with direct knowledge of its finances told the Sunday Times that the SABC will need to guarantee any such bank finance by means of the National Treasury and if the broadcaster fails to pay and the banks call on the guarantee, it could lead to a downgrade by ratings agencies.

Treasury spokesperson Phumza Macanda told the Sunday Times that it has not been approached regarding any such guarantee, but would consider it before reaching any decision.

Kganyago told the Sunday Times the audited annual results of the SABC is expected to be released by September 30.

Fin24 reported in May that the SABC announced it will play 90% local music across its 18 radio stations. The move followed what the state-owned company said has been “extensive” engagements with music representatives.

In choosing to play 90% local music, the SABC is also going beyond what is required of it by the Independent Communications Authority of South Africa (Icasa).

READ: SABC to play 90% local music

In late June acting SABC CEO Jimi Matthews resigned, saying recent changes at the broadcaster were “wrong” and he has compromised his values under the current leadership. He indicated his decision to leave followed widespread changes under Motsoeneng.

Matthews said the “corrosive atmosphere” had impacted negatively on his moral judgement, and made him complicit in decisions he “was not proud of”.

ALSO READ: SABC Acting Group CEO Jimi Matthews quits

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