Wed. Oct 23rd, 2019

Debt-ridden SABC needs bailout of R3.2 billion to stay afloat

SABC government bailoutWill Finance Minister Tito Mboweni give the broadcaster another handout?

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The South African Broadcasting Corporation (SABC) has applied for yet another government bailout amid fears that it may be unable to pay staff and service providers due to its grievous financial failings.

It’s been an arduous year for the public broadcaster, one marred by an exodus of board members, industrial action, brazen assassination attempts and building fires. Still, the greatest pitfall along the broadcaster’s perilous path rests in its inability to flip a profit – even after receiving a multibillion-rand bailout in 2018.

The broadcaster has admitted that every month this year has
been a fine balancing act; pitting staff and municipal services at opposite
ends of the scale. Unfortunately for the broadcaster, mounting debts – owed to
service providers and municipalities – have thrown operations into a tailspin,
with the sustainability of the SABC coming under intense scrutiny.

How much money does the SABC owe?

SABC Chief Financial Officer, Yolande van Biljon, confirmed
that an application for a R3.2 billion government bailout had been submitted. Van
Biljon explained that the broadcaster’s total debt rests under the R2 billion
mark, saying:

“In terms of debt, there is over a billion that is owed. If you add accruals, you come close to R1.8 billion altogether that is due and payable.”

The CFO further added that, should the funding support application be approved, it would effectively rid the broadcaster of debt and ensure the sustainability of day-to-day operations.

Tito Mboweni to the rescue?

Telecommunications Minister, Stella Ndabeni-Abrahams, confirmed that the application had been received by her department. While no official confirmation on the approval or refusal of the application has been made public, Ndabeni-Abrahams said:

“It is in our best interest to ensure that SABC survives and thrives in everything that they do. That is why we committed that we will be giving SABC money.”

The final decision regarding the hefty bailout does not,
however, rest with Ndabeni-Abrahams. Instead, the National Treasury has the
final say. Overseen by Finance Minister Tito Mboweni – who has been particularly
scathing on failing parastatals and their continuous calls for bailouts – the Treasury
is believed to still be in deliberation on the fate of the SABC.

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