Treasury permits cash-strapped SABC to take on more debt
Treasury has allowed the cash-strapped SABC to take on more debt to ease its current financial woes, Communications Minister Nomvula Mokonyane has confirmed.
Mokonyane pointed out that the government would not allow the public broadcaster “to collapse”.
“The Auditor-General has highlighted seriously the viability of the SABC as a going concern and to this end, as the shareholder working with the board, our engagements with the national treasury have been concluded and the National Treasury has granted consent for the SABC to increase its borrowing limits from the capital markets in line with the Public Finance Management Act and the Broadcasting Act,” she added.
The SABC has had a net loss of R622-million in this financial year.
However, Mokonyane says the loss is “significant progress” compared to a R977-million loss in the 2016/2017 financial year.
The financial viability of the broadcaster has been under the spotlight as it failed to pay creditors earlier this year.
The broadcaster has faced financial maladministration and misgovernance over the years, under former chief operating officer Hlaudi Motsoeneng.
Mokonyane said they would use the increased amount to pay creditors, including independent producers, Sentech and the South African Football Association.
“Secondly, these funds will be utilised to acquire new content to replenish the current content offering so as to attract new audiences, thus generating commercial revenues,” she added.
Mokonyane believes the SABC can be turned around.
She said a turnaround task team had been put together, comprising the department of communication, national treasury and the SABC, with treasury assigning a turnaround specialist to look into the strategy. She said the strategy was presented to her on Tuesday for her consideration.
“Such a strategy will provide a holistic assessment of the broadcaster and identify means and ways to guarantee the future sustainability of the SABC,” she said.
“We do believe that we have the right skills in the board and management to drive a robust turnaround strategy that will lead the broadcaster on a new path towards a public broadcaster that embodies sound corporate and financial management, embraces new technologies and digitisation, and is geared towards increasing revenue and diversifying income streams,” Mokonyane said. — Fin24