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We need R3bn to avoid collapse, SABC tells Scopa

South African Broadcasting Corporation (SABC) board chairperson Bongumusa Makhathini told Parliament’s standing committee on public accounts (Scopa) that all the state broadcaster needed was a R3-billion government guarantee to avoid looming collapse in March.

The board briefed Scopa on Wednesday morning, following a meeting on Tuesday where board member and veteran journalist and editor Mathatha Tsedu told the portfolio committee on finance that the SABC’s ability to pay full salaries would be in doubt as early as February next year.

READ MORE: SABC debt close to R700m

Makhathini told Scopa on Wednesday that thanks to its R1.3-billion debt, the public service broadcaster was battling to meet its monthly obligations.

He said about 70% of SABC’s revenue went to wages, whereas this should in fact be 50%.

Makhathini said the SABC approached government for a guarantee over a year ago but, instead, got a letter of approval to go to the banks and borrow.

He said this solution does not take the SABC out of the woods, as its audit outcomes did not make it an attractive prospect for banks.

READ MORE: SABC has no choice but to retrench — executives

He said if the SABC was granted a guarantee, it would use the funds it accesses through the guarantee to finance the repayment of debt, the procurement of content and maintenance of infrastructure. — Fin24

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Khulekani Magubane
Khulekani Magubane

Khulekani Magubane is a senior financial reporter for Fin24. 

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