The SABC office in Auckland Park, Johannesburg. Picture: SUNDAY TIMES
The SABC office in Auckland Park, Johannesburg. Picture: SUNDAY TIMES

The SABC continues to sink deeper into financial crisis and is now unable to pay some of its service providers and producers.

The crisis has affected key production houses that produce popular shows for the SABC.

SABC CEO Madoda Mxakwe confirmed during an interview on SABC News on Wednesday night that the public broadcaster was not in a position to meet some of its financial obligations.

"We are in a situation now where we are not even able to pay some of the content providers and I think it is important to note that we are looking [to ensure] … that we spend the limited resources we have responsibly to ensure that we keep the boat afloat," said Mxakwe.

The SABC has also failed to raise funding from financing institutions, while it awaits the outcome of its appeal to the Treasury for a R3bn guarantee.

Mxakwe said the broadcaster was looking at various immediate and long-term measures, including aggressive cost containment and diversifying revenue streams, to improve its dire financial situation.

"If you look at the evolution of our financials over the last three years, it is only now that it has hit a crisis point … but I also need to hasten to add that despite all of this, as an organisation, we are looking at immediate as well as long-term solutions to ensure that we turnaround this … we are fully aware that an SABC that is not financially viable: it is not only detrimental to us as employees, but it does affect the industry as well and the SMEs. We have accelerated our plans to ensure that we increase revenue generation and …we want to be more diversified," Mxakwe said.

The bulk of the SABC’s revenue (85%) is derived from advertising, sponsorships and other commercial partnerships. The broadcaster posted a R977m loss after tax in 2016-17.

DA MP and communications spokesperson Phumzile van Damme said on Thursday that "in the interest of transparency and openness, the SABC ought to have informed Parliament’s communications committee of its financial distress".

"As such, the DA will write to the chair of the communications committee, Humphrey Maxegwana, to request that the committee convene as a matter of urgency, in order to be briefed by the SABC on these latest revelations and to provide a plan of action on how they will resolve it.

"The financial crisis at the SABC has a direct impact on job security for many, as reports suggest that five production companies have been affected by the SABC’s failure to pay its bills. The SABC’s financial crisis has allegedly resulted in some producers having to take out loans to stay afloat…. If the SABC is to support the development of local television and music, it must make sure that they are paid, and on time. These are often struggling artists with families to feed, bills and employees to pay," Van Damme said.

phakathib@businesslive.co.za