Treasury still mulling over SABC’s R1bn funding request
Treasury is 'still applying its mind to the SABC request' as losses at the public broadcaster mount
Uncertainty still shrouds the R1bn government guarantee the South African Broadcasting Corporation (SABC) requested from the Treasury amid growing concerns that the public broadcaster may be running into deeper financial difficulties.
In May, the Treasury rejected the SABC’s initial request for a government guarantee amid concern it lacked accountability and a sound financial plan.
The SABC is in deep financial trouble and fears are that it could collapse should it fail to get the guarantee. It has been struggling to meet its obligations, including the payment of service providers. Its huge losses have been attributed partly to axed executive Hlaudi Motsoeneng’s controversial 90% local content policy, which the interim board has since canned.
Parliament heard in June that the SABC was expecting to end the 2016-17 financial year with a net loss of R1.1bn. It recorded a loss of R411m in 2015-16, up from R395m the previous year.
Finance Minister Malusi Gigaba’s spokesman, Mayi-hlome Tshwete, said the Treasury was still applying its mind to the SABC request.
"Further engagement will be required between ourselves at the department [of communications]," he said.
"The greater threat is rushing into giving the money without making sure there are conditions in place to make sure they [the SABC] will not come back for another guarantee … we cannot do a rushed job which will be costly for the SABC and the taxpayer," he said.
Last week, Communications Minister Ayanda Dlodlo said in reply to questions at a media briefing that the amount of the bailout was irrelevant. Her department had sent all the documentation to the Treasury and had met with officials to discuss the type of assistance the public broadcaster was requesting.
"It is not just money that we are dealing with," she said.
The bail-out could take a number of forms but would take into account what the department needed to do to keep the SABC afloat. The department was also advising the Treasury on what needed to be put in place around conditionalities, for example whether the SABC should be owning or leasing buildings. "We have to show as a department that we take the issue seriously of turning the SABC around," she said.
Asked why it was taking so long to resolve the issue, the minister said her department had done what it was supposed to do and the "ball is in Treasury’s court". Dlodlo said she had spoken to the finance minister and the communications officials had met with the Treasury last Wednesday.