Will government’s huge SABC bailout work?

The R3.2 billion lifeline extended to the cashstrapped SA Broadcasting Corporation (SABC), has been cautiously welcomed by labour, with the Communication Workers’ Union (CWU) warning governance and use of the funds by executives would be closely watched by it.

Welcoming yesterday’s announcement by Communications and Digital Technologies Minister Stella Ndabeni-Abrahams – set to reverse planned mass retrenchments – CWU general secretary Aubrey Tshabala said the corporation, which lost billions of rands through gross mismanagement under chief operating officer Hlaudi Motsoeneng, would come under close scrutiny.

“The SABC needs a turnaround strategy to protect jobs, keep the corporation afloat and make it competitive. Due to financial instability, there was a time when workers were unsure whether they would get their salaries.

“Let this bailout be a springboard for a real turnaround, away from a business funding model based on revenue from television licences. What we do not want to see, is the perpetual bailing out of the SABC – a feature in most state-owned enterprises.”

The union required clarity on which non-core assets would be disposed of by the SABC, said Tshabala.

Ndabeni-Abrahams said the SABC would on Monday receive R2.1 billion of the R3.2 billion bailout it requested from government, with the remaining balance being transferred once the public broadcaster fully met outstanding preconditions.

“This will assist us in the turnaround strategy and gain the necessary resources to fully realise it,” said SABC chair Bongumusa Makhathini.

In terms of the SABC’s annual report tabled in parliament on Monday, the broadcaster incurred irregular expenditure of R5.2 billion – up from R4.9 billion the previous year.

While welcoming government’s decision to extend a bailout to the financially ailing SABC, William Bird, director at Media Monitoring Africa, said efficiencies at the corporation would be determined “by how effectively they use the funds and how soon they are able to turn the commercial elements around”.

“It will be crucial they build credibility in news, invest in programming, upgrade equipment and, equally important, they need to work on a new vision,” he said.

“The criteria should be spelled out that the public can help monitor them. This is a victory for the public,” said Bird.

INFO
Some of the conditions:

• Determine immediate cash requirements, supported by detailed cash flow projections for the next 12 to 18 months.
• Conduct a thorough investigation into what caused the financial collapse of the public broadcaster and determine why the previous turnaround plans were not implemented.
• Provide an update of how the entity was dealing with individuals implicated in an investigation report, following the recent probe into editorial interference and abuse of power at the SABC.
• Submit cost-cutting measures.

How funds will be used:

• Procuring “compelling content” to draw advertising revenue and meet audience needs.
• Infrastructure maintenance.
• Settling the R1.6 billion debt.

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