If we don’t get help we won’t be able to pay salaries‚ warns SABC chair
The SABC needs urgent financial help otherwise it may not be able to pay salaries in November – a situation which has already hit independent producers.
“Our financial situation‚ I’m not going to lie‚ it is in a very‚ very critical state. If we don’t get the financial help‚ come November we are going to struggle‚” said SABC board chairperson Bongumusa Makhathini in an exclusive interview with this publication on Tuesday.
Makhathini was responding to a question about whether the state broadcaster would be able to pay salaries given the financial situation that was presented to the National Assembly earlier in the day.
“We are in a very financially dire situation and it is the reason why we pushed very hard to get the turnaround approved by the board.
“We now have taken the portfolio committee through this turnaround so they understand the comprehensive overall things that we are driving to get the SABC on a better footing‚” he said.
He was speaking in the wake of a six-hour meeting with the National Assembly’s portfolio committee on communications.
Makhathini said they have already been struggling to pay independent producers‚ people who provide content which is critical to the mandate of the SABC.
“If the situation is not arrested‚ it will escalate and get to the employees‚” he said.
The SABC has until now been prioritising employees’ salaries.
“But at the end of the day‚ you can’t keep on pushing this thing down. At some point you need to get real help‚ real intervention‚” said the board chairman.
It’s been 16 months since the then interim SABC board requested a government guarantee to be able to borrow money in May last year. The broadcaster is yet to receive the guarantee.
This publication understands that the public broadcaster has received a disclaimer audit opinion from the auditor-general for the 2017/18 financial year‚ which puts it in an even more difficult position in terms of securing a loan.
“It makes it hard for financial institutions to be comfortable in funding us. That’s why we have to come up with a very strong‚ comprehensive and tangible turnaround strategy which is what we presented today with enough detail for people to see that we have a plan and we can turn this place around‚” said Makhathini.
He revealed that the SABC was given a “borrowing letter” of R1.2bn which is not the same thing as a government guarantee or a bailout.
“It’s just a letter that says ‘SABC board‚ go approach banks’‚” he explained.
And banks were reluctant to engage using that letter because there is no security with the debt.
The SABC presented a 104-page document which detailed the plans to turn around the broadcaster. Makhathini confirmed that the document to turn things around was prepared with assistance from the national Treasury from when the SABC was preparing an application for a government guarantee and later when it engaged with the auditor general who were expressing discomfort with the SABC’s going concern.
Last month the SABC board revealed that it was engaging labour unions at SABC about possible retrenchments which are part of the cost-cutting measures.
It revealed to MPs on Tuesday that employee costs were the major cost drivers at R3.1bnwhich is 42% of their total expenditure. Programming‚ film and sports rights came second at R1.7bn‚ followed by signal distribution and linkage costs [R718.1m] and broadcast costs which came to R486.6m.
A presentation by Human Resource group executive Jonathan Thekiso showed that 1100 of the SABC’s 3478 employees were in management position. This obviously raised eyebrows. Chief executive Madoda Mxakwe said they had about 495 personnel in management and not 1‚000 who accounted for about R540m of the R3.1bn. He didn’t provide an explanation for the 1‚100 in the presentation.
Trying to explain the bloated top structure‚ Thekiso blamed this on “irregular salary increases to numerous employees where we saw these employees being promoted from an administrator to a manager within a short space of time”.
There was also a blatant disrespect for recruitment policies and processes in terms of the appointment of people and their promotion. Thekiso said there were also payments of “critical skills allowances” where a role could not be perceived to be critical and employees were brought on board without basing the decision on the ratios of support staff versus core staff.
“We are reversing some of these things. We are reversing some of these appointments and promotions because these are articulated in the public protector’s report in terms of remedial actions‚” he said.
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