The South African Broadcasting Corporation is technically insolvent.
This is according to the broadcaster’s CEO, Madoda Mxakwe, who was speaking at a media briefing on Wednesday (31 October), reports TimesLive.
“We are technically insolvent as the SABC. We are not able to fulfill our monthly obligations it’s important to understand as an organisation‚ we are not able to fulfill our financial obligations.”
Mxakwe added that the SABC was currently in the process of engaging with different stakeholders and trying to extend their borrowing limit.
“I do need to put it on record that the commercial insolvency is indeed increasing significantly‚” he said.
On Monday, the SABC issued a notice to staff stating that it will retrench thousands of employees in an effort to save costs.
The state broadcaster confirmed it will proceed with Section 189 of the Labour Relations Act, retrenching up to 981 permanent employees and 1,200 of its 2,400 freelancers.
Around 3,400 permanent employees work at the SABC, meaning this restructuring will result in the broadcaster terminating almost a third of its workforce.
“It is envisaged that all employees and at all levels in the SABC will be affected by the restructuring,” the SABC said in a statement.
“This would include Group Services, Provincial Operations, Commercial Enterprises, Media Technology and Infrastructure, News, Radio, Sport and Television.”
“It is envisaged that 981 employees may possibly be retrenched as a result of the restructuring, across all the aforesaid business units and operations of the SABC,” the broadcaster added.
The SABC plans to complete this process by the end of January 2019 in an effort to turn around its financial situation.