SABC warns of a communication blackout as it runs out of money

The South African Broadcasting Corporation (SABC) is facing serious financial issues, and has warned that a communication blackout is ‘imminent’.

Speaking to the Sunday Times, SABC board chair Bongumusa Makhathini, said that the national broadcaster had to choose between paying staff and municipal accounts at the end of March.

It opted to pay its staff and now owes the City of Johannesburg more than R13.5 million. However the broadcaster is still facing a serious shortfall.

“I’m not sure how we are going to pay for salaries come end of June,” said Makhathini.

“We have also not maintained any of our infrastructure and a communication blackout is imminent. We anticipated ‘Day Zero’ in March, but we have managed to stay on air until now.”

Makhathini said that the broadcaster also owes signal company Sentech R317 million and SuperSport R208 million.

However, it appears that government is not prepared to let the broadcaster fall away just yet. A department of communications spokesperson told the Sunday Times that it was in the process of considering a R3.2 billion bailout for the SABC.

Failing state enterprises

The SABC is just one of a number of state-owned enterprises that is dealing with a major financial crisis.

According to the National Treasury, South Africa has no option but to increase financial support for Eskom.

The government approved a R69 billion ($4.6 billion), three-year bailout for the debt-laden company in February, but both finance minister Tito Mboweni and Eskom Chairman Jabu Mabuza have since indicated that it won’t be enough.

The enormous pressure of keeping the power utility afloat led to the resignation of CEO Phakamani Hadebe at the end of May.

He was followed by South African Airways (SAA) CEO Vuyani Jarana, who tendered his resignation at the start of June.

In his resignation letter to SAA board chairperson JB Magwaza, Jarana unpacked how uncertainty about funding and slow decision-making processes were delaying the airline’s turnaround strategy.

“The strategy is being systemically undermined, and as the group chief executive officer, I can no longer be able to assure the board and the public that the LTTS is achievable,” he said.

“Whereas government injected R5 billion of funding in the 2018/2019 financial year, a big chunk of that was used to fund creditors up to the end of March 2018.

“We have not been able to obtain any further commitment from government making it very difficult to focus on the execution of the strategy,”  Jarana said.

Read: The one way Ramaphosa could change how he runs his office

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SABC warns of a communication blackout as it runs out of money