Fin24 04 October 2019
The SABC will receive R2.1bn from Treasury on Monday October 7, 2019, Minister of Communications and Digital Technologies, Stella Ndabeni Abrahams said.
The minister on Friday briefed media on the funding allocation to the national broadcaster, which recently reported a loss of R482m for the year ended March 31, 2019.
The SABC has sought a R3.2bn cash injection from Treasury, but has had to meet eight preconditions before any approval can be granted.
The SABC has only met five of the eight conditions. Two of the preconditions have been partially met and one has not been met at all. Treasury has agreed to allocate R2.1bn to the broadcaster. The remaining R1.1bn will be approved when the other conditions are met, Ndabeni-Abrahams said.
“It is noted that the SABC turnaround requires more than the R3.2bn short-term funding,” Ndabeni- Abrahams added.
“The Department of Communications will further continue engaging with National Treasury to source funding through the normal medium-term expenditure framework processes,” she said. The SABC needs R6.8bn for its turnaround strategy, she confirmed. The department will follow normal processes to request the rest, but the R3.2bn allocated by Treasury is part of an “immediate intervention,” she said.
The SABC is expected to make monthly presentations to the department of communications on its financial status. This will ensure the broadcaster is in compliance with funding conditions, Ndabeni-Abrahams explained.
In terms of the preconditions which have been partially met – the SABC is yet to identify non-core assets for disposal to help reduce its recapitalisation requirements.
Board chairperson Bongumusa Makhathini had previously told Parliament’s portfolio committee on communications that the SABC had so far identified properties to dispose of, however identifying media assets would be tricky as the SABC has to consider its mandate to broadcast content in all the official languages. He told the committee that some radio stations might be loss-making now, but through the turnaround plaan could improve their financial status.
Ndabeni-Abarahms emphasised that she is not in a position to identify the non-core assets. “It is the responsibility of the SABC to identify non-core assets,” she said. “It does not mean that if they do away with certain assets, they can’t acquire new ones in future,” she added.
The other precondition which has been partially met relates to producing a separate financial reporting for public and commercial broadcasting services.
Although the SABC has not developed a comprehensive Private Sector Participation strategy, as required by Treasury, the minister said there is “willingness” to work on meeting this condition.
Ndabeni-Abrahams would not elaborate on what strategy the SABC is considering, as it is market-sensitive information.
Commenting on the appointment of a Chief Restructuring Officer at the organistion, Ndabeni-Abrahams said the department is still engaging on the draft terms of reference sent by Treasury. “We are making inputs as the department and we will send them back [to Treasury]. Once the process is finalised, together with the minister of finance, we will appoint the CRO.”