SABC in the red
THE SABC will today attempt to fend off a liquidation application in the Johannesburg High Court while at the same time convincing journalists that it has a financial turnaround strategy.
Hannes du Buisson, president of the Broadcast and Electronic Media and Allied Workers Union, says the SABC disclosed at a meeting between unions and management last week that it was R700m in the red.
The SABC has so far not confirmed this number to the press, and elected not to comment before the press conference, scheduled for this morning.
Legal firm Barry Aaron & Associates will apply for the SABC’s liquidation today as the broadcaster has so far failed to pay R450 000 it owes in legal fees.
Speaking to Business Day last night, Barry Aaron said although the SABC had promised to pay him on Monday, only R70 000 had actually been paid so far.
Aaron said he was expecting a letter from the SABC’s lawyer undertaking to pay him the balance by tomorrow morning.
If he received the letter, he would remove the matter from the roll, although the issue of costs would remain.
According to media reports, several other creditors will also be watching the outcome of the case as the SABC owes huge amounts.
Part of the problem is that the broadcaster receives only 2% of its funding from the government in the form of TV licence fees, and relies heavily on advertising revenue, which has been hit hard as companies cut marketing.
Kate Skinner, spokeswoman for the Save Our SABC Coalition, said the crisis resulted from an unsustainable funding model and serious mismanagement by both the board and senior management.
Suzanne Vos, Inkatha Freedom Party representative on Parliament’s communications committee, said the mess could not be blamed on the board, as the SABC had battled financially for years.
Vos said the committee did not scrutinise the SABC’s budget last year as the African National Congress in Parliament declared a vote of no confidence in the board instead.
She agreed the funding model was poor, but said the government could ill spare funds that should go to priority areas such as HIV/AIDS, health, education and housing.
Although the SABC reported profit of R111,3m for the year to March last year, this was because a R420m pension fund surplus was included in the results. Last year’s results show programming purchased but not broadcast had cost the SABC R76m, while wasteful expenditure of R40m was also reported, mainly due to litigation.
SABC financial health discussion
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