After repeatedly denying that it was in trouble, the public broadcaster
is about to ask Treasury for funds, writes Jocelyn Newmarch in The Weekender.

If the SABC were a private company, it would be trading illegally as it is technically bankrupt, independent producers say. The SABC is failing to pay creditors hand over fist and failed to give its staff an agreed increase this month, and is losing millions in advertising revenue.

A senior manager, who did not wish to be named, confirmed that the broadcaster will ask the N ational Treasury for a bail-out. The national broadcaster probably needs an additional R400m just to cover operating costs until the end of the year, the manager says.

Their constant assurances that suppliers would be paid, and the SABC’s regular failure to pay invoices, would be considered reckless trading if it happened in a private company, independent television producers say.

The popular soapie Isidingo was nearly pulled off air by its production company on April 30 as a result of nonpayment.

A representative from Endemol was sent to the SABC’s offices to collect the tapes prior to broadcast. The broadcaster then released a portion of the money owed and the soapie was eventually broadcast.

But producers say the SABC is now prioritising payment to companies which have shows airing daily, in a bid to avoid shows being pulled at the last minute.

The Department of Communications, which receives quarterly financial updates from the SABC, does not know how much the broadcaster needs from the government to remain afloat.

“We would only know the exact figure when the SABC submits,” the department’s spokesman Joe Makhafola says.

The SABC admitted two months ago that it would make a R780m loss for the year ended March, after repeatedly denying media reports about the extent of its deficit.

An austerity plan was unveiled in March, although the Broadcast, Electronic, Media and Allied Workers’ Union (Bemawu), the largest trade union at the SABC, says the organisation appears to be spending money at the same rate as before. Bemawu president Hannes du Buisson says the SABC did not pay union dues last month.

The SABC initially denied the union was not paid, but then admitted an administrative error and paid what was owed.

The SABC is scrambling to put together documents needed for its request for a bail-out to be considered. The Treasury has not received any request to assist the SABC, its spokeswoman Thoraya Pandy says.

A senior staffer at the SABC said the broadcaster needs between R1,1bn and R1,2bn for the next three years.

He says the SABC will approach the Treasury in the next 10 days with a formal request for a bail-out. It is unclear what form of assistance will be required — a direct financial transfer or a guarantee for short-term financing. This needs to be given to the Treasury through the Minister for Communications Siphiwe Nyanda, who represents the government as the SABC’s sole shareholder.

“If we didn’t have the press on our back and problems with the board, we’d be able to raise it with the banks,” the staffer says. “We’ve managed to stay afloat so far. We are not insolvent, we do have a problem with liquidity.”

Independent producers are owed more than R35m, says Rehad Desai, chair of the South African Screen Federation.

Click here to read the full report, posted on The Weekender's website.