The SABC is in dire financial trouble and needs to loan R1.5 billion in order to pay its stuff and keep operations running.
This is according to a report in the Sunday Times, in which the paper claimed it had obtained an internal email from the public broadcaster’s treasurer, Arrie Thomas, detailing its financial troubles.
According to the report, the SABC bank account balance has seen half a billion rand wiped off from it and it now has to scramble to be able to cover all its expenses.
Thomas’ email states that the current balance could soon be as little as R300 million.
The public broadcaster is said to be planning to approach four major banks and the National Treasury to secure the loan.
“This would force the Communications Department to approach the National Treasury to guarantee the loan, which economists say could trigger a ratings agency downgrade for South Africa,” Sunday Times said.
90% local content largely to blame for cash drain
Media experts say the new 90% radio and 80% TV local content quotas are largely to blame for the inflated costs incurred to the SABC recently and will continue to require large cash injections to realise Motsoeneng’s long term vision to overhaul the public broadcaster.
The quota has long been criticised by financial experts who predicted that it would spell disaster for the SABC.
Motsoeneng has however vehemently defended himself and the SABC, brushing aside all “negativity” by “naysayers” and ressuring the country and stakeholders that the it is finacially stabel.
This report is in direct contrast to the tune COO Hlaudi Motsoeneng has been singing over the last few months.
Motsoeneng has over and over again stated that the SABC is financially stable and that it has in fact made more than an additional R500 million since he took over his position.
In June, during a media briefing at the SABC, Motsoeneng and then CEO, Jimi Matthews, said they were confident that the public broadcaster would be able to attract and retain advertisers by broadcasting quality local content, which will in turn attract high viewer numbers.
When approached by Sunday Times for comment, SABC spokesperson, Kaizer Kganyago denied the claim.
DA calls on Gordhan not to approve SABC loan
The DA has called on Finance Minister, Pravin Gordhan, not to extend the loan to the public broadcaster, but instead place it under administration.
“The SABC should not need bailing out – it could be profitable, like many broadcasters in South Africa are, if run properly,” DA spokesperson, Phumzile van Damme said on the party’s blog.
“It is clear that under the tenure of Hlaudi Motsoeneng, CFO and Acting CEO James Aguma, and Communications Minister Faith Muthambi, the SABC is being run into the ground,” she added