Finance Minister Malusi Gigaba has, for now, rejected the SABC’s request for funding, saying the broadcaster must rework its funding proposal and submit more information.
“We haven’t asked for a bailout. We have asked for a guarantee from the Treasury which we would use to go request a loan from the banks because if we go to the banks on our own, the banks don’t trust us any more,” said Mathatha Tsedu, the deputy chairperson of the interim board of directors.
Communications Minister Ayanda Dlodlo told Parliament’s public accounts committee that they had withdrawn the letter that the newly appointed interim board drafted last week requesting funding assistance.
The board with Dlodlo is drafting a new proposal to the Treasury for a bank guarantee.
The SABC board refused to disclose the amount they would be borrowing from the banks or how much was needed to rescue the corporation because the process was ongoing.
Dlodlo said after submitting the request to Gigaba, he called them in and said that’s not where the SABC should be starting. He said the interim board must first ensure systems were properly in place before any decisions could be taken, determine where the weaknesses were, cut down on expenditure, and sell whatever assets could be sold that were not core to the SABC.
“In essence, he was saying to me ‘bring me a more tangible, evidence-based document to help me to help you’,” said Dlodlo.
She said Gigaba didn’t want to commit himself to a bailout or a guarantee before any of that was done.
“He also said to me that it might not even be necessary for the Treasury to intervene in the form of any of the two – whether a guarantee or the bailout. He suggested that it might be necessary to talk to the banks to extend the revolving facility. We are in the process of finalising all of that.”
Dlodlo said the funding request that was presented to her by the interim board didn’t take into account the fact that the SABC had to move from analogue to digital and therefore the funding request didn’t cover things related to the digital migration.
“So to me, it was a funding request that was inadequate. It was almost like putting [a plaster] on a wound and not actually treating the wound. I am looking at treating the problem we are experiencing at the SABC,” she said.
She said the board and a team from her department were looking at determining on the asset register, which is in itself a problem, what could be disposed of which was not core to the SABC business.
They were also looking at many other areas where they could cut costs, shift or postpone large procurement.
Dlodlo also revealed to shocked MPs that in her first meeting with the SABC executives the issue of the extent of the dire financial situation was not brought to them voluntarily.
“We had to dig for information before the word came that we actually are in a serious financial situation to a point where we might not be able to pay salaries,” she said.
“It was never brought voluntarily. I don’t know whether it’s fear or it’s deceit. I don’t know what it is, but it’s that thing, where the SABC always wants to withhold information.”
The committee heard that the SABC was about R23 million behind in royalties payments.
“The invoices are there, they are loaded. We are just waiting for funds availability. It’s something we will deliberate on on Thursday to see who gets paid,” said acting chief operations officer, Bessie Tugwana.
The corporation also owes the South Africa Music Performance Rights Association a whopping R52.7 million in royalties but Tugwana was quick to say this was not about the non-availability of funds but was due to a longstanding dispute.