Friday, April 7, 2017

Another new massive SABC bail-out looming as new communications minister Ayanda Dlodlo meets with treasury 'to get the SABC afloat financially'.

Another massive government bail-out for the SABC is once again coming to prevent the beleaguered and cash-strapped public broadcaster from going over a cliff.

The SABC – unable to pay staff, TV producers and service providers – is once again at risk of its broadcasting operations seizing up at the end of the month. 

Without an urgent government bail-out the internal operations of the SABC will start to seize up as the SABC won't be able to pay staff at the end of April without a big cash injection from somewhere. The SABC already abruptly stopped and is no longer able to pay all TV producers and its content and service suppliers.

The latest SABC bail-out could be in the form of any of - or a combination of - another government-guaranteed bank loan like in 2009 for its previous bail-out, an emergency credit extension or even a massive government grant

The new minister of communications, Ayanda Dlodo confirmed that she met with treasury and the new minister of finance on Wednesday to "sort out issues around the financial status of the SABC and there are processes that we've decided upon that will be implemented soonest".

In 2009, after severe mismanagement, maladministration and corruption, the SABC came to the brink of financial collapse and was only rescued in the form of a government-guaranteed bank loan from Nedbank of R1.4 billion.

Last month SABC spokesperson Kaizer Kganyago called the 2009 bail-out "not a bail-out".

"We have never asked for any bail-out ever, ever since I was here. People keep on saying SABC got a bail-out and I don't know where they're getting it from. What we asked at the time in 2009 was a government-guarantee. And what that meant is that we were going out to the markets, to the banks to loan the money."

Kaizer Kganyago failed to mention that the SABC is such a high-risk organisation for lenders that the SABC on its own is unable to get emergency credit without a government-backed guarantee.

That makes it a bail-out since the South African government - not the SABC - becomes responsible for carrying the risk of default, with a cash injection that the SABC couldn't and still can't secure on its own.

Last month when Kaizer Kganyago was asked about suppliers not being paid he said "we have not reached a stage like that".

"We are able to fulfill all our commitments in terms of payment of staff, in terms of payment that we owe and so on. We are doing that on a month to month basis. We don't have a crisis."

Now the wheels have once again come off the crumbling South African public broadcaster with urgent intervention that is needed to save it from imminent collapse. Meanwhile just 22 executives at the SABC are paid R43 million per year.

The SABC's latest worsening financial crisis comes after scathing testimony in late December 2016 and earlier this year from current and former SABC staffers, executives and board members in an ad hoc parliamentary investigation into the chaos, maladministration and corruption at the SABC.

SABC executives first revealed in July 2016 that the SABC's cash is fast running out and that a dramatic bail-out of R1.5 billion is once again needed - something that the SABC, despite being in a dire financial position, denied.

With ongoing plummeting SABC TV viewership and radio listenership, the SABC acting CEO James Aguma repeatedly kept saying - as recently as February this year in parliament - that there isn't a cash problem and that the SABC's finances are stable and satisfactory.

Now the SABC, on the brink of financial collapse, is dealing with the disastrous fall-out from a litany of unilateral decisions and decrees made by its famously matricless former controversial chief operating officer (COO) Hlaudi Motsoeneng like abruptly upping local content quotas to 90% for radio airplay in May 2016 and 80% for the SABC3 TV channel in July 2016.

Under Hlaudi Motsoeneng's disastrous SABC rule, a barrage of  top executives were fired and exited the broadcaster that continues to be besieged by ongoing court cases and hearings at the CCMA.

The SABC also had the broadcasting regulator overturn a shocking self-imposed censorship decision by the SABC's news division during which several journalists who opposed the decision were first fired, and then ordered to be reinstated by the courts.

'Urgent to get the SABC afloat financially'
On Thursday the new minister of communications, Ayanda Dlodlo on SABC2's Morning Live who admitted that "my expertise is in other areas" and not in broadcasting, said she doesn't want to blame Hlaudi Motsoeneng for the SABC's chaos and financial meltdown and that she doesn't know if he's still being paid and employed by the SABC.

"I don't even want to put the problem on one individual, or one set of a leadership team as being the only problem or the problem. I'd want to be a little more focused on the broader picture than looking at individuals. How does the system in itself work."

Ayanda Dlodo said she met with the new minister of finance on Wednesday to "sort out issues around the financial status of the SABC and there are processes that we've decided upon that will be implemented soonest".

Ayanda Dlodlo said the most important thing for her is "getting the SABC afloat financially, ensuring that the SABC board is fully functional, but also ensuring that the acting positions are done away with. People must go back to their positions. People must start working."

Ayanda Dlodlo called the situation over the SABC once again not paying TV producers and service providers just like in 2009 when it came to the brink of financial collapse "extremely worrying".

Fears of job losses
"The SABC's dire financial situation has sparked legitimate fears across the television industry of a repeat of the SABC's 2009 financial meltdown which saw many companies close and numerous jobs lost," says the public pressure group SOS Coalition in a press statement.

It comes after the SABC last month suddenly warned of possible SABC staff retrenchments in a statement.

"The SABC's failure to meet its contractual obligations not only places the industry in crisis but also puts thousands of livelihoods at risk in a time of high unemployment".

The SOS Coalition says its wants the new minister of communications, Ayanda Dlodlo and the new SABC interim board to prioritise the "SABC's immediate financial crisis to ensure the payment of SABC staff salaries and the payment of independent producers".

"Meet with independent producers as soon as possible to work out a joint way forward to ensure payments are made".

East Coast Radio presenter and broadcasting expert Terence Pillay this week said the SABC got itself into dire financial straits due to "mass nepotism, mass corruption, and the allocating of massive budgets to friends for the making of terrible television".

"Of course the details are quite complicated but in a nutshell the once revered broadcaster with a great name turned into nothing but a paper-pushing post office of sorts."

"Now they finally seem to have grounded to a halt, and all independent TV producers can hope for is that it's not completely dead."