SABC's finance boss Yolande van Biljon warns: SABC's 'Day Zero can happen tomorrow', can't confirm that South African public broadcaster's staffers will be paid at end of June, says SABC owes over R1.8 billion to hundreds of companies.

The SABC's "Day Zero can happen tomorrow."

That is the dire and stark warning from the SABC's chief financial officer, Yolande van Biljon, who in an interview on Monday morning with SABC News said that the cash-strapped South African public broadcaster could see its operations seize up at any moment.

So precarious is its cash-flow situation and so beleaguered is the South African public broadcaster's financial situation that its finance boss on Monday couldn't guarantee that SABC staffers would be getting paid at the end of the month and didn't want to make any commitment and say that salaries will be paid.

The SABC that is drowning in debt owes more than R1.8 billion to hundreds of companies and service providers ranging from Sentech and SuperSport to production companies, royalties payable to Samro, and many more.

The South African public broadcaster is finally completely without money and on Sunday Bongumusa Makhathini, SABC chairperson in an interview with The Sunday Times warned that the SABC is on the verge of seizing up and that "communication blackout is imminent".

"I’m not sure how we are going to pay for salaries come end of June," Bongumusa Makhathini said according to a report in The Sunday Times.

The SABC has been waiting for months on another government bailout of R3.2 billion while its already precarious financial position kept worseing, pleading with Stella Ndabeni-Abrahams, the minister of communications, to do something.

Meanwhile political pressure saw the bloated broadcaster forced to abandon its plan of mass retrenchments that was scrapped before the general elections.

In February this year after his budget speech, Tito Mboweni, the minister of finance, revealed that the SABC now actually needs R6.8 billion as a bailout if it's to survive.

On Monday Yolande van Biljon, SABC CFO, told SABC2's Morning Live in an interview that the broadcaster's juggling act to pay SABC staff salaries at the end of every month has "been the case for the last 8, 9 months. It has just been progressively worseing the last few months".

"We have had low-income months due to various reasons and that impacted heavily on our available cash resources and in the process the strain on the cash have just increased tremendously."

"In terms of debt there is over R1 billion that is owed. If you add accruals you come close to R1.8 billion altogether that is due and payable," she explained.

Asked about the R3.2 government bailout she said "we've had not had formal feedback yet. There is lot of support though".

"Again I ask you, will SABC employees be paid at the end of the month?" asked the Morning Live co-host Leanne Manas, who also revealed that some SABC employees, especially some freelancers, continue to not receive payment and that it has been happening as recently as the end of May.

"We're doing our best Leanne to provide for it in our forecasts and ensure that it is the first thing line-item that is executed in about two weeks from now. The moment a SuperSport or a Sentech or one of the other big partners is just unable to further say 'we're happy to carry you for another month' then the salaries will be at risk."

"As I sit here now it is in the forecast, we are planning to pay it as usual, but the times are extremely uncertain. It's really a day-to-day monitoring situation," Yolande van Biljon said.


'All suffering'
Yolande van Biljon explained that about 10 institutions are owed the majority of the R1 billion in SABC debt with the public broadcaster that also owes money to the South African Auditor-General (AG), as well as the Special Investigating Unit (SIU).

"Then there's literally hundreds of smaller guys if I can put it like that. We do typically try to ensure that they have an allocation because we don't want to put further strain on the general, smaller service providers and suppliers. The pressure is with those big, 6 or 7 institutions that we owe a lot to."

"We need the funding support as soon as possible in my view. I worry. Apart from the salaries you know, there are service providers and suppliers in the bigger circles that work with the SABC which are all suffering as a result of what we have to deal with."


'Day Zero can happen tomorrow'
"I think Day Zero can happen tomorrow. It depends on if one of these big partners are unable to support us financially, or must be forced to switch off our signal and distribution network, or where the maintenance situation impacts one of our critical infrastructure facilities in one of the studios and there's a real black-on-air situation because the equipment couldn't do what it is supposed to do anymore," Yolande van Biljon said.

"The fact that we're managing it and that we keep presenting a front that everything is fine doesn't serve our purpose. But we've got phenomenal people, we've got fantastic support from our partners that ensure that we remain on-air as is required."

"But it takes one small thing at this point in time and the SABC's Day Zero will be that day," she said.

Explaining the impact of a SABC blackout she said that "28 milion people who listen to our radio stations will not have their news, entertainment and education. That's half of the population which will be immediately affected and they lose this news, entertainment and education in their mother tongue".

"I think it's quite a disaster. The television stations the same thing - a little bit less viewers but if you at SABC1, a significant number of viewers. Millions of people in South Africa will suddenly no longer have access to this kind of information, entertainment, education and news. And this is the SABC's mandate."

"Half of the population will be affected and then I'm not even talking about the 5 000 people who work with the SABC whether in a freelance basis or on a permanent basis - obviously those people and their families and the broader circles will be affected."

'BLACK-ON-AIR' DANGER: SABC boss Madoda Mxakwe tells parliament the crumbling South African public broadcaster will be bankrupt by 31 March 2019 as audience share continues to fall: 'Our cashflow is depleted'.

Madoda Mxakwe, SABC CEO, on Tuesday told parliament that the financially gutted and struggling South African Broadcasting Corporation will be factually insolvent by 31 March 2019 as audience share continues to fall, saying: 'Our cashflow is depleted'.

The South African public broadcaster is on the edge of financial collapse and has already been described by South Africa's Auditor-General (AG) as "commercially insolvent".

The SABC told parliament it's heading for another R568 million loss for the financial year - R281 million more than anticipated - that it can no longer guarantee that it will be able to pay SABC staff salaries at the end of March, and that a "black-on-air" scenario will happen soon without a government bailout.

Last month the minister of finance, Tito Mboweni, revealed after his budget speech in parliament that the SABC needs a whopping R6.8 billion in cash as a government bailout to survive.

On Tuesday Madoda Mxakwe told parliament's portfolio committee on communications that by the end of this month the SABC will no longer be able to pay anybody as its liabilities will exceed its total assets when the broadcaster enters technical insolvency.

A plan to retrench thousands of SABC workers from the overstaffed and bloated public broadcaster where wages form the biggest expense by far was scuppered since 8 May 2019 is election day in South African and political parties don't want to see workers being fired in an election year.

"The severe liquidity challenges we are facing threaten our status as a going concern. Our cashflow is depleted. We cannot honour payments to service providers. We cannot adhere to all our committed contracts," said Madoda Mxakwe.

"We cannot even commission local content production as a result of all of the severe liquidity challenges that we're facing".

"The situation is so bad that several major content providers of key programmes they actually refuse to engage with us. Understandably, because we have not been able to pay them in the past couple of months," said Madoda Mxakwe.

"We can't acquire sports rights. Owing to our liquidity challenges we are not able to do it."

"In terms of the significant suppliers that are due and overdue, you are looking at Sentech, we're looking at SuperSport, Samro, as well as other providers of content that we have not been able to pay."

"The SABC cannot guarantee that it will be able to pay its employees' salaries at the end of March 2019. Should this crisis not be addressed as a matter of urgency, the SABC would be unable to operate and the 'black-on-air' scenario is a real and highly possible threat," said Madoda Mxakwe.

The SABC told parliament that since October 2018 the broadcaster's audience share has been declining, with its revenue that is expected to continue to decline in the 4th quarter of its financial year.

Madoda Mxakwe told parliament that the SABC "is managing a lot of disciplinary cases emanating from the forensic reports that we continue to get. On any given day I get anything from 2 to 3 of these and they depict the kind of malfeasance we still see in the organisation".

Yolande van Biljon, the SABC's chief financial officer (CFO) told parliament that since January 2019 the SABC's actual revenue for the financial year was down 12% below the target at R5.4 billion.

"Our audience share is declining as a result of a combination of factors and we anticipate it to continue."

"Of our television stations, SABC1 remains the top-performing station but we're also too heavily reliant on it. It is outperforming the prior year revenue but it is the targets for this year which are not being met for all three TV channels," said Yolande van Biljon.

"We have incidents almost once a month where either there's a fire or a roof caves in as a result of the severe storms we've been having in Johannesburg. All of it are symptoms of our inability to maintain our infrastructure."

The SABC has repeatedly asked the minister of communications, with Stella Ndabeni-Abrahams currently the 11th minister of communications in 11 years, for a multi-billion rand bailout, similar to the government-guaranteed loan the public broadcaster received in 2011 during its previous financial implosion.

Stella Ndabeni-Abrahams on Tuesday said that the National Treasury had agreed to grant the SABC interim relief in terms of money. The amount of money wasn't disclosed.

Commercially insolvent SABC has now also stopped paying royalties to musicians; local artists owed millions of rands for music used on public broadcaster's radio and TV channels.

The SABC has now also stopped making royalty payments to South African artists and musicians, similar to local producers and production companies being owed millions of rands by the commercially insolvent South African public broadcaster.

On Sunday the City Press newspaper reported that the SABC owes the Southern African Music Rights Organisation (Samro) - the shambolic and controversial music rights organisation itself caught up in chaos and allegations of corruption - over R55.5 million by the end of June 2018.

Samro is South Africa's only music performance rights collection organisation and pays over hundreds of millions of rands to local musicians and artists annually.

Samro's annual report released in December 2018 indicates that the SABC owes Samro - and therefore South Africa's musicians and artists - millions of rands for music that have been used and that continues to be used on the SABC's radio stations and TV channels without pay.

The SABC is silent and doesn't want to say what the exact amount is that the cash-strapped South African broadcaster owes to Samro.

The SABC also owes millions of rands to South African producers and production companies for TV content it already received and broadcast and that it's not paying and can't afford to pay, in addition to non-payment to other service providers.

The SABC is also no longer able to pay its whole monthly electricity bill anymore and will from end-February 2019 no longer be able to pay all staff salaries, and from end-March 2019 no longer be able to pay any SABC staffers.

The SABC's royalties paid to Samro for music used on its radio and TV channels, and then to artists amounts to a third of Samro's income, with the SABC's that stopped paying that has put a dent of 22% less income in Samro and therefore local musicians' pocket.

While the SABC has been begging for another government bailout in the form of a government-guaranteed bank loan similar to the one in 2011 during its previous financial crisis, Stella Ndabeni-Abrahams, South Africa's latest minister of communications, has been publicly fighting and distancing herself from the collapsing SABC board, and has done little to solve the SABC's extremely urgent cash crisis.

SABC, 'limping from day to day', owes artists millions of rand in unpaid royalties; blames its financial crisis for its failure to pay.

The SABC owes singers and musicians millions of rand in unpaid royalties and more millions in residuals to actors, with the struggling public broadcaster on the brink of financial collapse, blaming its severe money woes for its failure to pay.

The SABC on Wednesday told parliament's Standing Committee on Public Accounts (Scopa) that the SABC "is behind with royalty payments" and owes artists at least R75.4 million.

The SABC owes the Southern African Music Rights Organisation (Samro) R14.5 million, the SA Music Performance Rights Association (Sampra) R52.7 million, the Association of Independent Record Companies (ARIC) R2.8 million, the Composers Authors and Publishers Association (Capasso) R3 million and the Recording Industry of South Africa (Risa) R2.4 million.

The SABC didn't provide any numbers for the outstanding millions it owes actors and writers for residuals for the rebroadcasts and repeats of TV shows like Sgudi 'Snaysi on SABC1 and the library shows broadcast on its SABC Encore channel on MultiChoice's DStv satellite pay-TV platform.

The SABC told parliament that the last time it paid any royalties to artists was in December 2016 but didn't specify an amount, and blames the public broadcaster's cash-strapped status.

The SABC also failed to pay all artists, winners and contributors for the 2017 Metro FM Awards held months ago.

Bessie Tugwana, acting COO, blamed the SABC's non-payment of artists on a "struggle to get verified documentation so we could pay" and the SABC's "cash-flow problem". She told parliament that everyone will be paid at the end of May.

A year ago, in May 2016, SABC spokesperson Kaizer Kganyago announced that the SABC will immediately increase the royalty tariff paid to artists for music content played on the SABC's 18 radio stations and TV channels from 3.2% to 4% - but nothing came of that, with the SABC unable to even pay the 3.2%.

The SABC referring to its situation as "dire" and saying it's "limping from day to day", told parliament on Wednesday that the "90% local content" decree for local music airplay on radio and "80% local content" on SABC TV ordered by the former chief operating officer (COO) Hlaudi Motsoeneng has destroyed the public broadcaster and is threatening the very existence of the SABC that doesn't have the money to pay for it.

New SABC interim deputy chairperson Mathatha Tshedu revealed that the SABC blew an additional R72 million on new local content to replace other local content no longer deemed suitable, for the 90% local content policy.

"We are looking at taking back detrimental consequences of some decisions. We are looking at the 90% which saw both the television and radio losing millions. It's implementation has to take cognisance of the fact that it mustn't threaten the existence of the SABC itself, which is what it is doing."

The SABC revealed that it wasted another R74 million in TV content it bought but never showed, marked as fruitless and wasteful expenditure.

The SABC, now struggling to pay staff and producers, further spent hundreds of millions of rand on irregular content buying, for instance R63 million in 2016/17 and R240 million in 2015/16.

Already owing them millions of rand in outstanding payments, last week the SABC told South African producers going forward that it only wants to pay them 25% monthly of the money they're due although they're expected to keep delivering 100% of the content the SABC requires to keep its TV channels on the air.

Communications minister Ayanda Dlodlo told parliament that "the dire state of the SABC wasn't brought to us voluntarily by executives. We had to dig".

Ayanda Dlodlo said the SABC's initial bailout request to treasury was inadequate. "It was like putting an Elastoplast on a wound instead of treating the wound".

After getting a bailout in the form of a R1.47 billion government-guaranteed Nedbank loan in 2009 during its previous bailout when the SABC teetered on the brink of collapse eight years ago, it's not yet known what amount in another government-guaranteed loan the SABC is seeking this time in its next bailout.

Loss-making SABC to increase royalty tariff paid to South African artists for needletime on its radio stations and TV channels from 3.2% to 4%.

The loss-making SABC on Thursday announced that the South African public broadcaster will increase the royalty tariff paid to artists for music content played on the SABC's 18 radio stations and TV channels from 3.2% to 4%.

The announcement of an increase in pay-outs is great news for local established and new South African musicians who will benefit from a bigger payout every time their music is played on public South African airwaves.


The news comes on the back of the SABC's recent decree by its chief operating officer (COO) Hlaudi Motsoeneng of a 90% local music content quota across all 18 of its radio stations that was widely welcomed by South African artists.

The royalty tariff will increase from 3.2% to 4% for artists registered with the Southern African Music Rights Organisation (SAMRO), South African Music Performance Rights Association (SAPRA), Independent Music Performance Rights Association (IMPRA) and the Association of Independent Record Companies (ARIC).

Still problematic however is that besides these four organisations, there's a lot of South African artists who are not registered with any of these bodies.

Also still troubling, is that many South African artists are still waiting on millions of rands in royalty back payments that's not been made.

South African artists also complain about problems regarding effective monitoring and reporting of needletime (which in turn negatively impacts on subsequent payouts).

The increased royalty tariff means more money for South African musicians' pocket but also more money that will have to be paid by the SABC.

The public broadcaster made a loss of R395 million in its latest reported financial year, and recently dramatically announced that it wants to start four new "language-based" TV channels, each of which will cost around R500 million to set up and operate.

Hlaudi Motsoeneng said the SABC is going to pay R1 billion to especially new and emerging local TV producers to create TV content for these channels but didn't specify where the astronomical amount of money is coming from.

"This move [to increase the royalty tariff] is meant to stimulate the music industry, through creating jobs and unearthing new talent. The SABC also wants to restore the dignity of creatives to move away from a situation of creatives in the music industry dying as paupers," says Hlaudi Motsoeneng.

"We're thrilled as SAMPRA by the bold decision taken by the SABC to beat the 3% rate set by the courts and up it to 4%," says Sean Watson, SAMPRA chairperson.

"We are very excited and looking forward to artists' lives changing. We have waited for 30 years for this," says Arthur Mafokate, SAMRO representative.

"On behalf of IMPRA and AIRCO, we are embracing and remain committed and grateful of the announcement from the SABC about 4% needle time payments to us as record companies," says Dodo Monamedi, chairperson of AIRCO and IMPRA.

Besides the increased payout the SABC is also setting money aside to pay a once-off honorarium in July to local South African musicians like Babsy Mlangeni, Steve Kekana and Letta Mbuli.