Ministry of Communications concerned about SABC’s declining revenue

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Parliament’s Standing Committee of Public Accounts ( Scopa) has heard that despite declining revenue, the South Africa Broadcasting Corporation (SABC) has no intention of approaching the National Treasury cap in hand.

The public broadcaster briefed Scopa on irregular, fruitless, and wasteful expenditure for the 2020/21 financial year. It blamed some of the financial woes on the previous management.

The Ministry of Communications, which represents the government as a shareholder in the SABC, says it is concerned about the public broadcaster’s declining revenue.

“The declining revenue that we are experiencing if it not attended to might pose a significant threat for the SABC going forward. Management is insisting that there will be no need for a further bailout but from our side, it does remain a concern,” says Deputy Minister of Communications and Digital Technologies, Philly Mapulane.

But the SABC blames this on costly signal distribution.

“Because of our unique role and very high-cost structure, signal distribution cost is still one of the major costs faced by the  SABC and we are currently in talks with Santech through the Competition Commission to have the tariffs reviewed and that will save us R250 million and get the SABC profitable,” says SABC Board Chairperson Bongumusa Makhathini.

Historical fruitless, wasteful expenditure

Scopa was told that no one has been held responsible for historical fruitless and wasteful expenditure costs incurred.

SABC Chief Financial Officer Yolande van Biljon says, “It was often very difficult to identify a responsible person and then definitely to proceed with recoveries that in respect to historic things, some items that have been condoned for example relate to content that we did not broadcast between 2009/15, there were sports rights that had similar kinds of challenges in that periods. One of the items that we condoned relates to the pay as you earn on fringe benefits that were not calculated properly at the time, again we are looking at the period of 2014/17, we tried to get information and responsible people but it proves to be a challenge.”

Axing of GE News 

The Scopa says it hopes that the SABC has followed due process in the matter surrounding its former Head of News Phathiswa Magopeni to ensure that it does not incur unnecessary financial losses.

Committee Chairperson Mkhuleko Hlengwa says Scopa does not want to venture into the merits and demerits of the case.  However, it hopes the outcome of any possible litigation will not be detrimental to the finances of the SABC.

In its response, the Board assured the committee that it was addressing the matter.

“It is common cause that there is an issue currently at play at the SABC in so far as the GE of News is concerned and a legal battle at play, we can only hope that due process been followed to the extent to which the SABC does not find itself at the end of the day with a financial burden which could have been avoided because consequence management in itself we have found across the spectrum if not handled correctly incurs an unnecessary cost of the state. So, we will not be drawn into merits and demerits it is not our purview, our only purview is that it must not lead to any financial obligations for the SABC because it may set into motion precedents that are undesirable for all of us.”

Hlengwa says the SABC should not find itself with a financial burden:

Despite its concerns, the shareholder says it is satisfied with SABC’s implementation of its turnaround strategy.