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Wednesday, 08 November 2023 17:49

'Dire' state of SABC threatening to 'collapse' signal distributor Sentech.

By Lehlohonolo Lehana.

Deputy minister of communications Philly Mapulane has told parliament that the SABC is not only technically insolvent but owes broadcasting signal distributor Sentech more than R700-million.

Mapulane told parliament that the money the SABC owes to Sentech is "significant" and, if the situation is allowed to continue it will "impact heavily on the sustainability of … Sentech".

Mapulane was briefing the Communications and Digital Technologies Portfolio Committee meeting, where the SABC presented its corporate plan.

"It has the ability to collapse this entity if you consider that the revenue of Sentech is hovering around R1.4-billion, "he said.

Amid this dire situation, communications minister Mondli Gungubele has requested the board and management to draw up a corporate strategy for the 2024 to 2026 financial years.

The SABC's revenue for the 2022/2023 financial year was 7.9% less than the previous year – and a remarkable 27% less than budgeted for. The broadcaster also reported a net loss in 2022/2023 of R1.1-billion.

It blamed the bad performance on poor audience ratings, the impact of analogue switch-off, load shedding, the inability to monetise sports properties and other content, and South Africans’ propensity not to pay their television licence fees.

Chief financial officer Yolande van Biljon laid out the aggressive revenue increases that the state broadcaster has forecast to stave off financial sustainability concerns.

Despite consistent decreases in revenue over a number of years, the SABC is predicting a revenue increase of 38% for the 2024 financial year.

Van Biljon said, that the achievement will depend on the development and near-fanatical implementation of a detailed execution plan.

She acknowledged that the revenue forecast was "very aggressive".

"Our concerns are directly linked to the performance of our commercial revenue. We are funded from revenue. We have no other funding sources. So if our revenue growth does not live up to expectations then our going concern is under significant pressure."

Mapulane immediately suggested that the SABC should revise its revenue increase projections downwards.

He explained that the public broadcaster’s second-quarter performance report revealed that it had already made a net loss of R464 million for the year to date. 

"Whilst the corporate plan is projecting a surplus in terms of revenue, already the information that is at our disposal in terms of the second quarter performance report indicates that there has been a net loss of just below R500 million," he said.

Mapulane added that the revenue projection figures "are not consistent with the evidence that has been presented".

He said the SABC had not been able to turn things around financially in previous attempts.

"Despite the huge capital injection and the turnaround plan which was implemented over three years, the SABC has not really managed to turn around."