Wed Aug 17 13:40:52 SAST 2011

SABC fails to meet loan terms

17 Aug 2011 | Thabo Mokone | Sowetan

THE SABC is still failing to meet conditions attached to the R1,4 billion loan guarantee it got from government two years ago.

Avril Halstead, chief director of sectoral oversight in the national Treasury, told MPs that the public broadcaster had not yet implemented a cost-cutting and revenue enhancement initiative, which was a key component of the loan guarantee the state had given to the SABC.
Halstead said among the many loan guarantee conditions that the SABC had failed to meet were those to:
lEnhance advertising revenue by R535million;
lIncrease sponsorship revenue by R128million;
lDecrease the wage bill by R287million; and
lReduce professional or consultancy fees by R136million.
"These are the conditions that were specified by the minister of finance (Pravin Gordhan) when he provided his concurrence to the guarantee.
"Although the SABC is not meeting most of the guarantee conditions, we have outlined a process for addressing those," said Harding, who went on to say that Treasury remained worried about the financial sustainability of the SABC.
The Treasury extended its helping hand to the struggling SABC after approving its application for a government bank guarantee to the tune of R1,47billion.
SABC senior executives, led by board chairperson Ben Ngubane, said that the national broadcaster was now turning the corner.
Ngubane cited the SABC's early payment of the R110million instalment of the R1,4billion Nedbank loan. The R110million was only due in December.