The commercially insolvent SABC had developed a five-year strategy that assumed it would survive on its own without any funding from the fiscus, the broadcaster’s chair, Khathutshelo Ramukumba, has told parliament.
The strategy hinges on the SABC generating enough income on its own to fund its public service mandate — at a cost of about R2bn a year — to inform, educate and entertain citizens in all official languages.
But Ramukumba emphasised at a meeting of parliament’s communications & digital technologies committee last week that the SABC still believed the fiscus should fund the organisation, particularly due to the widespread nonpayment of TV licences. By mid-2023, R44.2bn (including penalties) was owed by 9.2-million TV licence accounts.
Ramukumba said the five-year strategy was “very ambitious” with high-risk revenue projections.
Deputy minister of communications & digital technologies Philly Mapulane added that the SABC expected to break even over time if its corporate plan was successfully implemented.
The plan envisages aggressive revenue growth of 28% to R6.4bn in 2024/25, based on a 15% increase in advertising revenue, a 28% rise in sponsorships and a 19% increase in TV licence income.
As SABC CFO Yolande van Biljon said, this was a “tall order” as the public broadcaster could not invest in the content necessary to attract the audiences required by advertisers.
In 2022/23, the SABC had a net loss of R1bn and projected net losses of R590m in 2023/24, R242m in 2024/25 and R27m in 2025/26 before generating a profit of R907m in 2026/27, provided the corporate plan succeeds.
Mapulane said the funding of the public service mandate remained a problem and should have been addressed by the fiscus. The ministry had hoped for an allocation in the budget — in particular to help the SABC cover the elections — but this did not materialise and the SABC had to reprioritise to find the funds to cover the elections.
Group CEO Nomsa Chabeli said experience led the SABC to think that state funding was “unlikely”.
During the parliamentary processing of the SABC Bill, which sought to address the funding crisis of the public broadcaster, the SABC proposed that a household levy replace the TV licence. The bill has been put on hold as the committee left it for the post-election government to deal with.
Van Biljon told MPs the sustainability of the public broadcaster was under “significant threat” and it had adopted an austerity approach, she said.
Its going-concern status was disclaimed by the auditor-general in the past financial year. However, Van Biljon said the SABC needed to make a “firm and deliberate decision to execute the unfunded, noncommercial mandate within the scope of available funding”.
Van Biljon noted in the presentation the SABC was trading while it was commercially insolvent. It was unable to service all its debts when they fell due, and the longer it delayed payment to suppliers the greater the risk of litigation and further reputational damage.
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