18 June 2019

South Africa: And SOE It Goes - As Turnaround Plans Stumble, SABC Is the Latest Entity to Face Financial Point of No Return


The SABC board says a 'communication blackout' at the state broadcaster is 'imminent'. With its debt building insurmountably, the SABC joins the queue of state-owned entities with begging bowls out to National Treasury. The progress in turning around SOEs - the Ground Zero of State Capture - has been slow and faltering, beset by rising debt, leadership challenges and ambivalence from the government.

Another week, another state-owned entity (SOE) on the verge of financial disaster.

With SABC board chair Bongumusa Makhathini telling the Sunday Times that staff salaries may not be payable at the end of June, the broadcaster is reported to be facing a complete "communication blackout" imminently if its financial situation does not improve.

In addition to its immediate cash flow problem, Makhathini said the SABC's other greatest challenge is that it has not had the funding to "[maintain] any of our infrastructure".

In publicly expressing the SABC's challenges in such apocalyptic terms, the SABC board may be hoping to force the hand of National Treasury - which has since March 2019 been considering an application from the broadcaster for a R3.2-billion guarantee to enable it to raise funds from commercial banks.

Yet Treasury has revealed itself to...

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