AG flags SABC governance gaps despite progress claims

THE SA Broadcasting Corporation (SABC) remains trapped in a financial death spiral, with its leadership admitting it cannot survive without urgent government intervention, even as it struggles with systemic governance failures, declining audiences, and a staggering R6.2 billion in irregular expenditure.

During a tense hearing before Parliament’s Standing Committee on Public Accounts (Scopa) recently, SABC executives and the Department of Communications and Digital Technologies acknowledged that the public broadcaster’s funding model was “unsustainable” and that its ability to fulfil its mandate was under severe threat.

Deputy Minister Mondli Gungubele praised the SABC’s shift from audit disclaimers to unqualified opinions, calling it a sign of progress. However, MPs grilled the broadcaster’s leadership over persistent financial mismanagement, unresolved corruption cases, and a failure to meet key performance targets, with some accusing the SABC of “lowering the bar” to mask underperformance.

The SABC reported a 72% reduction in net losses before interest and tax, from R1.13bn in 2022/23 to R318 million in 2023/24. However, the acting chief financial officer, Tendai Matore, dropped a bombshell: unaudited figures for 2024/25 show losses ballooning back to R700m, raising fears of insolvency.

“The SABC is starving,” said ActionSA’s Adrian Beesley. “If nothing changes, this entity won’t last another 24 months.”

Despite a R3.2bn bailout in 2019, meant to stabilise the broadcaster, executives admitted the funds were largely spent on debt and short-term fixes, not long-term sustainability. “The bailout was not a recapitalisation,” said Group chief executive Nomsa Chabeli. “We used it to pay creditors and keep the lights on.”

MPs zeroed in on the SABC’s R6.2bn in irregular expenditure and R24.6m in fruitless and wasteful spending — primarily from penalties due to unpaid bills, including debts to signal distributor Sentech.

EFF MP Vuyolwethu Mente-Nkuna slammed the national broadcaster’s lack of consequence management, citing cases where officials implicated in corruption resigned before disciplinary hearings. “People just walk away with no accountability,” she said. “Why is there no civil recovery when millions are lost?”

One glaring example is the Mafoko Security contract, where the SABC unlawfully appointed a company that did not score the highest in evaluations. The matter remains in court, with the Special Investigations Unit (SIU) still investigating.

ANC MP Bheki Hadebe questioned why the SABC’s audit outcomes still required last-minute adjustments to avoid a qualified opinion. “Were financial statements even reviewed before submission?” he asked.

The SABC’s TV audience share continues to plummet. None of its channels met primetime viewership targets:

• SABC 1 targeted 22% but achieved only 18.8%
• SABC 2 aimed for 6% but hit 4.1%
• SABC 3 targeted 3% but scraped just 1.5%

Chabeli admitted that the broadcaster was outgunned by streaming platforms. “We’re competing with Netflix, YouTube, and TikTok with no investment in fresh content,” she said. While the SABC’s SABC Plus streaming app has reached 1 million users, MPs questioned whether it could compete without major funding.

A shocking revelation was that the SABC still funded post-retirement medical aid for former employees — a benefit discontinued in 2002 but still active for surviving pensioners. “How can you afford this when you can’t even pay current staff properly?” asked Mente-Nkuna.

Employees have endured a three-year salary freeze, and wage talks for 2024/25 are deadlocked at the CCMA. Staff morale is at rock bottom, with talent fleeing to rivals.

A major flashpoint was the SABC’s plea for exemptions from Public Finance Management Act (PFMA) rules, which executives say handcuff them in commercial negotiations. Chabeli gave an example: if a production company pitches a R300m telenovela, the SABC must issue an open tender, killing the deal as competitors swoop in. “We lose content creators to MultiChoice and Netflix because we can’t move fast,” she said.

But MPs warned against ditching procurement safeguards. “We can’t replace corruption risks with backroom deals,” Mente-Nkuna fired back.

The elephant in the room: Can the SABC survive without another bailout? Beesley pressed Gungubele: “Is Treasury giving more money? Yes or no?” The answer was blunt: No.

Director-General Nonkqubela Jordan-Dyani confirmed that no extra funding was coming beyond existing allocations. Instead, the government is pinning hopes on the SABC Amendment Bill, which may replace the broken TV licence system. But with only 20% of South Africans paying TV licences, the SABC’s financial future remains in peril.

The SABC’s leadership insists they are turning the corner, but MPs remain sceptical. “The SABC is not just a business — it’s a public service,” said chairperson Sakhumzi Zibi. “But if the government won’t fund it properly, we must reduce its mandate or watch it collapse.”

With no bailout in sight and digital giants eating its revenue, South Africa’s public broadcaster is running out of time.