SABC to follow the law to the letter in retrenchments

25 September 2018 - 15:59 By Andisiwe Makinana
Chairman of the SABC board Bongumusa Makhathini says one of the Treasury conditions for a government guarantee to the public broadcaster was that the SABC should reduce employee costs in order to be sustainable but in 2018‚ employee costs were still the biggest cost driver at the SABC
Chairman of the SABC board Bongumusa Makhathini says one of the Treasury conditions for a government guarantee to the public broadcaster was that the SABC should reduce employee costs in order to be sustainable but in 2018‚ employee costs were still the biggest cost driver at the SABC
Image: Waldo Swiegers. (C) Sunday Times.

The SABC will follow the Labour Relations Act to the tee regarding possible retrenchments at the financially struggling broadcaster.

Chairman of the SABC board Bongumusa Makhathini told MPs that it was not an accurate reflection that the SABC's turnaround strategy only focused on retrenching staff‚ saying in fact this notion ignored a lot of work that was being done to drive the corporation forward.

“We have done quite a number of things that have helped us to stabilise the SABC‚” he said.

“The turnaround plan has three main elements: dealing with the legacy and governance issues‚ looking at regulatory and policy issues and the third element talks to the commercial and operational issues‚” said Makhathini.

He was addressing the national assembly's portfolio committee on communications which convened an urgent meeting on Tuesday during the parliamentary spring recess to deal with issues related to the SABC.

Makhathini further added that in 2009‚ one of the Treasury conditions for a government guarantee to the public broadcaster was that the SABC should reduce employee costs in order to be sustainable but in 2018‚ employee costs were still the biggest cost driver at the SABC and continued to be out of step as a percentage of revenue.

“It is sitting at about 42% of the total revenue‚ which is an anomaly‚” said Makhathini.

Makhathini restated that with regards to section 189 [of the Labour Relations Act] … “that is a very tightly drafted legislation requirement and processes which the SABC intends to follow to the letter”.

He confirmed that the SABC had engaged with organised labour and employees to communicate to them that the broadcaster contemplated embarking on the section 189 process. “This process must fully comply with the Labour Relations Act and therefore it would have been improper for the employees to first hear about the process in a public meeting with this committee‚” he said.

He said this was the reason the SABC management had started engaging with labour so that they could work together in a consultation process which would result in a buy-in and alignment on how to proceed in the cost-cutting drive.

SABC group chief executive Madoda Mxakwe said for the past financial year‚ the total revenue was R6.6-billion and in terms of expenditure the SABC spent R7.3-billion. The net loss was standing at R622-million and their debt currently stood at R1.3-billion. Mxakwe said in 2013/14 the total employee costs were just under R2.5-billion and in 2017/18 that cost was just under R3.1-billion.

The SABC presentation revealed that employee costs were the major cost drivers at R3.1-billion‚ of which 42% was expenditure. Programming‚ film and sports rights came second at R1.7-billion‚ followed by signal distribution and linkage costs [R718.1-million] and broadcast costs which came to R486.6-million.

The SABC's major revenue streams were advertising‚ which brought in R4.78-billion [71%], TV licence fees R941-million [14%] and sponsorships R393-million.

The broadcaster said it was looking at new ways to collect TV licence fees as there were only 1.8-million households and businesses that paid TV licences out of a total of nine million accounts on the SABC database.


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