SABC must consider cutting jobs to stay afloat, says CEO
The SABC has little choice but to consider job cuts as it continues to struggle to generate sufficient cash flow and to remain sustainable, according to CEO Madoda Mxakwe.
Last week SA’s largest media organisation, which operates 18 radio stations and five television channels, said it had informed trade unions representing its employees that it will have to embark on a section 189 process with a view to cutting costs, including job losses.
The public broadcaster, which recorded a net loss of R622m in the financial year ended March, spends more than R3bn a year on the salaries of just more than 3,000 employees. It has not reported a profit since 2013. In 2017 it reported a net loss of more than R1bn.
The SABC’s decision to consider job cuts, which could affect hundreds of employees, has irked the ANC.
Ace Magashule, the party’s secretary-general said at the weekend it has decided “not to allow” the section 189 process to go ahead.
The board of the public broadcaster hit back, saying it is within its rights to “control the affairs of the corporation”.
This includes how the SABC operates the business of the public broadcaster and conducts labour relations with its employees, it said. “No person, organisation or entity is permitted to interfere with how the SABC board exercises its power in terms of … the Broadcasting Act.
“Any interference would be in contravention of the law and a recent court judgment to this effect,” SABC spokesperson Neo Momodu said.
“The SABC currently has a R1.3bn debt and an annual salary bill of R3.1bn,” she said.
“This is clearly not sustainable for an organisation that generates R7.2bn in revenue and had financial losses of over R622m in the past financial year. Being a responsible board‚ we cannot sit by and not act. This would be irresponsible and reckless on our part.”
Momodu said one of the SABC’s biggest cost drivers is the salary bill.
“The current ratio of revenue to wage bill is not sustainable, given the SABC’s dismal financial situation.
“It is for this reason that the SABC is contemplating other cost-cutting measures to further reduce costs,” she said.
Labour unions said they are engaging the SABC on the restructuring process.
The unions have called on the broadcaster to consider cutting the salaries of senior executives and board members instead of cutting jobs.
The organisation paid just more than R45m in salaries to its 40 senior managers in the financial year ended March.
BEING A RESPONSIBLE BOARD‚ WE CANNOT SIT BY AND NOT ACT. THIS WOULD BE IRRESPONSIBLE AND RECKLESS