Pressure mounts on beleaguered SABC to scrap retrenchments

Political pressure is mounting on executives at the SABC to abandon plans to retrench workers amid threats of a blackout on Friday.

Moves to slash the wage bill at the SABC come in the context of the government’s fiscal consolidation drive.

The public broadcaster’s wage bill is said to be weighing on its finances, and how the SABC crisis unfolds could set the tone for how the cost-cutting drive in similarly affected public-sector entities goes.

The public broadcaster, the main source of news and commentary for most South Africans especially in remote areas, is in the throes of a liquidity crisis.

The company announced earlier in January that the retrenchment process would affect 303 employees on various levels in the organisation, about half of the originally projected redundancies.

But unions and communications minister Stella NdabeniAbrahams are having none of it.

The Communications Workers Union (CWU), which represents about 900 SABC workers, said that it opposed the job cuts and its members would down tools on Friday.

The union said that the broadcaster’s management had not consulted employees before issuing retrenchment notices. It also wants the SABC board to be dissolved and the broadcaster placed under administration.

Ndabeni-Abrahams’ spokesperson Mish Molakeng said on Thursday that the minister remained opposed to retrenchments at the SABC.

“The minister has publicly stated that she is not in support of the retrenchment of employees at the SABC. She will soon meet the board and unions, respectively, to assist in finding a lasting solution between parties involved. She has consistently maintained that the process must be consultative, fair and just,” Molakeng said.

This points to division within the government on how to handle the matter as Treasury has been calling for the salary bill to be slashed.

The SABC, which has a wage bill of more than R3bn a year for its 3,000 permanent employees, received a conditional R3.2bn bailout from the government in 2019, which it used to pay off most of its debt and invest in content. Part of the conditions included cutting the cost of remuneration. The management has said it wants to reduce it by at least R700m.

The broadcaster has been in dire straits for several years and has often required government bailouts to continue operating, but state support is unlikely to continue as finance minister Tito Mboweni seeks to reduce the country’s debt load and avoid a full-blown fiscal crisis.

SABC spokesperson Mmoni Seapolelo said that the public broadcaster was satisfied that the retrenchment process could withstand any legal scrutiny.

“As confirmed by the labour court on December 2 2020 the SABC properly conducted itself in the process, provided all consulting parties with sufficient information and constructively engaged with a view to reach consensus on all the consultations,” said Seapolelo.

“It must be noted that this process is premised on the SABC turnaround plan, which is a bailout precondition by National Treasury and follows the approval of the new SABC target operating model. To ensure fair and inclusive consultations, the SABC held 48 consultation sessions over six months, which exceeded the minimum legislative requirements of 60 days and four sessions,” Seapolelo said.

Contingency plans were in place to ensure the continuous running of SABC services.

But Ndabeni-Abrahams is adamant that the financial crisis at the broadcaster can be addressed without retrenching workers.

One of the proposals on the table is the slashing of the exorbitant signal distribution fees, the second-biggest cost driver after the wage bill.

On average, the SABC pays R72m a month for signal distribution or about R864m a year.

With the SABC’s coffers continuing to bleed as costs exceed revenue, the public broadcaster’s executives appealed recently to MPs to interrogate the signal distribution fees charged by the state signal distributor, Sentech.

The SABC is Sentech’s biggest client. In 2019, Sentech had revenue of R1.4bn, with the SABC paying the signal distributor about R830m that year, up from R781m in 2018.