SABC’s crisis plan fails to impress MPs
The broadcaster’s savings from cost-cutting are far less than the money needed to rescue it
Members of Parliament tore into the embattled SABC’s proposed plan to drop at least a third of its programming in an bid to save the organisation’s depleted finances, saying it does not make sense.
Changes to programming are just one of the proposed interventions outlined by the struggling entity’s leaders when they appeared before Parliament this week.
They could not provide further clarity on the cost-saving initiative at the time of going to print, so it could not be established whether the proposals will affect the state broadcaster’s news offerings as well as any local productions.
In an effort to save itself, the SABC, which has reported losses exceeding R1.5-billion in the past two financial years, has proposed a range of drastic actions, which includes shedding just more than 2000 permanent and freelance jobs.
According to the presentation to MPs, the SABC’s losses for the current year to date have topped R323-million and are forecast to reach R800-million by the end of the financial year.
Organised labour is opposed to the proposed plan to cut jobs. The first consultative meeting, in terms of section 189 of the Labour Relations Act, between the unions and the SABC officially kicked off on Wednesday.
Section 189 requires employers to demonstrate that they have made efforts to avoid retrenchments.
On Tuesday SABC board members told Parliament’s portfolio committee on communications that it has already started to implement a costsaving strategy, which has enabled the broadcaster to save millions of rands over the past two quarters.
“A number of cost-saving measures have been implemented, but, despite all of those, we are still faced with what I call ‘Day Zero’,” SABC board member Mathatha Tsedu told the committee.
To push home the point, Tsedu spoke about how parts of the SABC headquarters in Auckland Park, Johannesburg, had started to crumble because the costs of maintaining the building had been cut.
But the amount of money the SABC has been able to save is a far cry from the amount needed to save it. The board has made a bid to the treasury for a R3-billion bailout.
According to the SABC’s turnaround strategy report, the wage bill, at R3.1-billion, was the major cost driver. The cost of programming‚ film and sports rights came second at R1.7-billion.
In the presentation to MPs, the SABC board outlined the short-term austerity measures the broadcaster will have to take. These include cutting marketing costs by R36-million, slashing spending on sports rights by R463-million and reducing investment in programme content by between 30% and 50%.
Tsedu told the committee that the board has already entered into deals with the producers of beloved local soapies Generations and Muvhango, which are currently carrying most of their costs. “We can’t even pay them … These guys are using their own money to finance the SABC’s operation.”
In August production on one of South Africa’s most-watched TV shows, Uzalo, had to be halted after cast and crew suspended their services when they weren’t paid their salaries.
SABC’s chief operating officer, Chris Maroleng, told the committee that the cut in content investment has a very significant negative effect on the broadcaster’s profits.
“Our inability to make the necessary investments basically resulted in a serious impact ... What we should be looking at is increasing that investment,” Maroleng said.
The committee expressed its general disappointment in the SABC’s presentation. The ANC’s Bongani Bongo decried the board’s lack of innovation regarding its strategy to rescue the broadcaster.
Democratic Alliance MP Phumzile van Damme said: “I don’t understand why you would stop content production. Isn’t that what draws viewers? Isn’t that what draws advertising? It makes absolutely no sense to stop content.”
Hannes du Buisson, spokesperson for the Broadcasting, Electronic, Media & Allied Workers Union, told the Mail & Guardian that the SABC’s turnaround strategy is “pie in the sky stuff”.
“There is no real action plan or strategy … There has been nothing that has made us say: ‘Wow, these guys really have a plan’,” he said.
Du Buisson criticised the board’s emphasis on implementing a costcutting plan rather than on generating revenue. He called the board’s plan to cut down on programme investment “ridiculous”.
“This is the very fuel of the SABC,” Du Buisson said, adding that the broadcaster instead needs to look into investing more in content.
“They are going to end up broadcasting repeat after repeat after repeat, and that is when people turn off their TVs and stop paying their TV licences,” he said.
Communication Workers’ Union general secretary Aubrey Tshabalala said the consultation meeting with the Commission for Conciliation, Mediation and Arbitration was shelved because the SABC could not provide further financial and other information related to the proposed restructuring. The meeting will now happen on December 12 and 13.
“We have been calling for an independent skills audit that will inform where and how you reduce staff … You cannot just make the first option retrenchment,” he said on the proposed plan to cut staff.
Du Buisson said the unions still have no clarity on which employees face retrenchment.
The current board and management has placed the blame for the public broadcaster’s woes on the mismanagement of their predecessors, including controversial former chief operations officer Hlaudi Motsoeneng.
This was laid bare in the recent Special Investigating Unit (SIU) report on irregular expenditure at the broadcaster, as well as former public protector Thuli Madonsela’s 2014 investigative report into the SABC titled When Governance and Ethics Fail.
The SIU report found that, under Motsoeneng, the SABC had entered into irregular contracts with at least eight companies, costing the broadcaster millions.
R4.9-billion in irregular expenditure has still not been accounted for.
Earlier this year Motsoeneng hit back at the SABC leaders, saying they were “clueless” and “obsessed” with him, and that the public broadcaster had performed well under his leadership.
The SABC board also said that one “expression of maladministration” inherited from the previous administration was the problem of chronic overstaffing.
Head of human resources Jonathan Thekiso said overstaffing has been accompanied by a legacy of nonperformance that has gone unchecked by management. “So you find that a job that ought to be done by one person ends up being done by two, three people.”
“I don’t understand why you would stop content production. Isn’t that what draws viewers? Isn’t that what draws advertising?”