Minister receives final report on state of affairs at SABC

Wednesday, March 11, 2009

Pretoria - The Minister of Communications Dr Ivy Matsepe-Casaburri has received the final report on the state of affairs at the South African Broadcasting Corporation (SABC).

The minister is currently studying the report, prepared by Deloitte & Touche, and is expected to formulate appropriate corrective measures.

The objective of the report was to assess the adherence to corporate governance protocols and identify best practices with a view of sharing these experiences among the state-owned enterprises. Similar reviews are conducted in all state-owned enterprises.

"The report (on the SABC) suggests some shortcomings with regard to corporate governance practices which will be discussed with the board and management," the departmental spokesperson, Joe Makhafola said.

He said that in formulating corrective measures, the minister would base her recommendations on the three independent reports, including the Bowman Gilfillan that was commissioned by the SABC as well as a report from a panel of experts commissioned after the Budget Vote speech.

"The review will assist us in taking corrective measures to refocus the entity," Mr Makhafola explained.

With regard to a budget deficit, the department is meeting with the SABC to fully understand the causes of this deficit and together with the National Treasury the department will recommend corrective measures.

Acting Group Chief Executive Officer of the SABC, Gab Mampone last week announced that necessary cost cutting measures would be made at the SABC. The department has since welcomed this initiative.

The corporation has reported that its financial woes emanated from its funding model, the global credit crunch and the rapidly rising cost of content.

Mr Mampone said as part of SABC's new developed turnaround strategy, the corporation would be looking at various measures to ensure its sustainability and viability.

He said these measures include the implementation of the Austerity Plan, the freezing of vacant posts, optimisation of TV license revenue and continuous engagement with government to find solutions on the funding of the organisation.

The strategy will further address the working capital dynamics and unnecessary spending and the corporation's revenue growth would be boosted through the development of their aggressive and robust advertising strategy.