GOVERNMENT APPROVES BANK GUARANTEE FOR SABC
Johannesburg, 24 November 2009-The SABC is pleased to announce that the Government has approved its application for a Government Guarantee for R1.473 billion for the corporation.
The Minister of Finance Pravin Gordhan has stated that the Guarantee will be released in tranches, with a draw down of R1billion available immediately, and the release of the remaining R473 million dependent on the development of a detailed project plan by the SABC committing the public broadcaster to explicit revenue targets and cost cutting measures to enable effective oversight and monitoring of projections by Government. Minister Gordhan has highlighted that these undertakings should be captured in a Shareholder’s Compact to be signed by the new Board of the SABC and the Minister of Communications Siphiwe Nyanda within three months of their appointment to facilitate oversight and monitoring.
The Chairperson of the Interim Board of the SABC says the granting of the Guarantee is evidence of the commitment by Government to public broadcasting in South Africa .
“I would like to thank both the Ministers of Communications and Finance for the support they have given the SABC to assist the Corporation in applying for the Guarantee. The Government Guarantee together with the October approval in the Medium Term Budget Policy Statement (MTBPS) of an additional R200m will enable the SABC to begin the turnaround to developing a vibrant and viable public broadcasting service responsive to the needs of all South Africans”.
“The SABC incurred a loss of over R900 million at the end of March this year and the application by the Corporation is aimed at both paying back creditors and implementing a turnaround strategy. As stated in Parliament recently, the SABC Interim Board has started the process of identifying cost cutting measures and putting inplace governance systems to guard against wasteful expenditure. It will be up to a new Board to develop in depth strategies to effect a turnaround.”
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