Treasury has allowed the cash-strapped SABC to take on more debt to ease its current financial woes with a borrowing limit of up to R1.2bn by the National Treasury.
The aim is to prevent the public broadcaster from collapsing.
The public broadcaster suffered a net loss of R622million in the financial year ending in March.
Director-General of the Department of Communications Dr Mashilo Boloka explains the conditions of the credit limit.
What we are talking about is not necessarily a government guarantee but the power of the SABC to go and borrow money, consistent with Section 23 of the Broadcasting Act.— Dr Mashilo Boloka, Director-General of the Department of Communications
The idea is that the SABC should be able to do two things. Upon getting that money, they should be able to prioritise the payment of the independent producers - Sintech, Safa, and others, and then also acquire content. That is the basis on which we have agreed.— Dr Mashilo Boloka, Director-General of the Department of Communications
They should also agree with the lenders on the payment plan.— Dr Mashilo Boloka, Director-General of the Department of Communications
Click on the link below to hear more from Boloka...
This article first appeared on 702 : [LISTEN] SABC given borrowing limit of up to R1.2bn