The South African Broadcasting Corporation is technically insolvent and it will have no choice but to embark on a mass retrenchment of workers in order to avoid total collapse.
This was revealed by SABC CEO, Madoda Mxakwe on Wednesday.
Mxakwe said the cost-cutting measures that were already implemented saved the national broadcaster R463 million in the past two quarters but was not enough and that advertising accounted for 85 % of the revenue.
"If you look at our net loss to date, we are sitting at R323m. The focus loss for the financial year is at R805 million. This brings us to the focal point of reviewing all operations and biggest cost drivers [to] ensure a commercially viable corporation,".
He said that this meant that monthly obligations wouldn't be fulfilled including financial commitments.
Mxakwe said the cost of the public mandate had been sitting at R4.2 bn and projection showed that costs would be R6 bn in the next three years.
The broadcaster's CEO said the threat to insolvency was increasing and it had been worsened by the wage bill which totalled R3.1 bn.
The SABC confirmed that it was in the process of retrenching close to 1000 staff members and that it would not renew contracts of around 1200 freelance contractors on Monday.
