National treasury has stepped in to rescue state-owned broadcasting signal distributor Sentech, which is in dire financial straits and no longer a going concern due to the ongoing fees dispute with the SABC.

Nonkqubela Jordan-Dyani, director-general of the department of communications & digital technologies, told parliamentarians on Tuesday that in total, the treasury has granted R889-million in adjustment allocation letters. The most recent one – R700-million – was received by the department on Monday. It is earmarked for funding signal distribution.

The DG explained to MPs in the communications portfolio committee that the department was still waiting to hear from treasury about the conditions of the allocations. Also, the money must not be viewed as a “special privilege” or a “debt write-off”, she said.

Sentech and the SABC have been in a prolonged dispute over signal transmission fees since the 2020/2021 financial year. The SABC owes Sentech about R1.6-billion for signal distribution. Sentech is also owed R84-million by the Universal Service and Access Agency of South Africa and R34-million by community broadcasters.

The department has brought in an independent mediator to try to resolve the dispute between the SABC and Sentech. The process is meant to be finalised by end-March.

Last week, the SABC told the portfolio committee that at this rate, it will not be able to cover the local government polls, which are expected to take place within the next year.

TV blackout risk

Sentech CEO Tebogo Leshope was frank in his assessment of the state-owned enterprise on Tuesday, reminding MPs that last year there was a threat of going black on screen because of the money owed by the SABC. Sentech was allocated R60-million from the department, diverted from its other entities, to avert a blackout.

“The chief financial officer dealt with that cash availability on your question as to whether there is a risk of a [television blackout]… At this point, we cannot continue without a minimum of a month-to-month payment. That’s how dire the situation is, and the committee has to note this,” he said.

Read: SABC says it can’t afford to cover the next election

Sentech bills the SABC R71-million/month. For most last year, it paid R20-million/month and increased this amount to R30-million in November and December, according to Sentech chief financial officer Clarinda Simpson. She said the SABC has undertaken to continue paying R30-million/month until the end of next month.

“At the moment, with the R176-million in the bank, we are not a going concern,” she said. “It’s something that all stakeholders need to reflect on and look at the root cause as to why key customers and government entities are not fulfilling their obligations in settling the debt with Sentech. We are a business enterprise. We are supposed to be self-sustainable, generate revenue, which we are doing… But then sister entities are not fulfilling their obligations and not servicing their debt, which puts us in this precarious financial situation.”

Jordan-Dyani told the committee that while Sentech’s role as the country’s primary signal distributor for radio and television was critical, it was especially important in an election year to deliver information to citizens.

She said the department has been in ongoing discussions with Sentech and the SABC since 2023. It is “hopeful” that the independent mediator will ensure the parties reach common ground.