THE cash-strapped SABC is facing more than R1bn in legal challenges and losses through criminal, irregular or wasteful expenditure written off for the 2009- 10 financial year, according to its annual report.
Among those pursuing claims against the SABC are the South African Revenue Service (SARS) as well as the South African Music Performers Rights Association (Sampra) over “needle-time” royalties.
The figure could in fact be higher because these amounts do not include unspecified tax on intellectual property rights allegedly owed to SARS for 2001 and 2002 before the SABC was corporatised.
A case brought by the Public Investment Corporation (PIC) on behalf of the Government Employees Pension Fund, for unpaid rental for offices occupied by the former Bophuthatswana Broadcasting Corporation (BopBC), has been set down for trial this month.
BopBC was absorbed into the SABC in 1997 and continued to use the building until February 2004.
The PIC is claiming R377m plus interest from the SABC. The two parties are in settlement talks, according to the annual report.
The Namibia-based Trustco Group and the SABC have both lodged an appeal against a high court ruling in Trustco’s favour for R24,7m. Trustco is asking for more money and the SABC is appealing the ruling. Trustco, a financial services group, is claiming R140m for the SABC’s alleged breach of contract relating to two wireless agreements in 2004.
Digital Horizon temporarily postponed its highly publicised R400m case against the SABC over a tender for four outside broadcast trucks in November last year , allegedly to allow for further investigation.
Coming as it did ahead of the Soccer World Cup, the case was closely watched. Digital Horizon was asking the courts to invalidate a multimillion-rand SABC contract awarded on tender to Sony SA in June to provide broadcast trucks. It claims it was the preferred bidder .
The broadcaster has also been drawn into a court battle between Sampra and the National Association of Broadcasters, of which the SABC is a member, over R132m Sampra believes is due to artists as “needle-time royalties”. The percentage owed by the SABC is not clear.
Investigations launched by the SABC’s interim board identified a variety of criminal activity and pursued leads that were highlighted in the auditor-general’s report.
For the year ended March 31, 14 cases relating to criminal or irregular expenditure were identified that amounted to R187m. The full amount was written off as a loss.
The previous financial year saw R33m written off.
When it came to material losses through fruitless and wasteful expenditure, R70m was identified but only R48m was written off.
The SABC said in its report that it is in talks with SARS regarding tax on intellectual property rights.
“For the years of assessment 2001 and 2002 when the SABC had yet to be corporatised, there is potential exposure that is still to be clarified,” the report said. It is not clear how much money is involved.
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