NBC is technically insolvent: Public Accounts Committee

20 Aug 2019 10:20am
WINDHOEK, 20 AUG (NAMPA) – Technically insolvent Namibian Broadcasting Corporation (NBC) needs N.dollars 313.2 million and N.dollars 4 million from the State purse to pay its outstanding liability in the form of post-medical aid benefits and severance pay to its employees, respectively.
The corporation’s current liabilities stand at N.dollars 270 million.
The near-bankrupt State broadcaster has its eyes fixed on the government for capitalisation or recapitalisation, in order to get out of the current financial mess.
This was revealed here on Monday, when the NBC management sat before the Parliamentary Standing Committee on Public Accounts.
The situation is so dire that if 30 NBC employees were to resign today, the State broadcaster would not be able to pay out their post-retirement medical aid benefits and other retirement packages, the corporation’s management admitted.
Further, NBC at the present does deduct post-retirement benefits from employees’ monthly salaries - at least on paper - when in fact there is no actual money involved, it also surfaced during the hearing.
This situation is fingered in Auditor-General Junias Kandjeke’s audit report into the finances of NBC for the 2016/17 financial year, on which the hearing was premised.
“It was further noted that there were no specific assets set aside by the corporation to fund these liabilities. Technically these plans are not funded,” Kandjeke found at the time.
The situation has not changed since then.
“With all due respect, you have been very much reckless,” the United Democratic Front’s Dudu Murorua told the NBC management.
Much of this is to be blamed on past regimes and a reduction in NBC’s subsidy from Government, Director-General Stanley Similo told the committee.
“But now you come in and have to deal with issues that have been there forever, even now when you do good, people won’t see that because you are swallowed by all these issues,” Similo said.
NBC got a N.dollars 140 million subsidy from the government for the current financial year, around 25 per cent less than it received the previous financial year.
“You’re technically insolvent. You having been given the mandate to run the broadcaster on our behalf, are at a point where we have to implement a structural reform change. Is NBC’s foundation strong enough to build on or do we need to break the foundation in order to build a new one?” Rally for Democracy and Progress leader and the committee’s chair, Mike Kavekotora asked.
NBC Chief Human Capital Officer, Vazenga Kauraisa responded: “Plans, in this case, is cash, it’s money, it’s revenue, it’s government subsidy. Without that, I don’t know what plans you are asking.”