Johannesburg - Due to bankruptcy and the collapse of service delivery, there are doubts that Msunduzi Municipality in Pietermaritzburg will fulfil its 2021 contract to fork out R27 million of ratepayers’ money to fund the Maritzburg United FC, which is desperate for funding.
While under administration since 2019 for failure to deliver services, the municipality signed an obligation to sponsor the KwaZulu-Natal capital city’s only Premier Soccer League (PSL) team, to be paid in tranches of R9 million each year, over three years.
The city’s announcement of the sponsorship in 2021 attracted an outcry from civil society organisations and opposition parties who expressed concern about spending money on the privately- owned soccer team while the municipality is struggling to fulfil its service delivery and employees’ salary obligations.
Maritzburg United FC chairperson Farook Kadodia said this week that he doubted that the Team of Choice would still receive the funding from the city.
“The team cannot survive if we don’t have any support from the municipality,” said Kadodia.
According to media reports, Kadodia, who according to linkedin.com is a director of Royal Rice, lost around R20 million when his businesses were looted and vandalised during the civil unrest two years ago. He reportedly has shares in 10 companies, including cash and carry wholesalers and building suppliers.
He said the team was important for the city since football is a major sport for all the people and without the Maritzburg FC “where can you get the PSL team for Pietermaritzburg?”
However, Kadodia expressed reluctance to talk about the city’s failure to deliver on its funding promise, as he tried to avoid the impression that he was fighting with the municipality.
“I still hope that they will support us. I cannot fight with the municipality because there is no money, if they had money they would help us out,” he said.
Kadodia said his only alternative is to look for commercial sponsors.
“You can help us to find a commercial sponsor, don’t worry about the municipality because that will make us (the team and the municipality) fight for nothing. Business people need to support Maritzburg before the team is lost,” he said.
He said it “has been very hard to find” businesses to support the team.
In February, Msunduzi municipal manager Lulamile Mapholoba wrote to Kadodia expressing regret that the municipality was unable to meet its contractual obligation “in terms of the payment intervals, as contained in the signed sponsorship agreement.”
Mapholoba cited the Covid-19 pandemic and July 2021 unrest as the reason the municipality was facing financial difficulties, “as residents and businesses are unable to meet their obligations in terms of paying for rates and services.
“The low payment rate as well as illegal connections through theft and vandalism, has severely affected the revenue collection efforts in the city, resulting in the Municipality experiencing an unprecedented all-time low cash flow at the moment.
“While respecting the fact that the Municipality does have a signed agreement with the Maritzburg United FC, a sponsorship, during a time like this cannot take precedence over the core mandate of the Municipality which is that of the delivery of basic services to its communities,” read the letter.
But Mapholoba did not rule out that the municipality would in the future pay Maritzburg United “when the cash flow becomes available”.
Msunduzi spokesperson Ntobeko Ngcobo said the municipality cannot simply withdraw from the sponsorship contract with the team.
“Any actions under the contract will need to be conducted within the parameters of governing contract law,” she said.
She said in the past nine years, the relationship with the team has delivered positive spin-offs toward the development of local sports talent, social cohesion, moral regeneration and local economic development.
Ngcobo said this was the third time that the Msunduzi Municipality, which has been in and out of administration in the past, signed to sponsor the club. She could, however, not say how much the club had been paid in the previous contracts.
The Msunduzi Association of Residents Ratepayers and Civics (MARRC),which has previously threatened legal action to stop the sponsorship, said there was no benefit to the public if the municipality spends R27 million on a soccer team while the city’s infrastructure is crumbling.
“The CBD is falling apart, the inside of the city hall is falling apart, the whole of the CBD stinks of piss and they are not doing anything.
“We are four years under administration and no changes are happening, and we are still under administration,” said MARRC chairperson Anthony Waldhausen.
African Christian Democratic Party councillor at Msunduzi Municipality, Rienus Niemand said it was wrong for the municipality to continue with the agreement.
“The municipality has got cash for seven days when it should have cash for 90 days, it is owed R6 billion which it has not collected,” Niemand said.
It is not the first time municipalities sponsor big soccer teams. Sunday World reported last year that during the 2011/2012 season, Polokwane Municipality, in Limpopo, paid R1 million to Kaizer Chiefs and also signed similar deals with Black Leopards and SuperSport United, prompting the DA to complain about fruitless expenditure.
The Umhlathuze Municipality also pledged to donate R3 million to Richards Bay FC but ended up only paying R1 million. eThekwini Municipality, which is also struggling to keep its streets clean, also pledged to spend more than R15 million funding the city-based Premier Soccer League (PSL) Royal AM Football Club, R5.2 million to Golden Arrows FC and R3.7 million to AmaZulu FC. The rugby team, the Sharks, is reportedly receiving R4 million annually from ratepayers.