Msunduzi Local Municipality Mayor Mzimkhulu Thebolla.
Msunduzi Local Municipality
- KwaZulu-Natal Cooperative Governance and Traditional Affairs MEC Bongiwe Sithole-Moloi believes the ANC-administered Msunduzi Municipality is out of line with regards to the R27 million Royal AM sponsorship.
- News24 has obtained a report that cites the Auditor-General as having slapped the municipality with a qualified audit opinion.
- The municipality says this is an “old” report because it refers to the 2022/23 financial year, which ended in June.
KwaZulu-Natal Cooperative Governance and Traditional Affairs MEC Bongiwe Sithole-Moloi has expressed her reservations about the Msunduzi Municipality’s R27 million largesse to PSL soccer club Royal AM.
She based her disquiet on the municipality’s failure to adhere to legislative processes – but the DA feels she is sugarcoating her real feelings about the deal.
On Tuesday night, News24 obtained a fresh progress report from the Department of Cooperative Governance and Traditional Affairs that showed the under-administration municipality’s finances had regressed.
Municipal manager Lulamile Mapholoba said the document was “old” because it related to the 2022/23 financial year.
The document, dated 24 October 2023 and titled “Overview report on section 139 interventions”, shows the municipality’s finances had backslid “to a qualified audit opinion.”
This as the municipality has contractually bound itself to dole out tranches of cash to the struggling PSL side, which does not draw significant crowds to the stadiums unless it plays big-name clubs like Kaizer Chiefs or Orlando Pirates.
Msunduzi Mayor Mzimkhulu Thebolla previously told News24 that hosting PSL games would make the economy in Pietermaritzburg “hum.”
Meanwhile, in a parliamentary reply to DA spokesperson on cooperative governance and traditional affairs, Martin Meyer, Sithole-Moloi said:
Although the ministerial representative is still processing the matter in line with his terms of reference, the department reasonably believes that the timing of the council decision on the sponsorship may have been unreasonable, not because the municipality is under administration, but mainly due to legislative processes that the municipality has not fulfilled.
Asked by Meyer whether the ministerial representative, who oversees the administration process, had agreed to the sponsorship agreement, the MEC said the municipal representative was yet to ratify the council decision to sponsor Royal AM.
“… Further, he has raised with the municipal manager [Mapholoba] and municipal leadership specific concerns, which, if not addressed, the resolution may not be implemented in its totality,” Sithole-Moloi added.
In the parliamentary reply, she confirmed the municipality had regressed to a qualified audit opinion, it was still under administration, and its finances had improved from an unfunded to a funded budget.
Mapholoba said the municipal representative “was there” when the decision to sponsor Royal AM with cash was made.
He added the attention around the deal was “unfortunate.”
Mapholoba was at pains to say whether the municipality had a good relationship with the Department of Cooperative Governance and Traditional Affairs.
He said:
It will assist municipalities if the department can issue some form of guideline because municipalities react in various ways. You look at the eThekwini Municipality, it’s taking everything, even the Carling Cup final will be played in Durban. The MTN 8 final was played in Durban after a proposal they put to the PSL. As a city, we can’t just be a dying city.
Mapholoba added the matter was in court through legal action brought by the DA, saying he was not “qualified” to respond to the MEC’s comments.
“But my view would be that if there is anything, we will positively engage with the MEC.
“We have a very good relationship with the department, and therefore, really, we don’t take that as a negative.
“But when this decision was taken, the ministerial representative was there [and] fully participated.”
READ | Msunduzi boss to meet lawyers about DA’s application to red card R27m Royal AM sponsorship deal
Meyer said after admitting the deal was unreasonable, Sithole-Moloi then attempted to “spin” the issue by saying this was due to correct processes not having been followed.
“The MEC knows this is a bad decision. She admits it’s a bad decision. Yet she does not publicly come and say so to Msunduzi’s ANC-run council,” he added.
“As always, she remains the MEC of inaction and too scared to speak up when her ANC comrades are involved.
“The Auditor-General has also lamented the state of Msunduzi’s finances and has confirmed that correct processes were not followed in terms of the sponsorship.”
Meyer called on Sithole-Moloi to summon the courage “of her convictions and prevent this sponsorship from taking place.”
He said there was no money for “nice-to-haves” while services were so severely lacking in Msunduzi.
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