The R27 million sponsorship deal by Msunduzi Municipality to Royal AM football club is facing opposition in council.
The DA has unleashed its lawyers to ensure that Msunduzi does not go ahead with its “unconstitutional” funding of the soccer club, following the previous beneficiary’s (Maritzburg United) relegation to the lower league.
The party said it has placed city manager Lulamile Mapholoba and the soccer club “on terms” regarding the “irregular sponsorship”.
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The irregularly approved sponsorship deal has compromised the city’s constitutional obligations and followed an unlawful process.
“The DA, through its legal representative, has served the municipal manager with legal terms and conditions, demanding that the matter [sponsorship] be set aside. If the manager fails to respond or continues with payments towards this sponsorship agreement, the DA will be forced to take this matter to court and seek personal costs against any officials who act in bad faith or gross negligence,” said Msunduzi caucus leader Ross Strachan, in a statement.
He said they have given Royal AM until Friday to disclose any payments the club have received from the municipality.
According to the lawyers’ letter to both parties, which The Witness has seen, the municipality did not follow proper procedure when awarding the sponsorship to the club.
We are also instructed that the municipality failed to comply with the prescribed supply chain management processes and procedures in entering into the Royal AM sponsorship contract.
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“Contrary to section 217 of the Constitution, the municipality failed to contract with Royal AM in accordance with a fair, equitable, transparent, competitive and cost-effective system. The municipality failed to comply with the Preferential Procurement Policy Framework Act 5 of 2000 and the Preferential Procurement Regulations, 2022 in awarding the Royal AM sponsorship contract,” reads the letter.
It also states that Section 15(a) and (b) of the Local Government: Municipal Finance Management Act 56 of 2003 (MFMA) requires the municipality to only incur expenditure in terms of an approved budget and within the limits of the amounts appropriated for the different votes in an approved budget.
“The Royal AM sponsorship contract will impose financial obligations on the municipality beyond the three years covered in its annual budget for the 2023/24 financial year.
“The municipal manager failed to invite the local community and other interested persons to submit to the municipality comments or representations in respect of the Royal AM sponsorship contract.
“In light of the above, we have been instructed to launch urgent review proceedings in respect of the July 19, 2023 council decisions, including the Royal AM sponsorship contract, and to seek any further competent relief. We are further instructed to institute proceedings if necessary to prevent any unlawful payments to the Royal AM football club pursuant to the Royal AM sponsorship contract or safeguard any payments that have been made, pending our clients’ review of the July 19 council decisions,” the letter reads.
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In the event that the municipality proceeds to authorise or make any payments to the club in the face of this letter, it reads, the lawyers will seek personal cost orders against those officials responsible and will place this letter before the court.
City spokesperson Ntobe Mkhize said Mapholoba has not received any documents from the DA.
Royal AM publicist Nikiwe Nyembe said the club have not received any correspondence from the DA, and cannot comment any further on the matter.
“Given the complexities surrounding the subject, the city council would be better positioned to provide the information,” said Nyembe.