The Democratic Alliance (DA) in Msunduzi strongly condemns the Speaker, Councillor Eunice Majola, Acting Municipal Manager, Nelisiwe Ngcobo, and the ANC caucus for their decision to dismiss a motion calling for the termination of the R27 million sponsorship agreement between the Msunduzi Municipality and Royal AM Football Club.
This refusal to table the motion is an affront to the residents of Msunduzi and undermines their interests.
The DA’s proposed motion sought to end the sponsorship due to Royal AM’s current financial and legal troubles, which include tax evasion, ongoing court proceedings, curatorship, sequestration processes, suspended league games, unpaid player wages, FIFA sanctions, and the possibility of liquidation or an auction of the club. Given these issues, the DA believes the municipality’s association with Royal AM is damaging to its reputation.
Despite these concerns, the Municipal Manager, with the support of the ANC, chose to block the motion, citing the ongoing court case where the DA is challenging the legitimacy of the sponsorship. The DA believes this motion presented a crucial opportunity to address the municipality’s tarnished image by distancing itself from the club’s financial and legal instability.
The DA will continue to fight the sponsorship in court, with a hearing scheduled for 28 February 2025 at the Pietermaritzburg High Court . Furthermore, we are calling for an internal audit to investigate the sponsorship deal, specifically to determine whether any payments have been made by the municipality to Royal AM.
Under Section 112(1)(l)(iii) of the Municipal Finance Management Act (MFMA) 2003, municipalities and municipal entities are prohibited from making payments to entities with unresolved tax matters.
The internal audit should establish whether any municipal funds were disbursed to Royal AM without ensuring proper due diligence and obtaining a valid tax clearance certificate. If it is found that payments were made without compliance, the DA calls for the application of consequence management and the opening of criminal investigations into those responsible for any unlawful payments.
The DA is confident in the court process and will be seeking costs against the municipality in this matter.