Durban: The sponsorship of the Royal AM football club by the Msunduzi Municipality hangs in the balance after a motion was put forward calling for the partnership to be scrapped.
The motion, tabled by the DA, comes in the wake of concerns that the club is increasingly becoming an embarrassment for the city of Pietermaritzburg.
As a result of the legal challenges faced by the club owner, the club is no longer delivering on its part of the agreement.
In the motion, the party states that “Royal AM has been put under curatorship by Sars (SA Revenue Service), with Royal AM matches consistently being cancelled. Thus, no tourism benefit is being extracted for the city or ratepayers. Additionally, the Royal AM brand is attracting negative scrutiny, and this council association via the sponsorship will negatively affect the city.”
The party called for the council to resolve that “the legal department is tasked with reviewing the sponsorship contract and evaluating ways to terminate it. Rescind the report and publicly distance it from Royal AM.”
In a statement, the DA in Msunduzi said it had submitted a motion calling for the municipality to review and ultimately terminate the R27 million sponsorship for the club.
“The municipality cannot continue supporting a business facing serious legal proceedings, including allegations of tax evasion. Non-compliance with tax laws and deliberate tax evasion are criminal offences that should not be taken lightly by any municipal authority. Maintaining a relationship with an entity under such scrutiny is damaging to the municipality’s reputation.
“Royal AM is already under curatorship, facing sequestration processes, and is unable to pay staff salaries. The club has breached contracts with former players, is facing sanctions from Fifa, and risks being declared insolvent by the world football governing body. Continuing this sponsorship brings nothing but disrepute to the Msunduzi Municipality.”
The DA has consistently opposed the sponsorship of Royal AM, especially given the dire state of service delivery in the municipality. Collapsing infrastructure has left residents without consistent access to water and electricity, the party has said.
The DA said the R27m allocated to Royal AM could be better utilised to address these critical service delivery issues and support the youth of Msunduzi through the maintenance of sports facilities and the funding of sports and youth programmes.
“Young people in the municipality are left vulnerable to crime and drug abuse due to a lack of support, yet Msunduzi is funding an entity that contributes nothing to the city apart from controversy and embarrassment,” said the party.
The DA will also appeal to the Provincial Treasury and the Department of Co-operative Governance and Traditional Affairs to intervene in this matter.
“Msunduzi deserves better. The municipality must prioritise its residents and redirect funds to address urgent service delivery and youth development needs,” said the party.
Msunduzi municipal spokesperson Ntobeko Mkhize said: “The motion will be addressed in accordance with council’s Rules of Order, ensuring that all procedural requirements are complied with. The municipality will then provide information following due process.”
Royal AM’s management was contacted for comment but had not responded by the time of publication.