SA Football Association briefing on its financial status, broadcasting deal, match fixing and delivery of AFCON and CHAN

Meeting report

Opening remarks
The Chairperson welcomed both members and visitors to the meeting.

She asked the Committee and visitors to be concise in their contributions during the meeting as there was a National Assembly plenary session in the afternoon. She also noted that the Mail & Guardian had reported that Luvo Manyonga (South African former Long Jump Champion) from Paarl, who had not gone to the Commonwealth Games in Glasgow, had not been reporting for practice. When his coach went looking for him, he was unfortunately killed in a car accident. It had transpired that Mr Manyonga was not reporting because he was using the illicit drug Methamphetamine (Tik).

The Chairperson reported that she had taken it upon herself to visit the family of Mr Manyonga’s deceased coach. She met Mr Manyonga, who was in mourning, during this visit and had arranged for him to be processed by the South African Institute on Drug free Sport (SAIDS). Ever since, she had been in contact with Mr Manyonga’s new coach to follow his progress after returning to training, but she would further brief the Committee on more developments at the conclusion of the meeting. She asked the Committee to discuss the way forward in following Mr Manyonga’s progress and the scourge of illicit drugs in South African communities seeing that Sports and Recreation South Africa(SRSA) together with SAIDS had discovered where the supply of Tik came from in that community.

The Chairperson informed Members that a Netball team from the Vaal that was travelling to Cape Town to participate in the national tournament was involved in a vehicle accident and one of the players was seriously injured and still in a serious condition in hospital. That player had been paralysed by the accident though she was still alive. The Chairperson indicated that even though she was planning to go and see the player the Committee was also invited to do so, but that issue would also be discussed at the end of that day’s proceedings. 

An additional matter to be added to the agenda was a report by the Management Committee (MANCO) on the Committee’s strategic plan. She asked the Committee to adopt the amended agenda.

Mr S Ralegoma (ANC) moved that the amended agenda be accepted as was.

Ms B Dlomo (ANC) seconded the motion.

Mr M Filtane (UDM) also supported the motion.

The amended agenda was adopted. 

Mr Ralegoma noted that there was concern over one of the Committee members appearing on National Television (TV) speaking as if they were representing the Committee.

The Chairperson thanked Mr Ralegoma for reminding her about this issue. The Committee had given no individual member of the Committee the mandate to speak to the media on its behalf. Part of the reason why the South African Football Association (SAFA) had been invited was to brief the Committee on the developments prior and during the new broadcasting deal that it was negotiating.  She had been fielding phone calls from the rest of the Committee about Honourable Malatsi’s appearance on TV, with Members enquiring if he was representing the Committee in his utterances. In her view, Mr Malatsi had been speaking to the South African Broadcasting Cooperation (SABC) in his personal capacity and not as a representative of the Committee. 

Mr Ralegoma said that this sort of thing could possibly hamper the work of the Committee. The Committee therefore needed to agree that the Chairperson would be its spokesperson. It was of course acceptable for Members to speak in their personal capacities when engaging the media. 

Mr S Malatsi (DA) said it was important to acknowledge that as much as the outcome of Committee discussions were reflective of the deliberations within the Committee, there was no legislative barrier stopping individual members from having opinions on specific matters, especially if members clarified their capacities when articulating those positions. He had addressed the media as s DA politician and had stated his party’s view on the matter. Any particular view expressed by partisan individual members of the Committee need not be viewed as going against the spirit of the Committee, because the Committee could and would not always be able to give permissions to differing views on partisan opinions. 

Mr P Moteka (EFF) said that that particular discussion point was delaying the proceedings as it had not been on the agenda; moreover if Mr Malatsi had not spoken on behalf of the Committee, he did not see any problem there.

The Chairperson said that she noted Mr Moteka’s position and that the Committee would shelve the discussion on Mr Malatsi. 

Adoption of Committee Minutes dated 23 of July 2014

The Chairperson tabled the document for consideration. She took the Committee through the document page-by-page and asked Members to make comments where necessary.

Mr Malatsi noted that the minutes were missing a substantive amendment relating to the National Lotteries Board promising to provide a detailed breakdown of funding provided to Sports Federations.

Mr Moteka noted another substantive amendment.

Mr Ralegoma moved for adoption of the amended minutes.

Mr Malatsi seconded the motion

The minutes were adopted with amendments.

Briefing on 2013 Africa Cup of Nations (AFCON) & 2014 Africa Nations Championship (CHAN)

Mr Lucas Nhlapo, Vice President, SAFA, introduced the delegation that was present as at that time because they currently were not all there.

Mr Mvuzo Mbebe, Chief Executive Officer (CEO), Local Organising Committee (LOC), briefed the Committee on the process of hosting both the AFCON & CHAN tournaments. He said that Mr Nhlapho, Mr Dennis Mumble and Mr Andile Ndengezi were all members of the LOC board of directors. SAFA and the government had agreed to set up the AFCON Non-Profit Cooperation (NPC) LOC to organise both tournaments.  

The LOC had employed competent people to organise the events. Only experts from all the required fields were utilised to successfully host the tournaments. The Department of Tourism had indicated that 40 000 visitors had attend the AFCON tournament.

Discussion

The Chairperson noted that the briefing by Mr Mbebe was overdue so that the Committee could provide oversight. She noted that the NLB had reported that it had provided financial support for both tournaments in the region of about R120 million. She was satisfied that the NLB had been mentioned as a separate stakeholder.

Ms D Manana (ANC) wanted clarity from Mr Mbebe on SAFA’s new broadcasting deal.

The Chairperson replied that this question should be posed after the SAFA briefed the Committee on the matter later on.

Ms Manana indicated that she would leave the rest of her questions for after the SAFA presentation on the new broadcasting deal. 

Mr L Ntshayisa (AIC) asked about the promises that had been made during the 2010 Soccer World Cup (SWC) to provide financial assistance for grassroots level soccer teams in rural areas. In his view, these promises had not been fulfilled. He was aware of this because he was a director of a grassroots football team.

Mr M Mabika (NFP) asked whether there was any provision made for the Committee to do oversight during those types of tournaments. Was it an objective of the LOC to have surplus or profit from NPC? Considering that the performances of the National Team sometimes hinged on players demanding better pay, could the LOC clarify how profits weighed in and were more important over the performance of Bafana Bafana.

Ms B Abrahams (ANC) asked if the LOC kept a database of the volunteers so that they could be used for future events. How many volunteers had been recruited and what was the breakdown of the R9 million spent on those volunteers? What happened to the SAFA infrastructure after tournaments were completed? Of the R25 million grant from SRSA for public mobilisation could the LOC provide a breakdown of how the total expenditure on public mobilisation was incurred? 

Mr D Bergman (DA) commented that citizens were more unified behind domestic football rather than the national team and that the mandate of the Committee, with all the sports fraternity stakeholders, was to get citizens behind Bafana Bafana. If AFCON was to be taken to be a similar tournament as the SWC, then the same infrastructure and marketing, such as fan parks and giving away tickets in bulk to schools would go a long way in avoiding the drop in sales and attendance during such tournaments, after the national team exited those tournaments. Currently when one wore a Springbok or a Proteas jersey there was an attendant pride that came with that from the players. Soccer players being unable to play because of minor discomfort did not set a good example for supporters of the national team. Instead of only looking at TV revenue, he saw the soccer fraternity working together to access other revenue stream like those fan parks 

Mr Malatsi wanted clarity on the ticketing issue for AFCON where there were tickets unaccounted for and what the cost of those was. Moreover what were the issues with the guarantees from Telkom and the R30 million telecommunications services bill for the AFCON?

Mr Malatsi asked the delegation to try to send the Committee its presentations or documents in time so they could be interrogated properly by members before meetings. 

Mr M Filtane (UDM) said that when the state granted money, the expectation was that there would be social change brought about from that funding. Until that featured significantly in a report then there was little that the people of SA could be proud of in an event that would have been financially supported by the government. It appeared as if most of the events were concentrated in Gauteng and KwaZulu-Natal (KZN). It was important that this be extended to other parts of the country. What was the breakdown of artists used to perform in those events, and from which provinces? That spoke a lot to why Bafana Bafana had little support in the country because very little linked it to other provinces except the two mentioned above. Lastly, he asked about the interest of the different board members.

Mr S Mmusi (ANC) noted that the LOC seem to have failed to prepare for what would happen should the National soccer team exit the tournaments in the early stages. There needed to be contingencies for such occurrences both from an LOC perspective and from SAFA as well. What did the LOC do for disabled people around those tournaments? Who owned the National Stadium and who was responsible for its maintenance?

Mr Ralegoma noted that the country hosted tournaments because it had the infrastructure and it was troubling to have a bad performing national team. That needed to be worked on because it was unbecoming to host, but have a mediocre performance. He wanted the actual costs breakdown from municipalities, which went to hosting the events.

The Chairperson wanted a report on the municipalities that owed the LOC money. In addition, she noted that there was a possible conflict of interest relating to Mr Ntshayisa’s soccer team and asked the Committee to deal with that at the end of the meeting.

Mr Moteka complimented the LOC for the successful hosting of both AFCON & CHAN and noted that the children of SA in remote rural areas could not feel the same pride in terms of those successes. Therefore SAFA had to try and involve them so that legacies were left behind after those competitions were completed. He noted that the LOC board was full of Cabinet members and that when they were constituted they needed to be non-partisan.  SAFA really needed to focus on its junior leagues so that Bafana Bafana could become a better team, because those were the feeder into a better national team. 

Mr Mbebe said that the presentation was a summary of a full annual board report that could be accessed. He agreed that a lot more could have been done, but the LOC had little time to plan for legacies as well. He was not excusing the failure of the LOC to have more tangible legacies, but time had been against it. He asked to be excused from responding to issues surrounding Bafana Bafana, because SAFA was the responsible authority, whereas the LOC was responsible for the tournaments. The LOC had never asked, nor had it received R120 million from the NLB, rather it had received R8.5 million for the AFCON and R17.7 million for the CHAN and there were audit certificates too attest to those amounts. Therefore he could not speak to the amount of R120 million because he was not aware of it. 

Mr Mbebe explained that the agreement was that the LOC would give tickets over to SRSA and it would in turn provide tickets to all state institutions, including the Committee.

Ideally when a company was given a mandate to run an event, there was always a need to break even or to make a profit. Moreover, the country could not afford to give an impression that it could afford to run an event whereas it could not. The profit that accumulated out of hosting an event had to go towards the development of the sport going forward. That profit was never to be turned over to SAFA for the payment of Bafana Bafana because they were not the responsibility of the LOC. 

Mr Mbebe stated that there had been about 2000 volunteers for the AFCON in each host city and about 1000 for the CHAN. The amount spent on volunteers was for mostly a R200 stipend for each day a volunteer was at the stadium working, transporting volunteers from their place of residence to the venues, their branded clothing and their feeding as well.

Marketing went under public mobilisation; the draws and the activations of the mascot. There had been a desire to establish fan parks, but there simply had been not enough time or the resources to do those, as a result that had been given over to the provinces and host cities to fulfil.

At the time of the 2013 audit, the LOC was not happy with the report that it had been given by the ticketing company. At the end of the audit however, the LOC was satisfied with the accounting of the tickets that had not been accounted for during the audit, because it had been found that those tickets had been duplicated in print but had been accounted for as additional tickets, instead of duplicates that were supposed to have been cancelled through thorough backward auditing.

The LOC had been informed that the telecommunications matter was between Government and Telkom and as far as it was concerned that burden had been removed from its shoulders. 

Mr Mbebe acknowledged that the social changes were not to the extent that was intended and there was no coherent report on that, even though the volunteer corps internships and small companies in the diaspora which were targeted did however benefit. 

Indeed the artists used for both tournaments’ opening and closing ceremonies were mainly from the host cities rather than across the country and that was an issue of time constraints and resources, though that was not an excuse. 

The agreement between SAFA and the State was that each would appoint board members in a 13:9 split respectively. Moreover SAFA would appoint an additional member of civil society where the state would add another five members from civil society on top of the nine it already had as well. The LOC received an already constituted board of directors. Mr Mbebe then listed the various interests which particular directors on the board represented. 

The LOC had anticipated Bafana Bafana not lasting long in the CHAN and had campaigned accordingly because it had exited early in the AFCON as well, but there had been no drop in ticket sales then. The Western Cape really had disappointed the LOC because during the AFCON, stadiums were full irrespective of which countries were playing. Similarly Limpopo and the Free State had also not bought tickets, to the extent that the LOC had to give away tickets to ensure that the stadiums were filled. 

In so far as the disabled were involved in the tournaments, there was minimal recruitment amongst them even as volunteers. The LOC had tried to accommodate them in that access was there, but there was no significant effort to get them involved.  

The National Stadium was owned by the Department of Public Works (DPW) and it was leased to the City of Johannesburg for 99 years. The FNB had the naming rights to the stadium.

Indeed a comprehensive report of how much funding had come and from which state institution was needed, but the LOC understood that such a report was the responsibility for SRSA. The LOC would enquire if that report had been prepared for both tournaments.

The LOC would summarily provide the Committee with the total that was owed to it, by the municipalities of Rustenburg and Nelson Mandela Bay respectively. 

Mr Mbebe thanked the Committee for its support during its engagement with the LOC. He added that even though it was winding down, the LOC would submit recommendations to SAFA, the Committee and the SRSA, as there were critical issues that needed to be observed for future references in terms of hosting tournaments of a similar nature. 

The Chairperson told the Committee that there would not be another round for questions and suggested that the Committee should deal with the presentation on the process followed for the broadcasting deal. She thanked the LOC for its briefing to the Committee. She expressed concern about the long period leases that DPW was granting municipalities. 

Engagement with SAFA

Mr Denis Mumble, SAFA CEO introduced the SAFA delegation that had just arrived with the SAFA President.

The Chairperson asked again whether members agreed to have SAFA’s new broadcasting deal briefing before any of the remaining presentations.

Mr Filtane asked why that agenda point needed to be prioritised over the others remaining.

The Chairperson replied that she suspected that some of the most contentious issues the Committee had, would be responded to by that briefing.

Mr Malatsi moved to adopt the motion to deal with the process of appointing a new broadcaster first.

Mr Filtane seconded that motion.

Process that was followed, broadcasters that were considered, and terms of SAFA’s new or pending broadcasting contract

Dr Danny Jordaan, President, SAFA, said that the entity had appointed Ernst and Young (EY) to assist it with a turn-around strategy and that its representative would report on that and Mr Mumble would report on what was happening in football across the country.

Dr Jordaan said that the reality with broadcast rights in SA was that the total revenue for rugby for 2013, from those rights was R759 million and that its broadcast revenue as far back as ’95 to 2005 was already $555 million with News Corp for the SANZAR (South African, New Zealand and Australian Rugby) board. When rugby renewed that contract with News Corp for 2006-2010, it was for $323 million, the current contract for 2011-2015 was $437 million which was about R4.3 billion after conversion. The Premier Soccer League (PSL) recently renewed its contract with SuperSport for about R2.2 billion a year, whereas cricket had also signed a deal in Dubai for $202 million and SAFA had only a R27 million deal for 2013. SAFA’s total revenue from broadcasting was at R53 million, that left one wondering as to the reasons behind that. Notably, that was a result of SAFA’s commitment to the free-to–air broadcaster. The SABC had been told by Dr Jordaan that whilst it claimed the poor to be its viewers; those were the very same target for SAFA as they followed and played football. Therefore no one could tell SAFA what was in the interest of its members, because SAFA had long before been sacrificing even before the regulations around listed events came out. The fact that the Government had signed the International Telecommunications Protocol and the migration from analogue to digital TV had created a space for new broadcast players. One of those was SIYAYA TV and the broadcast landscape had changed in SA because of that legislation and migration. SAFA had to look at new revenue opportunities for football and to secure the interests of its free-to-air viewership members simultaneously.

Dr Jordaan stated that having to brief the Committee on that deal at this time was a consequence of a media leak. SAFA still had an existing contract with the SABC, which would end in April 2015, when it would renegotiate with the SABC. Moreover nothing would happen from then on until the date of commencement of the legislation governing the migration. The impression had been created by the media was that from 20 August 2014, there would be no soccer on SABC anymore but SAFA had communicated with the SABC that it was its responsibility to dismiss that lie. Secondly, it had been alleged that SAFA would be denying the poor of their right to view soccer whereas in fact no one was more aware than SAFA of its commitment to ensure free-to-air football, because when it came to Banyana, the under-17 and under-20 games, SAFA paid for production costs over and above free-to-air- to both Supersport and the SABC to broadcast those games, and there was an auditable trail for what he was saying. The net amount for football therefore was far less than what SAFA received. Compared to rugby and cricket, he asked why the country had been quiet when those codes had been signing deals outside the country since ’95, why had it been quiet concerning the PSL as well. Why was it that when SAFA was entrenching its commitment to free-to-air viewership it became an issue?  The Independent Communications Authority on sport broadcasting regulations provided for free-to-air-TV even if an entity was a subscription broadcaster therefore the poor could not be denied viewership even if they were not subscribers; especially international games. 

Dr Jordaan confirmed that SAFA had signed a contract with SIYAYA TV and for the first time it would have true value, because if rights were paid to SA football for R50 million a year why would someone else offer R200 million for the same rights? It was quite possible that for the last 22 years Bafana Bafana’s rights had been undervalued, did that then mean SAFA had to calculate back the loss of R150 million a year for the last 22 years and claim it? That unfortunate outcome was based on an Apartheid calculation to devalue football in SA because in the past soccer was on SABC 3, whereas SABC 2 & 1 carried cricket and rugby. SABC 3 only paid R100 000 for any sport whereas the other two channels paid millions to the sports they broadcasted. SAFA had simply addressed that historical gap and had committed no wrong in signing a contract with SIYAYA, because that would not deny its members the right to broadcast. SAFA did however, have the responsibility to correct those past imbalances.  SAFA was apologising that it could not have briefed the Committee on the deal before those media developments because even after the articles had been published it had to rush to reassure and ask both SIYAYA and the SABC to make statements to clarify those matters to the public. All Bafana games would still be carried by the SABC and as such there was no crisis and he hoped that his account would have clarified the issues around the SIYAYA deal.

Discussion

The Chairperson said that when media houses sprung surprises on the sports fraternity in the country, sporting bodies needed to accept that the Committee would always first need to be briefed by those federations before it made any statements. She reiterated that she was the Committee’s spokesperson, therefore for future references members needed to guard against making statements on issues that came from the media without first having been briefed by sporting bodies in Parliament. 

Mr Filtane said that it was acceptable for SAFA to report verbally at this moment, but a written report would be a much better account on the issue under debate, because interpretation of such an account would differ individually whereas a written report would ensure a similar general understanding. What steps was SAFA taking to ensure that after the current SABC contract had lapsed and that free-to-air soccer would still be provided for going forward? It was a marketing norm that when one made his commodity scarce its value increased tenfold therefore SAFA had to look at that element as well, because possibly people had come to take things for granted for far too long and had come to expect far much more than they were prepared to sacrifice for. Stadia were half full and currently there was a fight for people to have the right to view at home, the question then remained as to whom were the sporting federations preparing that nice cake for?  The legal unit of SAFA possibly would have to step in and assist SAFA to avoid a situation where the poor could be denied the opportunity to view.

The Chairperson interjected and informed Members that Dr Jordaan’s presentation was part of the package that was distributed to them,

Mr Bergman noted that the sports fraternity in the country needed to investigate why the SABC involved broadcast deals always landed the broadcaster and its partners in embarrassing conditions. The paradox when comparing football to rugby and cricket was that stadium attendance for the latter two was dwindling whereas TV viewership was increasing, when it came to soccer the opposite was happening. 

Mr Bergman further noted that from a marketing perspective households were a target advantage for both rugby and cricket because when it came to competitiveness  they were in good standing in world rankings and that could not be said of Bafana Bafana. Giving the current national coach a longer term to get the team in a better position internationally and negotiating better broadcast deal could possibly make soccer as a commodity more golden in the long term, but that also needed proper consideration because if there was going to be free-to-air on a digital channel, and noting all of SAFA’s concerns; how else could the soccer fraternity make soccer more accessible? The fan parks he alluded to earlier was one way of comodifying soccer, whereas memorabilia like stickers and playing cards were another way as well. Moreover the current pricing of PSL club apparel made it more of a commodity than Bafana Bafana and of course the National team apparel needed to be just as accessible, but all those were expensive for school children to be wearing. Roadshows also needed consideration in bringing the team closer to the nation, cheap season tickets for students or designated civil groups was another way of making soccer accessible for the nation. Lastly, he complained that he was not in favour of the Committee always getting information last.

Mr Moteka noted for clarity that comparing grassroots developmental soccer and the current broadcasting deal, what were the benefits accruing to that level of football? 

Mr Malatsi wanted clarity on what transpired leading up to the deal with SIYAYA TV because the Committee understood the setbacks in having soccer broadcasted by the SABC. Prior or during the negotiations with SIYAYA where there any other broadcasters that SAFA had considered and what was the outcome of that exercise? Did SAFA only prioritise monetary value in settling for SIYAYA? 

Mr Ralegoma noted that the contextualisation as presented by Dr Jordaan should not be lost in debating the issue of the new deal. The Committee was still speaking about transformation because rugby and cricket had been paid more than soccer for a long time and that apartheid legacy was still very much entrenched. Sponsorships were still along apartheid lines. Important for him was how the national team could become competitive and sustainable going forward because SAFA was currently dependent on the South African Breweries brand (Castle) whereas Parliament was likely to deal with legislation purporting to remove both alcohol and tobacco advertising from public spaces and TV. That was going to have a direct impact on sporting federations because already Boxing South Africa (BSA) had been the first casualty of such moves, whereas rugby and cricket had been protected from the adverse effects of such proposed legislation. The point by Dr Jordaan that soccer had been deliberately undervalued was taken well by the Committee which was why it had not spoken to the media before that briefing on the SIYAYA deal, because SAFA had a right to find new revenue streams and that included satisfying the Committee with reports of how it was going about that. It was unacceptable not to interrogate the disparities in broadcast rights values as mentioned by Dr Jordaan because that lack of resources affected sports development adversely in rural and township schools, as compared to advantaged schools.  The Committee needed to agree that all federations had the right to decide on how to be competitive and sustainable, and that when engaging them after they had reported to the Committee, that context had to be kept in mind. He advised that the Committee should wait until SAFA had concluded its deal and then invite it to come and account. 

The Chairperson told the Committee that because of time she would grant Dr Jordaan very little time to respond because there were still other presentations that were outstanding. Moreover the Committee needed to avoid being afraid of challenging apartheid legacies and that the issue of vetting members of Parliament (MPs), Department officials and others needed to be seriously interrogated because media leakages were simply unacceptable. The Committee needed to avoid debating leaked media reports.

Mr Bergman said that members of the Committee could not speak as individuals when addressing visitors of the Committee; moreover they could not predetermine or condition what could be asked of visitors because everyone was trying to redress the same injustices of the past. 

Dr Jordaan replied that there were substantial documents which spoke to everything he had said.

The broadcast regulations specified that the SABC could not be excluded from the SIYAYA deal because it was a free-to-air broadcast entity. 

SAFA noted the point on marketing and would see how the stadium attendance would be when Bafana Bafana played their first game under its new coach in Cape Town and where thankful for the ideas.

Dr Jordaan expressed hope that when the SAFA finance report is tabled and when the CEO reported on SAFA’s development work it would become quite clear on who benefitted from the SIYAYA deal and the great need for funding to support that work.

Dr Jordaan informed Members about an under-19 boy from Northern KZN who had had a three sided corrugated iron dwelling, with a blanket as all his worldly possessions. That boy was part of the National under-19 team and was living at the SAFA Soccer Academy. That was the kind of role and transformation that football could bring to those youngsters from the under-17 through to the under-19 national teams and that was SAFA’s commitment.  Moreover no one in the SAFA management was getting commission. They did not have a work credit card or petrol cards and did not get a consistent monthly salary. He was adding this information to refute rumours about purported maladministration at SAFA House.  

There were a number of broadcasters that had applied for broadcast licences, but their business models differed. Some would emphasise sport, whilst others had different programming, but SIYAYA had a major focus in sport in terms of the money it had allocated to sport, which was why SAFA had chosen it. The only comparable players with SIYAYA were the existing partners that SAFA had, namely SuperSport. SuperSport only offered SAFA R7 million whereas SIYAYA was offering R175 million and that was mostly because SuperSport was only interested in Bafana Bafana and SIYAYA was going to cover Bafana Bafana, Banyana Banyana, Under-23, Under-20, Under-17, Under-15 because it was programme based. The SABC could not cover all this because it had different programming competing with soccer, which was why there were delayed live matches. That unfortunately affected sponsorships because commercial partners wanted to see their boards at the stadium live. If that was not happening they would not pay. He could not disclose more detail around that contract as there were confidentiality issues as well.    

Dr Jordaan suggested that the Committee possibly needed to hire two helicopters and fly over Cape Town and look over the schooling landscape. If they saw a school with ten fields, two school buses and proper windows then they should know that those were rugby and cricket schools. A school with broken fences, no sports fields, broken windows and no school bus, then those should be identified as football schools. The best resourced schools in SA did not offer football and SAFA had even engaged Dale College from the Eastern Cape where most of the professional cricket and rugby players came from. SAFA had to first put up infrastructure in those disadvantaged schools before getting soccer going. That apartheid policy of the private well off schools not playing football remained intact even though the schools populations had diversified over the years. He could even provide a list of junior ranking soccer players that had been recruited by those elite schools that had come out as rugby or cricket players .When SAFA had asked Dale College when footballers would be produced from that school it had been told that it would have to fund that football programme itself.  

The Chairperson said that the Committee still had an outstanding meeting with the Minister of Basic Education (DBE) to discuss some of the curriculum issues that were affecting football development and other sports adversely. She added that whatever follow up questions members had would have to be combined with the discussion on the SAFA finances.

Presidential Report On behalf of the SAFA NEC Period September 2013 to June 2014
Mr Mumble said that the SAFA Chief Financial Officer (CFO) and the EY representative would take the Committee through the finance section of the Presidential report. 

Financial Stability
Mr Gronie Hluyo, CFO, SAFA, took the Committee through the financial statements. He said that the statements had been audited even though they had not been approved by SAFA’s National Executive Committee (NEC). The presentation contained some information and not the entire Statements report because it had not been approved yet, even though the audit and finance standing Committees within SAFA had approved those statements.

SAFA’s auditors had found that its financial statements presented fairly in all material respects the consolidated and separate financial positions of SAFA ending 30 June 2014, and its consolidated and separate financial performance and cash flows for the year, then ended in accordance with international financial reporting standards. SAFA was quite satisfied that it had received an unqualified audit opinion.

Mr Jaco Van der Walt, EY Partner, took the Committee through financial statements comparison between cricket, rugby and soccer. From those numbers it could be seen that SAFA had the least revenue from 2012 right through to 2014, even with sponsorships the situation was the same.
 

Discussion
The Chairperson allowed members to engage both the financial report and stated that the match fixing presentation would also be entertained. Moreover she pleaded with the Committee to arrange that a visit to that netball player from the Vaal who had become paralysed through a vehicle accident on her way to a netball tournament in the province.

Mr Filtane asked what percentage of the SAFA expenditure had been audited. What used up most of SAFA’s funds post 2010? Was there a policy governing how reserves were used when SAFA was in trouble? What was SAFA’s risk management policy in terms of its finance?

Mr Malatsi asked if the financial statements as they were had provided for the establishment of provincial soccer academies. What was the latest in the SAFA House transfer of ownership from the state to SAFA? 

Ms Abrahams wanted to know how the 2010 International Federation of Association Football (FIFA) legacy fund was managed and who the beneficiaries were.

Mr Ralegoma wanted clarity on the issue of left over infrastructure, specifically busses from 2010 which apparently were parked at SAFA house.

Mr Hluyo replied that KPMG had done a very comprehensive audit and that all SAFA’s expenses had been audited. 

He said that the bulk of what was revenue for 2010/11 were actually assets that SAFA had received from the World Cup Organising Committee (WCOC) and FIFA and not cash. 

The reserves accounted for in the report were reserves in the manner of accounting reserves and not reserves in the way of investments. They were assets minus total assets, minus total liabilities where the net result would be an accounting reserve. In terms of the cash SAFA had, the FIFA Legacy Trust was a separate entity and therefore the reserves mentioned in the report were as explained above.

SAFA had an internal Audit and Risk Committee as part of its risk management policy. 

SAFA had received 35 Hyundai busses as assets from hosting the 2010 SWC. It had sold about 22 of those busses and the remainder were given to the Southern African Football Associations from neighbouring countries as part of the SWC legacy. Swaziland, Lesotho and Mozambique had already received their busses and SAFA was continuing to distribute the remaining ones. 

Mr Mumble said that the busses that had stayed at SAFA’s yard for a while were there because the Association was dealing with technical challenges with the South African Revenue Services (SARS), in their distribution. The busses were currently being borrowed by their recipients and had to be returned to SA which was why they would be seen at SAFA house from time to time, that was the situation just until the challenges with SARS had been concluded.  Five of the busses would be kept by SAFA for use by the national teams and their opposition teams when there were home games. The Minister of Sport had agreed to make representations to the Minister of Finance on behalf of SAFA in resolving the issue of the distribution of the busses.

SAFA had previously told the Committee of its intention to own the land on which SAFA House had been built as well as the stadium. The DPW stadium lease of 99 years was to the CoJ which had appointed a commercial management company to manage the stadium. Part of the commercial arrangements was the sale of naming rights to the stadium that FNB had acquired, which was why the stadium was called FNB. The stadium had been built in 1988 through a partnership of commercial companies together with the National Soccer League. In the early 2000’s SAFA had negotiated a deal as part of the SWC bid to acquire FNB stadium and to make it a centrepiece of its SWC bid. It had spent about R330 million in its two combined bids for the SWC. Moreover SAFA had a R500 million equity built into the stadium therefore SAFA had to part with about R830 million as part of its investment into bringing the SWC to SA. The expectation then had been that SAFA would receive some kind of equity in some of the venues that had been built for the SWC. That had not happened and SAFA had to inversely give up its stake in the FNB Stadium in exchange for Government to complete the refurbishment of FNB and it had done so without qualms. Part of the expectation however prior to the FNB issues, was that SAFA would build its headquarters at the stadium precinct. Ownership of FNB had not occurred even though SAFA had engaged a few Ministers over the last few years, therefore it hoped that in the next financial year it could complete that process since the President of the country had engaged the Minister of DPW on that issue. Of course SAFA would appreciate any assistance from the Committee in that respect.    

The Chairperson asked the Committee if it was possible to invite SAFA again so it could finish the rest of the remaining presentations as there would be no time for it to finish all of them, especially since she had read that the legacy trust had R450 million. She would allow SAFA to address the match fixing issue before adjourning the meeting and that whatever questions members had needed to be concise.  

Dr Jordaan asked for permission from the Committee to play a short video clip that would speak to development programmes that SAFA was running. The legacy trust had a separate bank account and he listed the directors of that trust. The Trust had been dedicated to soccer development and tertiary bursaries; since education was one of the major challenges for footballers. SAFA would be producing its first batch of MBA graduates at the end of 2014. Currently the legacy trust had R430 million left even though SAFA had spent R73 million and that mainly was because the R73 million was interest accumulated through the trust. SAFA would give a detailed report on how the trust was used for football development.

Briefing on Match Fixing

Dr Jordaan gave the Committee the Wikipedia encyclopaedia definition of match fixing. Club owners were normally the beneficiaries in match fixing and SAFA would ask its head of security to take the Committee through the presentation on match fixing.

Mr Mlungisi Ncame, Head of Security, SAFA, took the Committee through the presentation. He said that the people from FIFA who had conducted the investigation left that body immediately after submitting their report to FIFA. As a result SAFA could not get any update on how far FIFA had gone in processing that matter despite SAFA repeatedly requesting an update on the matter as it was quite concerned about the delays in finalising of that matter. After giving the report and other documents to the South African Police Services (SAPS), SAFA had also requested it to travel to Hungary to interview Mr Winston Raj Perumal who was the leader of the match fixing ring and the SAPS had not updated SAFA since then. He could not speculate whether the delays were because the investigation was encompassing more than 80 countries globally or otherwise. SAFA had told FIFA it was ready to receive them in SA should they want clarification on any of the documentation handed over to them. FIFA had replied that it was satisfied with the documentation and would contact SAFA should it needing anything further.

The Chairperson noted that it seemed that the ball had shifted to FIFA as far as match fixing was concerned, but the Committee appreciated the report because it had been worried. The Committee would request FIFA to come and account to the Committee.  After she had been told that FIFA could not be called to Parliament she suggested that the Committee should remain so that it could discuss a way forward on the FIFA delays. Moreover, SRSA in all its reports to the Committee had not briefed it on the new developments concerning match fixing. 

Dr Jordaan said that SAFA would certainly support a call by the Committee for FIFA to come and account for the delays on the match fixing issue.

The Chairperson said that from previous experience, there was an auditable trail to trace where the correspondence was coming from. She allowed members to engage the presentation.

Mr Malatsi said that the Committee could decide on a way forward seeing that it had been provided with clarity by SAFA. It should therefore write to FIFA to come and account for the issues around match fixing, considering whatever counsel it would receive from the content advisor, but it would be disingenuous to accept that FIFA could not be summoned without knowing what the barriers to that were.

Mr Filtane noted that there was not even one wholly owned African company in the sponsorships that SAFA had. The state repeatedly claimed that it created business opportunities for Africans, but in the same breath the Committee was told that it was Africans that did not own decoders to watch soccer matches that they needed to watch. Strangely, there was no movement between the poor and the rich to come together to help one another, maybe SAFA needed to investigate that issue. The biggest problems that members had identified in schools sport were teachers that were not interested in doing sports after hours. That was why he believed that the Minister of Sport should leave those teachers and rather contract professional trainers to do that duty, because if a constant flow of sports persons did not come from schools sports in the country would suffer. 

The Chairperson said that that mandate also applied just as well to Mr Filtane as well.

Mr Mmusi said that as far as he knew FIFA were quite self-important. The match fixing saga had been reported to the previous Committee, which he was part of. He had hoped that Mr Ncame would give a more detailed account of what had happened in SA in terms of that issue.

The Chairperson said that the Committee was glad that SA sports had received so many medals in Glasgow but the Committee would focus on transformation of sport quite stringently as some of the members had given historical accounts of what had happened in sports with the previous regime. It was unacceptable that the status quo remained 20 years after ’94. The Committee would assist anyone who wanted to develop rural and very women focused sports.

She said that even SAFA needed transformation as there were no women represented by the delegation before the Committee.

Dr Jordaan said that SAFA would get its female management to come next time it had to account to the Committee.

The meeting was then adjourned.