Boxing SA’s Annual Report: briefing; Committee Annual Report & 2006 Draft Programme: adoption

Meeting report

SPORT AND RECREATION PORTFOLIO COMMITTEE
15 November 2005
BOXING SOUTH AFRICA’S ANNUAL REPORT: BRIEFING; COMMITTEE ANNUAL REPORT AND 2006 DRAFT PROGRAMME: ADOPTION

Chairperson: Mr BM Komphela (ANC)

Documents handed out:
Boxing South Africa presentation
The Fighter October 2005 edition

SUMMARY
Boxing South Africa presented a report on its activities during 2005. The Annual Report was not tabled, as the Auditor General was not satisfied and was still busy compiling his report. Challenges facing the sport were outlined. Measures to promote the sport were described. Members asked questions about how the welfare of boxers could be ensured both during and after their careers in the ring. Members also posed questions about shortcomings with television coverage; and also questioned the life-skills training on offer to boxers. Following the presentation, minutes of recent meetings and the Committee’s Annual Report were approved. An outline of the Committee’s program for the first quarter of 2006 was submitted.

MINUTES
The Chairperson stated that the Office of the Auditor General (AG) had not yet finalised its audit report on the Boxing South Africa (BSA) financial statements for 2005. BSA would have to return to the Committee in 2006 after the AG’s report had been received. The crux of the annual report was so that the Department could sanction certain amounts of funding. The AG would release an opinion as to how aspects of the Public Finance Management Act (PFMA) had been observed by BSA. This should happen soon. He also observed that the new Chairperson of BSA, Adv Mpofu, had been called away to accompany the Minister to the Arts Festival.

Mr Krish Naidoo, General Manager (GM) of BSA, introduced the leader of the BSA delegation, Ms Stompie Xulu. She introduced the other member of the delegation, Ms Nontembiso V Magwaca, a Board member. Mr Sakhiwe Sodo, another Board member, joined the delegation during the course of the meeting.

The Chairperson introduced the Members of the Committee. He also introduced Mr RG Pieterse, a Member of the Portfolio Committee on Communications.

BSA presentation
Mr Naidoo presented the new Board. In response to a question from the Chairperson, he also gave the geographical distribution of the members. The Board consists of Adv D Mpofu (Johannesburg), Ms Xulu (Mpumalanga), Mr P Ngatane (Transkei), Ms Magwaca (Cape Town) and Mr A Norman (Johannesburg). There was one vacancy, as a member who had taken out a promoter’s licence had resigned to avoid any possible conflict of interest. Mr Archie Jonas (Free State) had not been re-appointed after his term had expired. He had been appointed by the previous Minister.

Mr Naidoo said that the Board had met in East London the previous weekend, where a Mission and Vision statement had been formulated to cover its term of office. Arising from this statement, the Board had set itself some goals. These were:
While regulating the sport, care should also be taken to balance the previous imbalances.
-To provide entertainment.
-To provide employment.
-To create role models.
-To establish boxers as ambassadors.
-To maintain financial viability.

Mr Naidoo said that there were a number of challenges. The first was to comply with the Boxing Act. A Chief Executive Officer (CEO) was to be appointed. The Board had conducted interviews with a number of candidates, and an appointment was imminent. BSA also had to formalise its structures. Salaries and job portfolios had to be determined. The question of whether provincial or national competencies should dominate had to be resolved. The Minister had approved the new structure in July 2005. Provincial representation was important, and representatives had been appointed. These posts would be included on the organogram. Current staff was on contract until 31 January 2006, while a consultant was busy compiling job profiles.

The second challenge was a financial one. Mr Naidoo said that R3.3 million had been received from the private sector, in particular from the sponsorships provided by the SA Broadcasting Corporation (SABC) and Distell. R500 000 had been received from licence fees, which were R100 per person per annum. Sanctioning fees from tournaments had brought in R1.2 million, a government grant R1.4 million and the Lottery Board had allocated R750 000. The question of viability rested on the Board’s ability to find new sponsors, if needed. The licence fee was being kept low to increase participation, and the tariffs would be reviewed. Any appeal to the government for funding would be justified according to needs, and funding requests would be rightsised.

He said the third challenge was one of welfare. Boxing was regarded as a poor man’s sport. Recently, the Board had negotiated a full accident cover policy for boxers. Death and disability coverage for boxers injured or killed in the ring had been established for the first time in the country. Public liability insurance to cover spectators had been negotiated. BSA’s assets had been insured. A Boxing Foundation was being established which would offer financial advice. This was being registered. Operation Outreach had been launched. This was being driven by veteran boxers and would target mainly schools and prisons, where the sport was strong. Old heroes would be provided as role models. The outreach program would also look to increase participation amongst minority groups.

Mr Naidoo said the fourth challenge was in training and development. R1 million was being spent on this per annum. A contract had been concluded with the High Performance Centre (HPC) at the University of Pretoria. To date, 20 promoters had been trained in aspects such as financial and project management. Courses had also been offered to 38 ring officials, 20 boxers (covering technical aspects as well as matters such as diet and nutrition), 10 administrators and members of the Board and staff (covering corporate governance). Four informal workshops had been held, and two more would take place before the end of 2005; these would be conducted in the Free State and Limpopo.

He said that the fifth challenge was the relationship with local and international organisations, in particular with the SA National Boxing Organisation (SANABO), the amateur sport body. In terms of the Boxing Act, BSA was mandated to liaise with all international organisations. There were three important organisations, and discussions had been held with the presidents of the World Boxing Council, the World Boxing Association and the International Boxing Organisation. Agreements had been concluded which would see South African boxers rated, help being given with training and participation in the KO drug program which would expand into Africa. A draft agreement had been prepared with SANABO, which would look to provide seamless delivery of top boxers. It was important to identify potential boxers early, with children of between seven and ten years being taken into development programs.

Mr Naidoo said that the sixth challenge was one of ownership. The Boxing Awards had been taken over by a private company, but ownership thereof had now been returned to BSA. The event would be run in partnership with the SABC. The boxing museum was located at NASREC. It was owned by Distell, but they were looking to transfer ownership to BSA. There was a possibility of taking over a museum in East London, and BSA was looking to the other provinces as well. In terms of broadcast rights, these were being negotiated directly between promoters and the broadcasters. BSA did not have any insight in these arrangements. Tournaments were not sanctioned by BSA, nor did they have any control over the money flow. A committee had been set up to explore the relationships between broadcasters, promoters and the BSA.

Dr Naidoo listed nineteen challenges over the last three years which had been met. Boxers and Trainers associations were being formed.

He then gave an overview of the 2005 Annual Report. The Chairman’s Report discussed the consolidation of the administration process. Ten organisations had been running the sport in South Africa, but a unitary administration had now been achieved. This section of the report also touched on the relationships between boxing and television, transformation issues, accountability, the BSA foundation and hand-over issues.

The General Manager’s report dealt with the systems and procedures that had been put in place, and the soundness of the administration. He discussed insurance for injured boxers, the relationship between boxing and television, the Boxing Convention resolution, and tournaments. The number of tournaments presented in the year under review had dropped from 92 to 72, but this was as a result of the tightening on controls. Safety factors included the upgraded instruction to have two doctors on duty at tournaments, the provision of sufficient exits and ambulance access points. The nearest provincial hospital had to be put on standby, with specific provision for neurological surgeons to be ready, and the nearest police station had to be prepared to deal with any emergency. He described four challenges. The first was to close the gap between the amateur and professional divisions of the sport, and BSA would work closer with SANABO on this front. Secondly, boxers had a lack of personal sponsorship. Thirdly, women’s boxing had shown to be a slow starter and needed encouragement. Finally, he bemoaned the absence of provincial championships.

Mr Naidoo then discussed the 2005 Financial Statements. A qualified report had been received for 2004, due to an incomplete correlation between funds received and licences issued. At that stage, provincial representatives had done applications. A separate bank account had now been established to deal with licence fees. In the past, concessions had been given to needy boxers in the form of deducting licence fees from the boxers’ purses. This was a pragmatic step, but had led to administrative problems.

He said the books for 2005 were still being audited. Statements had been submitted timeously on 31 May 2005, but they were subsequently withdrawn as BSA was made aware that they might be disclaimed. The statements were rectified and resubmitted on 27 September, and a second audit was completed on 31 October. There was a problem with the lack of internal controls. A committee had been appointed to exercise audit controls, including some outsiders. The committee comprised D Ntuli, A Norman, Adv Mpofu and M Tabala. Quarterly meetings had been held.

One of the correction measures had been to institute a segregation of duties. Payments were now prepared by administrative staff and then processed and controlled by the CFO. Dual control was in place. Reconciliations were reviewed and signed by the GM. The VIP payroll system dealt with all earnings and deductions, as well as PAYE matters. Separate accounts were held for BSA’s different activities. Quarterly budgets were prepared and expenditure was monitored. Internal audits were held for each tournament.

Mr Naidoo said that an effective administration was being created. Policies, procedures and controls were in place. The full staff of nineteen would be in place by early 2006. Compliance with time limits would be assured.

Mr Naidoo then discussed the Baby Champs program. Many boxers had fewer than four bouts in a year, and seemed unable to get fights on major tournament cards. Ten tournaments had been held across the country for these boxers, in which 168 fighters had participated in seven weight divisions. The finals would be held on the same day as the Boxing Awards for 2006. There would be at least two female bouts on the card. An incentive for the developing promoters would be that the best would be appointed to handle the finals. Boxers from this program would be in line for potential international exposure. It was hoped to increase the number of divisions catered for and the incentives.

As regards plans for the future, Mr Naidoo said that it would be necessary to regulate relations between the BSA Board and promoters. Agreements would be signed with international boxing organisations. A segmented approach to training and development would be followed, separating those boxers who needed specialised coaching and those who would profit from a more general program. Specialised training would be offered to different categories. The quality of tournaments would be improved. He also saw the need to enhance the popularity of the sport.

Discussion

The Chairperson said that the Committee was aware that office bearers served in a voluntary capacity, and that they did have other commitments. The Committee needed the leadership of organisations to attend these meetings as they were the policy makers. The Committee was not comfortable that the elected officials of BSA were not present. He said that it signaled contempt of Parliament if the elected leadership was not present. The Committee understood the reasons for their absence, but stressed they should make a better effort to attend the next meeting. He noted that the Annual Report was still incomplete, and that they needed to discuss the views of the AG when these were available. He would not pre-empt the AG’s report.

Mr DM Dikgacwi (ANC) said that the history of boxing should be preserved. He noted the case of an Eastern Cape boxer who had died, and his family had no money for his burial. Several ex-boxers lived in poverty. He said that boxers should be empowered. In many cases, they were "ripped off" by trainers and managers. For example, some had no concept of foreign currency and exchange rates, and were abused by their managers in this regard.

Mr CT Frolick (ANC) said that commendable measures had been taken to ensure that boxers would get their dues. He asked what provision had been made to look after injured and retired boxers.

Mr TD Lee (DA) said he had been unhappy with the state of BSA’s report last year, and it seemed as if this unhappy situation had been repeated. He said that boxers had been mariginalised, and others involved in the sport. Some promoters received no backing from television, and it seemed that only certain promoters had access to the medium. He asked how all could get a fair slice of the cake. He observed that BSA’s plans would fail if there were not a fair chance for all.

Mr RG Pieterse (ANC) asked how BSA planned to broaden the popularity of Boxing. He spoke about the amateur side of the sport, and how shadow boxing had been popular in the rural areas in the past. He asked how Boxing could be promoted in the rural areas, where there were no gymnasiums or other facilities. He asked why there were no female referees, officials, medical personnel or promoters. He asked why the broadcasting emphasis was on television, and if Boxing commentary would return to radio, particularly on community radio stations.

Ms DM Morobi (ANC) asked how talent would be identified, particularly in rural areas and townships. She asked why television broadcasts were screened so late at night.

Mr Naidoo replied that the real issues raised by the Members of the Committee showed that parliamentarians were in touch with the people. The deceased boxer in the Eastern Cape had been living in dire circumstances. BSA had made contributions and the municipality had provided aid. A benevolent fund had been established, and grants had been made to eighteen applicants. Exploitation of boxers was a big issue. Arrangements had been made with the SA Revenue Service (SARS), and a copy of every contract leaving the country would be given to them. A deduction of 25% would be made from all purse money. All contracts between boxers, managers and promoters would be sanctioned by BSA, who would play a mediating role. All payments would be on record and be made to boxers directly by BSA. The after-care of boxers would be addressed by the Outreach program. Ex-boxers would be brought back into the fold to promote the sport, which would benefit Boxing by their presence and would also provide them with a means of remuneration.

He said that television scheduling was done by the networks. An annual meeting was held between the broadcasters and the promoters, at which BSA attended as an observer. Dates were allocated as a result of this meeting. Although the SABC is a public broadcaster it still has an obligation to provide the best entertainment to the public. He said that it was an objective of the new Board to broaden the popularity of the sport. Some of the best boxers originated from the rural areas and had been attracted to the big cities. Some form of transfer system was being developed, in which the recipient of benefits would be expected to make some form of payback to his original trainers. Some R30 000 was being spent per annum on improving gymnasiums in rural areas.

Mr Naidoo said that there were some female referees. Fifteen of the 90 licenced ring officials were women and the targets were improving. He said that there was still radio commentary, mentioning stations such as Ukhozi. Television authorities dealt direct with the promoters. BSA needed to get involved with this process.

He discussed the role played by talent scouts. In the Australian model, children of three years of age were identified for training. A similar approach was used in China. This kind of program was needed in South Africa, but funds were required. As regards the late programming times on SABC television, he explained that Boxing had to compete with other sports. Scheduling was done according to ratings. There had been a slight improvement in the times. However, experience showed that later time slots might be better given the lifestyle of television viewers making it difficult for fans to watch Boxing on television much earlier than the current time slots.

Ms Magwaca gave some background on the ex-boxers fund which had been established.

Mr TJ Louw (ANC) asked about the girls clad in leotards which were part of Boxing matches.

Mr SJ Masango (DA) asked what interactions had been conducted with overseas people.

Mr Naidoo replied that agreements had been made with international organisations. International exposure was needed for boxers and officials. He mentioned the example of how a local boxer, fighting for a title in a huge venue in the USA could feel intimidated by the size of the crowd. He said that the leotard girls carrying the round card were part of Boxing tradition. Some concern had been expressed about inappropriate dress.

The Chairperson said that a workshop had been held to coincide with the Boxing Awards in 2004. The Committee had sent a clear message why it was necessary to continue nurturing the boxing treasure, but at the same time there were still many poor boxers. He asked if legislation was a contributing factor to the poverty of boxers, and how this issue could be dealt with. He observed that there had been some change of heart by the SABC after the Committee had raised concerns. He refused to accept the SABC’s model of the relationship between coverage and numbers of viewers. The public broadcaster had a responsibility to promote the sport. The Committee was discussing this with the powers that be.

He asked about life orientation and life skills training for boxers. More information needed to be provided at the next meeting. Skills were particularly needed in dealing with finances and HIV/AIDS awareness, particularly considering the questionable lifestyle of some boxers. He was also concerned about the disrespect some boxers showed towards national colours. He felt that this was expressed by poor dress sense at official functions and a lack of respect shown towards the national colour blazers, the flag and anthem. He observed how foreign boxers stood to attention while their national anthem was played prior to bouts while South African boxers tended to jog around and continue with their warm-up exercises during this time.

The Chairperson noted that the health of the sport was increasing slowly. However, he felt the need to have meetings with BSA quarterly or at least every six months to monitor this process. He asked how the Board was constituted. He did not know how it was elected, or if it was appointed on the Minister’s prerogative, or if there was a public nomination process.

He asked about the provincial structures, and if the representatives had any facilities to communicate with BSA. He asked about the licence fees. Mr Naidoo replied to this question that some 500 boxers were currently licenced.

The Chairperson noted that dates should have been supplied with the achieved milestones which were listed in the presentation. He asked when the Boxing Foundation would be finalised. He asked about the mechanics of the Outreach Program, such as if the provinces were being targeted one at a time, of if the program was being launched over a wide area simultaneously. He also asked for more details on BSA’s plans to target minority groups.

He asked about rural facilities, where they were and who was attending these facilities. He asked about the ownership issues, as he observed that promoters were making more money than boxers. He noted that if the contract was signed with the boxer, then he should decide the fee. He asked how the process of honouring deceased boxers was being done, and if their families were involved. He felt that the proposed Hall of Fame had a role to play in the honouring process.

The Chairperson asked what the regulations were trying to fix. He asked what the Committee and government could do to assist in fostering the pride in boxing achieved at tournaments. He asked what regulations applied to boxers who canvassed their own sponsors. He noted that a recent tournament had been delayed because of a conflict between one of the boxer’s personal sponsors and an event sponsor.

He reminded BSA that in terms of the PFMA (Section 65(, reports were to be tabled in Parliament by the end of September. The AG report had to be included in this. He remarked that this was a legal requirement. He also asked about the facilities which BSA was creating. It was pleasing to see this happening, but more details were required.

Mr Naidoo replied that life orientation skills were being presented as part of the course offered by the HPC. This included basic etiquette lessons. He agreed with the need to have regular reporting, but suggested that BSA could rather make quarterly reports to the Department of Sport and Recreation (SRSA) which could forward these to the Committee. He said that the appointment of members to the Board was the sole prerogative of the Minister. This was an internal matter at SRSA, and BSA had no say over the process.

He said that the control of Boxing was now centralised. However, it was impossible to run the sport from one location. Contractors had been in place throughout the country to administer the sport at a local level on a consultancy basis. BSA was working towards converting the consultants to full-time employees. In terms of licence fees, the current fee was offset by far by the benefits associated therewith. He undertook to forward details of where workshops had been held. He said that a trust was being formalised to back the Boxing Foundation. This matter was in the hands of attorneys at present. The foundation would deal with issues such as the care of boxers after retirement and any other activities not directly involved with the running of the sport.

He agreed that the annual report would be discussed in more detail at BSA’s next meeting with the Committee. He said that ownership of Boxing was reverting to the public domain. Boxers should be seen as employers, who utilised the services of managers, trainers and promoters rather than vice versa. However, often boxers had limited means with the result that rich promoters tended to hold more power. Regulations were being done by the Minister which covered all aspects of Boxing. A booklet had been published containing all the current regulations, and copies of this were given to all licenced boxers and officials.

Mr Naidoo agreed that posthumous awards were a great idea. He agreed on the need to honour past boxers. He would raise this matter with the Board at their next meeting in January 2006. The question of sponsorship should be regulated by law. Issues of personal sponsorships should be discussed with promoters when tournaments were being planned. Discipline was needed with the provisions of contracts, while the rights of BSA’s principal sponsors also needed to be respected. He was aware of the situation raised by the Chairperson, and said that the boxer in question had been in the wrong. A letter had been sent to him to express BSA’s displeasure with the situation.

Mr Naidoo asked the Committee’s help in negotiating better scheduling times on television, in arranging funding and in being available to attend tournaments.

Facilities had been arranged with the assistance of Vodacom. Mr Naidoo hoped that by improving the quality of rural gyms the boxers in those areas would be encouraged to remain there. The Outreach program was experiencing a tremendous response from minority groups. He saw Boxing as a part of the nation-building progress, and commended the efforts made by white champion boxers of previous years in promoting the sport. The program had started and was wide reaching. The prisons were a particular focus area due to the popularity of the sport already being experienced there. The program would advance even faster when the agreement with SANABO was in place.

The Chairperson asked about the administrative staff. Mr Naidoo replied that BSA had nine full-time employees at their head office, and one representative in eight of the provinces. There was currently no representative in the Northern Cape.

Mr Sodo said that the issue of poverty amongst boxers was being addressed, but was too slow. He spoke about the Baby Champs program being started because many boxers were unable to gain exposure from some of the bigger promoters. Some prospects had been discovered, and opportunities had been created for all boxers. The program had only started in 2005, and at present only covered seven weight divisions, starting with featherweights. Several boxers had been given a chance to make a name for themselves, and to make a living. New promoters had also emerged.

The Chairperson remarked that there were boxers and promoters everywhere. The perception was, however, that the television schedules excluded some promoters, particularly those without the right political connections. He had some praise for the attention BSA was trying to give to the life of boxers after retiring. Although no labour relations were defined in the sport, it was still miles ahead of those working in the Arts and Culture environment. Some design was needed in the engagement of veteran boxers in the outreach program. He remarked that boxers had a short career, and this situation needed to be accommodated. He also had concerns regarding the security of tournaments following a shooting incident in the recent past. He thanked the BSA delegation and excused them.

Committee Annual Report and Draft Programme for 2006

The minutes of the meetings held on 25 October, 1, 7 and 8 November were approved.

The Chairperson summarised the Committee’s Annual Report. He said it reflected the seriousness of the Committee’s work. During 2005, 35 meetings had been scheduled, of which only two had been canceled. The report was adopted, with the Chairperson’s overview to be added.

Mr Frolick remarked that there was a deficit of R 89 000 in the Committee’s funds. The Chairperson replied that funds from other committees should be diverted to make good this shortfall. He said that the Committee faced more challenges in the coming year, especially on issues regarding the 2010 Soccer World Cup. He said that the report on the Committee’s visit to France would be tabled in Parliament on 16 November.

Mr Frolick asked about the bidding for the Gay Games. He was not aware of this until hearing of it in the media. It has since transpired that the bid had failed. He asked what SRSA’s involvement was in the bidding process for major events such as this.

The Chairperson then tabled the draft program for the Committee for the first quarter of 2006. Planned meetings were:
30 January – adoption of the study tour report for the Western and Eastern Cape visits, and the review of the annual business plan.
31 January – workshop involving sports, and the sub-committee on names.
February – briefing on SA Sports Council and Olympic Committee – the HP program, schools and its annual plan; minutes; tabling of BSA’s annual report
7 February – discussion on the Special Measures Amendment Bill regarding the handling of the World Cup and discussion of the Safety at Stadiums Bill. The Chairperson warned the Committee that this latter bill was a big document.
14 February – issues arising from the President’s State of the Nation speech. The Committee’s priorities might need to be reworked as a result
21 February – deliberation and assessment of the budget vote
28 February – SRSA’s strategic plan and budget vote
7 March and onwards – public hearings from various sports federations; a joint meeting with the Portfolio Committee on Communications regarding the SABC’s strategic planning and logistic arrangements regarding the World Cup; also a joint meeting with the Department of Environmental Affairs and Tourism. This last meeting would include a discussion on sports tourism and its impact on the gross domestic product. The Chairperson expressed an opinion that the tourist’s first point of entry should be Soweto and Alexandra rather than Sandton and Midrand.

Mr Frolick reminded the Chairperson that caucus meetings would be held on 2 February before the opening of Parliament the next day.

The Chairperson emphasised that this was a draft program, covering the period up to 28 March. The program was adopted subject to revision.

The Chairperson noted that this would be the last Committee meeting for the year. The Minister was currently in Ireland for the final presentation of the Rugby World Cup 2011 bid. The study reports for the Eastern and Western Cape visits would be considered during 2006. He thanked all Members, including the opposition parties, for their contributions during 2005.

Mr Masango thanked the Chairperson on behalf of the opposition parties.

The meeting was adjourned.