Budget hearings with Boxing South Africa and Promoters

Meeting report

SPORT AND RECREATION PORTFOLIO COMMITTEE
26 May 2006
BUDGET HEARINGS WITH BOXING SOUTH AFRICA AND PROMOTERS

Chairperson: Mr B Komphela (ANC)

Documents handed out:
Boxing South Africa Presentation
E-mail from Branco Sports Productions
Newspaper cuttings: E Cape Tournament, Sacking of Boxing SA CEO

SUMMARY
The Chairperson felt that the Committee needed a close working relationship with Boxing SA. The budget process was underway and would soon to be presented to the Minister. The full board of Boxing SA, except for the CFO, was in attendance. The budget proposal showed an expected income of R6.6 million, and a shortfall of R 800 000 would have to be made up. Support had been received from some provincial governments already. A major sponsor had been lost, and initiatives were underway to source new sponsorships from the private sector.

Financial irregularities exposed by the Auditor General’s report had been addressed, and had also resulted in the suspension of the General Manager.

Boxing SA was expanding its activities into the provinces, and hoped that this would bring the sport closer to the communities. The Baby Champs program was going a long way to produce exciting new fighters, promoters and ring officials, and emphasis was being placed on developments in the rural areas. The development of the sport amongst women was also being addressed, both as boxers and officials, and a highlight would be the visit of Leila Ali, daughter of Mohammed Ali, later in the year.

Members asked questions regarding the support of the sport in all areas of the country, and whether the provincial structures being put in place were sufficient. Monopolistic situations with promoters were questioned. Television coverage was also discussed.

MINUTES
The Chairperson welcomed the delegation from Boxing SA. He said that Parliament required regular quarterly meetings, but that this meeting was specifically to address the budget. The Committee would look at the documents and the Attorney-General’s comments, and looked forward to a closer relationship with Boxing SA to assist with the Auditor General’s findings. The budget was due to be presented on 31 May by the Minister, and the Committee had to decide whether to recommend it or not. He said that the Committee shared the vision of Boxing SA and its challenges.

He noted that Committee Members had received invitations to events from some promoters, but the time was inconvenient at present. It was too cold to wear the Bafana Bafana shirts in support of the Sinqoba campaign, but that this would be done in August. He had attended campaigns where there had been no SABC coverage. He felt that some of the vibrancy of the sport had gone.

Mr D Lee (DA) apologised that he could not remain in the meeting due to other commitments, but confirmed his interest in the sport.

Presentation by Boxing South Africa
Adv Dali Mpofu (Boxing SA Chairperson) said that the full board of the organisation was present with one exception. There had also been one resignation. In terms of the Boxing Act, there were seven posts on the board; one was currently vacant. He introduced the members of the board: Ms Violet Mgwaca, Ms Stompie Xulu, Mr Sakhiwe Sodo and Dr Peter Ngatana.

He apologised to the Committee for missing the previous meeting as he had been with a different Portfolio Committee at the time. Interaction had occurred with the Chairperson and other members of the Committee later that day, however.

He said that the presentation would firstly address financial issues, and the strategic plan would then be discussed. He showed a planned income or R6.6 million. Training costs were estimated at R2.3 million and operating costs at R5.1 million. This left a shortfall of R800 000, and Boxing SA would appreciate it if government could make up the difference. He presented a detailed breakdown of income sources. He said that they hoped SuperSport would make a greater contribution. A similar breakdown was given for the planned expenditure.

Adv Mpofu described Boxing SA’s transformation and development programs. Workshops were being held for licensees in all categories. The Baby Champs league was continuing, and was proving successful. The training given to boxers included academic training. Administrators and ring officials were also being trained. He noted that some judges and officials were of a poor standard.

Additional funds were allocated to provincial offices, and financial aid was requested. Boxing needed to be closer to the people, and exciting initiatives were underway. In the old dispensation, Boxing had used a federal structure. The sport was then centralised, which was good as there had been chaos in some provinces. Control was still centralised, but now there was a strong provincial set-up. He felt that this was the best of both worlds. Eight offices had been set up around the country with representatives who were employees of Boxing SA. This introduced a complication as the Minister of Finance now needed to be involved due to the salary payments. Boxing SA wanted to lobby to provide for two administrative assistants as well as one full time employee in each province.

Following the audit report, new procedures had been written. Most of the financial problems identified by the Auditor General were being addressed, and an internal audit process had been established. He admitted that the situation regarding financial reports in the organisation had been unacceptable. Reports had never been submitted or received. The audit report was unavailable for the four years of Boxing SA’s existence. The new board had set a goal of having all reports in order and on time.

It was discovered two to three weeks previously that this was not the case, as had been undertaken at an audit committee meeting in February even though management had been assured that all was in place. The AG said that the documentation was still not ready despite extensions being granted. A board meeting had been held the previous week demanding answers. As a result, the General Manager, Dr Krish Naidoo, had been suspended pending a disciplinary hearing. Steps were also being taken against the Chief Financial Officer. Clear instructions had not been followed, and there was no explanation for this. Unfortunately this had leaked out to the media and swift action had to be taken.

Adv Mpofu said that the provincial governments were ’coming to the party’, and the private sector would follow suit. The Gauteng government had taken the lead and was staging tournaments. In the Eastern Cape, the provincial government had pledged R100 000 per tournament, and boxing had been identified as an aspect of the Mass Participation Program in that province. Talks had been held with authorities in the Free State, KwaZulu-Natal and Mpumalanga; while audiences had been requested with all the responsible MEC’s. Some metros were also involved. He felt that these were exciting developments.

The Baby Champs program had been bulldozed into action despite not having been on the budget. It had therefore been restricted to the junior weight divisions but had attracted coverage and exposure, while most of the fights were competitive. Interest was also seen in the white communities, and a large audience had been present for the finals, which were staged in the southern suburbs of Johannesburg, a traditional boxing area.

On the negative side, he revealed that the sponsorship from Vodacom had not been renewed. However, he felt that this could be a blessing in disguise. There was a new focus on governmental sponsorship. He felt that this highlighted the danger of relying on a single big sponsorship, and felt that the better approach would be to attract a basket of smaller sponsors. Boxing SA was still seeking another anchor sponsor, and he was currently in talks with CEO’s of two major organisations. The SABC had also offered to meet the sport halfway, and one result of this could be the Blow by Blow television show on Friday nights being named after a sponsor.

Adv Mpofu said that the structure of Boxing SA would be de-linked from the post of CEO. The new CEO would start on 1 July. He was confident that this would be achieved. He undertook to speak to promoters about invitations to Committee members to attend events, but felt that it might be better if invitations were extended by the board. He added that the Chief Financial Officer had been unable to attend the meeting as he was working full time on preparing the required documents.

Discussion
The Chairperson accepted the apologies from Adv Mpofu. He then invited members of the Committee to pose questions to the Boxing SA delegation.

Mr M Dikgacwi (ANC) welcomed the move to spread Boxing structures around the country, but said that this could not just stop in the provincial capitals. He mentioned the example of the town of Robertson, where the only facility had been destroyed by fire. He asked to what extent ex-boxers were being used as trainers, as this did not seem to be the case.

Mr R Reid (ANC) noted that the additional provincial budget worked out to R 4 200 per annum. He asked if this included office rental, or if it was only the salary for the regional representative. He noted that there were no facilities in rural areas such as George and Mossel Bay. He asked if Boxing SA could assist.

Ms Ramakaba-Lediea (ANC) asked if there was a plan to reach out to the children sitting idly on street corners. Her constituency was in the community, and she needed to report to her people on sport.

Mr J Masango (DA) noticed that there was a big allocation for training. He asked if the incompetent officials alluded to by Adv Mpogu had been retained, or if a new group of officials was being trained to replace them. He asked why there was no mention of Mpumalanga in the provincial structures, but there was an office in Port Elizabeth in addition to the Eastern Cape provincial office.

Adv Mpofu replied that Mpumalanga was included. Their omission from the presentation was a typing error. Because of the size of the Eastern Cape, Boxing SA had decided to establish a satellite office in Port Elizabeth.

He addressed the issue of retaining experienced staff against bringing in new people. A balance had to be kept by keeping the good old officials but at the same time encouraging newcomers. A veterans association would be established to use those people as coaches and officials. It had been a failure not to use the veterans although some had offered their service voluntarily. He hoped that a new sponsorship could be used to set up a veterans development project in the budget. Current boxers would also be trained in basic skills.

Community participation had been a promise of the new board. There were no more excuses for tournaments not being held in rural areas. This had already happened in Limpopo and rural areas of Gauteng. What made this easier was that the Baby Champs program had ready-made television coverage, and this was guaranteed. Promoters earned more through television rights than gate takings.

He said that provincial representatives would be employees of Boxing SA. There would be full control over them. They would be required to cover all of their respective provinces, and their services would be retained or terminated depending on the successful completion of their duties. The new General Manager would liaise with them. Their salaries would be covered by the budget. As service providers, they would be expected to provide their own business premises.

Adv Mpofu pointed out that Boxing SA only catered for the professional side of the sport, and the development aspect fell under the South African National Amateur Boxing Organisation (SANABO). Mr Sodo was the Boxing SA board member who acted as a bridge to SANABO.

Boxing SA would promote women’s boxing. The Baby Champs program was also used to develop promoters, and incentives were in place for the staging of women’s bouts at these tournaments. Amongst women, he said, the sport was growing like wildfire and there were record numbers of female boxers. A highlight would occur in August when Leila Ali, daughter of Muhammad Ali, would visit the country. At the Baby Champs finals, all the officials including referees were women. He believed that this had never happened in any country.

Mr Sodo answered questions concerning the Baby Champs league. The program had brought quality boxing to the fore. The standard of trainers was improving, and on several occasions fighters trained by some of the leading trainers had been beaten by those of the up-and-coming trainers. With the allocation of promoters, Black Economic Empowerment (BEE) principles had been applied. Several quality promoters had been discovered in the rural areas. All the bouts had been closely contested. In the finals, all fights had gone the distance. The future looked bright and there was excitement in all areas.

Regarding the women’s aspect, more tournaments were held at Boxing SA’s initiative than SANABO’s. Provincial government departments would be involved to aid development. Immediate reachable goals were being set for boxers, who could graduate from the Baby Champs program to provincial ratings, on to the national ratings and ultimately become national champions.

Mr Masongo commented that the flair had gone out of the sport. He observed that different sports suffered from limited exposure.

Mr Dikgacwi said that the cake was not shared evenly with the up-and-coming promoters. Boxers were being reaped. They did all the hard work but the promoter took all the rewards.

Mr Reid noticed that many national champions had come from Cape Town in the past, but it seemed that the sport was now in a decline in that area.

Ms Mgwaca replied that efforts were being made to involve veterans. However, training facilities in the Cape Town townships were often used for other purposes such as emergency housing for victims of fires.

Adv Mpofu said that the provincial structures would address the state of the sport in their respective provinces. He observed that boxing was a cyclical sport, and there were already up to ten new superstars in the making. They were making strides in the community, and this would lead to television and sponsor involvement. The SABC now had stronger arguments to campaign for an earlier time-slot for boxing coverage.

He said that there was a serious problem with promoters. It must be remembered that this was their business. The Promoters Association was shown that it was in their own financial interest for general growth to take place, but this sector remained very competitive. Boxing SA acted as a regulator, and tried to prevent the formation of monopolies. Certain promoters were no longer able to take part in the Baby Champs tournaments.

He was aware that some boxers were being ripped off. The boxer should be the first priority, and Boxing SA had made some interventions. The organisation also had sight of contracts, and was in communication with boxers. It would finance a union for boxers.

Ms Ramakaba-Lesiea said that boxing did not only happen in Gugulethu. The Western Cape was a very big area, and even Cape Town alone was too big for one person. She asked if transport was being provided. The provincial MEC should be involved.

Adv Mpofu agreed with her sentiments. Partnerships with the provincial governments would address these issues, and contact with the private sector was also needed. Contracts for provincial representatives would be for the entire province.

Ms Mgwaca said that there would be a tournament in Mossel Bay on 8 June.

Mr Sodo said that boxing should be screened earlier on television, or during the day on weekends. This would help increase the exposure. Late times were also a problem in the rural areas where spectators had long distances to travel on their return home. He admitted that there was a slight decline in the sport, but argued that this could be a perception amongst the older generation that everything was better in the "good old days". However, there were currently some exciting prospects.

The Chairperson said that the country was on the cutting edge of technology with the SABC and communications. He felt that television ratings for boxing were declining. This was linked to a lower standard of fighting, and was not encouraged by poor attendances at the venues. He felt that the continued exposure of the sport might improve ratings. A balance had to be struck between exposure and ratings.

Adv Mpofu agreed. He said that the SABC at present had neither a distinctive public or private broadcast role. Current strategy was however returning emphasis to its public role. The SABC was owned by the state, and so must rather advance developmental objectives rather than seek profit for its own sake.

The Chairperson said that boxing should participate in mass participation events, especially in the prestige events.

He noted that an indaba had been held in the Free State between old and current boxers. The younger boxers still revered their predecessors, and their involvement was beneficial. Families of boxers also needed recognition.

He said that NACOC (National Co-ordination Committee) had its own agenda. He felt that community tournaments should be held.

The status of sponsorship was a sad story and needed to be discussed. Public hearings had been held in athletics after twenty powerful sponsors such as Sanlam and Trek had withdrawn from the sport when the regime controlling the sport had changed. He felt that this was not so much about value for sponsorship money but rather a gesture of hostility towards the new faces in charge of the sport. This was ethically and morally wrong.

Mr Komphela said he had no problem with the removal of the CEO from office. This was the correct decision if Dr Naidoo had been part of the problem. He observed that black CEO’s were not wanted, and quoted the example of Banele being sacked by SASCOC (South African Sports Confederation and Olympic Committee) as a wrong decision. In that case, it seemed to him that the driver of the program had been retrenched while the passengers remained. Discussions were held behind closed doors. He said it was a common complaint when black managers were seen to earn big salaries, but asked what the basis of the comparison was. It was only a problem when a black person earned a big salary. In fact, in the case of Banele, the organisation had no money to pay for his retrenchment package. He mentioned intervention in the crises experienced in Rugby, and felt that the powers of black CEO’s were being eroded.

He said that he had been in discussion with the Chairperson of the Portfolio Committee for Arts and Culture. Boxing SA had instituted an insurance policy to care for the boxers and their families. If a performing artist died, then their families had to rely on charity. Arts and Culture have now followed Boxing SA’s lead.

The Chairperson alluded to an awards presentation held in Sandton, where national blazers had been presented to boxers. He had felt uncomfortable with the poor manners of some of them, where their clothing and demeanour during the proceedings had been disrespectful. He also cited the case of boxers dancing in the ring as warm-up exercises while the national anthems were being played. These were poor examples, and he felt that life skills were lacking.

Dr Ngatano replied that the boxer in question had not attended the life skills program presented at the High Performance Centre. He had been reprimanded, and ironically had lost his title in his next fight. The excuse at ringside of not having enough warm-up time was not acceptable. He stated that Boxing SA had been embarrassed at the function attend by the Chairperson.

Adv Mpofu said that the insurance policy had been easy to implement, but was making a big positive impact. Dr Ntana’s HIV/AIDS testing system was working well.

The Chairperson looked forward to an appointment of a CEO in July. He said he would discuss this with the Minister. It would represent a major problem if the appointment was not made, and he saw an apparent shortage of suitable candidates. He said that Branco should not be the only beneficiary of BEE initiatives. He had wanted promoters to attend this meeting of the Portfolio Committee as they must all be part of the process, and interaction was needed. He said that he had received a delegation of angry boxers protesting the allocation of television dates, and this practice reflected the perceived monopoly in sport. He said the process must be fair. He concluded that special attention must be paid to the visit of Muhammad Ali’s daughter.

The meeting was adjourned.