DA Takes Royal AM to court. Image:X/@ROYALAMFC_sa/@Our_DA
DA takes Royal AM and uMsunduzi Municipality to court
DA says it is protecting the financial stability of uMsunduzi Municipality as it challenges the R27m sponsorship deal with PSL club Royal AM.
DA Takes Royal AM to court. Image:X/@ROYALAMFC_sa/@Our_DA
The Democratic Alliance (DA) has taken uMsunduzi Municipality and Premier Soccer League outfit Royal AM to court over what it believes to be illegal sponsorship of the club, as it did not go through regular tender procedures.
DA TO PROTECT MUNICIPALITY’S FINANCIAL STANDING
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In July, the municipality announced that it had offered R27 million deal to the club, owned by billionaire businesswoman Shawn Mkhize, luring to the provincial capital.
The deal is similar to the one the city had previously given to Maritzburg United, but the contract was terminated due to their relegation. One of the clauses in the contract stipulates that the club will be required to play in the top flight.
Soon after the announcement, the DA accused the municipality and Royal AM of corruption and maladministration, as they requested a paper trail detailing sponsorship and the processes followed.
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DA COURT PAPERS
In its court papers, the DA highlighted the municipality’s flouted tender procedures as well as its failure to provide residents with basic services.
Other issues in the affidavit include:
• It breached Section 217 of the Constitution to contract in a system which is fair, equitable, transparent, competitive and cost-effective;
• It ignored the Preferential Procurement Policy Framework Act 5 of 2000;
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• It violated Section 15(a) and (b) of the Municipal Finance Management Act (MFMA), which allows municipalities to incur expenditure in terms of an approved budget and;
• Section 33 of the MFMA has not followed in that it imposes financial obligations on Msunduzi beyond the three years covered in the annual budget for 2024/2025;
• Section 112 of the MFMA was not followed in that the municipality’s supply chain process which required the Royal AM sponsorship to go through a competitive bid;
• Regulation 10 of the Municipal Cost Containment Regulations and the municipality’s own cost containment process state that the council must not finance sports events.
