Big concern over Safa cash crisis
Big concern over Safa cash crisis
Posted: 2010-01-26 12:50
The lack of transparency with regards to Safa’s financial situation is cause for concern.
The Mother Body is reportedly in the red, with a figure of around R27-million being tossed around.
Safa’s vice-president of finance, Mandla Mazibuko, was not in his office when KickOff.com tried to contact him to verify all the facts pertaining to the matter, but new CEO Leslie Sedibe, without divulging figures, confirms the crisis.
He said in a recent statement: “Safa, like, most companies in South Africa, was hit by the consequences of the global economic crisis, which saw delays in payments of monies due to Safa.
“In order to alleviate this challenge we have called in suitably qualified experts to improve our debtors’ management and accelerate the payment of accounts due to Safa.”
The problems were revealed by the Mail & Guardian newspaper recently in a report which said it had access to Safa’s bank accounts, which show a negative balance of more than R7.4-million.
It said other Safa documents showed that it also owed suppliers another R7-million. A senior Safa official, who was not named in the newspaper report, said the situation was even bleaker than that.
“We are close to R10-million in the red, excluding what we need to pay our suppliers,” he said. “It’s becoming increasingly difficult to run the sport smoothly in the country. The majority of our regions have not received their grants, which has paralysed the game in these affected areas.”
A letter written by the Safa Waterberg region – leaked to the Mail & Guardian – said the region was facing eviction from its office, had not paid its phone bills and owed staff members their salaries.
A key element in Safa’s problem is that it is owed R27-million by the SABC, who are also in deep financial trouble.
The public broadcaster, according to Government sources, owes R910-million. However, there is light at the end of the tunnel for the SABC after the new interim board signed a five-year loan agreement with Nedbank this week which will contribute to stabilising the cash strapped corporation.
The board has also negotiated an additional R200-million budget from government, as well as a government guarantee of R1.4-billion.
Unlike the SABC Board, instead of releasing details of the action they are taking, Sedibe has tried to put the lid on the boiling pot by saying: “Safa is fully operational and that all projects and programmes are going ahead as planned.”
Safa has grand pre-World Cup plans for Bafana with camps in Brazil and Europe. Add the cost of these over the next three months, together with a new salary bill for Bafana players and additional staff (no figure has been disclosed in this regard), as well as that for Carlos Parreira and his technical team, and that will put them deeper into debt.
So unless there’s a payment from the SABC soon, Safa will struggle even more with its cash flow.
Mazibuko had earlier reportedly confirmed to the Mail & Guardian that Safa’s account is in a deficit, but would not give any figure. “It’s really too early for me to comment because I’m still going through the books,” he said.
Looking even further ahead, will the pot of gold from Fifa after the World Cup bring relief? It will, but the question must be asked, to whom?
If the PSL’s Board of Governors goes ahead with its stated intention of challenging the validity of the new Safa hierarchy, you can bet your last cent that they will endeavour to get a court order prohibiting Kirsten Nemathandani and his officials from touching the multi-millions until after their legal wrangle has been settled.
One last question that remains to be answered: What happened to Safa’s profits from last year? Will Nemanthandi and his new crew have to account for that, or must the old guard answer that one?
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