Safa’s struggle to stay in the money
Big sponsors are giving less, so association may face a shortfall
Bafana Bafana’s poor performance on the football field has hit the South African Football Association (Safa) where it hurts most … in the pocket.
The dwindling fortunes of the national team has resulted in Safa’s revenue dropping from about R200 million per annum to below half that amount.
This week, Safa will announce the extension of their sponsorship with SAB for a further five years, but the beer-brewing company will only be throwing R20 million a year into the hat as opposed to the R50 million they poured in annually over the previous five-year cycle.
Absa have also extended their partnership, but for only R20 million per annum.
Overall, this means a 60% drop from the deal that was announced in 2007 when the previous Safa president Molefi Oliphant appeared, beaming from ear to ear as he announced a ground-breaking partnership with the two companies, worth R500 million over five years.
Instead of R100 million from the two companies per year, Safa will be getting a mere R40 million.
Safa generates most of its revenue from sponsorship, recorded as R251 310 725 in last year’s financial report.
The new deals come in the wake of Vodacom announcing they will no longer continue to back the Vodacom League, and Sasol pulling out of financing the Under-23 national team.
Safa has not yet found a replacement for FNB, which bankrolled the national Under-17 team while the SA Under-20 national team has been without a financial backer for ages.
The glorious picture of the 2010 Fifa World Cup is fading.
Safa has also lost income from the rent (recorded as R3.24 million in last year’s financial report) the world football governing body paid for using some of Safa House.
So dire is the situation that Safa’s National Executive Committee took a decision two months ago to appoint an ad hoc committee to assist CEO Dr Robin Petersen with a turnaround strategy.
The committee, made up of Safa vice-president Danny Jordaan, Buti Lerefolo, Nomsa Mahlangu and Xolani Mtumtum, tabled its report and recommendations during the NEC meeting held at Safa House on Saturday.
Petersen is expected to start implementing some of the recommendations this week.
A well-placed insider told City Press that while revenue has been decreasing, the association has continued to splash out money on salaries (a staff of 93 that includes 22 heads of departments) and the hiring of consultants.
Another expense which created a hole in the Safa pocket is said to be the R800 000 monthly salary former Bafana Bafana coach Pitso Mosimane received.
New coach Gordon Igesund’s salary will be between R400 000 and R500 000.
Another expense has come from increasing the NEC from 24 members to 39 which means more money for travelling, allowances and honoraria.
According to Safa’s last annual financial report tabled at the AGM in September, the association reported a R37 million profit.
Petersen disputed a figure given to City Press as a shortfall the association has accumulated prior to this year’s AGM.
However, another top insider said the only way Safa can report a positive balance would be by including assets such as Safa House (R60.6 million) and the buses received from the World Cup (R63.4 million) as part of their liquid cash.
Petersen said: “We have a plan to reach our annual target of R200 million in sponsorship. We are aiming at getting five to six partners who will enjoy the same rights as breweries and Absa because they no longer have exclusive rights.”
He said in the past Safa had to give back about R10 million per year to SABC for the broadcast of Bafana Bafana matches.
“But according to our new deal, they will now pay us,” he said.
He said Puma had also joined as a partner and not as a technical sponsor, as Adidas was.
While he refused to reveal the figure, City Press believes Puma is worth between R24 and R26 million per year.
Safa also recently concluded a five-year broadcast deal with the SABC reported to be worth R215 million.