The Democratic Alliance (DA) in the Msunduzi local municipality has introduced a motion demanding the municipality reassess and eventually cancel its R27 million sponsorship deal with the embattled Royal AM football club.
Royal AM, which has recently been placed under curatorship by the South African Revenue Services (SARS), has faced significant financial turmoil. Following the freezing of the club’s funds, staff salaries went unpaid in December 2024. This has raised serious concerns about the club’s financial stability and future operations.
On Wednesday, the Premier Soccer League (PSL) took the drastic step of suspending all of Royal AM’s matches indefinitely, citing the club’s inability to guarantee that it could fulfill its fixtures under the current curatorship.
Reggie Khanyile, a DA councillor in Msunduzi, has stated that the municipality cannot continue its financial support for a business embroiled in severe legal issues, including allegations of tax evasion. The DA argues that continuing the sponsorship of a club under curatorship, with its financial and legal troubles mounting, would be irresponsible and detrimental to the municipality’s reputation.
“Royal AM is already in deep financial distress, facing sequestration proceedings, and unable to pay its staff. The club has violated contracts with former players and is under sanctions from FIFA, with the risk of insolvency. By maintaining this sponsorship, the municipality risks further tarnishing its own image,” Khanyile said.
Khanyile pointed out that the DA has consistently opposed the sponsorship, especially given the pressing issues facing the municipality. Msunduzi residents continue to suffer from severe service delivery challenges, such as unreliable access to water and electricity, and deteriorating infrastructure.
“The DA believes that the R27 million earmarked for Royal AM could be better spent addressing these critical issues. Instead of funding a troubled football club, the municipality should invest in improving public services and supporting youth development programs,” Khanyile suggested.
He further emphasized that young people in Msunduzi are especially vulnerable to crime and substance abuse due to a lack of opportunities and recreational activities. “Rather than backing an entity that brings controversy and negative attention to the city, the DA believes the funds could better serve the youth by improving local sports facilities and funding youth initiatives that promote a healthier, safer community,” he added.
The DA is also calling for intervention from the Provincial Treasury and the Department of Cooperative Governance and Traditional Affairs (CoGTA). Khanyile indicated that the party would escalate the matter to these higher authorities to ensure that the sponsorship deal is scrutinized and, if necessary, terminated.
