Chippa sponsorship row erupts into Ironman threat at council

A bitter row over the proposed renewal of Nelson Mandela Bay’s sponsorship of Chippa United erupted into a dramatic standoff in council, with the political head of sports threatening to defer the city’s Ironman sponsorship if councillors delayed the soccer deal. However, the city’s Ironman sponsorship was earlier approved by the council on Thursday. Councillors were debating a report to extendChippa United Football Club’sanchor tenant agreement between the Mandela Bay Development Agency, the municipality and the sports team.

The report also sought approval for a sponsorship fee of R6m per annum for three years, subject to the metro’s logo appearing on the front of the players’ jerseys Under the proposed new arrangement, the city would no longer pay the R7m annual relocation fee that formed part of the previous agreement. The report warned that without an anchor tenant, the Nelson Mandela Bay Stadium would be unable to recover some of the costs associated with operating the facility, widening the gap between stadium expenditure and income generated from league matches. “The consequences would extend to potential stadium partners, sponsors, advertisers, suite holders and event owners considering bringing further events to the venue.

“In the absence of an anchor tenant, a reduction in stadium staffing and consequent job losses may be necessary. “There is further risk to the stadium becoming under-utilised, requiring the municipality to spend additional funds to attract events to the venue,” the item read. But the debate took a sharp turn when DA councillor Rano Kayser read out concerns from the municipality’s budget and treasury department, which warned that it could not support the Chippa sponsorship due to National Treasury guidance, a high court judgment and the absence of a legal opinion.

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Kayser questioned whether councillors were being asked to approve a transaction their own financial officials had effectively warned could be unlawful. “If we implement this in line with Circular 131, it’s an unlawful transaction.

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