Because of instability in their ranks, EP Rugby are at risk of losing a whopping R40m in much-needed Lotto funding, which will result in financial hardship for struggling club teams, financial affairs head Mbulelo Gidane says.
Gidane revealed the shocking information to club delegates when he presented the union’s financial report during EP’s annual meeting at Cillie High School on Saturday.
He made the comments at a rowdy meeting which was marred by an altercation between deputy president Roger Serfontein and Young Collegians president Dan Ngcape, which resulted in mayhem erupting in the hall.
“You will recall we have appointed a consultant, Weza Moss,” Gidane said.
"[He] made a submission to Lotto of R40m.
“EP have received a clean bill of health from Lotto.
“That application we have submitted to Lotto is in serious jeopardy because of our situation right now at the union [instability].
“We have subsidised clubs out of the money.
“Also because of money we are not going to get from the municipality [R6m] it will be difficult for us to fund any transport for clubs in the 2024 season.
“This is sad news I must present.
“One structure that we receive an allocation from is Saru and it totals R12m per annum and the R6m from the municipality is the only [other] income we receive.”
Gidane said potential sponsors were reluctant to get involved with EP Rugby because of a R7m SA Rugby debt hanging around the union’s neck.
Despite being impressed by an electrifying Grand Challenge club final rugby in 2023 at the Nelson Mandela Bay Stadium, sponsors do not want to become involved with the union.
Gidane gave an insight into the union’s financial affairs when he spoke for more than an hour at EP’s annual meeting.
He said Saru debt should be written off and the issue must be raised as a matter of urgency with the mother body.
“EP went to speak to some sponsors.
“The first thing the sponsor said was that he was impressed by your electrifying club rugby final between Gardens and Kruisfontein United and also that you took your final to Nelson Mandela Bay Stadium and a big crowd attended.
“The potential sponsor said he would like to be involved, but he could not give EP money to pay Saru.
“Another sponsor said the same thing when we went out to canvass
“The debt of Saru is a core issue for EP Rugby.
“You can go to any institution and you cannot have debt for more than 10 years.
“This debt was because of our own professional arm and that professional arm was run by Saru.
“Why are we not sharing the cost if this was run by Saru?
“Why is Saru putting this thing over our neck?
“We will tell Saru that this debt is a serious negative for us.”
“A crucial part is most of EP’s expenses go to the costs of contracting players. That is the biggest part of our budget.
“We must decide on our strategy so we can play top-tier rugby.
“If you look at the expenses we are incurring on the players, it is equal to the other provinces playing at our level
“If EP play a double round of IPL (interprovincial) for ladies, as Saru is suggesting, without any funds allocated for this competition, we will land in liquidation.
“A serious threat is both our funders are not giving us money with any interest taking inflation into account.
“Both structures are not doing that.
“When our leaders go to Saru, they must raise this matter
“EP are coming out as a better union.
“You will recall EP had no assets and today we are sitting with assets.
“One of those is the bakkie, a generator and computers to all sub-unions.
“When you go to our offices there is also a nice facility for virtual meetings.
“EP will end this year with a profit of R200,000 regardless of the municipality money.”
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