The Democratic Alliance has called for the immediate termination of Royal AM's R27 million sponsorship by the struggling Msunduzi Local Municipality in KZN.
The DA in the Msunduzi council submitted a motion calling for the municipality "to review and terminate the club's R27 million sponsorship" of the outfit owned by controversial Durban businesswoman, Shauwn Mkhize (nee Mpisane).
Troubles are mounting for the Betway Premiership outfit Royal AM FC and Mkhize after the club reportedly failed to pay salaries in December. The club and businesses associated to Mkhize have been facing scrutiny since they were attached after Sars search and seizure in November last year over tax debt to the tune of over R40 million.
DA Councillor Reggie Khanyile, said the municipality cannot continue to support a business facing legal proceedings, "including allegations of tax evasion".
"The municipality cannot continue supporting a business facing serious legal proceedings, including allegations of tax evasion. Non-compliance with tax laws and deliberate tax evasion are criminal offences that should not be taken lightly by any municipal authority," the statement read.
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"Maintaining a relationship with an entity under such scrutiny is damaging to the municipality’s reputation. Royal AM is already under curatorship, facing sequestration processes, and unable to pay staff salaries.
"The club has breached contracts with former players, is facing sanctions from FIFA, and risks being declared insolvent by the world football governing body. Continuing this sponsorship brings nothing but disrepute to the Msunduzi Municipality.
Earlier this month the club asked the PSL to postpone their fixture against Chippa United after their players allegedly went on striker over non-payment.
The DA said it had always been opposed to the sponsorship because of the lack of service delivery in Msunduzi.
"The DA has consistently opposed the sponsorship of Royal AM, especially given the dire state of service delivery in Msunduzi. Collapsing infrastructure has left residents without consistent access to water and electricity.
"The DA strongly believes that the R27 million allocated to Royal AM could be better utilized to address these critical issues and support the youth of Msunduzi through the maintenance of sports facilities and the funding of sports and youth programs.
"Young people in the municipality are left vulnerable to crime and drug abuse due to a lack of support, yet Msunduzi is funding an entity that contributes nothing to the city apart from controversy and embarrassment"
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