Another amateur era fiasco

The WP liquidation, says Tank Lanning in his Sport24 column, is yet another reminder that rugby in SA is still run by amateur era structures which deliver amateur era administrators.

Tank Lanning

So it was at a SARU Board Meeting in April that WPRFU President Thelo Wakefiled had a full go at then SARU President Oregan Hoskins, saying that he would rather go bankrupt than privatise over 50% of the union.

Careful what you wish for Mr. President …

On Monday it was confirmed that WPRFU had obtained an order for the provisional liquidation of Western Province Rugby (Pty) Ltd – the commercial arm of the union.

Not to worry, though. All carries on as per usual. It was just that pesky commercial arm which had run up a chunky piece of debt that had to be shut down. The “Real” WPRFU – the one that owns Newlands, and gets run by a council voted in by the 90 odd clubs – she is just fine!

Not to worry that WPRFU is a 75% shareholder in the soon to be liquidated PTY, that the coach and player contracts sit with the PTY, or that Wakefield was part of the board that ratified the astonishingly poor deal that caused said debt.

A deal that saw media and sponsorship agency Aerios allocated what WP Rugby believed to be the Wi-Fi rights to Newlands for number of years. All Good. The almighty stuff up, though, is that the deal they signed also included all stadium advertising rights – as in all! Stadium signage, signage around the big screen, ads in the programme, and even the signs in front of the suites.

Basically leaving WP Rugby nothing left to sell, hence Aerios claiming just over R72m from WP Rugby for what they deem to be their rightful commission on deals that WP (and SARU for the CT Sevens) did directly with various sponsors without their involvement.

Wakefield, no doubt planning not to have to deal with this fiasco via a cushy role on the SARU Exco, now finds himself at the coalface. His first defence was to try and blame former CEO Rob Wagner, and while it was certainly not the now resigned CEO’s finest moment, there is no way on earth that a deal like this gets passed without the board’s approval.

“When we recruited the (new) CEO we said we want a person that understands business,” weaved Wakefield on Monday. So what did they look for in the old one?

People have – rightfully – been quick to ask what qualified Wagner to run WP Rugby, but why no questions as to what qualifies Wakefield to run WPRFU?

It seems the former team manager’s qualification is the ability to garner votes from the clubs.

Sport24 Chief Writer Rob Houwing has revealed that four independent directors recently resigned from the board of WP Rugby, stating jointly that “an acceptable level of governance is absent which contributes to the current financial status”, and that “the situation has been exacerbated by lack of transparency”.

Yet remaining firmly glued to their aeroplane seats to every game are President Wakefield and Chairman Sam Ndube, happy to blame the state of their finances on anything but their reckless trading (Even without the Aerios deal, WP are more than R11m in the red, a number that the auditors almost refused to sign off given the state of the accounts), the state of Newlands stadium or lack of a move to the Cape Town Stadium. Hell, even the new Currie Cup format they voted in was named as a reason!

And now it looks like they will get away with liquidating an arm of the union in order to escape what looks to be a fair creditors claim incurred through their stupidity. My knowledge of corporate law is a little stale, but is there not a case for piercing the corporate veil here?

Not that there should be corporate arms of unions in the professional era in any case. Club rugby – or community rugby as the Kiwis and Poms call it – should be the vital, but small, amateur arm of the union reliant on funds generated by the commercially driven (and privately owned) entity entrusted with the running of professional rugby in the area. Not the other way round!

The Kings were a dog show from the start, but together with that embarrassing mess, this forced liquidation by WP simply has to be the straw that breaks the camel’s back and forces change.

It’s yet another reminder that rugby in SA is still run by amateur era structures which deliver amateur era administrators that are ill-equipped to run the game. And until that changes, no amount of coaching indabas will move our game forward.