Tottenham Hotspur Stadium in London. (Photo by Adrian Dennis / AFP)
The proposed sponsorship deal between SA Tourism and Premier League football club Tottenham Hotspur will not proceed, Minister of Tourism Patricia de Lille confirmed on Thursday.
The official confirmation comes nearly a week after De Lille “advised” SA Tourism board to stop the deal because it was unlawful and invalid.
The minister had written a letter to SA Tourism’s board asking whether the deal was budgeted for, whether it met procurement requirements and whether it was formally cancelled.
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The R900 million deal with the United Kingdom (UK)-based team was met with anger after details on the matter emerged in February, prompting three SA Tourism board members to resign.
SA Tourism, which defended the deal claiming that it would get R88 million in return on investment over a three-year period, then decided to launch an investigation to find out who leaked the information of the deal to the media.
In a statement released on Thursday, the minister confirmed the agency agreed not to proceed with the proposal.
“The SA Tourism Board will no longer proceed with the transaction, nor will it seek the concomitant requisite approvals for the proposed transaction.
“As stated before, in the current economic climate, the use of public funds must be carefully considered and for any department to fulfil its mandate, it must be done in a cost effective way, exploring multiple options and with due consideration for all priorities,” De Lille said.
“Our justification for any significant spending must still make sense in terms of the broader economic climate we find ourselves in as a country.”
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She said the focus will now turn to carrying out growing the country’s tourism sector through other avenues.
“I will also continue engaging SA Tourism and the department in more detail on the budget to ensure that we fulfil our mandate of growing visitor numbers to South Africa, providing the necessary support to enable growth, increase job creation and increase the sector’s contribution to the economy.
“It is my hope that all proposals going forward will be discussed at the earliest time to ensure that the myself and the department, together with our main entity SA Tourism, works together from the onset and seeks advice and support from one another while following all due processes and legislative requirements,” the minister continued.
Last week, De Lille revealed that a legal opinion indicated that the deal was unlawful and invalid because it did not comply with the Constitution, the Public Finance Management Act (PFMA) and SA Tourism’s own supply chain management policy.
“It appears that the sponsorship is a service which was proposed to be acquired by procurement through sole source. Sole source procurement is, however, only allowed where there is no competition in the market and only one supplier is able to provide the goods or services, which does not appear to be the case here,” she said on Friday.
The minister added that the deal has not been budgeted for and expenditure in that regard would be irregular.
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