WPRFU elections: The good, the bad and the ugly

OPINION: It was Scottish novelist, poet, playwright and historian Walter Scott that coined the phrase: ‘O what a tangled web we weave, when first we practice to deceive.’

This certainly rings true when it comes to election campaigns.

And the build-up to the election to replace Thelo Wakefield as Western Province Rugby Football Union President rank up there with the most fallacious political crusades you can find.

And expect it to get egregiously worse as election day (Monday, November 26) gets closer.

• See candidates’ list below!

In a recent letter to the clubs, the outgoing President, Wakefield, asked them to uphold certain intrinsic values: integrity, passion, solidarity, discipline and respect.

Of those, passion stands out above all as a portrayal of people’s behaviour.

Unfortunately, aspects such as integrity and respect are savagely being trampled on.

The precarious financial situation of the professional arm is the ‘battleground’ in this ‘civil war’.

@rugby365com has extensively reported on the campaigning and in the process stumbled into the unappealing side of the campaigning.

Our reporting has been critical of the Zelt Marais camp, but for the sake of finding an equilibrium, there is a need to question some of the information that flowed in our direction.

For starters, we need to understand that the WPRFU is NOT bankrupt or approaching bankruptcy. Far from it! It has assets (properties) worth hundreds of millions of Rands (ZAR) – some of those bonded as security and some not.

However, it is the Newco, formed after WP Rugby (Pty) Ltd was declared bankrupt in December 2016, that is the cash-strapped entity.

This is the professional arm of the union – which pays the contracted players and permanent staff. It runs the day-to-day business of the franchise’s teams – Western Province (senior and junior sides) and Stormers.

And this is where the waters start to get murky.

Newco, which is wholly owned by WPRFU and have WPRFU officials on its board, never had a cent of its own or any assets when it started out. It has been relying on loans and cash handouts from the union.

That is why the Presidential elections are so important. The new President and his executive will control the WPRFU & Newco purse strings.

It is also why the flow of information has to be questioned and double-checked. A muddle of misinformation could cloud the debate surrounding the candidates … and may already have done so.

* Don’t miss this week’s podcast – looking at the cash crunch n SA Rugby!

One recent report suggested that the “fear” of a 25 percent salary cut for all personnel – including the players and coaches – has gripped Newlands.

However, for perspective, it is worth remembering that pay cut was just one of many cost-cutting proposals put on the table at meetings. Another option is retrenchment (as has been the case at the Lions) or loaning out players to other unions to cut the salary bill. However, you have to wonder where the cash-strapped Newco will find the money to pay severance packages?

As it is, the Newco has been going to the union (the amateur arm) cap-in-hand since it was formed in the wake of the 2016 bankruptcy. And despite being hailed as a ‘turn-around’ strategist, one has to ask why CEO Paul Zacks and the professional arm keep going back to the union for cash to pay salaries?

What actual cost-cutting measures have been put in place by Newco (the professional arm)?

Who are making the decisions for Newco (the professional arm)?

It is well documented that Newco (the professional arm) requires an equity investor to stay afloat. Why has this not been forthcoming? Is it true that potential suitors are loath to deal with certain individuals in the Newco?

Another burning question centres around the proposed property deals – where some of the union’s real estate is developed to generate income. Why is that if the council voted to proceed with said property deals, no deals have been closed in two years? Is blame being unfairly apportioned? Are people playing the ‘blame game’?

Are some officials being short-sighted in their approach to dealing with the current cash-crunch? There are talks of a property deal where Newco/WPRFU will get ZAR20-million up front – to use to cover salaries. However, what will the long-term consequences be? Will the long-term losses be bigger than the short-term gains?

What happens a year from now if they take the ZAR20-million up front and the lack of rental returns put them back in the red?

Is it not perhaps, in the long run, better to bite the bullet now – go for an option where there is no cash up front, but gives the union a higher return in terms of long-term rental?

It is worth keeping in mind that Newco’s salary payouts are being funded by the union anyway. Unless Newco has long-term income plans, they will remain reliant on union funding.

Then, of course, there are the loans owed to Remgro (well over ZAR45-million) and FNB (over ZAR20-million). Perhaps it is worth considering the suggestion that they sell off some smaller properties to get those off the books?

Another predicament is the looming Aerios lawsuit. Will there ever be an independent investigation into the cause(s) and who was responsible for the Aerios saga? Getting out of that pickle will require astute negotiations and it is a mire that won’t go away on its own.

As I said. It is going to get ugly in the final run-in to the elections.

By Jan de Koning
@king365ed
@rugby365com