Nelson Mandela Bay mayor Babalwa Lobishe has refused to back down on her termination of the development agency’s mandate to run the city’s stadium — despite threats of action over what some are calling an unlawful move.
At the Nelson Mandela Bay Stadium on Monday alongside Eastern Province Rugby Union president George Malgas, Lobishe said the Springbok match against Italy would go ahead as scheduled on Saturday without any involvement from the agency.
Lobishe’s decision had sent shock waves through rugby circles, prompting an urgent meeting with the South African Rugby Union earlier on Monday to address the growing uncertainty.
Lawyers representing the Mandela Bay Development Agency (MBDA) issued an urgent letter to Lobishe on Monday, warning that the municipality’s termination of its management mandate was unlawful and would be challenged in court if not immediately reversed.
MBDA chief executive Anele Qaba declined to comment on Lobishe’s statement.
Addressing the timing of the termination, Lobishe said there was never a right moment in governance for such decisions, implying that the stadium would continue to host major events regardless.
“There is jazz coming and many other events which will be hosted at the stadium so we might say it is not a good time now but will tomorrow be a good time?” she said.
“If we were to consider other events taking place here, there wouldn’t be a good time to take back the mandate.
“As the municipality, we are given the responsibility to manage public funds and in the course of doing that, we must be able to do so every minute and when we see part of our revenue collection can be better achieved through the stadium, we ought to do that.”
Lobishe said the stadium’s management mandate had rotated among various municipal departments including economic development, sport, recreation, arts and culture, as well as budget and treasury.
She said any contracts related to the stadium held by the MBDA would be inherited and closely monitored by the municipality to ensure clarity and the continued success.
“There are no employees that are going to suffer or services that are going to suffer from the changes that are being instituted,” Lobishe said.
The municipality and the MBDA have not seen eye to eye for quite some time.
In October 2023, the MBDA took the municipality to court after the council resolved to dissolve the agency’s board.
However, the Gqeberha high court ruled that the board, chaired by Glenda Perumal, was lawfully constituted.
At the time, the city had withheld funds owed to the agency, but judge Jannie Eksteen ordered that all outstanding payments be transferred to the MBDA.
Meanwhile, BLC Attorneys, representing the MBDA, said the agency would continue its operations at the stadium in accordance with the service level agreement.
These include the preparations for the match on Saturday.
In a letter to Lobishe on Monday, the agency’s attorney, BLC director Sonja Tifloen, said that the service level agreement with the municipality had been extended for a considerable time and was still in operation.
“Indeed it seems clear that the original service level agreement has been tacitly relocated from time to time,” Tifloen wrote.
“The agreement between the municipality and the MBDA can only be terminated on reasonable notice.
“Having regard to the original terms of the service level agreement it seems clear that a period of 90 days has always been regarded as a reasonable period.
“Under the circumstances your decision to withdraw the mandate with immediate effect is unlawful and ineffective.
“In any event, with respect, you do not have the authority to withdraw the mandate.”
Tifloen urged the mayor to confirm as a matter of urgency that operations of the stadium by the MBDA would continue.
She said the MBDA reserved the right to approach the high court for urgent interim relief.
Asked about concerns over pending legal action against the municipality, Lobishe challenged this notion, questioning how an entity owned by the city could take legal action against it.
“Where would they derive their power from? They are fully owned by us, given a mandate by us and monitored by us,” Lobishe said.
“Our memorandum states we can withdraw the mandate any time.
“We did not sleep and wake up and take the decision when it is clear legally.”
In an email on Monday, Saru’s head of legal and compliance, Chantal du Pisani, requested an urgent meeting with the MBDA and the metro to discuss the development.
“It is a serious concern that we have been informed of the termination of the MBDA’s mandate to operate the stadium,” Du Pisani wrote.
“Please be advised that the South African Rugby Union has a binding agreement with the MBDA for the use of the stadium this coming weekend to host a Springbok Test match which forms part of our national and international obligations.
“This sudden development raises significant risks to the delivery and integrity of the event.”
Du Pisani requested a meeting to clarify stadium operations, assess risks to the match, ensure safety preparations and secure stakeholder protection.
At 4pm, Saru released a statement after meeting the municipality.
A spokesperson said preparations were proceeding as planned, noting that the 9am operations meeting with venue staff took place without any disruptions.
“We have no concerns in any way that the match will be affected and will make no further comment on the matter.”
Meanwhile, in an internal memo, Qaba urged calm ahead of the game.
He said management and employees working at the stadium remained contracted to the agency and may not report to anyone else.
“The board and I are engaging the municipality on this matter and taking the necessary legal advice on the best way to proceed, so until advised differently, we continue as normal.
“The stadium is due to host its biggest event in a long time, and this requires focus and no distractions.
“We encourage you not to be consumed by this as any negative rumour is likely to breed further anxiety and discomfort among colleagues.”
The Herald
Would you like to comment on this article?
Sign up (it's quick and free) or sign in now.
Please read our Comment Policy before commenting.