The City’s Mayoral Committee has recommended to Council that a municipal entity be established to manage and operate the Cape Town Stadium on behalf of the City. Read more below:
The City of Cape Town’s Mayoral Committee today 20 March 2017 approved a recommendation to Council that a municipal entity be established to manage and operate the Stadium Precinct Area.
This entity will be a state-owned company, fully owned by the City.
‘Our goal is to minimise the financial losses of the Cape Town Stadium and to maximise the potential income streams by increasing the use of the Stadium. In this way, we also hope to create a centre of excellence which is in accordance with the City’s Organisational and Development Plan (ODTP) – a process that we are busy implementing that will transform the work of this organisation in order to transform lives,’ said the City’s Mayoral Committee Member for Finance, Councillor Johan van der Merwe.The municipal entity will have an independent board, which will be tasked with appointing a specialised management company. A service delivery agreement will be entered into between the City and the entity which will set out financial and non-financial performance indicators.
The report that will accompany the recommendation to Council represents the final step of the legislative processes set out in Section 84 of the Municipal Finance Management Act, which need to be met in order to establish a municipal entity.
In following these processes, the City was required to precisely identify the function that the entity would perform; undertake an assessment of the impact that shifting the function would have on the City’s staff, assets and liabilities and to solicit comments from the local community, organised labour and specified national and provincial functionaries.
The functions of the entity will include general facility and operations; events and entertainment services management; commercialisation, marketing and hospitality management; and finance, legal and administration management.
Current staff managing the Cape Town Stadium will be seconded to the municipal entity for a period of three years. The City will continue to interact with affected staff and the relevant trade unions, and keep them informed of the processes.
The entity will be appointed for a period of 50 years, with an option to renew for a further 49 years, in terms of the required Municipal Asset Transfer Regulation. The entity will manage and operate the Stadium Precinct, with the possibility of extending the management function to the wider Green Point Park Precinct in future.
The City will continue to provide support services to the municipal entity for a period of three years. These services include human resource support, internal audit, risk management, accounting, financial management and budgeting support.
‘We are committed to enhancing the financial sustainability of this key strategic asset, as well as its benefit to the broader community and the city’s economy. The establishment of the municipal entity will help to achieve this, and is in line with the City’s broader vision, as set out in the ODTP, to modernise and streamline our government,’ said Councillor Van Der Merwe.