COSATU alarmed that SA Tourism’s CFO has admitted to a relationship with the agency involved in planned R1 billion football sponsorship deal

3 February 2023

The latest media revelations that SA Tourism’s interim Chief Financial Officer, Johan van der Walt, has been reported admitting to having a relationship with an agency that is involved in the proposed R1 billion football sponsorship on an English Premier League team needs to be investigated. We call on government to halt this deal until such time that the involved parties can clarify themselves and provide more details on allegations of conflict of interest.

The Federation is fully supportive of all efforts to revive the tourism sector, and totally understands the need to advertise South Africa around the world to encourage more tourists to visit our shores. What we find questionable is for SA Tourism to spend more than a third of the budget allocated to promote South Africa’s tourism sector on a single deal.  This is alarming in the absence of any factual evidence showing the return on investment for such a deal. This has been scorned by tourism and marketing experts as little more than a bail out by a struggling developing economy of a pampered English soccer team, who’s impact on promoting tourism to South Africa has not been quantified. 

The misplaced bravado of the CEO of SA Tourism is discomforting, to say the least.  There are no allocations for such a reckless appropriation in the Budget or the Medium-Term Expenditure Framework.  Such an allocation in the absence of it being approved by Cabinet and Parliament would not only be fruitless and wasteful expenditure, but in fact unlawful. 

The tourism sector is an important sector of our economy and is relatively labour-intensive and would help the country with foreign earnings. But the extravagant claims and economic projections being made by SA Tourism are not new, they were made by the organisers of the 2010 Soccer World Cup. But up until today, there are no reliable figures to justify that level of investment that was made a decade ago.

Tourism’s importance is sometimes overplayed, it remains a largely low-wage sector that is vulnerable to adverse natural, geopolitical, and global economic contingencies on which government has no control over. Covid-19, the 2015-18 drought in Western Cape, and terrorism threats have undermined tourism before, especially from Western Europe.

Too much emphasis is placed on these service and primary sectors, but this is not transformative in terms of the neo-colonial structure of the economy nor its location in the international division of labour.

This controversial deal also shines the spotlight on the fact that many senior and strategic positions at SA Tourism are occupied by people who are acting and not permanently employed. The Federation has been consistently arguing against interim chief executive appointments in the SOEs and state agencies because this creates instability of management and leadership and undermines stakeholder confidence. This needs to be rectified as soon as possible because its not sensible to entrust important decisions to people who pay no price for being wrong.

The Presidency, Treasury and the Department of Planning, Monitoring and Evaluation need to intervene and manage this clandestine proposal it erodes what is left of government’s credibility. The government needs to urgently attend to the list of concerns and irritations being raised by social partners and stakeholders. This saga calls for political leadership to tame and chaperon the self-righteousness, absence of sound fiscal moderation and misdirected idealism of SA tourism.  

Issued by Sizwe Pamla, National Spokesperson, COSATU, 3 February 2023