PRESENTATION TO CLUBS AND OTHER STAKEHOLDERS RE THE STATUS OF RUGBY IN

EASTERN PROVINCE

Introduction

Many wrong perceptions have been created within the minds of people about EP Rugby. This is done on purpose, with different people / organisations having different agendas. We can’t be blamed for not portraying the positives of our Union and Brand.

Let us focus on what we regard as the most important issue that can bring prosperity to our Province and region:

FINANCES

1. Finances

EP Rugby is split into 2 sections - Commercial [ (Pty) Ltd] and NonCommercial [Union]

Finances – Commercial

INCOME

• SA Rugby Murdock income & BA Sponsorship• Minimal Suites and Advertising

EXPENSES

• Stadium cost (very high)• Salaries of Staff, Team Management and Team

Match Fees

Finances – Non-Commercial

INCOME

• Provincial Allocations & Development (SARU)• Interest on Debentures (Commercial)

EXPENSES

• Development• Provincial Teams & Salaries & Clubs (minimal

assistance)• Biggest cost - Traveling

Major concerns re Finances

• Not continuous top class rugby – not annual Test and Super 14 rugby – Sponsors not getting exposure – more interest when Test and possibility of getting Super 14 Franchise allocated of Test & Guarantees

• Major inequalities from motherbody re % of monies for Commercial vs Non-Commercial

• Negatives from motherbody – Commercial is transferred monthly. Non-Commercial (Development & Provincial) must first incur cost and thereafter claim from SARU

• No financial assistance from motherbody for club rugby – NB!

• Very high cost for Stadium Maintenance – possibly highest in South Africa

• Veto right by SAIL re finances of (Pty) Ltd

Positives re Finances

• Annual approved budgets – try to remain within limits

• Financial Policies and Procedures in place

• Working on Internal Control Systems – challenge

• Rates and Taxes – R3.4 million as at 30 June 2005– Written off on Thursday 20 October 2006– Rebates are now been provided (since 2005)

2. Governance and Transformation

2.1 Governance

• Constitution in place – regulatory document guiding Excom and Clubs

(adhere; consult re amendments; account)

• Code of Conduct

• Drafted Bye Laws

• Financial Policies and Procedures – policies and processes for Finance Management – in line with Constitution

• Policies and Procedures Manual – Communication, Human Resources Matters, Aids, Leave, etc

• Employment Equity Plan

• Business Plan

• Communication & Marketing Plan – consulting in order to re-draft

2.2 Transformation and Development

2.2.1 Transformation

• Transformation Charter re Provincial Teams in place. No major issue – far exceeds transformation targets

Top Leadership

Presidency W C A % Af %Bl- 2 2 50% 100%

25% women (African) in Presidency

Manco W C A % Af % Bl1 2 2 40% 80%

Executive W C A % Af % Bl5 7 4 25% 68,7%

Staff – Senior HOD’s W C A % Af % Bl2 1 2 40% 60%

Staff – Monthly W C A % Af % Bl4 5 6 40% 73,3%

Staff – Weekly W C A % Af % Bl1 1 6 75% 87,5%

Total Staff W C A % Af % Bl7 7 14 50% 75%

NB: Black Economic Empowerment Strategy in place – preference be given for suppliers (small & medium) with a PDI as owner / dominant partner

PTY Ltd – Commercial Arm Directorships

Directors W C A % Af % Bl3 1 3 42,9% 57,1%

2.2 Transformation and Development - continued 2.2.2 Development

• 5 Year Development Strategy in place

• Manager SARU – M Puzi – Best Development Strategy in South Africa

• Vast areas – need 2 more (employment) Development Officers

• Focus Areas– 1 Mass Participation– 2 Capacity Building– 3 Player Development– 4 Sports Science and Medical Services– 5 Management Systems– 6 Sponsorships– 7 Supporters / Spectators– 8 Staff Development

• Working closely with smaller sponsors i.e. Clover, Mecer, Algoa FM (in process to finalise media partnership), NMB Sevens, Lets Play of Supersport (in process)

3. Progress Report – PWC Forensic Audit

• Late 2005 – Findings released with allegations – PWC Report

• 3 Advocates appointed – to further investigate – as suggested per PWC report. Could not complete – suggested we hand over to SAPS (Commercial Branch)

• EPRU – appointed lawyer Chris Unwin to finalise and properly investigate. Speak to all necessary to finalise legal matters

• SAIL (equity partner) – submitted PWC report to SAPS

• Unwin report finalised by August 2006

• SAPS – finished investigation on 23 October 2006. Public Prosecutor to make a final decision re prosecution or not

• Internal DC Hearing under (appointed) CCMA Commissioner Jonathan Gruss – sittings already on – 1 13th September 2006– 2 3rd October 2006– 3 10th October 2006– 4 24th October 2006

• Two processes to be completed. Internally – EP Rugby to make decision. SAPS – Prosecutor – awaiting outcome

• Incorrect that EP Rugby does not want to deal with matter. Even requested SARU/SA Rugby to assist in order for matter to be concluded. EP Rugby has given full co-operation. Incorrect information being disseminated! No money stolen by Excom and/or staff. Not crooks.

4. Rugby

• Regionally – EPRU driving force that Spears Appeal matter be taken out of court and settled by rugby administrators

• EPRU’s view in terms of the Spears– Spears a MUST– Only to participate in Super 14 in 2008– SA Rugby to assist (financially and opportunity wise) in 2007– Annually (after 2008), last SA team to play Promotion/Relegation– Fair compromise on our side. Not sure SARU/SA Rugby plan re the Spears & other matters

• EP Rugby (Pty) Ltd – would like SA Rugby to assist us to part ways with equity partner SAIL. Can however not sell more than 49% equity to SA Rugby

• Approved budget in Commercial Division – only allows for small contracts to players. Scheduled urgent Board Meeting to review budgets and contract values

• Challenge (major) to have more funds available to retain talented identified players. Systems are in place to produce good quality players. Constantly fielded average 47% black players in Vodacom / ABSA Currie Cup teams

• Secure sponsorship for Stadium. Difficult because of Team performance and not definite as to what will happen after expiry of lease agreement (with NMBM) at end of 2007

• Budgets – major impact on retention of players; thereafter performance and crowd support. In most instances, support for rugby has shown steady decline (Clubs, Currie Cup, Super 14 and Springboks)

• All Provincial Teams competed in SARU fixtures. Attained good results. Even expected to supply more teams. Representative of all communities

5. Club Rugby

• Super, Premier and Sub Union Division / Leagues

• EPRU – Effectively runs Super and Premier Leagues. Club competitions – very competitive and regarded as one of the toughest and best organised. Sub Unions struggle with traveling

• Review competitions annually at end of year by clubs. Clubs submit proposal / ideas. End of previous season, new competition structure gets adopted (by clubs) for following year

• End of 2005 – discussions by clubs re competitions for 2006. African Bombers part of these discussions where Special League (2nd competition) was mooted. Accepted by all clubs present, including PE Harlequins, excluding Spring Rose. When Spring Rose raised a question(s) at the 3 rd meeting (Super League meeting at end January 2006), EPRU again put matter on agenda for end of March 2006 meeting. PE Harlequins plus other clubs objected and EPRU had to proceed to schedule matches. Info – all these years EP Primary Schools are structured along same lines. Also SARU Easter and other Tournaments are played along same lines. SAFA in Metro structured along exact demarcations

• Clubs affiliated in 2006 (not all completed season or participated in 75% of matches):

W C A % Af % Bl

10 77 36 29,3% 91,9%

6. Schools Rugby

• Both Primary and High School levels – in good state.

• Very good competition amongst schools in Province

• Development – focus on areas to introduce more schools to the game – grow the game in terms of EPRU Development Strategy

• Both sub-structures of EPRU – organise own rugby, but reports to EPRU Executive – serving on Executive

• Annually EPRU makes available monies to assist with administration and attending of different Youth Weeks

• Only traveling and accommodation assistance from SARU.

• School structures sometimes request players or schools to contribute additionally to cover cost – EPRU ruled against this practice at last Union Meeting in September 2006

7. Relationships

• Affiliated to EP Sports Council – working relationship (gather info) re NMSC

• Regular meetings with NMBM (Local Govt). Get Grant in Aid for facilities from NMBM. Usage of Municipal facilities and EPRU Stadium. R3.4 million debt finally written off

• Provincial Govt - got R750 000 during 2004. Not received thereafter. Good working relationship with NM office (plus officials) and Cacadu offices (officials)

• National Govt – SARU were to supply us with info re funds that are available for us to access

• Good relationship with British Airways – Team Sponsor – 3 years. Need big sponsor for Stadium Naming Rights, Academy, Clubs, Schools, Provincial Teams and Women’s Rugby

• Working on relationship with media – need to do more to further improve. Projects, programmes and activities always made available to media. Inaccurate info presented to public

8. SARU / SA Rugby

• New President’s vision – work to restore good relationships with motherbody

• Motherbody – must do much more to bridge gap between bigger & smaller Provinces

• More Tests, Super 14 and Currie Cup Premier Division to take place in our Region

• Respect Autonomy, Constitution and Protocol in Province(s)

• Honesty required on rugby matters

Conclusion

• Vision of EP Rugby and President – not to be realised overnight

• Working all to betterment of Rugby in the Province

• Respect Constitution and wishes of majority. Also place for those whose dreams are not necessarily realised

• Fresh mandate sought at 18 November AGM. Clubs can replace leadership if they have failed. Observers can oversee election to check that it is free and fair

“The successful experiences most of us would like to have in life are rarely an accident. They are

almost always an achievement, the result of careful planning and thorough preparation.”