PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE FOR SPORT AND RECREATION

1. PRESENTATION TO THE PARLIAMENTARY PORTFOLIO COMMITTEE FOR SPORT AND RECREATION By: Ray Mali, UCBSA President Gerald Majola, UCBSA CEO 13 September 2005

2. INTRODUCTION • We have been invited to address this Committee on four issues: • The proposed franchise system for the next four years • Development programmes in the Amateur Cricket Division • The UCBSA’s financial status • Mass participation and Women’s Cricket

3. FRANCHISE SYSTEM • It is important to understand the background to the implementation of the franchise system and so we will give the Committee a brief historical sketch before we outline the status quo. • During the 2001/2 season, the UCBSA Finance Committee and other stakeholders became concerned about the 11-team professional domestic competition for the following reasons: • The size of the competition was making it increasingly unviable • Playing standards had dropped and the gap between domestic and international professional cricket was widening • The dropping standards were alienating the public, sponsors and broadcasters

4. An independent team from PriceWaterhouseCoopers was appointed to interview all stakeholders and make findings and recommendations to the UCBSA. • They recommended that a franchise system be introduced on a strength vs. strength basis. This would address the three concerns outlined earlier if the franchises were limited to a viable number.

5. UCBSA General Council decided on 31 August 2003 that six franchises be appointed based on them: • Covering the entire country geographically • Beginning operation for the 2004/5 season • Criteria were established for the franchises, including the acceptance of the UCBSA’s Transformation Policy.

6. The franchise companies are responsible and accountable for operating the six professional teams under the auspices of the UCBSA’s professional wing, Cricket South Africa (Pty) Ltd. Each was given a grant to kick start the season. • This releases the UCBSA’s Affiliates to concentrate on the development of the game at amateur level and become feeders for the professional teams. • The six professional teams are: Goodyear Eagles, Highveld Lions, Mercedes Warriors, Nashua Dolphins, Nashua Titans and Nashua Cape Cobras.

7. The system was a big success in its first year of operation and a review process was put in place to look at operational matters as agreed before the season. • After the season ended, General Council appointed two independent members of the Franchise Review Committee to submit findings and recommendations, namely Professor Kader Asmal, former Minister of Education; and Mr. John Smith, Chairman of the former Ministerial Committee on SA Cricket Affairs.

8. They were joined on the Committee by UCBSA General Council Members to provide administrative support and these were: Chairperson of the Franchise Criteria Committee, Mr. Rob Kurz, Legal and Governance Sub Committee Chair, Advocate Norman Arendse; and myself as CEO. • The main recommendations of the report of the two independent members was adopted by General Council, namely the six team franchise system should be retained for a period of at least four years. • The only Affiliate that has not participated in the system is Griqualand West Cricket Board.

9. They brought an urgent application in the High Court seeking relief to review and set aside the recommendation of the Franchise Review Committee. The application was struck from the roll, with costs, after the court finding that the matter was not urgent. • We are still in talks with Griquas on the matter and hope that they will join the vast majority of South African cricket structures that support the franchise system.

10. We can assure the Committee that the new system is achieving its goals. • It will make South African cricket sustainable • It will produce better cricketers • It envelopes and includes all regions of South Africa • And it will clear the way for even more focus on amateur cricket

11. DEVELOPMENT PROGRAMMES IN THE AMATEUR CRICKET DIVISION, MASS PARTICIPATION AND WOMEN’S CRICKET • As was stated earlier, the creation of the franchise system has cleared the way for the UCBSA and its Affiliates and Associates to focus even more on the development of amateur cricket. • A key element of our strategic plan has been the broadening of the base of South African cricket through the new domestic competitions for both Affiliates and the five new Associate Members. • The new Associate Members are: • KwaZulu-Natal Inland ▪ Limpopo ▪ Border-Kei ▪ • South Western Districts ▪ Mpumalanga

12. The regions have now been drawn into the mainstream of cricket, whereas before they were mainly confined to rural or country districts cricket. • They play their own competitions, with both three and one day cricket, and their players feed into the franchise system. • In this way, we are able to identify talent in all four corners of South Africa and provide a ladder for the players to climb right into the national team. • We have fortunately been able to secure a sponsorship for all these amateur competitions through SA Airways.

13. This sponsorship is the first of its kind for cricket and is a major breakthrough for the amateur game. It means that we can organize a double round of competitions for Affiliates and Associates providing them with even more cricket than last season. • We also have our High Performance Centre in operation at the University of Pretoria. This centre is used to prepare promising youth players from both the amateur and professional ranks to go to a higher level. • Linked to the High Performance Centre are regional Schools of Excellence which have been built as part of our World Cup Legacy Project.

14. This flagship project, launched in 2003, is entering its last year. The progress to date has been excellent. • Most of the projects are now completed with only 6x of the 54 still in constructions. • Recently we officially opened the Krish Mackerdhujh Oval at Fort Hare University, the Basil D’Oliviera Sport Centre at Rondevlei and Fred Hufkie Cricket Oval in the Camdeboo Municipality. • These Schools of Excellence Centres are in turn linked to mass participation programmes at youth level, involving both schools and club cricket.

15. Our schools programme comprises: • School vs. school • District camps • Regional teams • Winter programmes • Trials • Talent camps • National weeks • U19 tours and World Cup competition

16. The schools system feeds into cricket at club level, where we have put a special focus. We believe that clubs are the key to linking youth and senior cricket and we are going out of our way to develop clubs. • We have launched a club administration course nationally in conjunction with SETA accreditation to ensure that clubs are run properly. • We are presently seeking a sponsor for Premier Club Leagues on a national basis as part of our programme to uplift club cricket.

17. Our budget for mass participation and development programmes for the coming season is in the region of R40-million. We have full time coordinators in all the regions to ensure that the programme is in place and the funds are being spent in the right way.

18. WOMEN’S CRICKET • The UCBSA remains committed to the advancement of Women’s Cricket which has now formally joined the mainstream of South African and international cricket. • The highlights of last season for women’s cricket were: • Successfully hosting the Women’s Cricket World Cup 2005 • Implementing the first home-and-away provincial league for Women’s Cricket in South Africa • The secondment of the SA Women’s Cricket Association President to the UCBSA’s General Council

19. The International Women’s Cricket Council stated that the World Cup was the best yet held anywhere. • One of the major contributing factors to the success of the tournament was the partnership between the UCBSA, local Government (Tshwane) and Central Government (Lotto and the Sport and Recreation Department). • It is this kind of partnership that needs to be extended nationally into nation-building aspects of cricket. • We were particularly grateful for Lotto funding, because we have yet to secure a sponsorship for Women’s Cricket which is a sad indictment on commerce and industry.

20. Despite this draw-back, we will continue to fund the development of Women’s Cricket but we need more support in order to do all the projects that are needed.

21. FINANCIAL STATUS OF SA CRICKET • The systems that we have in place to develop cricket are extensive. Because of historical imbalances of the past, they are also expensive as these challenges are unique to South Africa in world cricket. • Operating in the South African context, we have to ensure that we: • Produce a world-class national team • Develop our sport from a mass base that has been historically deprived of facilities and capacity building

22. One of our major challenges is that our revenue streams are dependent in the main from international television rights. These in turn are dependent on a 10-year international programme devised by the International Cricket Council. This makes our revenue graph look very up and down, while the demands on our funds from the national team and the development programme are constant. • We have introduced a culture of strict cost controls and internal auditing and, as a result of these measures, we have managed to achieve an operating profit when an operating loss was forecast in our budget.

23. We have also been able to increase (when comparing 2003/4 with 2004/5) our allocations to our Affiliates for amateur cricket by a significant R15-million off a base of R30-million – an increase of about 50%. • However, we have been hit hard by the strong Rand and this has denied us the opportunity of returning a very healthy surplus that would have protected our reserves. • Had the Dollar/Rand exchange rate remained as it was three years ago, we would have had an extra R50-million for development.

24. It is obvious that we have to find ways of expanding our revenue sights beyond international television rights and continue improving efficiencies and reducing costs. • The next two years will see some belt-tightening, but not at the expense of amateur cricket where, as already stated, we will be spending over R40-million this coming season.

25. CONCLUSION • South African cricket is on a sound financial footing, but it is becoming increasingly difficult to go it alone. We need more partners from Government, commerce and industry if the development of cricket is to take place on a scale that this nation deserves. • We particularly need assistance from local government regarding the maintenance and establishment of facilities. • We are still very hopeful that this Committee will establish a Cricket Sub Committee to help in this regard as was envisaged by both of the UCBSA and this Committee three years ago.

26. This partnership would go a long way to assisting us to use all the potential available to make South African cricket a truly national sport of winners.