Cycling SA announcement on racing insurance

As a result of the changes to funding methods and mechanisms available to sporting federations, Cycling South Africa established a Finance Review Committee (FRC) to assess and manage the impact of these changes on the sustainability and financing of the federation.

During this period, it became apparent that one of the services provided to members, being that of racing insurance cover at sanctioned events, was behind on premiums for membership affected from 1 March 2017 onwards.

This matter was immediately addressed by the FRC. Cycling SA is meeting with the insurers this week to address the situation after which an update will follow.

It must be noted that funding into Cycling South Africa may be unpredictable at times. Although funds may be approved, it is the timing of the payment of these funds, which creates challenges resulting in a negative impact on our cash flow. Often payment is delayed beyond actual project dates, meaning that we have to “cross-subsidise” as a short-term measure. This phenomenon is a major contributor to the current situation we find ourselves in.

Also, external factors beyond our control mean that we have to execute pre-approved plans with less funding - a perfect example was the unexpected significant weakening of the ZAR in relation to foreign currency in December 2015. This happened at a critical period when our athletes were at a crucial stage of their 2016 Olympic qualification and preparation plans internationally. Despite the significant drop in our ZAR value we still had to fulfil our international obligations towards our athletes. The only way to do this was to dig into the little funding we had in our reserves and earmarked for other projects. This is just one of the examples where Cycling SA goes out of its way to serve our cyclists – our reason for existence.

The work continues within Cycling South Africa to attract funding into the organisation with many income-generating solutions being pursued along with on-going discussions with potential partners.