FIFA World Cup? (1 Viewer)

[loquasagacious]

The $2.9 billion is what PricewaterhouseCoopers reckons hosting the cup could cost after meeting FIFA's stringent and sometimes outrageous conditions. According to FIFA - the quaint governing body that can't organise a video replay to prevent blatant cheating - no Australian stadium is good enough and no other major sporting events will be allowed within a couple of months of the round ball tournament.

Hilariously, Australia has already signed up to comply with FIFA's whims and fancies despite the only costing apparently being the PwC study commissioned by Frank Lowy's FFA.

Uh-oh, that sounds rather like an ''independent expert report'' and most of us know what independent expert reports are like: they tell those paying for it pretty much what they want to hear. Think all those independent expert reports for the likes of Timbercorp and Great Southern, the report that found AMP buying GIO was a good idea and the amazing divergence of opinion whenever the two sides of a contested takeover each hire an ''independent'' expert.

Given the track record of such hired experts, in my opinion there is good reason to be wary, very wary, of the PwC numbers.



Before blow-outs
Even taken at face value, it's pretty scary stuff: they're already talking of an Australian World Cup running at a tangible $1.3 billion loss and that's before all the usual blow-outs and complications and after optimistic assumptions about the number and type of tourists that might come. (You might need a considerably larger security spend on English soccer fans than you do on British and Irish Lions rugby fans, for example.)

And there's another reason why the FFA/PwC numbers could be fraught with fiscal danger: for some strange reason, they're a big secret.

People and organisations in my experience tend not to be overly protective of robust reports of which they're proud. Ask PwC for the copy of the report and you're told, not unreasonably, that it was commissioned by FFA and therefore belongs to them so it's up to FFA to release it. Ask FFA for a copy and the answer is ''no''.

It has been selectively leaked though to the AFR which last week described it as a ''PricewaterhouseCoopers business case prepared for the government''. My understanding would be more like ''an FFA pitch for a couple of billion dollars of taxpayers' funds''.

I'm reduced to working off the AFR report of the PwC report which ''assumes'' a maximum spend of $2.9 billion on stadia and predicts that the nation would receive in return $345 million in net benefits.

And that's where the report leaps into the wonderfully vague world of intangibles. You see, you can only come up with those $345 million in net benefits if you also predict a very abstract $1.64 billion windfall from the promotion of ''Brand Australia''.

The last time I saw crucial intangibles of that order was in ABC Learning's last set of accounts.

German model
It looks like the PwC/FFA study draws heavily on the German experience of staging the latest World Cup with a claimed 1.1 million visitors. Put on a soccer tournament when your neighbours are a couple of hundred million soccer fans and there's a good chance several will drop by for a look. Stage the same tournament on the other side of the earth, well, you can't just walk over.

A much better comparison might be made with the Sydney Olympic Games, the ''best ever'', of course. And a great party too for everyone involved, a fantastic time to be a Sydneysider. Even crime rates dropped sharply. There was a suspicion something mildly mind-altering may have been added to the water for the duration.

And there was massive global coverage of ''Brand Sydney'' and ''Brand Australia'' with the games and everything about them receiving positive play. One can only wonder what valuation PwC might have put on that at the time, especially with the then-rich North American market that isn't soccer-crazy but enjoys a good Olympics.

But the rich wave of international tourists didn't really come. The events were generally filled with wonderfully generous Australian fans. And New South Wales is still paying for the hangover with that ``Brand Sydney'' stuff proving very intangible indeed.

So far it seems the hoi polloi haven't caught on to what an enormous spend the soccer mob has signed us up for if we win the bidding competition. (And that's not a cheap game to play either - you could fund Australia's Copenhagen delegation many, many times over and still have change for team t-shirts and budgie smugglers.)

There's been a story about gaps already appearing between the NSW and Federal Governments over exactly who would pay the $200 million just to make Sydney's ANZ Stadium acceptable for FIFA, but that is less than 7 per cent of FIFA's ''business case'' cost.

And for a really good laugh, there's an internet soccer writer who's opined in relationship to the AFL apparently not wanting to get out of FFA's way:
''The economic benefit created by hosting a World Cup would be massive, so FIFA and the FFA will be in a position to financially compensate the AFL for any losses.''

Yeah, right. And if you believe that, you could probably hang out a shingle for writing independent expert reports.

Should Australia even be trying to host the World Cup? Why/Why not?

Is it the place of Government to fund major sporting events?

 

[A High Way Man]

That article is pretty shit

 

[abhi23]

What's up with "no Australian stadium is good enough"?? Gee I thought we had some pretty good ones.

I'd like to see a World Cup here but not if it's that expensive and reliant on intangibles. What does the report say about estimated ticket revenue?

The RWC 2003 was pretty successful - it got state gov. grants, therefore football would demand it too.

 

[jennyfromdabloc]

No. The idea that it could be hosted here without government funding is impossible.

Even if it would provide a net gain to the economy (which I highly doubt) I would still oppose it because it unfairly and arbitrarily creates winners and losers.

 

[Nebuchanezzar]

i think cultural and sporting events deserve taxpayer funding, even if i don't like the sport or culture. makes for a more exciting society or something idk.

pretty boring otherwise. MORE HIGHWAYS FOR CITIZENS

 

[khorne]

I don't think a lot of Australia's are into this kind of football, and additionally, I don't see the potential for the revenue to make up the huge cost.

 

[Nebuchanezzar]

cultural revenue

 

[loquasagacious]

cultural revenue

Have I mentioned my plan to build a 100m tall statue of myself? It will generate a large intanigible revenue of over $6billion, this figure comprises a combination of contribution to Brand Australia and contribution to Australian culture.

 

[Mu5hi]

I don't think a lot of Australia's are into this kind of football, and additionally, I don't see the potential for the revenue to make up the huge cost.

australians love all sports, i bet you the stadiums will be filled.

I think alot of the costs is to get 16 stadiums to have 40,000 capacity aleast.

 

[pman]

No. The idea that it could be hosted here without government funding is impossible.

Even if it would provide a net gain to the economy (which I highly doubt) I would still oppose it because it unfairly and arbitrarily creates winners and losers.

what do you think sport is, one guy (or team) wins and the rest lose

 

[badquinton304]

Its probably the biggest world sporting event aside from the olympics it will bring in money. People travel the world for this event so id assume there wouldnt be empty seats.

 

[jb_nc]

Its probably the biggest world sporting event aside from the olympics it will bring in money. People travel the world for this event so id assume there wouldnt be empty seats.

m8

did you read the article

no, no, yo udidnt

 

[untouchablecuz]

who cares about money

WORLD CUPPPPPPPPPPPPPPPPPPPPPPP

 

[SnowFox]

No. The idea that it could be hosted here without government funding is impossible.

Even if it would provide a net gain to the economy (which I highly doubt) I would still oppose it because it unfairly and arbitrarily creates winners and losers.

Go shoot yourself.

 

[badquinton304]

m8

did you read the article

no, no, yo udidnt

Well I said it will bring in money, nothing about net profit though, said nothing about supporting it or not. I think it will draw in seats. But I generally dont care for sports unless it can be useful by drawing in either immediate profits and/or promoting the country in such a way that it brings in long term benefits.

 

[loquasagacious]

what do you think sport is, one guy (or team) wins and the rest lose

Thanks for identifying yourself as someone who does not understand the issue.

Go shoot yourself.

Thank you for a brilliant contribution. How about you get back to bagging out your erstwhile friends.

who cares about money

WORLD CUPPPPPPPPPPPPPPPPPPPPPPP

Money does not grow on trees. It must come from somewhere. And in this case they are saying that $2.9billion dollars should come from the Government - which is just another way of saying from taxpayers.

Tax should be minimised and new spending does not help this. The tax that is collected should be spent in a cost-effective way - e.g. something which actually generates a tangible return on the investment.

Its probably the biggest world sporting event aside from the olympics it will bring in money. People travel the world for this event so id assume there wouldnt be empty seats.

Well I said it will bring in money, nothing about net profit though, said nothing about supporting it or not. I think it will draw in seats. But I generally dont care for sports unless it can be useful by drawing in either immediate profits and/or promoting the country in such a way that it brings in long term benefits.

You still haven't read the article.

How does bringing in money even matter if it doesn't bring in enough money???

How do you calculate the "long term benefits"? The Sydney Olympics was a good demonstration of how little immediate profit was generated and how few long term benefits were realised.

 

[SnowFox]

Thank you for a brilliant contribution. How about you get back to bagging out your erstwhile friends.

Eh.

 

[debts]

Bullshit we would spend $2.9 billion on stadia - only upgrades to a few stadiums are needed. Stadium Australia was only $680 million, the Melbourne rectangular stadium is $288 million to build from scratch. The only necessary stadium to be built would be one in Adelaide, but they may just go with an upgrade to Hindmarsh Stadium. These upgrades to sporting infrastructures would be far more useful, unlike the whitewater and hockey stadiums left in the wake of the Olympics which are not useful beyond their immediate function.

It's difficult to determine anything at this point, i believe the pure attraction of the event and the region which we are in will be enough for us to generate good returns from the World Cup. Germany's World Cup posted a 94 million Euro net profit just from ticket sales, merchandising and FIFA's subsidy. The boost we would (perhaps) receive from tourism in that period would be immense. But i don't think people will not come; there is too much passion for football for that to happen. Long term - just hope that another 9/11 doesn't happen.

 

[jennyfromdabloc]

who cares about money

WORLD CUPPPPPPPPPPPPPPPPPPPPPPP

If you love the World Cup so much, pay the air fare to go wherever it is hosted yourself.

I don't give a fuck about the World Cup, why should I be forced to pay for it?