Courtesy of... 
By Bernard Hickey
5:30 AM Sunday Jun 5, 2011
By Bernard Hickey
5:30 AM Sunday Jun 5, 2011
IRB CEO Mike Miller, here with Aaron Cruden, has a sweet job.
As it's based in Dublin, the International Rugby Board (IRB) should know a thing or two about bailouts.
It's time it considered a request for one from the Government of New Zealand.
It has become clear this week that Kiwi taxpayers face a loss of close to $100 million if, as seems likely, hundreds of thousands of tickets are unsold.
This means we face the enviable prospect of borrowing money from China's sovereign wealth fund to, essentially, pay for a bunch of rugby bureaucrats in Ireland to swan about the world having long lunches and doling out cash to develop the game in places such as Georgia and Kazakhstan.
Let's not beat about the bush here. Our Government is likely to borrow $20 billion or the equivalent of 10 per cent of GDP this year. It is cracking down on all sorts of spending.
People will be made redundant. Public services will be cut. We are in for a fiscally painful time.
So why are we subsidising a bunch of sports bureaucrats?
IRB chief executive Mike Miller said in December last year the IRB expected to make a profit of about £95 million ($200 million) from Rugby World Cup 2011, through the sale of media rights, sponsorships and corporate event packages.
Meanwhile, the-then Labour government agreed to a deal in which the taxpayer underwrote the two-thirds of the $39 million of losses expected from the tournament.
That assumed that 1.35 million tickets out of a total 1.6 million tickets were sold.
The rugby union and the Government have jointly taken responsibility for that.
So far only half the tickets have been sold and there are fewer than 100 days to go. There is now a significant risk that fewer than a million tickets will be sold. That leaves a potential shortfall of $70 million, adding to the $39 million of losses already budgeted for.
The Christchurch earthquake has obviously changed the landscape, as has a near four-year-long recession that is making rugby supporters much more cautious about spending their money on non-essential items.
Already, the games scheduled to be held in Christchurch have been moved and $20 million has been refunded to 150,000 ticket holders.
This potential burden for the New Zealand taxpayer is added to the money ploughed into stadia and infrastructure although, to be fair, the benefits will be felt for years to come rather than just over the next six months. Almost $500 million has been pumped into building the new Dunedin stadium and redeveloping Eden Park.
The New Zealand Herald has estimated a further $53 million will be spent on cup-related activities by police, Tourism New Zealand, the Transport Agency, New Zealand Trade and Enterprise and other government departments.
And then there's the $2 million for the Tupperware waka.
So we've already paid more than our fair share for this party, which will generate $200 million for the IRB.
The least the rugby bureaucrats could do is waive the hosting fee, which is currently included in the $310 million running costs of the tournament. It could stump up for some of the running costs for the tournament.
And if it doesn't do that, perhaps a little pressure could be applied by either the Government or spectators. After all, it will be free on television.
Perhaps we as taxpayers should save our hard-earned money and simply watch it on the telly. Sponsors and television rights holders, who are paying the IRB rather than the Government and rugby union, may not enjoy seeing their "product" prancing around in front of empty stands.
It makes no sense for us to borrow to line the pockets of rugby bureaucrats in Dublin.
My Right of Reply...
Touche Bernard!
Rugby is a sport that is dynamic and is part of a fast-growing sector (not on a par of course, with the 'Most Beautiful Game to Grace our Entire Global Estate - Football), which currently it's macro-economic impact is underestimated.
As yet and in due course, Aotearoa aka New Zealand will be able to draw some conclusions with some comparable and sound data as to the the impact on value-added and purchasing power that the Rugby World Cup will have on employment.
The economics on this large-scale sporting event, the physical in-activity costs, including the ageing population (health care cost reduction and health promotion) and by sector specific analysis (e.g. sport and tourism as economic drivers).
The further globalisation, commercialisation and professionalism of Rugby, with it goes hand in hand increased sports sponsoring, sale of broadcasting rights and ticket sales (which currently, due to some unforseen circumstances "So far only half the RWC tickets have been sold and there are fewer than 100 days to go").
The sport structures and facilities remodelled, built and work still in progress are and will be innovative investments and once reconfigured at the conclusion of the RWC will hopefully meet the evolving sport and physical needs, of the 21st century especially for those Kiwi's at the local level.
Sport has been identified as a growth area offering job potential and the main reasons for this are:
- The reallocation of income to health and leisure activities;
- The development of sporting activities which affect a wider part of the population (young people, elderly, people with disabilities) and meet a variety of needs (leisure, entertainment, health, education);
- Changes in the supply of sport
My own opinion is that sport can make positive contributions to the attainment of goals, but it needs to be made more Explicit and the potential of sport should therefore be made more visible in policy-making at the political level. Mechanisms and methods need to be identified to ensure that sport is taken into account in the framework. However, the launch of policy actions and enhanced cooperation on sport at the political level, needs to be underpinned by a sound knowledge base by both governmental and non-governmental stake-holders in order to coordinate efforts to improve the quality and comparability of data (Trustworthy statistical information on sport and sport related matters, being a necessary pre-condition for developing well founded policies and for giving sport a higher profile in other policy areas) and also to allow better strategic planning for sport here at home in Aotearoa.
Trustworthy statistical information can provide the factual means to assess the need for and progress of political initiatives.
"Rugby, with it goes hand in hand increased sports sponsoring," MEMA, Major Event Management Act, 2007 is that all the government has to date, accomplished! and with only One Pitiful Prosecution!
The Fruits contained within the... 'World of Sports' can also be Savoured and Devoured by All and Sundry in Aotearoa (Land of the Long White Cloud)...We the Occupants...2
Kiaora kia koutou katoa
Greetings to you ALL ;)
