David Koch: I’m sick of stadium bashing by State Governments. It makes no financial sense

David Koch
The Nightly
4 Min Read
It's time for State Governments to stop stadium-bashing, writes David Koch.
It's time for State Governments to stop stadium-bashing, writes David Koch. Credit: The Nightly

I’m sick of myopic penny-pinching State Governments backing away from big events and major sports infrastructure. Apart from being just plain embarrassing, it makes no financial sense at all.

If I hear one more politician blurt out motherhood statements like “We should spend the money on schools and hospitals”, I’ll scream. It is absolute political nonsense to garner cheap votes.

If you follow that logic, then governments should spend every dollar on schools and hospitals.

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There is never an argument on how much is enough to spend on schools and hospitals and what other spending could be cut back to provide extra dollars.

Maybe politicians’ electoral allowances, or parliament house dining rooms, or VIP aircraft?

It is a stupid argument unless there is a specific target on what is actually enough.

Big sports events or stadium infrastructure just seems to be an illogical target.

In the last nine months, we’ve had the Victorian Government pull the plug on hosting the Commonwealth Games because of the expense. Now the Queensland Government is backtracking on the Olympic Games and bucking against the $2.7 billion redevelopment of the Gabba.

A focus of the recent Tasmanian State election was on the proposed $750 million stadium tied to the granting of an AFL licence and the establishment of a local team in the national league.

Tasmania’s entry into the AFL is subject to the construction of a 23,000-seat undercover stadium at Macquarie Point which would provide spectators with the same standard of facility as all other AFL clubs.

All major parties in the election claim they would renegotiate the agreement. They’ve got Buckley’s chance.

A couple of years ago the same political furore surrounded the $830 million redevelopment of Sydney Football Stadium. Again, the old “the money would be better spent on schools and hospitals” motherhood statement was trotted out.

All of it is political nonsense.

Back in 2014 the Adelaide Oval redevelopment was completed at a cost of $610 million to become the home of AFL and cricket. Yes, its planning and approval process followed the same political textbook furore and there were even protest marches in the street against the redevelopment and even the construction of the footbridge linking the stadium to the city.

A stadium is a piece of public infrastructure, an asset, which generates an economic return and appreciates in value over the long term.

Ten years on no one will admit to being part of those protests as the Adelaide Oval redevelopment is seen as one of the most significant long-term economic drivers of the State. It is a public infrastructure showpiece.

Its impact on tourism and hospitality has been enormous. This weekend SA basks in the attention of hosting Gather Round, a festival of AFL football that would not have happened without the Adelaide Oval upgrade.

This weekend alone the event will generate more than 150,000 visitor nights and inject over $90 million into the SA economy. Over 40 per cent of tickets have been sold to interstate fans.

That $90 million every year from this one event goes to local hotels and restaurants which employ people and make profits which is then channelled by Government into schools, hospitals and ambulances. The healthier a State economy is, the more it can fund schools and hospitals.

A stadium is a public asset that generates economic activity.

That’s where politicians mislead voters with their motherhood statements. Yes, the cost of the Olympics and Commonwealth Games or a stadium rebuild is a big number. But it’s not a one-off cost. It’s an investment in assets that will earn money for the State for decades.

The Queensland Government says $2.7 billion to redevelop the Gabba, and its surrounds, is too much for a two-week event like the Olympics. Obviously that’s right if it was just for a two-week event. But it’s not.

The Gabba will have the Olympics as a client for two weeks but then for the next 40 years will host Brisbane Lions home games, test cricket matches, stadium music concerts, monster trucks and the list goes on. If Brisbane doesn’t have a world-class stadium it is likely it would lose events to other states.

For the next 40 years, the Gabba would attract hundreds of thousands of tourists spending up in the local economy and providing even more health and education dollars.

On a personal level, buying a house is a big ticket item for anyone. It’s a scary commitment but people do it because it provides them with a place to live and an appreciating asset to build their personal wealth. They might renovate and add an extra room because it adds value to the property. They might rent it out to earn extra cash.

It’s no different to a stadium except on a different scale.

A stadium is a piece of public infrastructure, an asset, which generates an economic return and appreciates in value over the long term.

And that is the nub of the problem — long term.

Unfortunately in modern politics, decisions are made for short-term political gain rather than long-term investments for the economic benefit of the State and country.

Unless we stop being suckered in by these short-term motherhood statements, even schools and hospitals will suffer over the long term.


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