Phillips: Sporting venues need new business model

Finance Minister Dr Peter Phillips said there is need for stakeholders to engage in a serious debate on the business model of sporting venues, which have been relying heavily on the State to support their operations.

"There is a whole question that may need to be taken up elsewhere as to the business model to be used in relation to these facilities, and that is linked to the wider question of what I would call creative industries and entertainment," Phillips said.

The minister made the comment during last Tuesday's sitting of the standing Finance Committee of Parliament, which examined the 2015-2016 Estimates of Expenditure.

Phillips noted that Independent Park Limited (IPL) has been given approximately $70 million to help make up for a shortfall as a result of sporting associations failing to honour their obligations for use of the facilities.

"We have to consider how we utilise these facilities to advance the interest of the country," he said.

grant reduced

The grant to IPL is being reduced from $211 million this year to $165.4 million next fiscal year.

Olivia Grange, the opposition spokesperson on sports, questioned the impact that it would have on IPL's ability to remain viable, especially in light of huge debts owed by national sporting organisations.

However, Dr Phillips said that while there is a reduction, support has been given to IPL to ensure it stays afloat.

"There is an additional provision, an increase of close to $40 million for utility and communication services being provided. There is $42 million for goods and services. Where you have the decrease is in appropriations in aid, which is really the estimate of what they will earn at Independence Park, and no doubt, the operators will have to look at their business model and their earnings."

Independence Park Limited is responsible for the day-to-day management and maintenance of the sporting and recreational facilities of the Independence Park Complex, which comprises the National Stadium, the National Indoor Sports Centre, the National Aquatic Centre, the National Arena, the Leila Robinson netball courts, and the basketball courts.

IPL, last year, set a target of earning $39.6 million in revenue through the rental of its premises, which has been lowered to $35.5 million.

"Over the years, the associations have not been able to pay, and so there is this amount outstanding to IPL, and so realistically, they can't project for this year," Grange commented.

Meanwhile, Natalie Neita Headley, the minister with responsibility for sports, said the Institute of Sports (INSPORTS) is to be reorganised. The entity's budget is to be lowered from $544 million to $499 million.

INSPORTS is responsible for development of a national network of world-class sports support services.

"There has been greater collaboration with the private sector. There is a new corporate plan, which is in place, which has been the result of further analysis. For example, there are some of the responsibilities that are currently carried by the Institute of Sports, which we believe would be firmly taken over and probably more suitably handled by another agency of sports," Neita Headley said.

"What is happening is the procurement of the proper personnel to be engaged to do the analysis that is required to do the restructuring so that the institute can be properly positioned to carry out its mandate as it was intended," the minister added.