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Sep 8, 2009

Golden years

The next decade promises a feast of sport. But will Britain benefit, or will the muddy economy prove to be an obstacle?

The next decade promises a feast of sport, with a number of high profile events taking place in the country. But will Britain benefit, or will the muddy economy prove to be an obstacle? John Bensalhia investigates

For those in the trade, the next decade looks set to be sport heaven. Yes, it’s what’s being touted as the ‘Golden Decade Of Sport’, a phrase no doubt coined by the same minds that brought you such bafflegab as ‘The Credit Crunch’ and ‘Swine Flu Epidemic’.

Beginning in 2010, Britain is promised a feast of sport, with a number of high profile sporting events being held in the country. Next year will kick off with the Ryder Cup, which is being held at Celtic Manor. 2011 will see the Champions League final come to Wembley. Then the following year, the big noise of the Olympic Games comes to London in all its glory.

After this event, and 2013’s Rugby League World Cup, the Commonwealth Games come to Glasgow in 2014, the same year as the Ryder Cup is held at Gleneagles. The Rugby World Cup will be hosted by England in 2015, while another world cup - that of cricket - will take place in 2019, also to be hosted by England.

EMPHASIS
So why the big emphasis on sport in the next decade? The recent announcement of the Rugby World Cup was heralded by Prime Minister Gordon Brown, who said that: “The Rugby World Cup is yet another tremendous event to add to the country’s decade of sport and another chance to show our nation’s passion for sport and what world-class facilities we have to offer.”

Does this stand up to scrutiny as a valid reason? You could say that this response from Brown simply means that Britain is being used for jingoistic purposes and an attempt (albeit on a large scale) to show the world what Britain is capable of with regards to sport.

Matthew Syed, writing in The Times paper, would argue the case for this apparent message. He argued that the so-called Golden Decade of Sport was surrounded by political spin and hype. “There is no legacy, no catalyst, no nationwide change of behaviour,” he wrote. “How can I be so sure? Because the government helpfully collated all the available evidence on the subject in a document called Game Plan that told us so.”

Beyond that, do these events hold any actual purpose for anyone? Former rugby player Will Greenwood came up with a slightly more detailed answer when questioned on the benefits of England hosting the Rugby World Cup. “I’ve seen the ability of rugby to change lives both on an individual level and on a community basis,” he said. “Part of the RFU pledge is all surplus money will go back into grassroots, both on a domestic and a global scale.”

Financially, there is the potential for events such as the Olympics to drag Britain out of its current financial mire. The Rugby World Cup alone is set to bring in an estimated £2.1billion of economic benefits to the country. Also, the UK market would stand to attract £220million in commercial returns from broadcasting, sponsorship and merchandising. Indeed, Deloitte Sports Business Group partner Dan Jones said that big events such as the Rugby World Cup can bring in significant numbers of visitors to a country, resulting in greater business activity and potential inward investment. He said: “The Rugby World Cup attracts travelling supporters in huge numbers, bringing colour and vibrancy to the event in addition to significant additional expenditure. The attributed gross value added figure of up to £1billion is very significant.”


The Olympic Games is also expected to bring in much-needed revenue for the country. The Financial Times said that tourism-related income was expected to be between £762million and £2billion. Tessa Jowell, minister for the Olympics, also said that the 2012 Games were a “Shot in the arm for the economy.”

A more indirect economic boost is the way in which parts of east London will be rejuvenated in terms of jobs and infrastructure. Past events have been a boon to cities, with greater prosperity and opportunities in these areas. Professor of economics at Sheffield Hallam University, Chris Gratton, said that 2002’s Commonwealth Games had helped to regenerate areas of Manchester, and the 1991 World Student Games had done the same for Sheffield.

LIMITED BENEFITS
However, are these promises of greater financial gains as simple as they are reported to be? There are various sport economics experts who claim that the financial impact of the Olympic Games may not be as great as hoped. A 2008 Urban Studies report suggested that in fact: “There is now a considerable accumulation of evidence that the direct economic benefits of hosting sporting events are limited.” The same report also asserted that the task of justifying a huge event such as the Olympics on economic grounds was like: “Trying to justify the construction of a bridge that is going to be used for two weeks only.”

An example of these economic expectations was seen in the aftermath of the 2006 World Cup, which was held in Germany. The predictions of a growing economy were hotly anticipated, with figures of a £3billion boost rattling around. However, a month after the tournament, the Bundesbank said that, in actual fact, the one-off novelty effects were disappearing. And the effects of the 2004 Olympics in Athens were also not as long-lived as maybe thought.

The prospect of such a scenario has been raised in various quarters. The Commonwealth Games is five years away, but former Scottish cycling world champion, Graeme Obree, said that the Glasgow event could spiral out of control in terms of cost. “There’s financial problems and restrictions being put on grassroots sport,” said Obree. “£2million is being removed from grassroots sports training - what effect is that going to have in the long term?”

On the subject of the 2014 Commonwealth Games, Scottish political leaders have started a campaign to force Westminster to replace lottery money that was allegedly diverted to fund the 2012 Olympics. SNP ministers in Edinburgh took their complaints to Tessa Jowell on the grounds of the apparent decision to spend nearly one fifth of lottery funds on the London games, meaning that the funding for the Commonwealth Games would fall by £13million.

However, on the other side of the coin, others have said that the Commonwealth Games will be comparatively cheap to stage because two thirds of the venues and infrastructure are already in place - for example, Hampden Park and the Celtic and Rangers football grounds. Deputy first minister, Nicola Sturgeon, said that the Commonwealth Games would leave a lasting legacy of improvements for Scottish people. She said: “Our vision is of a legacy which helps people live longer, healthier lives, in strong, supportive communities, valuing and protecting the built and natural environment with new and better skills, development, employment and volunteering opportunities.”

Perhaps part of this supportive community was the decision to ask criminals to help prepare the 2014 Commonwealth Games. Naturally, this decision was met with disquiet from some quarters. Margaret Watson of Justice For Victims commented: “The government seems to have lost the plot completely. The way to keep people safe on our streets is to lock up the criminals. Ministers seem obsessed with this idea of making life better and easier for offenders, but not for victims.”

GLOBAL RECESSION
The biggest issue linked in with the sporting events of the next decade is the recession. Globally, other countries have pulled out of bidding for sporting events because of the cost. For example, Australia pulled out of the bid to host the 2015 World Cup after the International Rugby Board wanted to charge an “exorbitant” guarantee fee of £96million. The Australian Rugby Union chief executive, John O’Neill, said: “The numbers are horrendously difficult to justify with that level of tournament fee. As a board, because we’re a public company, our directors are saying: ‘Well, that’s a contingent liability we would have to carry on our balance sheet and a bank isn’t going to guarantee it’.”

There have been two incidents when public figures admitted that they would have thought twice about bidding for the events, had they known what would happen in the future. Louise Martin, who led Glasgow’s presentation for the Commonwealth Games in Sri Lanka, admitted that Glasgow might not have bid for the 2014 Games if the recession had happened earlier. “I shrink from saying Glasgow wouldn’t have done it, but it looked a lot healthier before this time of recession,” she explained. “I have to believe we will come through this. It will be challenging, but we will find ways of making it work.”

Similarly, Tessa Jowell allegedly told around 40 leisure industry bosses that bidding for the Olympics was a mistake in light of the recession. However, she went on to defend the spending as a cyclical investment. “There are opportunities right around the country,” she said. “It’s unimaginable that this would be happening without the Olympics.”

However, it is possible that all these events will come together to bring something good out of the current financial doom and gloom. With a heavy emphasis on big, crowd-pleasing events, Britain’s Golden Decade of Sport may well get the necessary interest. And in addition to this, the Football Association’s decision to launch a bid for the 2018 World Cup is in progress. The FA believes it has a strong commercial base to make a successful bid and says that it is in the “strongest ever financial position after landing a range of deals with overseas broadcasters.”

The final word though, goes to Sebastian Coe, chairman of the London Organising Committee of the Olympic Games. He believes that the 2012 Games will help the country out of recession: “No-one would have chosen this downturn, but the Games could account for six to seven per cent of economic activity in this city over the next five years, not to mention the impact it could have on other parts of the country. That’s why we should be on the front foot - in good times or in bad, this is a project that really has an extraordinary impact.”


Pictures: London 2012.

 

 

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