17 April 2009

WRC: REVELATIONS

The Nelson City Council and the Nelson Mail loudly trumpet that there will be 14 million dollars worth of economic activity generated for Nelson, from hosting the World Rugby Cup. However it appears that the harsh economic realities of that imprudent financial adventurism are hugely different to those claimed by them.
Councils own economic impact assessment commmissioned from respected economists Berl, quite simply and startlingly states that;
"The revenues generated from admission (ticket) sales at the match, goes direct to the New Zealand Rugby Union.
Revenues generated from food and beverages to spectators at the match grounds are retained by Rugby World Cup Limited (RWCL).
The hospitality spending by spectators and in hosting VIP guests outside the games precinct would normally be included in the overall spending estimates used to generate GDP in the analysis. However, these revenues (or certainly profits) are retained by the RWCL.
In the event that all revenues associated with hosting Pool games at Trafalgar Park go direct to the RWCL, the economic impact generated as a result of holding the games is effectively ZERO.
The cost of hosting a game will effectively be paid by the council and ultimately the ratepayers.
This suggests that all expenditure associated with hosting a match is effectively a diversion or transfer of expenditure (by council) rather than additional expenditure coming into the region and conferring economic benefits to the region.
Only in the event that a portion of the Pool game revenues (either ticket revenues or other on site match revenues) is allocated to meeting the cost of mounting any games would there be downstream benefits into the regional economy."
That economic assessment is a sober and altogether stunning revelation of council imprudence and financial adventurism, and no wonder it was being kept secret.