Oval funds should be repaid - AG

Written By Unknown on Jumat, 08 Maret 2013 | 12.50

An artist's impression of the Adelaide Oval redevelopment. Source: The Advertiser

PRESSURE on the Stadium Management Authority to explain its spending at the new Adelaide Oval has increased with the Auditor-General raising questions about government funds at the project.

Auditor-General Simon O'Neill has found government funds designated for the construction of the $535 million Oval were used for the management operations of the SMA - and not construction of the oval as they were intended.

He recommends the State Government "recover the relevant costs" from the SMA, which is a partnership of the SA National Football League and the SA Cricket Association.

The State Government is now seeking advice from the Crown Solicitor on whether it can remodel the SMA which has no government representative on its eight-man board.

The concerns about the operating budgets of the SMA were flagged by the two SA-based AFL clubs - Adelaide and Port Adelaide - in The Advertiser today.

Mr O'Neill does not indicate exactly in his report how much money the SMA should tip back into the construction budget funded by the Department of Planning, Transport and Infrastructure.

However, he found there were payments of $960,000 to the SANFL and $1 million to SACA which had to be retrospectively approved by the Treasurer.

These payments were not related to the redevelopment or construction, but legal, public relations and salary costs for the SMA.

"Following the completion of this report I intend to write to DPTI recommending it seek to allocate contract costs between the redevelopment project and the AOSMA component and seek to recover relevant costs from AOSMA," Mr O'Neill said in his report.

Mr O'Neill adds the Treasurer also would need to retrospectively approve another blow-out - by $135,000 blowout on a $300,000 allocation approved to the SMA last year.

The Auditor-General's report follows the AFL clubs noting the SMA's budgets have ballooned from an anticipated $2m to $9m.

This has worried the Power and Crows about their future earnings at the Oval where AFL football will be played next season in the new 50,000-seat stadium.

The SMA's need for more money is measured by its grab of the premium tickets at the Oval - the exclusive "Stadium Club" memberships.

The SMA originally was to take 600 of the 1455 "Stadium Club" memberships that sell at $4500 and offer the best seats, best dining options and car parking at Adelaide Oval.

The SMA has now has claimed 1000 of these elite memberships.

The difference of 400 seats adds $1.8m to the SMA's coffers - money the Crows and Power want to boost their returns from the Oval.

Both Port and the Crows are mystified as to why the SMA has grown into a $9m body.

Power chief executive Keith Thomas said yesterday: "The original Adelaide Oval model put to us in 2009 was for a lean SMA to maximise the returns to the sports playing on the new Oval, in particular footy. We're asking why has that changed?"

Crows chairman Rob Chapman added: "The original intent was for a lean SMA that managed the Oval and its precinct - and maximised the return to football and cricket. That was always the intention.

"There must be fairness and equity in how money is distributed at Adelaide Oval."

SMA chief executive Andrew Daniels was at meetings in Melbourne yesterday and unavailable for comment.

The authority told The Advertiser: "There is pressure on the SMA to deliver a lean stadium management model - and a great product at the Oval."

Chapman on Wednesday for the first time took suspended Crows chief executive Steven Trigg's seat at the joint SMA meetings and argues "common sense can prevail" on the carve up of Adelaide Oval's returns.

"We reached a compromise on one key issue on Wednesday because there is goodwill and good relationships between all the parties," he said.

"I'm still confident we can get the right outcomes. But there is a long way to go."

The major intent of football's return to the city - after setting up AAMI Stadium at West Lakes in 1974 - was to generate more money for both the Crows and Power so the AFL clubs would move from the bottom half of AFL stadia return to the top quarter.

Adelaide's non-negotiable stance on leaving AAMI Stadium was Adelaide Oval had to deliver a $3m uplift in returns - a figure met in the 2009 projections.

The 2009 figures were based on the new Oval delivering more fans, more members and more sponsors than at AAMI Stadium where there has been a recent downturn in all these categories.

But Thomas says the 2009 budgets sold to the Crows and Power no longer stack up in 2014 and need to be re-assessed before the clubs sign 20-year leases at the Oval.

The AFL clubs may need as much as an extra $3m from the Oval in 2014 to keep pace with their interstate rivals.

"Three years after those original numbers were put to us, they now look insufficient," he said.

"Adelaide Oval can produce money to meet everyone's needs. But we need an open mind on how that money is distributed."

The biggest problem for the two SA-based AFL clubs in this debate is having no direct representation on the SMA.

The authority has eight directors - four appointed by the SANFL and four by the SA Cricket Association, the original leaseholder of the Oval from the Adelaide City Council.

There is no AFL representative. There is no appointee from the State Government which is pumping more than $500m into the redevelopment of the Oval and its precinct.

Baulderstone in October, 2011, was awarded the construction contract to redevelop Adelaide Oval - a $535 million State Government project expected to be completed for the start of next year's AFL season.

The SMA, however, is answerable to the government on construction issues at the Oval.

The blind point for the Crows and Power is not having a seat on the SMA is being denied transparency on how the authority operates - and how it manages the overheads at Adelaide Oval.

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