The Cape Town Stadium has suffered another loss from hosting a local sporting event - this time more than half a million rand.
Three PSL Kaizer Chiefs home matches were played at the stadium between December and February with a total spectator attendance of 56 517.
According to a close-out report to council, the recovery of the match appearance fee was R1.7million against the R2.2m approved by the city council last year, representing a shortfall of R510 245.
“This shortfall was to a certain extent mitigated, due to much lower pre-match ticket sales than anticipated.
“As a cost-saving intervention, two games were downwardly adjusted from a planning attendance figure of 40 000 to 20 000, resulting in a reduction of the services deployed per match,” said the report.
This reduced council approved expenditure from R5.8m to R4m.
Last month, the council requested its Municipal Public Accounts Committee to investigate far more significant losses of R28m suffered on the Cape Town Cup last year due to lower than expected spectator turnout for games that pitted Ajax Cape Town and SuperSport United against Portuguese club Sporting Lisbon and English Premiership side Crystal Palace.
The council initially approved city council expenditure of R750 000 for each of the three PSL games as well as city services such as transport, safety and security of more than R300 000 for each of the match days.
It came closest to breaking even on the final game against SuperSport United in February.
According to the agreement the council reached with Stadium Management SA (SMSA) - the rights holder to the PSL Kaizer Chiefs matches - SMSA would pay R5 000 rental per match and all stadium direct costs amounting to R436 771 to host the event.
The council’s costs would be recouped after ticket sales and any remaining income would be shared.
The council said by hosting the event, it was providing Kaizer Chiefs with a large support base - giving Cape Town fans three opportunities to engage with the team.
The match against Wits in December had the lowest attendance of 15 416.
Attendance picked up in January for the match against Platinum Stars (19 506) and even further in February against SuperSport United (21 595).
As part of the council’s agreement with the team, a coaching clinic was held before each match with approximately 60 participants focusing on girls entering the sport.
The millions of rand in losses suffered by the Cape Town Stadium each year has led the council to propose establishing a municipal entity to run as a private company, whose function it will be increase the utilisation of the stadium and to reduce the financial burden on the municipal fiscus.
“Like many stadiums, it struggles to be financially viable and various business models were investigated to improve this situation.
“The original environmental authorisation and land use conditions relating to the Cape Town Stadium have been amended to allow for better commercialisation to improve income streams,” said an assessment statement published for public comment until December 12.
The directors of the Cape Town Stadium and Green Point Urban Park, as well as 38 others, would be seconded to the new municipal entity of which the council would be the sole shareholder.
The council places the total cost of employment of the stadium staff at R18m for the 2016/17 financial year.
Cape Argus