Cape Town - Cape Town Stadium, which cost R4.4billion to build, last year cost almost R80 million to maintain and only managed to generate R22m in income, with ratepayers forking out R55.1m - up from R27m the previous year - to keep the white elephant going.
The City’s deputy mayor and mayoral committee member for finance, Ian Neilson, said: “There are some numbers that we can attribute to inflation, but the trouble is that because it is such a big stadium, there are fixed costs associated with a big stadium.
“There are also costs that are events-related; just opening the doors of the stadium already costs so much.”
Neilson said it was not cost-effective to have small events that hosted just 5000 people at the stadium. “Although we allow, for example, small soccer matches because we are trying to keep it going, they are not really financially viable as the costs are so high.
“It would make more sense for them to play at a smaller venue,” he said.
According to the Cape Town Stadium annual report, tabled at on Wednesday’s council meeting, the stadium reported an expenditure of R79.6m last year, which included the general upkeep of the stadium, security
services, board members’ remuneration and contracted cleaning costs.
But there seems to be some light at the end of tunnel after the City said it had signed a memorandum of agreement with Western Province Rugby for the latter to become the anchor tenant.
The City announced that from February 1, 2021, WP Rugby would become the stadium’s anchor tenant, potentially for the next 99 years.
Neilson said this would alleviate the operational costs for the City.
“I think the big change will happen when Western Province Rugby comes in, and when we are finished building the additional suites at the stadium, completed in time for rugby season.
“This will not only make it more profitable when rugby is played there, it will make it more profitable for any other event.
“One can charge a lot more for a seat in the box than for a normal seat. It will also increase the income streams of other events,” Neilson said.
Cope caucus leader Farouk Cassim said: “This year we have heard that the City has given the stadium a grant of R50m, as well as an unquantifiable amount of indirect funding.
“The City is still contractually obliged to cover any expenditure shortfall. I am not particularly impressed with the way the entity is trying be financially viable.
“The entity needs to do more - and quickly - to achieve wider income streams to reduce its dependence on the ratepayers of Cape Town.”
ACDP caucus leader Grant Haskin said: “A more detailed and accurate assessment can be done on the
stadium after a year of Western
Province Rugby moving in.”
@MarvinCharles17