Thursday, 31 May 2012

RWC losses

Such are the measures of success in hosting international sporting events: The Herald calls the 2011 Rugby World Cup a success for having lost the country only $31.3 million, "$8 million less than they expected." Alas, the article seems not to be online. But as most of the APNZ story seems to come from the IRB press release, you can probably just read that.

I'd be interested in seeing what went into that final "cost to the country" tally. Is it just the cash transfer from the government to the RWC? Local government outlays as well? Costs of diverting a substantial part of the Wellington bureaucracy to supporting the RWC? Stadium expenditures, like Dunedin's mess, where the RWC push was a pretty explicit part of the case for building it?

RWC Minister Murray McCully comments:
"Without a doubt, RWC 2011 will generate significant economic benefits for this country for many years to come."
Far from producing a windfall, predicted to be worth between $750,000 and $2.2 million to the city, economic growth actually slowed during last year's tournament.

Proponents of the city's involvement, which included two matches, were "overly optimistic", said economic policy analyst Peter Crawford, and some city councillors are asking whether hosting large events is worth it.

The estimates process got it so wrong because it did not balance the likely benefits against the costs, he said.

One of the costs was the extent to which such a major event crowded out other activities.
I'll look forward to seeing Sam's paper at the NZAE meetings.

HT: Hamish Keith


  1. The $31.3 million is the loss incurred by Rugby NZ 2011 Limited, the company responsible for organising the tournament. So it is ticket revenue to RNZ 2011 less RNZ 2011's expenses, which were travel and accommodation for the participating teams and officials, stadium hire, the fixed fee payable to the IRB, etc etc.

    The Government paid $21.3 million of RNZ 2011's loss, the NZRU paid the other $10m.

    The figure does not include any other RWC related benefits or expenditure, including anything else by central government (e.g. VIP hosting) or local governments (transport) or any money spent on stadia.


  3. I would have projected a $100 million loss so I could brag about having saved $69 million!