Editorial: Games decision fits climate of restraint

OPINION: By most reckonings, $600 million represents a big pile of lolly. It would buy all of our gold card-waving pensioners annual cruises in the Carribean for the rest of their days, or build a dozen or so good-sized performing arts centres.

On the other hand, it is what the Government currently borrows every two-and-a-half weeks just to keep the bureaucratic wheels turning – and would be little more than small change for New Zealand's richest man, Graeme Hart, whose fortune is currently estimated at $7.5 billion.

It is also what hosting the 2018 Commonwealth Games in Auckland had been projected to cost New Zealand taxpayers and ratepayers – most of whom should be mightily relieved that the Government has stopped the idea on the starting block. As Prime Minister John Key put it in announcing that the Government would not back a New Zealand Olympic Committee bid for the event, a projected loss of that magnitude made it way too expensive.

The Government is already committed to spending nearly $300m on facilities for next year's Rugby World Cup. Part of the justification for this benevolence is that the event is being held throughout New Zealand, ensuring the benefits of improved infrastructure and regional visitor spending will be widespread. Though rugby is still a minor player in international sporting terms, the range of countries involved guarantees a significant global audience, meaning post-event tourism spinoffs might also flow far and wide.

The benefits from hosting the Commonwealth Games eight years hence are harder to establish. With many of the sporting and population powerhouses absent, the games are second tier. The Commonwealth itself already seems something of an anachronism and its place on the world stage is more likely to diminish than grow in future years.

Winning hosting rights to international sporting events is often used as an opportunity to kickstart spending on sporting facilities which, while costly at the time, do benefit the host cities and nations into the future. However, Auckland last ran a Commonwealth Games 20 years ago, and is gaining a major spruce-up for the RWC. If existing facilities would have sufficed for 2018 then there might have been greater enthusiasm for the NZOC and Auckland bid to mount a campaign seeking the hosting rights.

The Government justifies its RWC spending on the grounds that the tournament will generate an extra $500m-plus in gross domestic product. Though such projections are more easily made than quantified after the event, it suggests a two-for-one benefit to the country from taxpayer spending – even if that does not include the significant additional spending expected of local authorities.

Too much of the Commonwealth Games budget would have disappeared into "operational" spending, with just $180m projected to be spent on facilities – tangible assets, in other words. With the country still struggling out of recession and with Cabinet ministers expected to make across-the-board cuts in their budgets, Mr Key's decision is the right one.

- © Fairfax NZ News

Newest First

Oldest First