FAI lacks cash to pay for stadium
Accounts show soccer body is short of the €74m it needs for Lansdowne Road redevelopment
Published 20/07/2008 | 00:00
THE redevelopment of Lansdowne Road appeared last night to be in jeopardy, as a major cash crisis emerged in the Football Association of Ireland (FAI).
The stadium, which is being rebuilt in a joint venture between the FAI and the Irish Rugby Football Union (IRFU), with considerable assistance from the Government, could be halted as the financial position of Irish soccer appears to be precarious.
According to its latest annual accounts, which are due to be presented to the organisation's annual general meeting next Saturday, and which have been obtained by the Sunday Independent, the FAI is some way short of the €74m needed to meet its end of the cost of the redevelopment work.
Earlier this month, John Delaney, the FAI's chief executive, claimed at a press conference that he could write the cheque for the stadium in the morning, but the figures totally disprove that and show a major hole in the pockets of Irish soccer.
The accounts show the FAI has a cash surplus of €4,273,445 and just €21.2m in cash reserves. The closing shareholder fund showed the FAI had €16.4m last year compared with €12.1m in 2006.
However, the organisation also had debts totalling €10.1m falling within the 2007 financial year and an additional €3.9m falling outside that financial year.
The total wage and salary bill for the FAI in 2007 came to €10.5m. That figure does not include manager Giovanni Trappatoni's salary as he is not technically a member of staff.
A figure of €412,034 was paid to senior executives, and includes Mr Delaney's salary. The FAI denied all of this amount was Mr Delaney's salary.
Since construction began in 2006, the total spend on Lansdowne Road has been just over €70m, which has been entirely covered by the Government.
This means the Government has only €121m left to contribute. But given the shortfall on the FAI side, there is now real uncertainty over the future of the stadium.
The net cost of the stadium is €411m because both the IRFU and the FAI will be able to reclaim all the VAT paid during the construction. The accounts also show that the FAI contributed €2.5m to the running of the Lansdowne Road Stadium Development Company.
The Government yesterday ruled out any additional help on the project, with Sports Minister Martin Cullen taking a strong line with the sporting organisations. A spokeswoman for Mr Cullen said that in a recent meeting with the FAI and the IRFU he had made it clear the Government commitment was capped at €191m.
The poor financial position comes despite the FAI's sale of its former headquarters in Merrion Square for over €8.7m last year and four big money matches at Croke Park against Germany, Wales, Slovakia and Cyprus which brought in €2m each. Added to that was the €7m odd they received in television rights for the games, which they won't match this year as there is only one competitive match scheduled at the GAA HQ this year. Ireland play Cyprus in October, which is likely to be a sell-out.
Mr Delaney and his fellow executives will come under severe scrutiny at next week's AGM in Castlebar, Co Mayo, when delegates will be made aware of the situation.
Despite the gloomy outlook in the figures, the FAI strongly denied yesterday that it had a cash crisis, insisting it would meet its commitments on Lansdowne Road.
An FAI spokesman again said that a "cheque could be signed in the morning".
In a statement to this newspaper, the FAI said: "At the end of December 2007, the FAI had cash reserves of €21.2m and, in addition to that, we also have lines of finance in place to meet the capital commitments towards the new stadium, which will only be required to be paid to the Lansdowne Road Stadium Development Company during the course of 2009.
"The Government has confirmed that the FAI and the IRFU have in place the finance to meet their capital contributions to the stadium. In addition, the FAI will be going to market with corporate box and premium tickets this September."