Devil is in the detail of Budget cutbacks
Published 12/12/2010 | 05:00
T HE Budget has come and gone but there is still some time to go before its full impact on Ireland's sporting landscape will be known. The only new development last Tuesday was the cut of €2m (to €45.8m) in the Horse and Greyhound Fund.
We already knew that the Irish Sports Council's funding for next year would be cut by five per cent to €46.9m and that a plan hatched at the infamous Fianna Fáil think-in last September to re-open the Sports Capital Programme to new applications had to be shelved as the country plunged headlong to the brink of bankruptcy. And so, in the wake of last Tuesday, we are left with a lot of uncertainty in terms of sports funding for 2011. Over the coming weeks the various sporting bodies will sit down and cut their cloth to suit their measure. Horse Racing Ireland, the ISC, the GAA, the FAI and the IRFU will have less money to distribute and it remains to be seen what the scale will be of the inevitable cost-cutting measures which must follow.
We already know that the GAA is likely to reduce its grants to counties and clubs and that there will be job losses and salary cuts at the FAI. The IRFU has been a little more circumspect about its intentions, but it too has been reviewing its cost base and this has already been felt at development level.
In horse racing, next year's fixture programme, as well as prize money, is being looked at by HRI and some pruning of both appears inevitable.
The declaration that betting tax would remain at one per cent but that it would be extended to apply to all transactions was widely expected. However, there must be concern on all sides at the lack of clarity around this move and the fact that a further wait of several months until the Finance Bill is introduced is now on the cards before we do have some idea of how it will be achieved.
It was an anomaly of the system that only bets placed in bookmakers' shops were liable to this tax. It had been flagged that the Government had come to accept -- slowly it should be said -- that doubling the tax on over-the-counter bets while allowing all those made on the internet or on the telephone to remain untaxed was patently unfair. In fact, it was unsustainable. So too was the amount of money coming from the Exchequer (€28m this year) to top up the revenue from betting tax.
HRI, one feels, would prefer the tax to be increased to two per cent but this cannot be reasonably contemplated until the current rate has been effectively applied across the board. The fear is that this is still some way off as the Department of Finance grapples with the logistics. Furthermore, the Government's projection that an additional €20m could be generated annually once introduced also appears fanciful and may need significant downward adjustment. One report last week suggested that €5m was a more realistic expectation.
As for the sports council, although a five per cent reduction in its budget in a climate of merciless spending cuts is modest, it is still faced with the task of passing that cut on to athletes and national governing bodies just a year and a half out from the London Olympics.
This year, €8.35m of its allocation was invested in high performance. The top grant of €40,000 went to 16 athletes -- the likes of Olive Loughnane, David Gillick, Derval O'Rourke (pictured) and Paddy Barnes were among the recipients.
There is an argument that direct funding should be preserved as a priority, particularly for those top-performing athletes who have shown an ability to make good decisions, and to get value for money. Most of our elite athletes on the carding system have London 2012 in their sights and will have meticulously planned the next 18 months of their lives and so an adjustment to their funding at this point could have highly detrimental consequences.
On the other hand, the ISC is also responsible for providing the core funding for over 60 national governing bodies, most of whom are also highly sensitive to reductions: a little cut can do a lot of damage.
The council's December board meeting takes place this Tuesday when the soul searching of how best to apply the cuts will begin in earnest.
Some board members, however, are known to believe that they should not be rushed into decisions and that if need be, emergency funding should be made available to get the more hard-pressed NGBs through January.
Another issue is what cut the ISC itself will take in terms of its own day-to-day expenditure.
Ultimately, everyone involved in sport in Ireland will feel the pinch next year because as money trickling down from the top evaporates, greater reliance will be placed on fundraising on the ground. And these are difficult times on that front too.