Although figures of the finances of the new Peter Mokaba Stadium for the current financial year which ends on 30 June are not available as yet, a report that was tabled in the Polokwane Municipal Council recently, showed that the municipality has suffered losses to the estimated amount of R30 million during the last four financial years and that some cost cutting measures have to be implemented as a matter of urgency.
The municipality subsequently engaged the services of experts to develop a facilities commercialisation plan for the two Peter Mokaba stadiums as well as some other facilities in the city and a detailed plan is expected soon, the municipality’s Communications and Marketing Manager, Matshidiso Mothapo, said on Tuesday. The consultants will, among others, look into the reduction or discontinuation of catering for VIP areas and the appointment of a permanent stadium management company.
The municipality has also converted some of the unused space in the complex into offices, effecting savings in office rentals.
During the 2016/17 financial year, the expenditure was R19,1 million and the income R5,8 million, recording a deficit of over R13 million. The figures for 2015/16 reflected expenditure of R14 million and an income of R6 million. During 2014/5 expenditure was R10 million and income R9,2 million, while the 2013/14 expenditure was R14,8 million and income R7,1 million.
According to the report, maintenance, hospitality catering, events security and standby operations during events contributed to the expenses. During 2016/17 an amount of R4,9 million was spent on items which include R4,5 million for contractors and R7,980 million for appearance fees for Baroka and Polokwane City Football Clubs. Hospitality catering cost R975 288 and cleaning services amounted to R894 233. It was stated that maintenance costs of the facility will increase as it gets older. A break-down for the expenditure for the other financial years was not provided.
The income of R5,8 million for 2016/17 was generated, among others, by ticket sales, contributing R2,045 million, conferences and meetings bringing in R2,26 million and skybox hospitality ticket sales R843 768. Office rentals contributed R270 508 and stadium tours R23 000.
As part of the cost reducing measures, the municipality informed the two football clubs that no further appearance fees will be paid for the 2017/18 financial year, resulting in a cash saving of R8 million. The municipality will, however, continue to support the clubs by providing free usage of the facilities, payment of the standby services, security, waste management, among others. The calculated cost of the concession will still amount to more than R5 million per year, but the parties agreed that the income from gate takings will be divided on a 50/50 basis.
Story: BARRY VILJOEN