The costs of holding sporting events on site have also deterred some organizers here.
The Sports Hub has also been hit by a string of high-profile resignations, including at top management level. In the eight years since Sports Hub opened its doors, it has had four different CEOs.
Sports Hub’s former executive director, Oon Jin Teik, previously told TODAY that the difficult part of running the sports and leisure center seamlessly under the PPP model was trying to balance profit with the delivery of a public service bring.
Former SHPL employees who TODAY spoke to largely agreed that the private sector’s goal of making a profit is often at odds with the government’s goals of opening the sports center to the public.
However, they said it was not just a matter of ideological differences. They found that the relationship between the government and SHPL had started on the wrong footing, making an already difficult task almost impossible to carry out.
“The PPP was completely missing the ‘P’ meaning ‘partnership,'” said another former senior officer, Timothy (not his real name).
FUNDING FOR LESS PROFITABLE COMMUNITY PROJECTS THAT NEVER SUCCESS
Aside from the deep-rooted issues raised by former employees, another contentious issue raised was the lack of subsidies and funding for less profitable, community-focused events.
Aside from Singapore Athletics’ failed bid to host the Asia Masters Athletics Championships on the Sports Hub due to high costs, there were also no plans to host the Merlion Cup, an invitational football tournament.
Talks in 2015 collapsed after disagreements over a force majeure clause in the contract, which meant the organizers would have to pay third-party costs if the tournament couldn’t go ahead due to unforeseen circumstances.
Former employees of the sports center told TODAY that there was a fund that had originally been set up with the intention of funding less profitable projects such as B. those that were more accessible to the community.
This fund, called the Premiere Park Foundation, was first publicly mentioned over a decade ago by then Minister for Community Development, Youth and Sport Vivian Balakrishnan.
dr Balakrishnan, in a 2008 speech announcing the Sports Hub tender, said it was proposed that the foundation receive a “significant portion of the revenue from the facilities, and these funds would be reinvested into funding events, Activities and other facilities pumped”.
It was envisaged that this would “start a virtuous cycle where the more activities there are, the more revenue flows, the more revenue is then also available to go into recruiting and running other events and activities invest”.
However, former SHPL employees interviewed said the money initially earmarked for the fund “evaporated” quickly.
A former executive at one of SHPL’s partners said there had been a “series of misjudgements” that cemented the fate of the fund.
“There were certain commercial arrangements that the consortium felt they had access to that were later denied,” he said.
For example, he said a multi-million dollar commercial deal was in the works to secure the naming rights of both the Sports Hub and the Singapore Indoor Stadium, but that deal eventually fell through.
There were also many unexpected costs that arose due to maintenance issues, such as the estimated seven-figure sum to replace the turf on the soccer field.
“In our calculations, the revenue would be provided, (but) those expectations were scaled back and that led to a lack of ability to fund certain aspects, including the foundation,” he said. “Foundation funding has practically evaporated.”
CAN A GOVERNMENT MANAGED SPORTS HUB IMPROVE ITS GAME?
From China to Britain, several stadiums around the world have been funded through PPPs or similar deals, with mixed results, sports experts told TODAY.
The 18,000-seat Mercedes-Benz Arena in Shanghai is an outstanding example of how a private company has successfully gained the local government’s trust to operate the venue, said Mr James Walton, Head of Sports Business Group, Deloitte Southeast Asia.
While most sports venues in China are considered state-owned facilities, the Mercedes-Benz Arena works differently. It is jointly owned by Anschutz Entertainment Group, a private overseas sports and entertainment company, and PAC-Shanghai Oriental Pearl (Group), a state-owned media group.
This resulted in a “clear division of responsibilities and mutual understanding and application of relationship-building methods,” Mr. Walton said.
For example, the private company was a leader in professional event management and “their focus is on day-to-day management, sponsorship sales and event programming.”
Meanwhile, the state-owned media group, which is one of the most influential state-owned enterprises in Shanghai, has been effective in “supporting government relations and local community engagement,” Mr Walton said.