Post by jollyroger on Jul 16, 2006 22:53:35 GMT 10
This is a copy of the Roy Masters article NET LOSS (1st July 2006)
It is the article that preceded Frank Lowys response as reported by Rubbernose - "Football Strikes Back"
Net Loss
July 1, 2006
By Roy Masters
HARRY KEWELL'S gout and an Italian player re-enacting the death scene from Othello may have cost Football Federation Australia $3.3 million in World Cup payments - but it's unlikely the money would have flowed to the sport's biggest creditor, the taxpayer.
Australian soccer owes the Federal Government $4 million, but the chances of the federation's chairman, Frank Lowy, repaying the capital are remote.
Lowy, Australia's second richest man, has received considerable credit for the resurrection of the game in Australia but the real benefactor has been the Government, which gave the sport $9 million on the condition it undergo a major reform after years of internecine fighting.
A further loan facility of $6 million was set up, of which FFA has drawn $4 million. Before Kewell's gout and his unavailability against the Italian team in Germany, the possibility was raised of Lowy finally repaying the debt.
After all, FFA has already received $7.68 million for qualifying for the World Cup and a further $1.65 million for advancing to the round of 16.
"Good luck," a Lowy confidant said of the chances of the Australian Sports Commission recovering the money.
"He won't pay it back. He wants more. He wants the ASC to put more money into its youth and Australian Institute of Sport programs."
The ASC is the Government's policy and funding arm.
Its deputy chairman, broadcaster Alan Jones, made mention of the debt in a 2GB radio interview with ASC chief executive Mark Peters shortly after the drawn match with Croatia.
Jones also referred to Lowy's use of the broadcaster to lean on the Prime Minister, John Howard, for a rescue package for the sport in 2003.
Jones said: "Frank Lowy said to me, 'You must ring the Prime Minister, we need money'.
"I said, 'Frank, you ring the Prime Minister'. He said, 'Oh, that would ruin my friendship'. I said, 'Oh, you want to ruin mine?"'
Peters chuckled and Jones continued.
"So I remember saying to the Prime Minister 'Twelve million' and he said, 'How much?' And somehow or other the $12 million materialised in a grant and a loan - no problems now.
"It will be able to be paid back won't it?" Jones asked.
Peters responded: "That's right." Although, rather than clarify that only $4 million was repayable, Peters praised the Minister for Sport and the Arts, Rod Kemp, for his role in rescuing the sport.
Earlier in Jones's broadcast, he interviewed FFA chief executive John O'Neill, who deflected praise directed at him for Australia's achievements, saying: "No, thank you to the Sports Commission."
There was no mention of the $4 million debt. On Thursday the ASC received a small interest payment and FFA is seeking to have the term of the loan repayment extended. Mark Ryan, a Lowy spokesman, said Lowy understood the loan would be retired.
FFA is by far the most heavily funded of the four football codes in Australia.
For 2005-06, FFA received an allocation of $2.812 million from the ASC. That compares with $466,000 to AFL, $528,000 to rugby league and $454,000 to rugby union.
Just under half the allocation to FFA - some $1.115 million - is funding for its program at the Australian Institute of Sport.
Twelve ex-AIS scholarship holders were in Germany representing Australia at the World Cup. Furthermore, Croatia's Josip Simunic, Joey Didulica and Ante Seric were all born in Australia and trained at the AIS. Sydney-raised Seric says: "I owe the AIS."
Funding for soccer's AIS program is nearly six times greater than the $200,000 AFL, rugby league and rugby union each receive per year for theirs.
The other half of the ASC grant to FFA, or $1.423 million, is an allocation for the development of the sport, an ongoing payment which is five times the $208,000 AFL, league and union each receive annually to encourage participation in their sports.
Soccer is the only sport which receives funds for its elite players, the men who competed in Germany. Of the $1.423 million annual grant to FFA, $1.282 million is allocated to its high performance arm.
Furthermore, in the year to June 30, FFA received an additional $60,000 for international travel.
All this is on top of the $9 million non-repayable grant which Lowy sought to reform the sport and the loan facility of $6 million.
Lowy has indicated he will remain head of FFA for four more years.
When he announced this to state presidents on the eve of the A-League grand final earlier this year, it was met with rapturous applause.
However, O'Neill, whose contract ended with the World Cup, has not reached agreement on his new term.
O'Neill's salary is $1 million a year - a reason, perhaps, why the canny Lowy is stalling contract talks.
Relations were strained before the two left for Germany. There were suggestions Lowy's hands-on role indicated he may assume the position of executive chairman.
John Ribot, chairman of Queensland Roar, a Brisbane-based A-League team, compared Lowy running FFA with Rupert Murdoch taking charge of the National Rugby League.
Ribot knows the responsibilities of running a national football competition: he was CEO of Murdoch's Super League in 1995-97 when it was at war with the Australian Rugby League for pay TV rights.
Shortly after the A-League final, when it was announced O'Neill had secured a $130 million, seven-year TV deal with Foxtel to show A-League matches, Lowy convened a meeting with the club owners.
Ribot asked one of the first questions to Lowy: "Now that you have agreed to stay on, will our CEO also be reappointed?" Lowy indicated O'Neill's future was secure.
Indications are Lowy and O'Neill got on very well in Germany, but why wouldn't they in an atmosphere where only Harry Potter has had a more magical ride? Lowy's spokesman, Ryan, insists negotiations between the two will begin soon.
Lowy's FFA board initially consisted of Melbourne-based company director Ron Walker, who is also chairman of John Fairfax; Sydney businessman John Singleton; Brian Schwartz, then CEO of Ernst and Young (Australia); Suzanne Williams, a lawyer and formerly company secretary to SOCOG, the organising committee for the 2000 Sydney Olympics; and Phil Wolanski, a property developer and managing director of DW Co Pty Ltd.
Singleton resigned late last year when he surrendered all his public company directorships. He has subsequently raised the issue of conflict of interest over Lowy's position as chairman of FFA and his family's investment in the Sydney FC A-League team.
Singleton is a part owner of the Central Coast Mariners which was defeated by a goal by the Lowy family team in the A-League grand final.
Sydney captain Dwight Yorke, on loan from Manchester United, was paid more than Singleton's entire team.
In early May, when Lowy's coach resigned because he could not come to terms for the 2006-07 season, Lowy's colleagues at Sydney FC tried to poach Singo's coach.
The larrikin businessman, who holds the marketing rights to Central Coast Stadium at Gosford, took a late night mercy dash to the coach's Central Coast home to secure him on a marginally upgraded contract.
However, Lowy's spokesman insists his boss made an 11th hour plea to the Sydney FC to stop negotiations with the Mariners coach.
Asked if Lowy's involvement is a conflict of interest, Ryan said: "He's between a rock and a hard place. If he puts money in it's a conflict of interest but if the family private company, LFG, didn't put $5 million in, Sydney FC may have gone down."
FFA elections are due in November, when Lowy and the interim board must go to the sport's grass roots for re-election.
But there are signs that the old rump board of Soccer Australia will seek a shoot-out and attempt a comeback.
Although all state and territory associations have adopted FFA-approved constitutions, the NSW Soccer Association is yet to reform and adopt an approved constitution.
NSW intransigence looms as an own-goal for the sport. O'Neill appears determined FFA will not return to its old ethnic roots, saying before leaving for Germany: "The lunatics won't come back to run the asylum."
Nor does he believe the sport will continue as Australia's fourth football code, insisting from Germany that "normal transmission won't be resumed".
The accumulated losses of the A-League clubs amount to $16 million, with $6 million attributed to Sydney FC.
The competition it replaced, the NSL, lost $60 million in its last four years.
Ribot estimates the Foxtel TV deal will result in each A-League club receiving a grant of $1.4 million, wiping out the 2005-06 losses of most clubs.
"The phones have been running hot since the World Cup with sponsors wanting to get involved," he said. "There has also been a definite spurt in the sale of season tickets.
"The Rebel Sports group, one of the sponsors, ordered 100,000 football jerseys before the World Cup and my understanding is all have been sold."
But with 10 of the Socceroos expected to retire and only three expected to return to Australia and play in the A-League which begins in August, the heroes of Germany won't be appearing on Australian pitches. And none of the three - Mark Milligan, Archie Thompson and Stan Lazaridis - played a minute at the World Cup.
Funding is the key and FFA is already counting the cost of Germany. FFA's High Performance manager, John Boultbee, a former director of the AIS, was lamenting the mounting expenses the day after Australia's final-seconds loss to Italy.
"FIFA paid our airfares and gave us an accommodation subsidy but it didn't go near meeting our total costs," he said from Germany. "We had to fund a big proportion of it."
Asked when the ASC can expect the $4 million repaid, he said: "I don't know the answer to that."
It is the article that preceded Frank Lowys response as reported by Rubbernose - "Football Strikes Back"
Net Loss
July 1, 2006
By Roy Masters
HARRY KEWELL'S gout and an Italian player re-enacting the death scene from Othello may have cost Football Federation Australia $3.3 million in World Cup payments - but it's unlikely the money would have flowed to the sport's biggest creditor, the taxpayer.
Australian soccer owes the Federal Government $4 million, but the chances of the federation's chairman, Frank Lowy, repaying the capital are remote.
Lowy, Australia's second richest man, has received considerable credit for the resurrection of the game in Australia but the real benefactor has been the Government, which gave the sport $9 million on the condition it undergo a major reform after years of internecine fighting.
A further loan facility of $6 million was set up, of which FFA has drawn $4 million. Before Kewell's gout and his unavailability against the Italian team in Germany, the possibility was raised of Lowy finally repaying the debt.
After all, FFA has already received $7.68 million for qualifying for the World Cup and a further $1.65 million for advancing to the round of 16.
"Good luck," a Lowy confidant said of the chances of the Australian Sports Commission recovering the money.
"He won't pay it back. He wants more. He wants the ASC to put more money into its youth and Australian Institute of Sport programs."
The ASC is the Government's policy and funding arm.
Its deputy chairman, broadcaster Alan Jones, made mention of the debt in a 2GB radio interview with ASC chief executive Mark Peters shortly after the drawn match with Croatia.
Jones also referred to Lowy's use of the broadcaster to lean on the Prime Minister, John Howard, for a rescue package for the sport in 2003.
Jones said: "Frank Lowy said to me, 'You must ring the Prime Minister, we need money'.
"I said, 'Frank, you ring the Prime Minister'. He said, 'Oh, that would ruin my friendship'. I said, 'Oh, you want to ruin mine?"'
Peters chuckled and Jones continued.
"So I remember saying to the Prime Minister 'Twelve million' and he said, 'How much?' And somehow or other the $12 million materialised in a grant and a loan - no problems now.
"It will be able to be paid back won't it?" Jones asked.
Peters responded: "That's right." Although, rather than clarify that only $4 million was repayable, Peters praised the Minister for Sport and the Arts, Rod Kemp, for his role in rescuing the sport.
Earlier in Jones's broadcast, he interviewed FFA chief executive John O'Neill, who deflected praise directed at him for Australia's achievements, saying: "No, thank you to the Sports Commission."
There was no mention of the $4 million debt. On Thursday the ASC received a small interest payment and FFA is seeking to have the term of the loan repayment extended. Mark Ryan, a Lowy spokesman, said Lowy understood the loan would be retired.
FFA is by far the most heavily funded of the four football codes in Australia.
For 2005-06, FFA received an allocation of $2.812 million from the ASC. That compares with $466,000 to AFL, $528,000 to rugby league and $454,000 to rugby union.
Just under half the allocation to FFA - some $1.115 million - is funding for its program at the Australian Institute of Sport.
Twelve ex-AIS scholarship holders were in Germany representing Australia at the World Cup. Furthermore, Croatia's Josip Simunic, Joey Didulica and Ante Seric were all born in Australia and trained at the AIS. Sydney-raised Seric says: "I owe the AIS."
Funding for soccer's AIS program is nearly six times greater than the $200,000 AFL, rugby league and rugby union each receive per year for theirs.
The other half of the ASC grant to FFA, or $1.423 million, is an allocation for the development of the sport, an ongoing payment which is five times the $208,000 AFL, league and union each receive annually to encourage participation in their sports.
Soccer is the only sport which receives funds for its elite players, the men who competed in Germany. Of the $1.423 million annual grant to FFA, $1.282 million is allocated to its high performance arm.
Furthermore, in the year to June 30, FFA received an additional $60,000 for international travel.
All this is on top of the $9 million non-repayable grant which Lowy sought to reform the sport and the loan facility of $6 million.
Lowy has indicated he will remain head of FFA for four more years.
When he announced this to state presidents on the eve of the A-League grand final earlier this year, it was met with rapturous applause.
However, O'Neill, whose contract ended with the World Cup, has not reached agreement on his new term.
O'Neill's salary is $1 million a year - a reason, perhaps, why the canny Lowy is stalling contract talks.
Relations were strained before the two left for Germany. There were suggestions Lowy's hands-on role indicated he may assume the position of executive chairman.
John Ribot, chairman of Queensland Roar, a Brisbane-based A-League team, compared Lowy running FFA with Rupert Murdoch taking charge of the National Rugby League.
Ribot knows the responsibilities of running a national football competition: he was CEO of Murdoch's Super League in 1995-97 when it was at war with the Australian Rugby League for pay TV rights.
Shortly after the A-League final, when it was announced O'Neill had secured a $130 million, seven-year TV deal with Foxtel to show A-League matches, Lowy convened a meeting with the club owners.
Ribot asked one of the first questions to Lowy: "Now that you have agreed to stay on, will our CEO also be reappointed?" Lowy indicated O'Neill's future was secure.
Indications are Lowy and O'Neill got on very well in Germany, but why wouldn't they in an atmosphere where only Harry Potter has had a more magical ride? Lowy's spokesman, Ryan, insists negotiations between the two will begin soon.
Lowy's FFA board initially consisted of Melbourne-based company director Ron Walker, who is also chairman of John Fairfax; Sydney businessman John Singleton; Brian Schwartz, then CEO of Ernst and Young (Australia); Suzanne Williams, a lawyer and formerly company secretary to SOCOG, the organising committee for the 2000 Sydney Olympics; and Phil Wolanski, a property developer and managing director of DW Co Pty Ltd.
Singleton resigned late last year when he surrendered all his public company directorships. He has subsequently raised the issue of conflict of interest over Lowy's position as chairman of FFA and his family's investment in the Sydney FC A-League team.
Singleton is a part owner of the Central Coast Mariners which was defeated by a goal by the Lowy family team in the A-League grand final.
Sydney captain Dwight Yorke, on loan from Manchester United, was paid more than Singleton's entire team.
In early May, when Lowy's coach resigned because he could not come to terms for the 2006-07 season, Lowy's colleagues at Sydney FC tried to poach Singo's coach.
The larrikin businessman, who holds the marketing rights to Central Coast Stadium at Gosford, took a late night mercy dash to the coach's Central Coast home to secure him on a marginally upgraded contract.
However, Lowy's spokesman insists his boss made an 11th hour plea to the Sydney FC to stop negotiations with the Mariners coach.
Asked if Lowy's involvement is a conflict of interest, Ryan said: "He's between a rock and a hard place. If he puts money in it's a conflict of interest but if the family private company, LFG, didn't put $5 million in, Sydney FC may have gone down."
FFA elections are due in November, when Lowy and the interim board must go to the sport's grass roots for re-election.
But there are signs that the old rump board of Soccer Australia will seek a shoot-out and attempt a comeback.
Although all state and territory associations have adopted FFA-approved constitutions, the NSW Soccer Association is yet to reform and adopt an approved constitution.
NSW intransigence looms as an own-goal for the sport. O'Neill appears determined FFA will not return to its old ethnic roots, saying before leaving for Germany: "The lunatics won't come back to run the asylum."
Nor does he believe the sport will continue as Australia's fourth football code, insisting from Germany that "normal transmission won't be resumed".
The accumulated losses of the A-League clubs amount to $16 million, with $6 million attributed to Sydney FC.
The competition it replaced, the NSL, lost $60 million in its last four years.
Ribot estimates the Foxtel TV deal will result in each A-League club receiving a grant of $1.4 million, wiping out the 2005-06 losses of most clubs.
"The phones have been running hot since the World Cup with sponsors wanting to get involved," he said. "There has also been a definite spurt in the sale of season tickets.
"The Rebel Sports group, one of the sponsors, ordered 100,000 football jerseys before the World Cup and my understanding is all have been sold."
But with 10 of the Socceroos expected to retire and only three expected to return to Australia and play in the A-League which begins in August, the heroes of Germany won't be appearing on Australian pitches. And none of the three - Mark Milligan, Archie Thompson and Stan Lazaridis - played a minute at the World Cup.
Funding is the key and FFA is already counting the cost of Germany. FFA's High Performance manager, John Boultbee, a former director of the AIS, was lamenting the mounting expenses the day after Australia's final-seconds loss to Italy.
"FIFA paid our airfares and gave us an accommodation subsidy but it didn't go near meeting our total costs," he said from Germany. "We had to fund a big proportion of it."
Asked when the ASC can expect the $4 million repaid, he said: "I don't know the answer to that."
