How football keeps the economy kicking Peter Munro
September 19, 2010 AUSTRALIAN rules football boosts the Victorian economy by $1.64 billion each year, with gambling now the fastest growing area of football-related spending, according to a new report on the game's economic impact.
AFL chief executive Andrew Demetriou, responding to the report, admitted the league's board had ''grappled'' with concerns about the growth of gambling, with betting agencies telling The Sunday Age football-related betting had reached $200 million a year in Victoria alone. ''We've got to be very careful to continue to make sure we don't expose the code to corruption,'' Mr Demetriou said.
The report, commissioned by The Sunday Age, found football's tentacles spread through the economy, providing more than 4000 full-time jobs. Football is increasingly important in driving tourism, with growing numbers of people travelling interstate to watch games.
Report author Bob Stewart, a leading sports analyst and football specialist for 30 years, found that despite it being a big business, football's economic base remained grass-roots supporters.
''Australian rules football is the only game that can generate that much member support; that people are prepared to become fully connected, paid-up members of the club and then buy the merchandise that goes with it.''
Match attendance for this home-and-away season was about 6.5 million, while club memberships topped 600,000 for the first time.
Dr Stewart, an associate professor in the school of sport and exercise science at Victoria University, calculated the flow-on effect of spending on the league, based on data from sources including the Australian Bureau of Statistics, gaming companies, football leagues and the state government.
Despite revealing the positive impact of football in Victoria overall, the report - the first to independently gauge the AFL's economic impact, found one potential area for concern.
Betting has reached record levels and is now the single greatest source of spending by Victorians on football, accounting for almost $200 million last year. Another $20 million was plunged on poker machines in AFL club facilities.
Figures provided to The Sunday Age by major gaming companies TAB Sportsbet, Centrebet and Sportingbet suggest Victorians will gamble similar amounts this year.
''That is evidence of the commercial scale of the game, but when you look at sports such as cricket there is cause for concern. You don't want the game corrupted or undermined by betting scandals. Then the whole reputation of the game falls away,'' Dr Stewart said.
Market leader TAB Sportsbet, an official partner of the AFL, expects to take $150 million in bets this year, including tomorrow's Brownlow Medal, up from $120 million last year. Victoria's share of spending is estimated at $105 million, up from $87 million. Managing director of sports betting Craig Nugent said tie-ups with the AFL in the past two years had increased public awareness of wagering.
Up to 350,000 individual bets were expected on Saturday's grand final, more than two-thirds of them from Victoria, he said.
Live betting by telephone during a match doubled in the past year, he said. Fixed-odds betting, primarily on sport and racing, grew almost 50 per cent last year. Centrebet expected total turnover of about $65 million on the 2010 season, including $15 million in live betting or ''in-the-run'' betting, it said.
Mr Demetriou said the AFL had promotional agreements with several gaming companies, in exchange for about 5 per cent of their net profits on average. ''I think it's going to continue to grow and we've got to be very careful to continue to make sure we don't expose the code to corruption and people who want to infiltrate or abuse the process,'' he said.
Anti-gambling activist Tim Costello said community concerns were rising. ''The AFL should be deeply worried about the size and indeed dependency on wagering,'' he said. ''The AFL's brand is part of the community and the community knows wagering and gambling is destructive … I see problem gamblers who can't go to the footy with their sons because the betting odds are on the big screen.''
An AFL club president had expressed alarm to him about the growing dependence of clubs on poker machine takings, he said. ''Any business case that looks at the brand value of the AFL when this is the biggest single component should be worried, because public opinion is turning.''
A report by consultancy Street Ryan and Associates, commissioned by the AFL, estimated the total financial contribution of Australian football to the national economy was $3.79 billion last year. Victoria commanded the greatest share of spending with $1.9 billion.
Dr Stewart, an associate of Victoria University's institute of sport, exercise and active living, said he took a more conservative approach to account for gaps in available figures. ''My report did not include estimates of volunteer labour, the contribution of suburban football or hospitality spending on finals,'' he said.
The report did include country football's economic impact, which is about $90 million.
''If you add in some of these others, the figure could equate to the Street Ryan figure and could well exceed it.''
Overwhelmingly, the business of football is booming. Sales of merchandise and football memorabilia last year was about $20 million, more than three-quarters of which was spent on Victorian clubs. Corporate sponsorships and related hospitality services were estimated to be worth $72 million. Separately, the AFL was credited as Australia's biggest sport and recreation sector employer, and one of the nation's big employers, delivering more than 4000 full-time equivalent jobs last year.
The report found the AFL's 10 Victorian clubs spend at least $195 million on staff, including $50 million on coaches and player support staff, and $60 million on management and administration.
Mr Demetriou credited building works at club training grounds, including Punt Road and Princes Park, for having driven employment growth over the past two years. ''There are thousands of people employed because of the game, which range from people employed in industry to venues, travel, accommodation and food and beverage, and that figure continues to grow as our game grows,'' he said.
''In Victoria you have also got clubs building infrastructure over the last two years, so there have been hundreds of jobs created.''
He nominated tourism and wagering as areas of growth. The report found AFL-related tourism provides a $165 million stimulus to the Victorian economy.
Tourism Victoria chief Greg Hywood said cheap airfares had boosted spending by interstate visitors.
''Football followers clearly travel more than they used to,'' he said.
Saturday's grand final was one of Melbourne's four tourism pillars, he said, along with the Australian Open Tennis, Australian Grand Prix and spring carnival.
Premier John Brumby last week announced $30 million in funding to help upgrade the MCG's Great Southern Stand, citing the need for continual investment in ''our home-grown code''.
Overall, Sport and Recreation Victoria gave $248 million to Australian rules football projects between 2000 and 2010, including works at training grounds such as Whitten Oval. Almost $6.5 million went to upgrading country football and netball facilities. A further $7.2 million was spent on drought-relief programs for local clubs, including water-harvesting projects.
The AFL's social and cultural initiatives, including programs against racism and violence towards women, were more difficult to quantify. But their impact should not be discounted, Dr Stewart said.
''We hear so much anecdotal evidence in communities around the state that football and, to a lesser extent, netball are the activities that link communities together,'' he said. ''There is something about sport in general and football in particular that brings people together and provides the social cohesion that a night at the theatre or a quick trip down to the Ian Potter Gallery doesn't give you.''
Victorian Equal Opportunity and Human Rights Commission chief Dr Helen Szoke praised the AFL's ''social cohesion'' programs as sophisticated. ''Because their brand is so strong, when the AFL comes out against racism or homophobia or violence against women - notwithstanding players do run amok - that really sets a very high standard for the community,'' she said.
http://www.theage.com.au/victoria/how-football-keeps-the-economy-kicking-20100918-15h9z.html
