Johannesburg — The national treasury is being called on to make more money available for the building of 2010 stadiums for the Fifa World Cup as almost all nine of the cities that will host games are experiencing "funding shortfalls", which collectively run into billions of rands.

Finance Minister Trevor Manuel announced in the medium-term budget policy statement late last year that government had made R15bn available for the World Cup.

Of this amount, R12bn was for the construction and refurbishment of stadiums.

Even with local funding included, the amounts allocated to the host cities are not enough to meet the tenders that are being received for stadium construction. Given the determination of the country and government to make the world football spectacular a major success, the reports of shortfalls will put more pressure on the national treasury and Manuel to make more money available for municipalities set to host games.

It emerged in public hearings of Parliament's sport and recreation committee yesterday that most of the host cities were experiencing shortfalls due to expenditure estimates that had grown because of inflation, the exchange rate and rising input costs.

Five of the host cities made presentations to the committee yesterday, reporting a combined shortfall of about R2,5bn, and tomorrow the remaining cities will present the status of their preparations for the tournament.

Cape Town's 2010 administrator, Mike Marsden, told the committee the new Green Point stadium was budgeted at R2,5bn but the preferred bidder had placed the cost at R3,7bn. For Cape Town alone this meant a shortage of R1,2bn. Marsden said extravagant tendering also played a role in the higher costs.

He and Cape Town mayor Helen Zille told the committee that while many things were being done to try to reduce the costs, there would still be a "residual gap" that would demand the attention of the national treasury.

Marsden said Cape Town was working closely with the provincial government on the stadium project. He said Cape Town had estimated the cost, based on current industry prices, at R1,8bn. The lowest tender offer was R2,6bn. With 10% escalation, contingencies of 5% and insurance, the total packages went to R2,5bn and R3,7bn. Negotiations were under way to have the tender amount reduced.

Cape Town had gone to the very limit of its affordability in the project, securing more than R2,4bn. Millions were being spent on transport and electricity upgrades. This demonstrated Cape Town's commitment to the project, Marsden said. "It is not a lavish design; it is functional."

Marsden said the escalation of costs was a concern. "We presently factor in escalation of 10%. If inflation picks up and there are foreign exchange fluctuations, we believe that this could leave not only Cape Town but other host cities exposed and we believe there is a need here to address the manner in which government protects host cities from escalation," he said.

In separate submissions, teams from Durban, or eThekwini, and Nelson Mandela metros both said that they also faced sizable funding gaps. Durban's was put at about R600m, Nelson Mandela's at R262m, while Polokwane's was at R300m.

Committee chairman Butana Komphela said last night he was confident that the national treasury would come up with a solution that would not harm the municipalities hosting World Cup games. He said the treasury had been expecting escalations in the costs of building stadiums and had been in constant communication with the host cities.