6 June 2008
Cape Town will adopt a multi-pronged plan to address the almost R600-million shortfall it faces in its construction of the Green Point stadium.
This and the city's joint business plan with the provincial Transport Department were presented to the 2010 World Cup standing committee in the provincial legislature yesterday. The budget for transport development is R1.6 billion.
Mike Marsden, executive director, service delivery integration, said the potential sources of income included a portion of Fifa's ticket revenue, naming rights to the stadium which would be sold on the international market, revenue from the stadium operator after the tournament and sales of corporate suites.
Marsden said the budgetary shortfall was a problem shared by other World Cup stadiums.
But Cape Town had decided not to take out a loan. "We want to ensure a debt-free stadium.
"We wanted to complete the stadium without impacting on general service and infrastructure delivery."
He said an international process to find an experienced operator for the stadium, who would ensure the maintenance of the stadium without burdening ratepayers after 2010, was under way.
The city's technical director for 2010, Dave Hugo, said Local Organising Committee head Danny Jordaan had agreed in principle that (ticket sales) money could be forwarded to the city. Hugo said the stadium cost estimate was now R3,95-billion.
In the worst case scenario the cost could rise to R4,03-billion. As things stood, more than R3,37-billion had been secured for the project, with the shortfall standing at about R580-million.
Hugo told the committee they were unable to give the actual cost "until the last of the construction" took place.
The risks involved with the stadium's finance included the specially designed roof forward cover and standby generators.
The stadium's roof erection was expected to start in September and the roof was expected to cost R429-million.
The committee was told that about R500-million of the R4-billion stadium cost would be paid to overseas companies.
This included payment for cables outsourced in Germany, the roof's compression ring and generators from the US.
Hugo said they were shocked when Sars wanted payment for import duties as they had thought the project was exempt from taxes.
He said they were talking to the revenue service to find a solution.
The stadium was expected to be completed by December 15, 2009, six months ahead of the tournament.
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