Mr BAYLEY – Minister, I want to go to the Macquarie Point stadium, should it ever be built. My understanding is in Stadiums Tasmania’s annual report that, as an asset, that would be transferred over to the books of Stadiums Tasmania to manage in the longer term. Can you explain what happens to the debt associated with building that stadium that Macquarie Point Development Corporation would accumulate? The figures we’ve been provided through the budget panel shows that Macquarie Point Development Corporation would borrow at least $490.7 million to build it, more assuming there are cost overruns as people are expecting. Do you expect that debt liability to transfer across to Stadiums Tasmania with the asset?
Mr DUIGAN – That would be a question for the Minister for Macquarie Point.
Mr BAYLEY – You’re the minister for stadiums Tasmania. I suppose the question is: would you be comfortable with that liability of debt being transferred across with the asset? That is a normal practice when it comes to the transferring of assets, ensuring that they’re able to be serviced and the like. What would your view, as minister, be in relation to transferring that debt?
Mr DUIGAN – In terms of the question and the hypothetical nature of it, James, is that one that you have contemplated?
Mr AVERY – It’s not something that has been determined as far as I understand. It certainly is one that the minister, I believe, would be across at this point, but it’s not something we have entered into formal discussions with.
Mr BAYLEY – It’s not hypothetical though, aside from the fact that the stadium is a hypothetical proposition at this point, but if it is built, it will incur at least $490.7 million worth of debt to one agency. That asset then gets shifted to another government entity and I am asking you, as minister, for the entity that would inherit that asset, whether you would be comfortable with that liability shifting across with it?
Mr DUIGAN – All I can give you is the fact that, you know, as part of the sports portfolio, that’s not a scenario that’s been contemplated.
Mr BAYLEY – Not been contemplated, so what has been contemplated? Just a direct transfer of the ownership of the asset to Stadiums Tasmania?
Mr DUIGAN – That Stadiums Tasmania would become the operator of the stadium, yes.
Mr BAYLEY – Owner and operator.
CHAIR – Mr Garland.
Mr BAYLEY – Coming back to the Macquarie Point stadium debt – $490.7 million is Mac Point’s borrowings. Last year’s Budget identified them as being short-term borrowings, additional expenditure outside of the forward Estimates is anticipated to be met through short‑term borrowings by Mac Point Development Corporation. This year’s Budget has no such qualification around the durability or the length of those borrowings, so, I think we can assume that they will sit there for a little while. The Coordinator‑General has flagged that maybe they don’t get paid back at all.
Notwithstanding your previous answer that it hasn’t been contemplated to shift that debt across to Stadiums Tasmania, as would be the normal practice, the government does propose to service the $490 million through grants from the general government sector going forward. If the government was to be doing that, servicing that debt for Macquarie Point through grants from, effectively, operating budget, would you be content with that debt then being shifted across to Stadiums Tasmania?
Mr DUIGAN – All of that is very much cart before the horse, and I don’t think there’s anything meaningful I can say from the discussions that I’ve had to answer those questions. Those are questions that will come in the fullness of time. We need to get the stadium approved and get it built, then we will understand how those kinds of machinery elements will take place.
Mr BAYLEY – Surely, as minister who’s responsible for the entity that will adopt this stadium, you’d have a position on whether the debt that is incurred in order to build the stadium should travel across with the stadium itself.
Mr DUIGAN – That will be the case, should that come in front of me. At this time, that’s not a circumstance that has –
Mr BAYLEY – In budget Estimates, as minister responsible for that the entity, the final home for that stadium – if it is built, you don’t have a view on whether the debt should travel with the asset?
Mr DUIGAN – Not that I would give you here today, no. Not without having the opportunity to fully contemplate the question.
Mr BAYLEY – This hasn’t been a discussion within government, in terms of how you manage that debt, which entity pays for it, how it gets paid down?
Mr DUIGAN – Not a discussion that I’ve been party to.
Mr BAYLEY – Much is made of the AFL deal to deliver the Devils as the 19th licence in the league. We understand that and it has a lot of deliverables in it that are really clear, and this has been debated at length. One of those that your government has spruiked a lot recently is a $360 million commitment that the AFL is making to Tasmania and to football in Tasmania. The AFL deal itself only flags $120-odd million, $124 million I think it is. The Planning Commission identifies that the balance was committed via media release.
My question to you is have you signed a subsequent agreement with the AFL where it spells out its commitments, and you have them signed up to that?
Mr DUIGAN – I haven’t signed a subsequent agreement. As you mentioned, we are expecting that the AFL will invest $358 million in total into Tasmanian football a part of the licence deal which will flow into communities and clubs and that will be made up of $10 million into the club’s training and administration centre, the T&A, $90 million toward game development, $33 million into development of young male and female talent, $210 million into distributions to the new club over 10 years, and importantly, a minimum of $15 million into the stadium at Macquarie Point.
Mr BAYLEY – So $124 million of that is as part of the agreement, the 19th licence agreement, and on that basis, you’re proceeding with a remarkable process to approve and build that development. Are you saying that there’s not a subsequent agreement with the AFL that locks in those commitments? You haven’t signed one. Has anyone else in your government signed an agreement with the AFL to lock in those commitments?
Mr DUIGAN – My understanding is that these are the commitments that have been made as part of the club funding arrangement.
Mr BAYLEY – The club funding arrangement spells out $124 million. Your government has been citing $360 million for a long time since. Are you telling me that no one has put pen to paper with the AFL to lock in those commitments? The Planning Commission reports that it was a media release from the AFL announced it, but are you saying that no one has gone back to the AFL and asked them to sign on to those commitments, as they did in the club funding agreement and as Tasmania did to a significant number of different commitments?
Mr DUIGAN – The number to which you refer, which is contained in the club funding agreement, remains.
Mr BAYLEY – $124 million.
Mr DUIGAN – The $210 million number is a number between the AFL and the club because those payments flow to the club.
Mr BAYLEY – Some of them flow to the club. You just went through them before and some of them go to other places.
Mr DUIGAN – $210 million in distributions to the new club over the first 10 years.
Mr BAYLEY – So everything over and above the $124 million are actual payments to the club because that’s what you’re effectively saying, is that correct?
Mr DUIGAN – Yes, right?
Mr BAYLEY – Not into community football, not into other facilities, into the club?
Mr DUIGAN – And the staff who live, work, play here in Tasmania.
Mr BAYLEY – They’re not additional commitments into community football or football development in in the state. They’re commitments maintain the club.
Mr DUIGAN – Yes.
Mr BAYLEY – Minister, international and indeed national research has shown that stadiums are an increasing venue for sports betting advertising and encouragement and the level of saturation of advertisements, the integrated nature of it and the sort of impulse nature of the advertisements, and stimulating an impulse reaction to gamble, are of significant concern, and they are not matched with alternate warnings about gambling and measures to sort of deal with people’s addictions and challenges in that space.
Has the government turned its mind to this in relation to all its sporting venues, in terms of policy about how Stadiums Tas will engage with the sports betting sector, let’s call it, and with a harm-minimisation approach informing it first and foremost?
Mr DUIGAN – Thank you for the question, and I note the increasing level of interest around this particular issue. It’s probably one that’s directly in the Stadiums Tas space, given the commercial nature of the operations that Stadiums Tas would seek to operate under. James?
Mr AVERY – Stadiums Tasmania in relation to the Mac Point project or, in fact, any of our other venues, hasn’t been approached by any gambling or wagering organisations to date. We are certainly committed to partnering with responsible organisations, in that sense.
We’re aware that there are regulations that already apply. For example, I know there was some change several years ago in relation to live odds being advertised in venues during events, and that no longer happens. We think that’s a very good thing.
In terms of those partnerships that our hirers undertake, for example, if we’re talking in the sporting realm ‑ football and cricket ‑ we can’t determine who they partner with from a sponsorship point of view. We obviously can in terms of our own assets within the venues, which on event days, are limited. We will get, for example, somewhere between 5 to 10 per cent use of signage within the venue when we stage sporting events of an elite level.
From our perspective, we are certainly cognisant of partnering with responsible partners in relation to our assets within the venue. We cannot dictate terms to our hirers, unless there is an edict across the entire venue.
Mr BAYLEY – Just to unpack that a little bit more, through you, minister, for Mac Point, for example, on an AFL game day, should it ever come about, you’re saying that the AFL has [inaudible] 90 per cent control over the electronic billboards and all the advertising in that venue. You have no capacity to influence, moderate at least deal with some of the risks that may be associated with what is being promoted there?
Mr AVERY – You’re accurate in terms of the percentage split for the hirer. If the venue was deemed to be a venue that had banned all forms of gambling advertising, then that would be a measure, yes. Otherwise, at the moment we can’t, for example, determine to an AFL club playing there that they can’t do a sponsorship with a wagering company for guernsey sponsorship and branding. Obviously, we don’t determine who clubs do commercial partnerships with.
Mr BAYLEY – You’re saying that if a venue had a ban on all gambling advertising, for example, voluntarily put, that would then be a consideration that the hirer would have to take into account, as to whether they choose to take on that venue and actually use that venue in the first place?
Mr AVERY – Yes, it would create an issue in terms of where they’re able to play, and therefore whether you, as a venue, are able to enter into a venue hire agreement with that partner. For the Mac Point project, that is a relatively simplified way to look at it. I guess if this is flowing to all government‑owned or government‑funded venues, you’re talking about a lot of community venues. If there is a community organisation that has undertaken some sort of a partnership with a wagering company, there’s another layer of complexity there.
In terms of the venues that we operate, yes, it would create some sort of negotiating commercial issue with our hirers, if that was the case.
Mr BAYLEY – Is that something that you’ve contemplated at all, or the Stadiums Tas board has discussed how it wants to engage in that responsible wagering advertising space?
Mr AVERY – Our organisation is very mindful of it. We’re watching the trends nationally and globally in terms of advertising within stadia very keenly and very closely. There’s been a number of changes over the years, as I’ve alluded to, and we think they’re sensible changes. We are very aware of our corporate social responsibility as an owner‑operator of large‑scale community assets.
Mr BAYLEY – Do you see a world where those kinds of ads ‑
CHAIR – Sorry, Mr Bayley, we’ll have to come back to you.
Mr BAYLEY – When I go to the major venue content strategy recently released by Stadiums Tasmania, it identifies that venues are underutilised, with surplus capacity existing through the content calendar for all venues, particularly in winter.
Basically, our venues are already underutilised. There’s obviously been work done around the Macquarie Point stadium and I identified a remarkable 334 events across 337 calendar days. Are you confident that this is actually deliverable? Are you confident that this is deliverable for a new facility in Hobart when the existing facilities are already underutilised and seemingly underperforming when it comes to events?
Mr DUIGAN – You would need to look at the potential contrast between existing facilities and what is proposed for Macquarie Point, and –
Mr BAYLEY – An expense, and there’s a whole range of factors you would have to take in there if you are going to look at something massive and new.
Mr DUIGAN – Yes, all of that, but we do have the expert in the room and I would ask James to talk about that scenario and how he and his organisation see what you’re putting forward.
Mr AVERY – I believe there’s some underutilisation for a range of reasons. One, because previous owners of some of these venues, it hasn’t been their core business. They haven’t had the expertise or experience to be able to maximise these types of venues in terms of managing them on an ongoing basis, attracting content, different types of events, greater diversity of events. Part of the reason Stadiums Tasmania was established was to try to rectify some of those issues so the expertise and experience that our organisation brings to the table seeks to try to bridge some of the gaps that may be there in some of those venues.
Mr BAYLEY – Have you seen that turnaround since Stadium Tasmania was stood up?
Mr AVERY – Yes, we have in a relatively short space of time. As the Stadiums Tasmania model takes full effect, there is the benefit of greater efficiencies in terms of costs spread across greater venues. There’s greater purchasing power in terms of attracting events. All of that culminates in the model that we’ve put forward in relation to the Macquarie Point project as well.
Mr BAYLEY – In terms of the model for Macquarie Point, given there’s inherent risk and assumptions in the modelling, what would you consider would be fair margins of error, I guess, in terms of some of the predictions you’ve put into the major events schedule – not schedule, but estimations – for Macquarie Point?
Mr AVERY – We think there’d be very little margin based on the thoroughness and comprehensive nature of the operating model that we’ve built out. Specifically in terms of the events calendar, that’s been built on consultation with a wide range of stakeholders including industry experts, focus groups with Tasmanians who have indicated that they are interested in going to Devils games, interested in going to Hurricanes games, interested in going to concerts and other live entertainment events. It’s engaging specialists who operate on a national and global basis that build these types of modelling many times over, and previously have put together events calendars. It’s based on our consultation and analysis of other venues that are either operating in other states or are directly comparable to the one we’re doing. So, I would say that the margin for error around the events calendar is very small.
Mr BAYLEY – To pick up on that, before I move on. Who would ownership reside in?
Mr DUIGAN – Ownership?
Mr BAYLEY – Ownership: particularly if there was additional capital needing to be invested by the AFL or the club.
Mr DUIGAN – The land would continue to be owned by the council, leased to the club for a period of time. The club would own the building infrastructure, with some caveats around how that might be seen in the event of a catastrophic event.
Mr BAYLEY – Effectively, that’s now a $115 million grant to the club. They would own the asset at the end, not the land, but the capital as infrastructure?
Mr DUIGAN – Yes.
Mr BAYLEY – What commitments – I know this has been a point of discussion – what level of community access would be maintained for that $115 million, appreciating, of course, it’s a high‑performance venue and not all the facilities are suitable, but I think there has been some commitments made around ongoing community access to that infrastructure; what is that commitment? Could you re‑put it here for the committee and from an updated perspective, of ongoing community access to the high‑performance centre?
Mr DUIGAN – Yes, absolutely, community access: the high‑performance centre for the Devils will encompass two ovals, one of which will have the Tigers playing on it. In terms of access to the facilities, there are, I think, ongoing conversations and, Shane, you might be best placed to talk to how those interactions would be managed there. There are some, I guess, learnings from other clubs around the country in terms of how they provide access to their high‑performance centres; some do a great job of it and some are less forthcoming. Shane Gregory, Associate Secretary, Department of Premier and Cabinet, has been pivotal in the negotiations around that.
Mr BAYLEY – What commitments are you going to extract from the Devils while maintaining that?
Mr DUIGAN – Well, I think, given it hasn’t come out of the ground yet ‑ but you know, we’re all focused on that and I think council’s very focused on making this a welcoming place. It will be a place that hosts elite sport, no question about that, but we want this to be a very vibrant community asset. Shane.
Mr GREGORY ‑ Obviously, the primacy of the high‑performance centre is to support the AFL team. That will be the predominant use and there will be, given the nature of that function and the players, there will be significant components of the T and A facility that won’t be open to the public. The club is planning to have a cafeteria space that would be open to the public. They are planning to have some merchandising space that will be open to the public.
They will be having some auditorium facilities and a sort of function centre component, which they plan to have community events occurring in, and the secondary oval for their use under the club funding development agreement will primarily be a local community team facility. They will have a licence to access it, but it will be prominently for the Kingborough Tigers and they will continue their community‑based action.
Mr BAYLEY – And things like a pool or a gym or something like that, you’re saying that they wouldn’t be open to the community? It extends to cafeteria and gift shop.
Mr GREGORY ‑ Well, the consideration will be, when the Devils have an AFL men’s team and an AFL women’s team, a VFL men’s team and VFL women’s team, they’re not actually going to have a swimming pool as such, but the facilities in their wet area, their plunge pools, their recovery pools and their gym will be in pretty constant use, so no, I don’t think they would be making those available to the public for use. I do not think there would be capacity to do that.
