Tuesday, January 02, 2007

How Australia spent its $9.2 million World Cup fees

Australia's Socceroos' World Cup heroics delivered cash-starved Australian football the off-field financial injection it desperately needed, Tom Smithies of the Daily Telegraph reported. "The Socceroos entertained the world in reaching the World Cup's last 16, but the $9.2 million the team earned means it's the sport's bank managers who will have enjoyed the team's rollercoaster ride as much as anyone." he wrote. Football Federation Australia earned $$7.6 million ($1.09m "preparation costs" for training camps, reconnaisance missions, etc, and a $6.54 million appearance fee) for qualifying on behalf of the Oceania Football Confederation against South America's Uruguay. Having made the second round, Australia's prize share from the world football body FIFA climbed to more than $9 million.

FFA's expences were high, however. Coach Guus Hiddink earned $3.6 million for the campaign. He received 300,000 euros ($502,000) for the first six months, up to the Uruguay World Cup qualifiers. "Winning those opened up a bonus of $837,000, and another payment of $502,000 for the second six months, running through to the end of the World Cup. On top of all that, getting Australia through to the second round earned him another $1.67m bonus. That total fee of E2.1m equals $3.6m – more than 30 percent of the total FIFA cheque," Smithies noted. Once in Germany, Australia opted for a top-end hotel which, even after FIFA's subsidy, left FFA with a bill of almost $1 million. And, through their Collective Bargaining Agreement, the players, themselves shared one-third of FFA's World Cup prizemoney and marketing income, a minum of $3 million.

Smithies mentioned that the Socceroos' sell-out pre-World Cup friendly with Greece in Melbourne brought in close to $5 million (less Greece's appearance money and stadium costs) but did not include it as a World Cup revenue stream.

"The black hole the FFA took over from Soccer Australia, and even with government grants and loans, were left with a balance-sheet deficit of around $4m. Since then the FFA have been chiselling away at the red ink but officials say the World Cup money has wiped that out.," he wrote. It means all income can now be used for the benefit of the sport, rather than paying off debt. For the first time in recent memory, the FFA is solvent ... The fantastically increased profile of the Socceroos also brought obvious commercial benefits in terms of increased merchandise sales, though increased sponsorship has largely had to wait for the renewal of deals such as the one with Nike."

Australia is expected to spend big in preparations for the 2007 Asian Football Confederation Asian Cup and, according to Smithies, the FFA has allocated Australia's Olympic team (the Olyroos) around $2 million for its potential 14-game schedule. "Later this month the FFA will unveil the results of last year's review of its talent identification and development processes. Expect millions to be ploughed into coaching and development of the next generation of Cahills, Neills and Kewells," he concluded.

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