A new cost-benefit analysis of the controversial AFL stadium in Tasmania has found it could add $2.26bn in its first 10 years to the state’s economy.
It was delivered on the same day as the joint committee tasked with scrutinising the proposed AFL stadium at Macquarie Point found there has been no evidence to back the key assumptions underpinning the business case for the stadium so far, including the number of expected events.
Construction of the $715m, 23,000-seat roofed waterfront stadium was a condition of the AFL granting a licence to Tasmania for a team that is expected to enter the competition in 2028.
The stadium is backed by the Liberal state government but has attracted opposition, with thousands protesting at a rally in May.
The Hanson report, authored by Tasmanian Russell Hanson, former finance director of FitzGerald’s department stores, and CEO of the national body of The Wilderness Society, found it would boost the state’s economy by $226.61m a year.
“These benefits make it quite clear that the new stadium is no ‘dud deal’ as has been claimed,” Hanson said in a statement.
He said it will generate additional spending by visitors to Tasmania across the whole state of over $2bn over 20 years.
“This huge economic benefit is further demonstrated on examination of the PwC analysis of the Hawthorn games in Launceston and applying the same methodology to the new stadium, the economic returns are substantially positive, ongoing and an opportunity this state can’t afford to lose.”
The Hanson report analysed the $28.5m benefit calculated in 2017 by PwC and updated it to current forecasts based on CPI increases but also falling attendance levels to arrive at the $29.62m a year economic benefit for the Launceston region.
It was backed by prominent economist Saul Eslake who described it as a powerful case. Eslake is also a board member of Macquarie Point Development Corporation, which is involved in managing long-term plans for the site.
In its interim report on Wednesday, the parliamentary committee found the government did not consult with RSL Tasmania, the Vietnam Veterans Association, Hobart city council or TasWater until after cabinet made a decision on 5 September to lock in the site.
The RSL has raised concerns about the stadium potentially overshadowing the nearby cenotaph, while TasWater runs a sewage treatment plant on the site.
The committee said many assumptions in previous reports, including by consultants PwC (in its 2022 report into the economic impact) and MI Global, were not comprehensive or detailed enough to enable a meaningful cost-benefit analysis.
“Many of the assumptions contained in the various reports provided to government, including the PwC and MI Global Partners reports, are not comprehensive or detailed to enable a meaningful cost-benefit analysis to be determined,” the report read.
“These reports have significant gaps – for example, the absence of assumptions related to opportunity costs and implausible event attraction details.”
A PwC report claimed the stadium would attract 28 new events annually.
Seven of those were NRL matches, which have not been played in Tasmania since 2014, the committee noted.
Speaking to reporters on Wednesday, Liberal MP Felix Ellis said the Hanson report was ‘another piece of encouraging work that demonstrates the vital importance’ of the stadium.
“And ultimately we know that we need a stadium so Tasmania can have an AFL team,” Ellis said.
“That’s the culmination of a dream many decades in the making, and we’re really excited to see that Tasmanian kids can play for Tasmania.”
When asked about the interim report, Ellis said there was a range of different views, but that the state needed to complete the project because ‘it’s important to our state pride’.
In a statement, shadow treasurer Shane Broad accused premier Jeremy Rockliff of treating “Tasmanians with contempt” and covering up “gaping holes in the case for the stadium”.
“While the premier has proudly endorsed a report on the stadium from the former CEO of the Wilderness Society, he has failed to address the report’s admission that the stadium will likely cost at least $1bn and will be unlikely to attract the predicted 44 major events every year,” Broad said.
“Even worse, the Hanson report acknowledges that the Liberals’ failure to obtain a GST exemption, [which] means the $240m of federal funding ‘would be reduced from future GST calculations over a three-year period,’ saying this ‘effectively means it is just a loan’.”
The state government has pledged $375m towards the stadium, with the AFL chipping in $15m and $85m to be raised through borrowings or leases.
The federal government has committed $240m to broad development at the Macquarie Point site.
- With AAP
