COMPETITION GOOD FOR SPORTS FUNDING

28 November 2008

New EGBA survey shows that it not only state monopolies that can do good things

 

One of the most frequently rolled out justifications for state gambling monopolies - that these are good for sports funding - has been put under the comparative spotlight by a new survey commissioned by the European Gaming and Betting Association and published this week.

The study, conductes by independent UK consultancy Sportsbusiness, revealed that a competitive and regulated gaming and betting market can also benefit sports funding. Sportsbusiness compared the sports funding models of the UK, where a competitive market exists alongside the National Lottery monopoly, with France, where the Française des Jeux has a monopoly on both lottery and sports betting.

In the UK, a broader funding model had proved advantageous for sports, including those at grass-roots level, the study found. The average annual budget per UK National Governing Bodies (NGBs) was Euro 80.1 million compared to Euro 46.4 million in France. Commercial funding was the most important income source of revenue in both France and the UK, contributing 67.4 percent and 65.4 percent respectively.

Lottery funding accounted for 10.2 percent of revenue in France, as opposed to 7.9 percent in the UK.

The average per annum in lottery funding received by each of the French sporting federations was Euro 4.8 million, with 33.3 percent of this sum allocated for grass-roots sport and 66.7 percent on performance.

In the UK, NGBs benefited from a higher amount at Euro 6.4 million each - with 56.3 percent allocated to grass-roots, and 43.7 percent on performance, indicating that grass-roots sports funding was unlikely to suffer if more markets widened to allow competition.

Between 2004 to 2007, 4.5 percent of UK National Lottery sales were allocated to sport, while Francaise des Jeux’s contribution to sport over the same time period was only 3.8 percent.

David Henwood, Sportsbusiness director said: “Our findings indicate that differing gambling models can coexist without having a detrimental effect on sports financing and indeed a broader funding model can be beneficial for sport as a whole.”