West Ham’s Olympic “Gold” must be returned to the taxpayer, say Charlton Athletic Supporters Trust.
Following the broadcast on BBC1 last night of “ The Olympic Stadium; How the Hammers Struck Gold”, Charlton Athletic Supporters Trust (CAST) is backing Shadow Minister Chris Bryant’s call for a public enquiry into the rental agreement between West Ham and the London Legacy Development Corporation.
“The programme clearly showed that West Ham occupy the stadium essentially for free. The taxpayer has become West Ham’s biggest supporter and unwittingly propelled the club into the financial elite of European clubs. The current rental agreement is a waste of taxpayers’ money and unfair on other clubs who compete with West Ham” said Steve Clarke, chairman of CAST.
Orient are most directly threatened by West Ham’s new financial strength but due to the new transport links which connect South East London and Kent to the stadium, Charlton are also in the firing line. “Commercial competition is a fact of life in football” said Clarke. “However West Ham will now be virtually free of matchday overheads, and we also know that the club will retain 100% of the lucrative hospitality revenue. It has about 20,000 new seats to sell. We fear they will offer them at promotional prices in Charlton’s heartland. If they had to contribute more in rental they would be more cautious and concentrate on reaching out to lapsed West Ham fans, who mainly live north of the river. That is why CAST has taken up the issue.”
CAST board member Richard Hunt, who has done most of the research on the issue also criticised the attempts of authorities to cover up the facts of the case by blatantly refusing to comply with the Freedom of Information law, as featured in the programme. “Even now, the Information Commissioner is still unable to get the LLDC to comply with our request for full unredacted release of the rental contract” he said “Viewers could see how ordinary citizens can use the Freedom of Information law effectively; but they could also see how the excuse of ‘commercial confidentiality’ is used to reduce its effectiveness.”
The LLDC (guided by West Ham) claim that release of the contract terms would allow other clubs to gain a commercial advantage in areas such as the transfer market. “This is a ludicrous argument” said Hunt. “Other clubs already know that West Ham will instantly become more financially powerful. But far from giving clubs more leverage over West Ham, access to the contract will simply show these clubs that West Ham can now outbid them for a given player because they have lower overheads. They already know this! ”
The real reason for keeping the details secret, according to Hunt, is political embarrassment, and the fear of legal action.
“The programme has highlighted the overwhelming public interest in knowing all the details of the deal”, said Hunt. “The Information Commissioner must now rule that this overrides any excuse of commercial confidentiality. And politicians must tell the LLDC – a State Body of which the London Mayor is head – that it must not appeal such a decision”
Rumours already abound of a new EU State Aid complaint, this time initiated by London football clubs. CAST however believe that responsibility for addressing the issue lies squarely with UK politicians. “It is they who have overseen the negotiation of this deal” said Hunt “It is they who have decided that the taxpayer should become West Ham’s biggest supporter. EU State Aid rules do not in any way consider whether taxpayers’ money in a nation state is being used correctly. UK politicians should not hide behind the EU as an excuse for failing to address this issue. The next stage of our campaign will involve engaging with politicians who are – or should be- most directly interested in the issue.”
What is known about the terms of West Ham’s deal?
Annual rental has been reported at £2.5m by various media outlets, and not disputed by West Ham. However CAST has also discovered that the rental agreement allows for an unspecified reduction in rent if West Ham are relegated (source: LLDC submission to the European Commission in response to CAST complaint about unfair State Aid).
By comparison, Manchester City pay £3m/year (source: Wikipedia), while Ajax Amsterdam pay €9m/year (source: Guardian, 20.4.15.)
But West Ham will not pay the substantial overheads incurred by clubs who own their own grounds; namely: Stewarding, security and traffic management costs; ticket sales staff costs; pitch maintenance. All these costs are borne by the stadium operator. The programme estimated the value of this overhead avoidance at up to £2.5m/annum.
West Ham also avoid capital costs that other clubs currently have to fund themselves: The installation of a top quality pitch with undersoil heating is funded by the stadium operator. At Charlton, a similar installation in summer 2014 cost £1m, which the club’s owner had to fund himself.
West Ham’s Capital Cost contribution towards the rebuild of the stadium has also been widely reported as £15m. Rebuild cost is now estimated at £272m, so West Ham contribute just 5%. By comparison in Manchester, the City and Manchester City FC each contributed 50% (£20m each) of the respective conversion costs at the City of Manchester Stadium (source: Wikipedia)
West Ham can more than meet these costs by selling the Boleyn Ground; the deal stipulates that West Ham do not need to pay their tiny share of the conversion costs until they have completed this sale (source: LLDC submission to the European Commission in response to CAST complaint about unfair State Aid). In West Ham’s 2013 financial accounts, the Boleyn Ground is valued at £71m. It is understood the sale to Galliard Homes has been completed, but the public is not allowed to know the value of this sale. Meanwhile in Manchester, City gave up Maine Road to the council for nothing.
The rental agreement currently allows West Ham to keep 100% of revenue from corporate hospitality. (source: LLDC submission to the European Commission in response to CAST complaint about unfair State Aid).
The Emirates Stadium cost £390m, and Arsenal had to fund every penny because “the club was not granted any public subsidy by the government” (source: Wikipedia).
For more information:
Please contact Steve Clarke, Chair, Charlton Athletic Supporters Trust;
Email: firstname.lastname@example.org / tel: 07500057067