From one euro into sport, the state gets five and a half back

A KPMG study suggests that in Slovakia, sport stands and falls on parents and family budgets.

Monday’s presentation of the new state sports policy concept under the title Slovak Sport 2020 ended in disillusion for much of the sporting community. Unlike in the past, the movement was given the chance to influence the content of the proposal, but as Minister of Education Dušan Čaplovič admitted, the plan met resistance from the Ministry of Finance during the interdepartmental review. This was despite the fact that changes of a legislative nature (such as an amendment to the lottery law) had been envisaged only for 2015. The finale was bleak: section director Ladislav Čambal suggested that the proposal would go to the government, which is supposed to discuss it next Wednesday, probably only as a 2016 concept. “And we are supposed to accept that the finance minister swept it off the table?!” asked Samuel Roško, secretary general of the Slovak Paralympic Committee.

Share of GDP 2.1 percent
“Sport as an economic category of the state gives back more than it takes,” claimed the proposal submitted for public discussion on October 25. “A good thesis, which is very likely true,” estimated Jozef Tokos, adviser to former minister Eugen Jurzyca and head of the Viktória project team, in an interview with Sme on Saturday. However, he warned that “the serious statement is not substantiated in any way, not even with a footnote referencing research.” The Slovak Olympic Committee, thanks to its partners, already had on its desk a study from KPMG Slovakia, part of the global auditing “Big Four,” which contained strong arguments. It confirmed that Slovakia is no exception. The state does not lose money on sport – on the contrary, for every euro it invests, it gets back nearly five and a half (5.42). Based on conservative calculations, sport’s share of GDP last year reached 2.1 percent and its share of total employment 3.4 percent. For comparison: the EU White Paper on Sport in 2004 estimated the same parameters for the Union at 3.7 and 5.4 percent respectively.

The most expensive is tennis, not hockey
According to KPMG’s general director Ľuboš Vančo, the input data was provided by 145 sports associations. Two federations – football and basketball – did not provide them without explanation, so the firm collected the data from public sources and through structured interviews with experts, additionally verifying it by comparing with Czech data. The annual expenses of one of the approximately half a million registered athletes, beyond what the club pays, average 1,159 euros. For an unregistered athlete, intensive sporting activity costs 337 euros per year, and for a recreational one with irregular activities, 84 euros. “I was surprised that the most expensive sport is tennis – a tennis child costs parents 6,630 euros a year, while a hockey child costs 4,200,” noted Vančo.

The state does not motivate sport
In terms of public support, Slovakia is below the EU average. Last year Slovak sport received 133 million euros from public sources, with contributions from the state budget making up only 29 percent. Cities and municipalities were more generous, with nearly 71 percent. How much of the more than 97 million euros they provided went to sports facility operations and how much to particular sports disciplines is open to speculation. “A significant role of local authorities in sports financing is a European trend,” reminds the head of KPMG Slovakia. “In some countries they have a fixed percentage they must allocate to sport, but I fear that in Slovakia, under such rigid rules, sport could actually lose out in some areas.” Public financing of sport is high in northern and western Europe (highest in France), and low in central and eastern Europe. Unlike several other countries, Slovakia does not offer tax incentives to clubs or sporting families, nor does it motivate private sponsors or volunteers to engage in sports activities.

Three quarters paid by families
In Slovakia, sport stands and falls on parents and families. This follows from the calculation of sport’s economic benefits through multiplication. If the total costs of sporting activity (including athletes’ spending of 1.2 billion euros) are added to the costs of maintaining sports facilities (112 million), all the costs of sports events (including those of participants and spectators, more than 354 million), and sports administration (25.7 million), the result is a respectable 1.7 billion euros. Based on last year’s figures, that represents the total financial consumption for sport and sporting activity in Slovakia. Almost three quarters (over 74 percent) were paid by households, meaning they came from family budgets, while sports associations contributed nearly 18 percent from their own and sponsorship income. The state and public sector provided only 7.8 percent, the mentioned 133 million. (...)