The National Treasury has asked the city of Cape Town to slash the estimated R3,3-billion cost of the Green Point stadium for the Soccer World Cup by 40%, city mayor Helen Zille said on Wednesday.
”This is obviously a tall order, because we are convinced that the costings of the conceptual design are accurate and they were verified by independent experts,” she told a meeting of the city council.
She said the treasury request followed the council’s submission to treasury of a 37-page preliminary business plan.
This was the start of an ”interactive and iterative” process between council and treasury to find agreement on a final business plan that is acceptable to all parties, affordable and achievable, she said.
All three tiers of government will be sharing the cost of the stadium, which will have semifinal status in the tournament.
”The first step in this iterative process is a request, from a treasury official, to us, to find ways of reducing the stadium’s cost by 40%,” she said.
”We are, in good faith, reworking aspects of the conceptual design to determine whether there is any way we can cut the projected stadium costs from the R3,3-billion … to around R2-billion.
”The result of this attempt will be reflected in the second-phase business plan.”
The R3,3-billion includes ancillary facilities but excludes additional infrastructure development. Zille said the city itself will be contributing R400-million to the cost of the stadium.
The total cost of the event, including infrastructure, an extensive decentralised system of public viewing sites, practice venues, transport, information, communication and telecommunications will be just over R7-billion.
”We in the city have committed ourselves to secure approximately R1,2-billion of these costs,” she said. ”This amount includes the R400-million for the stadium.”
The deadline for the final business plan is October 31, followed by a final response from treasury in early November, and then the actual allocation of treasury funds.
”Depending on the results of this, we plan to commence construction of the stadium that can accommodate a semifinal very early in 2007,” she said.
Zille also said that assuming the city does not have to carry capital debt, the plan presents three different revenue projections, a low, a base and a high scenario.
In all three, except year one of the low scenario, a positive income flow is predicted from 2010 onwards.
She said she wants to repeat that, subject to adequate national funding, the stadium will be built at Green Point, not at the Culemborg site. — Sapa