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2010 host cities in the red
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sport24.co.za
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Johannesburg - The nine South African cities hosting 2010
World Cup matches will bear the brunt of a R3.2bn cost overrun in the
construction and upgrading of stadiums for the event, Business Day newspaper
reported on Tuesday.
The local organisers of the World Cup have been warning since July that
the stadiums are likely to overshoot the original budget by more than
3 billion rand.
Sports Minister Makhenkesi Stofile confirmed the amount of the overrun
in a written reply to a question in parliament from the opposition Democratic
Alliance.
South Africa is building five and upgrading five stadiums for the World
Cup. The original budget was R9.8bn but rising costs of inputs and poor
planning means all 10 stadiums are running over budget
Cape Town's new 68,000-seat Green Point stadium that will host a semi-final
match among others, is both the most expensive and the most over budget.
The stadium is expected to come in at around R3.3bn, nearly R1bn more
than initially budgeted.
Apart from poor planning, planning errors and a lack of foresight about
rising costs, Stofile also blamed changes to FIFA's and the local organising
committee's requirements for the bloated budget.
In his mid-term budget policy statement, Finance Minister Trevor Manuel
announced R1.4bn extra towards the stadium. The host cities are expected
pick up the remaining R1.8bn tab, despite increasing difficulties in securing
credit from local and international markets.
Stofile also expressed concern at the "high risk of labour unrest,
like in all other 2010 stadia projects."
Rising inflation, food and fuel prices were the driving forces behind
several strikes at World Cup stadiums last year. While the situation has
eased, more strikes are deemed likely between now and the October 2009
FIFA inspection date for the stadiums.
Such strikes would put further pressure on some cities already operating
to tight schedules.
Stofile warned it was "highly unlikely" that the new stadium
being built in the southern city of Port Elizabeth would be completed
by its March 31, 2009 deadline.
The Port Elizabeth stadium was already withdrawn from the list of 2009
Confederations Cup venues over fears that it would not be ready on time.
Sport24.co.za,
02/12/08
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