THE VISION THAT the FAI will be debt-free by 2020, much-trumpeted during the latter period of John Delaney’s tenure as CEO, lies in tatters in the wake of a series of expensive reports and investigations launched since it was revealed by the Sunday Times in March that Delaney provided the Association with a €100,000 loan in April 2017.
The FAI have been in crisis since that story emerged, and are now being investigated by the Office for the Director of Corporate Enforcement over their finances. Separately, the FAI have themselves commissioned Grant Thornton to assess their books and consultancy firm Mazars to conduct an extensive audit of the Association.
These are extremely expensive undertakings, and there is great concern about the FAI’s finances as a result. Such is the parlous state of things, Uefa are providing financial assistance to help the FAI through choppy waters.
There have been whispers that finances at this turbulent time are worse than expected, although the FAI strongly rejected SIPTU’s claim on 15 May that they are in danger of “being insolvent in only a matter of weeks.”
FAI President Donal Conway yesterday refused to divulge figures in relation to all of this, but did say that the Association have put together what he calls a “more sustainable financial plan”, expected to be finalised in a couple of weeks. It is being put together in conjunction with Uefa and Grant Thornton.
“The reports, we don’t pay for all the reports but the reports are obviously quite expensive,” Conway told reporters.
“That’s all part of the cost base in the financial planning that is being done. I’m not putting an exact cost on what one of those cost streams is actually costing us.”
All of this means that the ‘debt-free by 2020′ plan has been destroyed.
The FAI have for years suffered under the weight of debt relating to the disastrous Vantage Club scheme of September 2008. As a way of meeting their commitment to the redeveloping of Landsdowne Road, the FAI devised a premium ticketing plan which sold 10-year tickets ranging from €12,000 to €32,000.
(The IRFU, by contrast, even with the guarantee of a couple of high-demand Six Nations games every year, sold theirs at a flat €15,000).
Delaney admitted in February this year that mistakes were made in this pricing structure, and now a 10-year ticket costs €5,000.
The pricing – along with the economic downturn – left the FAI saddled with a debt that soared to €70 million at one point.
Delaney insisted over the last couple of years that the FAI were in a position to clear that debt by 2020, a year which will see the Aviva Stadium host European Championship games.
That now won’t happen.
“Certainly you’re right, it won’t be debt free by 202o”, said Conway.
“As part of that financial plan, we will decide on what is the most appropriate term to run out the remaining debt on the stadium. It could be pushed out ten years and further.”
Conway was speaking at the announcement of the FAI and Sport Ireland’s Governance Review Group’s report into how the running of the football body should be changed, crucial on getting finances back on track.
Sport Ireland will not restore State funding – around €2.9 million annually – unless these reforms are adopted, and while they have been endorsed by the FAI Board, they must be passed by a two-thirds majority at the FAI AGM on 27 July to come into effect.
Sport Ireland CEO John Treacy says the restoration of funding will also hinge on the outcome of Sport Ireland’s audit into the FAI, which will assess their fitness to handle public funds. That report is due in September, with the FAI eager to receive their second half of this year’s grant on time in the Autumn.
Large-scale infrastructure projects, including Glanmire in Cork and upgrades to the Aviva Stadium to host the Euro 2020 games will also be deprived of critical government funding if the proposals aren’t adopted.
The proposals outlined yesterday were developed with input from Fifa and Uefa, and Conway explained their financial importance to the FAI.
“If you think about it, Fifa and Uefa provide, in any one year, 20 to 25% of our funding.
“That is not to diminish the funding we get from Sport Ireland, but that’s in the 5% place.
“When you talk about Fifa and Uefa and sources of funding, you’re talking about something that is so much more significant. They will want to see this adopted.”
Sponsorship income is also paramount to the FAI – and Conway warned that they won’t want to be associated with the Association if the proposals don’t pass at the AGM.
“We have talked to all of our sponsors. They are all, for example, looking very carefully at this and their continued involvement with brand FAI is dependent on this kind of report being adopted.
“These are the kind of arguments we will be putting to our members to convince them that adopting this is in the best interests of the FAI.”
Conway will now lead a five-week lobbying process of delegates, to convince them to back the proposals at the AGM on 27 July.
Delaney, meanwhile, assumed the newly-created role of FAI Executive Vice-President in March, and has voluntarily stepped aside from that role as these investigations are ongoing.
The FAI refused to answer questions relating to Delaney at yesterday’s press conference, and declined to clarify whether this decision was taken on legal advice.
Details on the reform proposals can be read here.
