Dank affair exposes AFL’s weaknesses
The Australian
June 27, 2015 12:00AM
The AFL Commission and its *administration used to be close to infallible. At least in the eyes of this country’s sport watchers. The indigenous competition was flying higher than any other code because it was not fettered by the selfish and parochial views of the clubs that formed the national league.
That was a long time ago. Nobody thinks that any more. The commission and the men and women administrators who answer to it are not nearly as clever as first pictured. Not nearly as transparent as required. Not nearly as constant as hoped.
What many might have suspected is now fact. The confused and opaque treatment of Melbourne’s tanking scandal was not an aberration. It was pretty much the league’s blueprint for crisis management.
Any last suggestion that the league leaders and their underlings performed their job in a manner that the code’s supporters would be comfortable with has been shredded this week. This final reveal has come in two parts. The release on Thursday of a detailed account of the Essendon supplements saga in the book The Straight Dope written by colleague Chip Le Grand and followed yesterday by the AFL’s life ban on medicine man Stephen Dank
While the scandal is closing in on its third birthday, the book exposes the AFL’s dangerous need to control everything that it is involved in, and bludgeon into submission those who resist the league’s wish to manage any and every outcome.
The league is just one villain in a book without heroes. Coach James Hird? He never did understand the core issue in this case that flattened interest in the sport to such an extent people would *report turning off their radios and televisions if the saga and its progress was mentioned.
The book reveals in a meeting with AFL Commission chairman Mike Fitzpatrick that Hird was asked why he did not accept the league’s wishes that he own responsibility for what happened in 2012 at the club. Hird’s reply was that he *believed the club did not cheat.
The coach, and former champion player, of course, was never charged with cheating. The AFL wanted him to step away from the club for 12 months because he did not fulfil his governance responsibilities when club high-performance employee Dank was running a dangerous supplement and drug program which might well have put the health of Hird’s players at great risk.
Hird never accepted his governance accountability or that the AFL, ultimately, was trying to manage the damage to Hird, one of the game’s most adored and *respected figures, as well as to the game. Thus neither the game nor the coach escaped a mudslide of scorn.
Towards nearly the end of part one of the AFL’s role, the league had almost unravelled. Unable to manage the outcome it wanted, the chairman of the Australian Sports Commission, John Wiley, was whistled up to see if he could broker a deal with Essendon’s chairman, Paul Little. And then-chief executive Andrew Demetriou was like a groggy boxer, backed onto the ropes and throwing punches instinctively but without power and precision.
This is the same organisation — except Demetriou has gone and Gillon McLachlan has laced on the chief executive gloves — that is *attempting to steer Australian football to market supremacy nationally while soccer continues to soar and the reformed and *retooled NRL tries to widen its *influence outside NSW and Queensland.
The AFL is attempting to expand the competition as well as equalise it. To many observers it is beginning to appear such aims might be mutually exclusive.
The commission has set aside $200 million to ensure the Gold Coast Suns and the Greater Western Sydney Giants, the game’s 17th and 18th teams, are self-sufficient by 2016. The truth is these clubs might not be able to fund themselves by 3016.
The established clubs are convinced that the push of second teams into Queensland and NSW is starting to strain the commission’s finances. In a series of exclusive reports over the past two weeks, The Australian has exposed a brittle financial structure underpinning the league.
Thirteen clubs — the Suns and the Giants not included because they are being funded by the AFL — are carrying a combined debt of $91m. Last year eight clubs finished in the red.
This season’s results will be no better. Up to eight clubs are forecasting losses again. The Saints and Carlton have budgeted for $2.2m losses. Carlton’s result, in particular, has blown out but they had a poor start to the season and had to remove coach Mick Malthouse.
The Western Bulldogs and *Adelaide forecast losses close to $1m each. Geelong are expecting a negative result anywhere between $250,000 and $500,000, while North Melbourne could lose $60,000. Fremantle and Brisbane might break even.
The Future Fund established by the commission in 2007 has a book value of $89.4m but sits with only $63m in cash. While established to buy assets (Etihad Stadium) and be a reserve to cope with unforeseen financial circumstances, it appears to be used to keep the league turning over.
The AFL denies this but there is no doubt the account is being used for matters other than stated when the commission gave birth to the fund with an initial seeding of $16m in 2007. The past two annual reports record profits of a combined $29m, which are claimed to have been deposited in the Future Fund.
In simple terms that should put the Future Fund at $118m. Yet it is still recorded at $89m but with just $62m in cash. No doubt this is all regulated accounting and there is no suggestion of impropriety, but nonetheless money appears to be drying up at football’s headquarters.
Several clubs are sure the league is haemorrhaging money to its vision of national domination. McLachlan denies these suggestions outright though he acknowledged to The Australian this week that the establishment of the Suns and the Giants has proved more expensive than considered when they were mere doodling on whiteboards.
Increasingly, the AFL is taking money from the more successful clubs and pushing it into equalisation funds. Collingwood and Hawthorn have been the loudest opponents to the introduction of a soft cap on football department spending (not including player payments) and a hefty tax on *revenue growth.
The expenditure tax will provide $3.1m this year while the full impact of revenue from the soft cap on football departments will not be definitive until budget estimates turn into actuals in October. Next season the football department tax becomes more punitive, rising from 37.5 per cent of each dollar over the cap to 75 per cent in 2016.
Clubs with bigger revenue bases and membership rolls than others see this as the AFL asking them to do what is really the job of the commission. Banker to the poor. And money issues might become tighter rather than freer with the new broadcast rights to run for five years from 2017-2021. Already it has been suggested — and not denied — that the AFL will look for at least $1.7bn. That’s up from the present deal of $1.25bn.
The clubs already have their thinning hands out for a greater slice of the new money and the AFL Players Association is determined to garner a bigger cut of the deal for its footballers.
AFLPA boss Paul Marsh has said repeatedly that he wants a *formulated percentage of the broadcast deal and he is prepared to use both the salary cap and draft system for leverage.
Marsh represents a challenging element in the league’s distribution of money. He has come to the job with a clear mandate from his employees to wrench a lot more money for the players from the system.
And this is the AFL Commission’s growing problem. Revenue is not increasing as quickly as the number of mouths growling for a bigger cut. Programs previously driven with zeal by the AFL are now barely propped up. The push for the AFL to have an international presence has evaporated in step with increasing demands on the game’s funds.
When Demetriou delivered so many millions in the first broadcast deal, he was seen as something of a genius. Big money deals became commonplace. Now the market competition is greater, the costs more expensive, the public more discerning.
That’s the problem facing Gillon McLachlan, who heads into his first broadcast deal. Everybody is hungry and getting the MCG to reduce the price of hotdogs and meat pies is not going to cut it.
Farck !!!