Sri Lanka Cricket claims the Rs. 3.2 b debt is not its concern
Sri Lankan Cricket claims that the whopping Rs.3.2 billion that it owes the government is not its concern. SLC treasurer Nuski Mohammed speaking to the Sunday Times said that when the three stadiums for the 2011 Cricket World Cup were built there was some sort of Government assurance that it would take care of it and it is not our concern.
Sri Lanka Cricket’s Treasurer Nuski Mohammed said the main cause of their financial predicaments had come forth as a result of this massive debt burden; if not the SLC is at present is on a good footing where finances are concerned.
Responding to questions about the Rs. 3.2 billion that SLC owes the Sri Lanka government and the steps the game’s governing body is taking to remedy the situation, Mohammed said, “The Rs. 3.2 repayment is shelved. There are two reasons for that. One is there is a committee appointed by the Ministry of Sports — the Professor Veddikkara Committee which has still not finalised the bills. I am told last week, it has completed Khettarama and Pallekelle bills and now it is concentrating on Hambantota. Then the Rs. 3.2 billion will get substantially reduced anyway.
“Then we are talking to the Treasury, which also advises us to get the bills finalised to ascertain what the real liability is. We are confident because that was an obligation that we discharged not only to cricket, to Sri Lanka Cricket but also the Government, in having these stadiums ready on time. Then finally it was paid off when the T-20 World Championships were carried on successfully. We are proud that we had the tournament without any blemishes and at the end it also brought in extra money in.”
The Sri Lanka Cricket’s treasurer came out with details while refuting the charges levelled at the cricket management of Sri Lanka by some its employees who charged the local cricket authorities are in dire straits financially.
Mohammed was not willing to buy those allegations or about the onus of the Rs. 3.2 billion debt. He insisted that the SLC was on a sound footing financially.
“The Rs. 3.2 billion was a spillover from the World Cup venue construction. As you know, the World Cup construction cost touched something like Rs. 7 billion. It was financed partly through Sri Lanka Cricket — almost Rs. 2 billion; then a Rs. 2 billion loan from the Bank of Ceylon (BOC) and the 3.2 billion came from the government agencies because the Government said we have to get these World Cup venues ready on time. Then as a result we also got the 2012 ICC T-20 World Championships going on here. So the 3.2 billion there was some form of assurance from the Government that it would take care of it. So that is not for us. That is not our concern.”
The SLC treasurer, however, said that the SLC took the onus of the Rs. 2 billion loan which it borrowed from the BOC. He added, “We had to sort of tie our future income for the Rs. 2 billion loan that we obtained from the BOC. When I took over there was 18.43 million dollars outstanding. Besides, we owed almost a billion rupees to suppliers, contractors and others. More importantly the player payments were also outstanding — amounting Rs. 600 million.”
He then explained the relationship between the BOC and the SLC, saying it was rather strained. However, with the backing of the Sports Minister who also accompanied them for the negotiations, they managed to obtain the Rs. 600 million that was needed to pay the cricketers. That came by way of two loans. One was Rs. 150 million and the other was 3.9 million dollars. The SLC delegation gave the BOC the assurance that they would pay back the loans by June 2012.
“We knew that the Indian Cricket team was due in Sri Lanka. Our tour programme was good that year. Then we also had the World T-20 championships,” he said.
Mohammed said at that point they had a good cash flow which amounted to Rs. 1.4 billion. This helped them to partially settle the outstanding loan of $ 18.43 million and bring it down to $ 10.5 million. He added, “Besides that, we also paid the Rs. 950 million which was outstanding to our creditors on book. It was good year financially and we did our planning and brought down the credit.”
Then Nuski Mohammed said that as a result of our performance, the BOC had complete confidence in the SLC. Now the outstanding is stopped at 10.5 million dollars. “We knew 2013 was going to be a lean year with very little cricket – we only had New Zealand, Bangladesh and South Africa. Even the South African series was disrupted because of our commitment to the SLPL which never took off. Even the ICC Champion’s League did not bring in much money. When I worked my cash flow and when worked my budget we knew that we were not on a strong footing financially. Then we approached the BOC once again and re-negotiated the credit payment to complete payment by 2015 instead of 2013. But we said that we would keep paying the interest. With that renegotiation we got into a surplus cash situation. Besides, with a few future adjustments I have done my clash flow upto 2016. ”
There was another problem, he said. “For four years the stakeholders were not looked after, owing to the situation that prevailed.
We have a few cricket venues in the country and they are overused. So we were of the view that the stakeholders should be looked after because in turn they had to look after their facilities. Realistically it is school cricket which is our nursery and the clubs provide us with the players to the national grid. Besides the clubs only get the tournament money; in countries like India, England, South Africa and Australia the stakeholders get a handsome dividend. It is we who do not give it. The 27 million rupees we paid out to the clubs were only 1% of our income.”
When asked how the dilution of the SLPL had hit them financially, the SLC treasurer said, “Last year we made Rs. 250 million from the SLPL. Yes, we may have lost some income from the SLPL, but, we made up with our successful negotiations for the sponsorship where Dialogue and the Ceylon Tea Board came in. This combination brought us an income of Rs. 1.35 billion. That is over three years, and we already have obtained the one-third of it. Then the T-20 extra funds and some other inbound payments made us financially strong. Our cash flow is sound now. At the end of December we will end the year with a surplus”.comments powered by Disqus