Is the Sports Hub Symptomatic of a Deeper Problem with Singapore Sports? – Speech by Jamus Lim on the Sports Motion

Sir, I beg to move, “That this House celebrates the accomplishments of our athletes and para-athletes at the 32nd Southeast Asian Games and the 12th ASEAN Para Games in Cambodia, and calls on the Government to undertake a thorough evaluation of the areas of improvement in Singapore’s sporting ecosystem, and commit to realizing clear, achievable goals for sporting success over the coming decade.”

In November last year, I attended a concert by a band I had loved as a teenager: Guns N’ Roses. Besides reliving part of my formative years among thousands of other middle-aged fans doing the same, I got a chance to see aging rockers put on a spectacular show. More recently, my sister joined another 50,000 Singaporeans at the concert more aligned to her musical tastes: the Korean girl-band BlackPink.

Both concerts were held at a stunning venue: the modern National Stadium, nestled in the Singapore SportsHub. But the facility—an engineering marvel that can seat as many as 55,000 people—was meant to host, first and foremost, world-class sporting competitions and other community events. So as much as both my sister and I enjoyed our outings, the shadow of the failed SportsHub public-private partnership (PPP) hung over the scene. We were left to wonder: Is the future of the crowning jewel of our local sporting scene left to hosting concerts by foreign musical acts?

After all, I’m old enough to recall a time when the stadium hosted the Kallang Roar. It was a time when a deep sense of nationalism welled up, as we supported, especially, the football team. My mother still relates the story of me falling off the bed as a baby, after being startled by the roar following Quah Kim Song’s winning goal in the 1977 Malaysia Cup final. The stars of my time—Fandi Ahmad, V. Sundramoorthy, and David Lee—united Singaporeans across ethnic lines in a way that top-down policies can only dream of inspiring.

But the roar has fallen silent, as has the facility that was meant to revitalize local sports. In today’s motion, filed by myself and my fellow friend (and sports fan) Faisal Manap (WP–Aljunied GRC), we hope to provoke an earnest debate on the challenges faced by of our national sportsmen and women, whether they represent the country at the highest levels, or if they are young aspirants, seeking a healthy outlet for their time and energy.

Mr Speaker, as much as I love sport, my domain of expertise is in economics, and hence, my opening speech will focus on the economic challenges faced in bringing Singapore sport to the next level, using in particular the SportsHub episode as a foil. Mr Faisal will instead tackle what he the Workers’ Party believes are the non-economic challenges, using the example of football—the closest that we have to a national sport—to illustrate his points.

But we also hope that the discussion will go beyond just sports alone, because an eye to looking at our relative weaknesses on this front can offer insight into other areas of public policy in Singapore where we have been far less successful on the world stage, despite our outpouring of blood and treasure to stoke greater success.

Successes of Team Singapore 

Let me begin by first congratulating our national athletes in the recently-concluded 32nd SEA Games and 12th ASEAN Para-Games in Cambodia. Team Singapore fought hard, and secured 157 medals in the SEA Games, and 44 in the Para-Games. Every medal took sweat and tears, and I ask this House to join me in a round of applause for all our athletes, whether they medaled or not.

It is worth mentioning a few highlights. Sprint queen Shanti Pereira set a new national record for our 200m, on her way to a double gold for the 100m and 200m. We should not forget, however, that she did so amidst a continuing battle with the burden of injuries and the pressure of high expectations.

Fencer Tay Yu Ling returned to the top of the podium in fencing, after retiring in 2010, proving that, even in sport, age can just be a number that should not limit the boldness of our dreams.

Runner Soh Rui Yong, who had been excluded the 2021 Games, earned a silver medal in the 10,000m. During the event, Soh had offered Indonesian rival Rikki Simbolon a drink after the latter had missed his, in a striking mark of sportsmanship.

And our para-athletes, despite the physical odds they face, once again did us proud. They brought home 44 medals in total, with swimmers Colin and Sophie Soon contributing a fifth of that total haul.

We don’t do well in sports for a country with our level of income

As much as we celebrate the achievements of our athletes, we should also be aware of where we have fallen short. Let me be clear: this does not diminish their sporting accomplishments. But unless we can candidly look at both the wins and losses, we cannot fully understand what we must do to get better. After all, every successful sportsperson or team goes through the very same postmortem after a competition. We need to do the same here.

Our SEA and Para-Games performance placed us 7th among the 11 participating nations in total medal count for both. Given that we rank 9th in terms of population in the region, perhaps one could credibly argue that we outperformed our small size.

But population is only one factor in determining cross-country sports outcomes, and not even the most important one. If anything, systematic analyses suggest that it is countries’ incomes that is far more influential, whether in specific sports like soccer, or across sports more generally. Indeed, some have even gone as far as to argue that the same socioeconomic determinants—especially wealth and development—drives sporting success.

There is a simple reason why incomes matter. Richer countries are better able to channel significant private and public resources toward sporting achievements. Hence, it is unsurprising that the quality of sporting infrastructure matters, too. This is a prima facie reason why we might wish to promote infrastructure, such as the SportsHub, as a catalyst to elevate local sport. It also underscores the need to prioritize soft infrastructure, such as athlete support and coach development.

And in that regard, Singapore has not only punched way below our weight, but it has actually gotten consistently worse. With your permission, Mr Speaker, may I have the clerks distribute a handout that illustrates this underperformance in vivid detail. Members may also access these materials through the MP@SGPARL App.

The top panel shows a plot where (the logarithm of) total medal count in the Summer Olympics is set against per capita incomes, measured in a common currency corrected for inflation. The small blue dots are other countries across the different competitions since 1976, and Singapore is shown (apropos) in red. The green line is the best-fit line from a simple linear regression; the way to read it is that observations above the line are overachieving (for their level of per capita income), and vice versa for those below. We are far below, consistent with clearly falling short. And while our lack of Olympic success turns out to be not that unusual among ASEAN nations, we remain, unambiguously, an outlier.

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A similar story can be told for out lack of football success, shown in the bottom panel, but since we are now talking about a ranking—where a lower number is better—the line is inverted. Yet here, the story is even more disappointing: our FIFA ranking, back in 1993, is right smack on the line, which means we were at least consistent with our level of development. But as we have gotten richer, our ranking has paradoxically slid further away from what we would otherwise expect.

What explains our nation’s anomalous outcomes? As it turns out, money alone is not enough. Countries that have prioritized sporting achievement, including at the highest level, . This is why tiny Uruguay can win the World Cup twice, and still consistently send competitive teams to the tournament. It is why Iceland’s 330,000 people can qualify for international basketball and football tournaments. And why Australia is a powerhouse in swimming, Jamaica keeps tearing up the tracks, and New Zealand has the All Blacks.

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The promise of the Singapore SportsHub PPP

Part of the grand plan to revitalize our local sporting scene was the Singapore SportsHub.

The SportsHub was conceived as a PPP that was meant to go far beyond infrastructure provision; bid evaluation placed a weight of two-fifths on appeal of sports, leisure, and entertainment programming—more than any other criteria—reflecting the importance that the government placed on operational considerations. Yet after launching to much fanfare in 2014—as the then-largest PPP project in the world—the SportsHub would last only about a dozen years as a PPP.  Around mid-June of last year, the Government announced that SportsSG would take over ownership and management of the SportsHub, stating that this would serve the interests of Singapore and Singaporeans better. This came after a “detailed financial, legal, and operational due diligence” effort.

But it is notable that symptoms of underlying problems were already presenting themselves right from the start. Some of these—such as the delayed construction and launch, due to the global financial crisis in 2008—were plausibly due to external factors, beyond the control of the consortium. But costs significantly overran the original estimate of $650–800 million, eventually clocking in at $1.3 billion, twice the low-end estimate.

Even after construction, operational issues plagued the project. A football friendly between Brazil and Japan, held in 2014, received criticism that the pitch was “more sand than grass.” Just two months later, a Jay Chou concert held at the Hub was plagued by a leaky roof. In 2016, rumors swirled about how one of the consortium partners was at risk of being ejected, and a fiasco for that year’s National Day Parade, including a proposed upcharge for extra rehearsal days, poor reviews of the venue, and a final price tag ($39.4 million) around twice that of the cost at the Floating Platform or the Padang. Throughout, the facility had gone through CEOs like hot potatoes, averaging one every other year, not to mention others in the C-suite.

But if these fundamental problems were known to the government, it did not telegraph this much to the rest of us. In a response to a Parliamentary Question posed in 2017 expressing concern about the project, then-Minister for Community, Culture, and Youth Grace Fu only revealed that SportsSG was “in constant communication with SHPL [Sports Hub Private Limited]’s management… [and] has a dedicated team of officers who monitor SHPL’s performance closely and holistically.” When asked in 2019 if there were lessons to be learned from the episode, she declined to answer in detail, merely offering that, being the “[f]irst major PPP that the government has done… we can all learn from the process.” 

The economics of public-private partnerships

But we should be clear about why we pursued a PPP in the first place, beyond the simple-minded desire to flow with a public policy fad. In principle, there are three reasons why one may pursue a PPP for a given project.

First, it is because the public sector does not have sufficient funds, and a partnership with the private sector becomes a means of unlocking necessary financing. This is often the case with infrastructure projects; governments grant the rights of levying usage charges for, say, a road or a bridge to the private developer, in exchange for their delivering said construction project.

Second, it is because there is a desire to share the risks inherent in the project between the two parties. For projects with uncertain economic prospects—such as those to build power generators or water treatment plants, especially in a still-developing area—roping in private partners can diversify the risks of potential losses among those with the ability and willingness to bear such risks.

There is potentially a third area where PPPs may appear to make sense, but in reality warrants careful consideration. This is when the private sector may appear to possess the necessary expertise in the area, perhaps due to superior knowledge of the technology or market. But is it truly necessary to pursue a partnership structure, where the upside from risks undertaken are mutually shared? What does the private sector contribute to the endeavor, beyond their skills? Do the partners expand the market, develop the business?

After all, if it is expertise alone, a superior model is to simply hire the necessary human resources, project by project. You can think of the same thing when a firm decides on hiring workers. It takes a special contributor to be conferred the benefits of partnership.

PPPs in Singapore

For those unfamiliar with the model, it is easy to layer criticism on it. But this is misguided; it is like blaming the tools of a poor workman. Moreover, we have extensive empirical evidence documenting the success of PPP projects—in infrastructure, health, and education—across a wide variety of performance indicators, both at home, as well as worldwide. The prototypical template is a Design-Build-Finance-Operate (DBFO) one, where all aspects of DBFO fall on the private sector, with government dealing with political and regulatory risk.

Such projects include desalination and NEWater plants, an incineration plant, residential and university accommodation developments, and even a whole tertiary education campus (ITE College West). But there have also been notable failures; in addition to the SportsHub, the tender for Changi Motorsports Hub was investigated by CPIB in 2011, SMRT was returned to direct government management in 2016 after repeated service disruptions, while the Tuaspring integrated water and power plant had to undergo debt restructuring in 2019.

But the path not taken is just as revealing. In 2016, the government ruled out a PPP for Changi’s Terminal 3, because it did not wish to focus on profits at the expense of service standards. A similar motivation appeared to be behind the abandonment of NUS University Town, where the ability to price services would be severely constrained by the overall desire to ensure subsidized higher education. Such sentiments are instructive, because it underscores the importance of looking beyond purely financial considerations, to the ultimate purpose of any given project.

A postmortem on the Sports Hub PPP

As Minister Edwin Tong explained in his statement to Parliament following the takeover announcement, the government was aware of the options available, but it chose a PPP over the traditional procurement route.

We can probably rule out the first of the major justifications for adopting a PPP, which is that there were financing constraints. After all, the government—unlike, say, one of our higher educational institutions—would generally have no difficulties raising the necessary funds for a major infrastructure project, especially one that contributes to key national objectives. As proof of the pudding, this government routinely raises amounts for key infrastructure that are larger far larger than $1.3 billion dollars.

The reason seems more aligned with the third justification, which is that the partnership might avail specialized expertise for, presumably, operating the hub. Minister Tong alluded to this, stating that the PPP model was ultimately chosen because of the “unprecedented scale and complexity of such a major sports infrastructural project… and the limitations at that time of not sufficient depth and breadth of such expertise in Singapore, including in the private sector.”

But as I had explained, we wish to tread carefully when deciding on a partnership to leverage expertise. While such skills may well be lacking at home, it remains unclear why we did not simply put such foreign talent on a payroll. We routinely bring in such consultants, experts, and managers, even in areas where we have some expertise in, such as finance and technology. Besides, the all-important operational partners of the SportsHub PPP were either local or have been based here for an extended period: venue operations fell under Global Spectrum Pico, a tie-up that includes a local company, and facilities management was overseen by DTZ, whose presence in Asia is due to another Singapore firm, Edmund Tie.

Perhaps, then, it comes down to the second justification: a desire to share risks. My best guess is that this was indeed a prime motivator. Minister Tong proudly declared that the “entire project design, planning and construction were borne by the PPP partners… [and] this structure also allowed the government to mitigate the… risks of such a major project undertaking.”

But perhaps therein lies the problem: in trying to offload risks, but still retaining its nonpecuniary objectives, the government was trying to have its cake and eat it too. But is this coherent? Was the government trying to get the private sector to bear the financial risks, and then turning around and insisting that it also accommodate social objectives, instead of concentrating on the bottom line? And imposing fines for unmet standards that it cannot be expected to meet, further souring the partnership?

Such an approach—that the government can shift the risks to the private sector, while reaping the benefits without active management—is naïve optimism. It is well-understood that PPPs are ill-suited for social infrastructure, since profit-making and social objectives may frequently diverge. In fact, a study reveals that “appropriate risk allocation and sharing” is one of the top 3 critical success factors behind PPP projects in Singapore.

This disconnect was recognized by those involved in the running of SportsHub. Insiders shared about problems such as too many potentially conflicting KPIs and stakeholders, excessive top-down oversight with little agency offered to SportsHub management, and possibly misaligned goals even among key government agencies, such as SportsSG, the Tourism Board, and the EDB. And since we surely do want our country’s sports jewel to incorporate our nation’s sports promotion and community building objectives, having the government assume both the role of client and controller means that the PPP arrangement was fundamentally untenable to begin with.

On the future of the Sports Hub

Now that the government has taken over the SportsHub in its entirely, it is valuable for us to ask how it plans to ensure that the facility fulfills the aspirations for catalyzing Singapore Sport, as we had hoped it would, close to a decade-and-a-half ago. Here, I will pose a series of questions, which I hope the Minister can offer more insight into:

  • First, how will government management differ in practice from the PPP model?

One reason the government offered for pursuing the PPP approach in the first place was because it didn’t have the expertise. What assures us that it has the expertise now, to successfully run a world-class sports and events venue? If it does not—and I am sympathetic to how we should not expect public servants to possess such talent—and we will go the route of hiring external experts, why wasn’t this done in 2008?

More generally, will the government commit to clear objectives that are aligned, in advance, among stakeholders? It strikes me that a consultation process can help us better understand what the public will regard as a proper and ideal use of the facility, since it is meant to inspire local sports participation, after all.

  • Second, how does the government plan to balance community uses with profitable enterprises?

For example, will there be a revision to venue rentals now that the government has taken over the SportsHub? In particular, will there be a distinction between commercial rental and community ones? After all, one reason why the substantial takeover fees were paid was, ostensibly, to to remove commercial barriers for local sports promotion. Minister Tong has already alluded to some of these—under the rubric of ActiveSG and Kallang Alive—including “National School Games…, Singapore Youth Festival performances…, [and possibly even] the National Day Parade.” He even hoped for “the return of casual stroller or jogger to the stadium.” If the concern is—understandably—the crowding out of commercial returns due to the latter, we could consider scheduling community use events during clear downtimes when facilities are not being used. But if indeed the government will not operate the SportsHub under the “same assumptions as SHPL,” how much does it expect to incur on an annual basis, for operation, in the years ahead, and how will this differ from the original sums paid to SHPL?

Might there be a more general problem with sports expenditure in Singapore?

This discussion of numbers naturally leads us to a more careful discussion of sports expenditures in Singapore. To do so, we must step back and scrutinize the budget just a little bit, just so we are working off a common context.

In the latest budget estimates, SportsSG currently accounts for ongoing expenditures of a little less than $391 million, with development expenditures of close to $123 million. This comes to $514 million. There is a separate budget line for the Sports Programme, with an operating expenditure of $41 million, and development expenditure of $470,000. Taken together, we devote about $556 million (or half a percent of total fiscal expenditures), to sport.

Now, of this, the SportsHub consumed around $57 million in fiscal 2022, in the form of capital grants. There was an extraordinary development expenditure charge, of close to $1.4 billion, in fiscal 2022, which presumably was the up-front termination fee. But there are additional operational costs, of $800 million, which will have to be incurred through till 2035. I am assuming that these will be accounted for on an annual basis, and will show up in the budget statements in future, but I am happy to stand corrected.

If we agree with these numbers, then the next step is to ask if such expenditures should be giving us more bang for the buck. As it turns out, the general expenditure on recreational and sporting services for the EU amounted to 0.7 percent of all general government expenditure, a share very similar to ours. Japan spends a mere 0.02 percent (yes, you heard that right) of its government budget on sport, and in Korea, the entire Ministry of Culture, Sport, and Tourism—which notably includes massive expenditures on promoting Korean culture via Hallyu—comes to only 1.3 percent of the national budget, with sports accounting for just 0.3 percent. Yet these countries have performed more admirably on the international sporting stage than we have, even taking into account their larger populations. Ironically, we are ranked the best in the world for a sport—Tchoukball—that doesn’t have a national association. For another sport without a recognized national association—dodgeball—Singapore is 6th or 7th.

But all this applies at the micro level as well, which is why the SportsHub example is illuminating. The poor management of sports facilities is merely symptomatic of a more general inefficiency of public spending in sports, which in turn not only contributed to a failure of the PPP, but spills over into poorer sporting outcomes as well.

Other contributions

Mr Speaker, the remainder of the Workers’ Party MPs will speak to different elements to held flesh out this debate.

Both Dennis Tan and Faisal Manap will speak about football. This isn’t quite the overkill it seems to be, since, as mentioned earlier, football is a sport that almost every Singaporean connects with. They will also deal with different aspects: Mr Tan on how we can revitalize our Singapore Premier League, starting from the grassroots level, and Mr Faisal on how we can help our Singapore National team recover from its current malaise.

But sport goes beyond soccer, so Leon Perera will go on to highlight some less-celebrated sports, although along the way, he will also speak more generally about how our sports ecosystem may be strengthened. Gerald Giam will do likewise, offering ideas on tweaking the local youth ecosystem, to help improve our odds of sporting success in the international arena. And He Ting Ru will, similar to Leon, speak about inclusion in our sporting system, including the disabled, and those who are not necessarily participating at the highest levels of sporting competition.

And finally, Sylvia Lim will speak about how, to do well in sport, we must also take care of our ex-athletes even after they retire. In doing so, we not only provide them with the security of knowing that our country has their back when they compete, but even after they do, which in turn allows them to push themselves even before they start. It also speaks to how, as a society, we should be taking care of all segments of our society, even when those segments may have faded away from the public limelight.

I look forward as well to all the other contributions from members of this House, in what I expect to be a lively debate on how we can take Singapore sports to the next level.