The competition for government funding of major sports events: why do some applicants pass the needle’s eye? | A Summary

Eva Lechner & Harry Arne Solberg
NTNU Business School, Trondheim, Norway

The original idea behind this paper is to explore the Norwegian major sports event hosting policy in the past years. Norway is perceived as a regular host of many World Cups and World Championships, especially in regard to winter and ski sports. The first phase of this research indicated that an official major sports event hosting policy does not exist, though significant financial resources are dedicated to major sports events from the government budget on a yearly basis. The government welcomes hosting major sports events but has not established the criteria for financial support of such events, arguing that sports are already supported through profits of the national lottery. This approach, however, has not silenced voices of many sports event organizers who naturally seek additional financial resources and ask or even formally apply for grants and subsidies at the Ministry of Culture.

Hence, the second phase of our research inquiry included both document analysis (event organizers’ applications for government support, letters of acceptance and rejections were gathered and reviewed along with newspapers articles) and interviews (N=20). The common pattern for all applications has been found, and that is the argument of externalities. All event organizer who applied for the support claimed that their events create positive externalities. The most common argument then was the trickle-down effect (the event in question inspires the local population to exercise) and promotional effects (the event would promote the region on TV-screens and hence bring more tourists).

The results further shows that 11 events were granted NOK 476 million (€47.7 million) in the period 2012– 2018, whereas five events were rejected. The funding was highly concentrated, with 92% being distributed to four events: 2016 Lillehammer Winter Youth Olympic Games (NOK 252 million), 2014 Chess Olympiad (NOK 87 million), 2017 UCI Road World Championships (52 million) and the Arctic Race of Norway in the years 2016-2018 (NOK 45 million).

This paper shows that the absence of criteria for event selection opens up pragmatism, which encourages lobbying and ad hoc solutions. The most successful applicants associated themselves with politicians who lobbied on their behalf. Politicians and event organisers were closely related in these cases. Some events successfully connected their own aims with aims in the government’s political programme. Three events that received the most government support also received additional funding when unexpected problems emerged during the preparations. In these cases, the fear of cancelation created situations of urgency that helped the applicants receive additional funding. Such situations changed the relationship of politicians and event organizers in a way that allowed the latter to reach far more benefits than first expected. Cancelation of the events would have created a loss of prestige, not only for the organiser but a number of other stakeholders.

More than a half the funding within the researched period was received by the 2016 Lillehammer Winter Youth Olympic Games. It was the Ministry of Culture which recommended support for the event to the Parliament. In its recommendation the Ministry of Culture highlighted several benefits related to hosting the event and left out any potential risks or challenges. The arguments for hosting were many, including benefits targeting youth and regional development as well as a better chance to host the regular Olympic Games in the future. Many of the events that have received government funding were major cycling events. This is a rather surprising finding, considering the ‘winter’ profile of Norway. Cycling, however, does not need additional investments in sports stadiums and related infrastructure. Such arguments weres decisive for government support.

Overall, most of the supported events included sports that can be labelled as popular in the eyes of Norwegians. Hence, less popular events such as the golf tournament Solheim Cup or the triathlon event Ironman 70.3 had slim chances to succeed with their grant applications. On the other hand, focus on ‘domestic’ sports is a paradox as it may not generate the same promotional effects (positive externalities) as sports thar are appreciated abroad. A less important, though interesting, finding was that the graphic design of applications had very little to say in the selection process; the arguments (and lobbying) for the applications were more important than professional design and perfect pictures.

Copyright © Eva Lechner & Harry Arne Solberg 2021

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