World Cup games a boondoggle for taxpayers

Soccer
Reading Time: 3 minutes

Jay GoldbergConsider this: for every minute that Toronto and Vancouver host World Cup games, taxpayers will be on the hook for $644,000.

Last week, Canadians learned that Toronto and Vancouver had been tapped to host five World Cup games each as part of North America’s bid for the 2026 World Cup.

Politicians in both cities have been trying to sell taxpayers on their plan to spend an absolute fortune to host just 17 per cent of the 2026 World Cup games.

Toronto Mayor John Tory is trying to convince taxpayers that this is a huge boon for the city.

“I think it’s going to be one of the greatest sporting occasions in the history of the city,” said Tory.

Toronto taxpayers aren’t so convinced.

The estimated cost for Canada to host 10 World Cup games is approximately $600 million. And that’s before the cost overruns that everyone knows will be coming.

What do politicians claim will be the benefit?

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According to the city of Toronto’s own projections, local businesses will see an influx of $307 million from hosting the games. That includes a “boost” of 3,300 jobs, most of which will likely be temporary.

But a report prepared for Toronto city council this spring indicated that the cost to taxpayers for hosting the five Toronto games will be $290 million.

In other words, the economic gains the city expects to make are only $17 million larger than the cost coming out of taxpayers’ wallets.

Does that sound like a huge boon for the city?

The city is also understating the costs and overstating the benefits.

First, there’s a trade-off cost. With $290 million, 63,000 Torontonians with homes valued at $750,000 could have a one-year property tax holiday.

Second, the economic benefits are also tenuous at best. Research in the United States found that hosting Super Bowl games only leads to roughly 10 per cent of the economic benefit the NFL advertises.

And then there are the cost overruns. The 2010 Vancouver Olympics saw cost overruns of 17 per cent of the total budget, while the 1988 Calgary Olympics saw a cost overrun of 59 per cent.

Even if the cost of hosting World Cup games in Toronto comes in just six per cent over budget, the cost of hosting the games will be higher than any indirect economic benefits the city expects to gain.

Does that sound like a prudent economic plan?

There’s another question: why should taxpayers be on the hook for any money if only a fraction of the expected economic gains will lead to more tax revenue? Not only will hosting the World Cup games likely be a net money loser, but losses for taxpayers will be even more lopsided.

Agreeing to host World Cup games because of potential gains for businesses without regard to taxpayer costs is the very definition of corporate welfare.

Taxpayers in Toronto and Vancouver should be outraged. Neither city can run operating deficits, meaning the bill for hosting the World Cup games will be paid for through higher taxes or reduced government services.

But taxpayers outside of Toronto and Vancouver should be outraged as well. The federal government will be on the hook for approximately $200 million for Canada to host the 10 World Cup games, meaning taxpayers all across the country will be financing this fiscal boondoggle.

Should taxpayers in Saskatchewan be on the hook for a handful of World Cup games in two cities thousands of kilometres away? The obvious answer is no.

While Canada’s governments have been “awarded” World Cup games, no money is yet out the door. Taxpayers should tell Canada’s politicians that the country shouldn’t be wasting tax dollars on their political vanity project.

Canada should rip up the deal and let taxpayers in the United States and Mexico get stuck with the bill.

Jay Goldberg is the Ontario & Interim Atlantic Director for the Canadian Taxpayers Federation.

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The opinions expressed by our columnists and contributors are theirs alone and do not inherently or expressly reflect the views of our publication.

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Troy Media is an editorial content provider to media outlets and its own hosted community news outlets across Canada.

By Jay Goldberg

Jay Goldberg spent most of his career in academia, where he was most recently a policy fellow at the Munk School of Public Policy and Global Affairs at the University of Toronto. He holds an Honours Bachelor’s Degree in Political Science from the University of Toronto, and a Master of Arts Degree in Political Science from the University of British Columbia.

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