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Ecclestone: Government should support British GP

NEWS STORY
04/10/2015

As Silverstone reports a profit, F1 supremo claims the government should help finance British Grand Prix.

Normally, it is his daughters who grace the pages of the Daily Mail, the British tabloid tirelessly keeping its readers fully up to speed with almost every move the super-wealthy pair and their husbands make.

Consequently, when Bernie Ecclestone told the tabloid that the British Grand Prix, currently under threwat (again) should be subsidised by taxpayers, the reaction was not favourable.

"Our Government should support the British Grand Prix," said Ecclestone, amidst claims the event could be dropped as early as next year as the Northamptonshire track struggles to meet his demands.

"They supported the Olympics and that cost a fortune, plus other events," he added.

"How about instead of the taxpayer lining Ecclestone's pockets, he resigns then someone else takes charge of Formula 1 and cuts charges for hosting the grand prix," responds one reader. "Across the sport teams, fans and circuits are suffering purely for old Bernie's greed!"

"You are a billionaire due to the sport why not open your wallet... why should we line your pocket Ecclestone," writes another.

"Why should the general public, i.e. the taxpayer, subsidise a sport that is the definition of nepotism?" demands a third. "I can't think of a sport less deserving of taxpayer's money."

"Two words..." adds another.

To make matters worse, whilst Silverstone claims that its financial position is such that its bankers are not prepared to issue a letter of credit as they do not believe there will be enough money in Silverstone's account to cover the hosting fee for 2016, its owners accounts show a record £3m profit for last year.

Ahead of this week's AGM of the British Racing Drivers Club (BRDC) which owns Silverstone, all 850 members, who include Lewis Hamilton, Jenson Button, Frank Williams and Ron Dennis, were sent copies of the accounts for the year ending 31 December 2014

These showed, according to the Independent, that revenue rose to £54.7m, up £2.8m on the previous year, around half of this coming from the Grand Prix.

Pre-tax profits were £3m – the highest in ten years - whilst a revaluation of the track, plant and machinery saw an increase in value by £7.4m to £22.9m.

Under new MD Patrick Allen, who joined in January, staff costs have been reduced by £1.2m whilst a "low-cost airline" ticket pricing model led to 20,000 more spectators at this year's Grand Prix.

However, Allen, wary that the hosting fee increases by around 5% each year, that these are pair a year in arrears, and that fans will not accept a significant price hike, insists investment is needed.

"Our assets are static," says Allen. "We can revalue them and that fixes a hole in our balance sheet which, when I was brought in, was pretty weak and, to be honest, remains so. What it needs is a capital injection."

That injection is not going to come from taxpayers already struggling to meet the financial demands of essential services, which brings to mind Allen's comments from earlier in the week when he first revealed the problems facing the Grand Prix.

"What you really need for all parties is somebody who wants to buy a trophy asset and is willing to put a large amount of equity in," he told the Telegraph. "You want somebody that has got lots of money, who loves motor racing, who really wants to run Silverstone profitably but has the capital to inject into the business so it fixes the balance sheet and takes the risk profile away.

Whilst most will immediately think he is referring to Ecclestone himself, what of his girls? Petra has used trackside signage to advertise her (now failed) menswear label FORM, clearly realising the promotional side of the sport. Indeed, both are married to ambitious businessmen who must surely be aware of the vast rewards F1 can offer.

Surely, having reaped such fabulous rewards from the sport, the Ecclestones could put a little back in, rather than suggesting even further pressure is placed on the already hard-pressed British tax-payer.

Just a thought.

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READERS COMMENTS

 

1. Posted by Vinicius, 10/10/2015 2:45

"He is right. British people: pay for that!"

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2. Posted by The stogie, 08/10/2015 0:35

"A three mil profit and they apparently haven't paid their sanctioning fees? Maybe that' show they got the three mil?"

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3. Posted by DonRennis, 06/10/2015 11:30

"There seems to be a lot of tax experts posting here.

15 of the 19 races last season were funded by respective governments of the countries where the race was hosted, around $600m was invested by the governments in hosting F1 races in their countries.

Bernie gave Silverstone a massive discount when they signed a 19 year contract for 11.9m with only a 5% inflation. Other tracks start at £20m and rise by 8% .

I'd like to see an estimate of how much income tax is paid by British F1 employees and related services. Half of the £10k each that merc dished out will be going to the tax man. F1M and all F1 related freight services are based at Biggin Hill, that's another couple of hundred UK tax payers.

Leave off mindlessly attacking Bernie for avoiding tax. He is still resident in the UK and pays a f**k of alot of tax unlike any current F1 driver. Look beyond how much money he has and see that our government makes a fortune out of F1.
Herts county council sphome. £1m a month on taxis. If you want to moan about something I suggest you look a bit closer to home."

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4. Posted by Spindoctor, 05/10/2015 15:33

"He only says these things for effect!

By all means, Bernie\CVC pull the British GP, Italy, etc. and replace them with races in Azerbaijan or some other non-descript authoritarian hell-hole. Not a lot of those wealthy late-middle-aged punters in these places though. Surely that contradicts some of his earlier pronouncements?

It's getting to the point where: Quite frankly my dear, I don't give a damn."

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5. Posted by KoosOos, 05/10/2015 8:25

"Funny how people want the race to keep going on but will not pay more for tickets or let the government pay for the race. People like me have to pay for airplane tickets and hotel cost to go and see a F1 grand prix because we do not have one. Pay for it or lose the race."

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6. Posted by Wolf, 05/10/2015 1:59

"Bernie has finally done it. Time to walk away from F1. Hate to say it, but Bernie has pushed my tolerence for greed too far. "

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7. Posted by Nobby, 05/10/2015 1:16

"I'm a fan of F1 & of course Silverstone; but I also don't see why the government should be made liable for paying Mr E. a very large wedge; the size of which is probably the product of a runaway algorithm.

The country has more pressing things to spend its [our!] money on."

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8. Posted by Willie, 04/10/2015 23:56

"As Edward R. Murrow said to (US) Senator Joseph McCarthy: "Have you no shame, Sir?""

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9. Posted by Bill Hopgood, 04/10/2015 19:18

"I can actually see where Ecclestone is coming from when he says the government has coughed up for other events.
If the British public are not keen on the tax payer funding F1 then they should also be consistent in their opposition to all taxpayer funding of major sport events such as for example Football and Rugby World Cups, Olympic Games etc.
We have a similar issue here in New Zealand where the America's cup team has had millions yet motorsport gets very little in comparison. Indeed, for Rugby World Cups laws are changed even when the event is hosted in England.
The argument for the taxpayer funding of events is that it creates jobs and exposure etc. yet these statements are often difficult to prove, like TV viewing figures.
So, when anyone decides that there should not be funding for this sport or that sport then they should also consider how they would feel if their favorite sport was also unfunded by the state, just to be consistent.
In my view, no government should be ploughing money into any Grand Prix or sport, use the commercial returns of the event such as TV rights.
That would level the playing field for all circuits and provide FOM with a true return rather than each new event being used as an excuse to squeeze more money out the existing ones.
It sounds simple but it probably isn't."

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10. Posted by hardtrier, 04/10/2015 18:22

"Silverstone lost £15M in 2013, are we seriously thinking they turned the business around to £3M profit in 12 months - surely this is income from the MPEC sale filtering through?

No government minster is going to sanction income to Silverstone from tax payers to feed BE and CVC along with some of the world biggest brands,"

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11. Posted by You Started It!!, 04/10/2015 18:12

"No way!. Why should the British Tax Payer cough up for 22 millionaires to race a around a circuit to make Bernie more money!"

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12. Posted by slracer, 04/10/2015 17:25

"Well said Italian Job! If the other people "lining their pockets" with F1 money, i.e. Williams, McLaren, Hamilton, Button, et al, AVERAGED 10,000 pounds you would have an 8-1/2 million pound "capital injection". If the drivers made a one time million pound input from their multimillion ANNUAL salaries, this would pump up the coffers to well into the teens! Yeah, Bernie is "stinking" rich, but there are others who are also doing quite well! JMHO"

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13. Posted by gturner38, 04/10/2015 15:11

"The people suggesting Bernie should leave and let someone else run the sport are missing the fact that the bulk of the ownership wouldn't change. Bernie is the face of FOM, but CVC would still be there demanding the big contracts for their shareholders. Remove CVC from the picture and I think Bernie would be more flexible, not the other way around.

Having said that, it's not for Bernie to decide who funds the race. The track and various levels of government can figure that out on their own."

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14. Posted by Italian Job, 04/10/2015 14:41

"Maybe those British people who are paid a lot of money because they are in motorsport (or have retired from it quite wealthy) would like to buy debentures in Silverstone Circuit? If that's too difficult why don't they buy their own little bits of the circuit. That way we could have Coulthard's, Dennis', Hamilton's, Herbert's, Mansell's, Stewart's, Warwick's, Williams', and so on. Problem solved???"

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15. Posted by Ro, 04/10/2015 14:20

"Methinks Mr Ecclestone should cut the price.....Its all take take take from Mr Ecclestone...I sure that the Government has better and more worthwhile things to spend the money on. "

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