The issues – underlined by the growing gap between the competition’s wealthy Clubs and those which are struggling – were brought to a head by our Chairman Richard Colless last year.
While Richard raised the issue for the good of the entire competition and its many millions of fans, some Clubs and media have used it to bring into question the Swans' cost of living allowance (COLA).
Richard has publicly defended the Club's position – as he should - and in turn, I feel it is appropriate to outline our position to Swans members and fans.
That it is significantly more expensive to live in Sydney than in any other city in Australia is indisputable.
With the COLA, the Club is required to pay an additional 9.8 per cent of the salary cap to all players to compensate for the higher cost of living in Sydney. Our estimates suggest the true cost of living disparity is closer to 15 per cent and there is no shortage of evidence to support this. An October 2012 report by Pricewaterhouse Coopers (PwC), titled Cities of Opportunity, indicates that Sydney is the second most expensive city in the world after Tokyo.
A major point of contention is the suggestion that we have ‘stored’ the COLA and used it to recruit players, such as Kurt Tippett. That is simply incorrect.
Every player contract at the Sydney Swans stipulates that the COLA must be paid in addition to the agreed contract figure. Every player has a manager, and every one of those managers is aware the Club has the COLA. The COLA is also added to the standard contracts of rookie listed players. Like all Clubs, each contract that is signed is reviewed by the AFL.
To suggest the recruitment of Kurt Tippett was only possible because of the COLA, is to overlook a number of key factors:
- The AFL salary cap increased approximately $600,000 year-on-year from 2012 to 2013.
- Changes to the veterans list meant all Clubs received salary cap relief of $112,000 per eligible player outside the salary cap (compared to half the annual salary of up to two eligible players in previous years).
- At the end of the 2012 season, six senior listed players – Matt Spangher, Trent Dennis-Lane, Mark Seaby, Jarred Moore, Brett Meredith and Nathan Gordon– were delisted or traded to other Clubs. This player movement opened up approximately $1M in the Club’s salary cap. Those players were replaced with draftees and, of course, Kurt Tippett.
On the eve of the 2013 season, our Club has on its list four players who have been named All-Australian during their career. That number is significantly less than rival Clubs such as Geelong (9), Collingwood (8), Hawthorn (7) and West Coast (6). These numbers speak volumes about the exceptional team performance of our players on Grand Final day last year. It should be remembered that of all the experts who assessed the 2012 season, and in turn our list, none had the Swans in a position to play in the Grand Final.
While we are comfortable with the list management position at the moment - we recently announced the contract extension of Kieren Jack, Josh Kennedy, Ryan O'Keefe and Adam Goodes - there is no doubt it is something we will need to manage going forward. It is a challenge for us like it is every Club.
I hope this gives an insight into the Club’s position and to why our Chairman has been so spirited in his defence of the COLA in recent times.
Equalisation is a vital issue for the entire competition to address. The growing financial divide between Clubs deserves our attention. Let's not confuse the issue by debating the merits of a cost of living allowance that is clearly justified.