Kennett: ‘Rivers of gold are gone’

Hawthorn president Jeff Kennett believes the AFL must embark on a major reform of its executive and commission once the immediate virus crisis is resolved.

Hawthorn president Jeff Kennett feels the financial catastrophe triggered by the coronavirus lockdown should force significant change

Hawthorn president Jeff Kennett believes the AFL must embark on a major reform of its executive and commission once the immediate virus crisis is resolved.

The former Victorian Premier said “waste and complacency” had been hallmarks of the AFL for a number of years.

Kennett, who is a member of the AFL’s coronavirus crisis cabinet, feels the financial catastrophe triggered by the coronavirus lockdown should force significant change as the league grapples with the financial disaster that has struck the globe. “We can’t waste the opportunity this provides us with to bring in structural reform of both the AFL executive and commission,” he said.

While not detailing the specific changes he believes should be brought in, Kennett suggested the league had to slash its spending across the board if it was to survive in the post-pandemic economy.

“For a considerable period of time the AFL has survived on the rivers of gold that flowed through,” he said. “This bred complacency and waste, and must change, if football is to survive.”

The breadth of the financial crisis facing the AFL, and other sports around the world, is substantial. The AFL is believed to be looking at a shortfall in its corporate sponsorship revenue of up to $200 million next year alone.

This comes at a time when key AFL sponsors are in significant financial peril. Virgin Australia, which is in administration, is a major partner of the AFL as well as Carlton, the Giants and the Gold Coast and contributes up to $10m annually to the league in sponsorship. The AFL’s wagering partner BetEasy, which signed with the code last December on a contract estimated at $8m a year, has effectively been consumed by Sportsbet after a merger of their parent companies.

The league itself was forced to secure a credit line of $600m, using its ownership of Marvel Stadium as leverage, in a move it says will guarantee the future of all 18 clubs beyond this season.

The league has outlined the drastic cost-cutting measures clubs must undertake. Against pushback from some quarters, AFL general counsel Andrew Dillon said that football departments must operate with fewer than 25 staff for the remainder of this season. This effectively means a reduction of at least 30 per cent for clubs in terms of spending. “We must take a prudent approach to football department expenditure which recognises that a significant level of industry revenue has already been lost and there is further material risk to our financial position this season and in future years,” Dillon said.

The AFL and all 18 clubs stood down at least 80 per cent of their staff in March, with those remaining attempting to plot a path through the crisis with a view to the season restarting in June.