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Opinion article

The impact of COVID-19 on community sport

Australian Sports Foundation CEO, Patrick Walker, discusses the findings of a recent survey showing that one in four community sports clubs fear insolvency following the effects of COVID-19. He says that the future of community sport is under threat at a time when Australians need the health and community benefits it provides more than ever and that business and government have a role to play in protecting it.

COVID-19 has had a profound impact on our economy and everyday life, and the sports sector has not been immune. Professional leagues went into shutdown for several months, with up to 80 per cent of their staff either stood down or let go. Most professional sports leagues are now desperately attempting to avert financial catastrophe by meeting broadcast and sponsor commitments through completing truncated seasons in various geographical “bubbles”. On top of this, the Tokyo Olympic and Paralympic Games have been postponed until who-knows-when, putting the hopes and dreams of thousands of aspiring Aussie athletes on hold and affecting their livelihoods into the bargain.
 
Amidst this high-profile sporting crisis, a larger and more worrying crisis has been quietly unfolding at community sport level which, if not resolved, could have a profound affect on our nation’s physical and mental health and weaken the fabric of Australian community life. Yet the challenges facing community sport are receiving little of the attention garnered by the AFL, NRL and other professional codes, and to date the sector has received only limited and ad hoc financial support compared to many others.
 
The impact of COVID-19 on community sport has been as dramatic as on any other sector. Most obviously, the shutdown prevented millions of Australians from participating in the sports they love (Sport Australia estimates that over 11 million people and three million volunteers participate in sport each year). But even though community sport has now recommenced in many parts of the country – with the obvious exception of Melbourne and other parts of Victoria – the real crisis is only just beginning, and may have a significant and lasting impact on Australian life.
 
The Australian Sports Foundation recently conducted a nationwide survey of community sports clubs to assess the impact of COVID-19 now and into the future. We received responses from over 4000 clubs in communities all over Australia, representing nearly 100 different sports. The picture they painted was bleak:
 
  • Between March and June, COVID-19 cost Australia’s 70,000 community sports clubs an estimated $1.6bn. This was driven by reduced income (principally through lost sponsorships, fewer registrations and lack of fundraising activity) combined with continuing expenses (such as rent, rates, utilities and insurance);
  • The return to community sporting activity – welcome though it is – is taking place against a financial backdrop of ongoing reductions in club income, with local sponsors doing it tough and many members unable to afford membership fees or other costs due to financial hardship. Even worse, clubs face increased costs caused by the virus – new hygiene measures, and extra kit and equipment being two of the most common additional expenses;
  • Most concerning of all, these volunteer-run clubs have little in the way of cash reserves and so their very existence is under threat. One in four clubs – an estimated 16,000 clubs nationally – fear insolvency, and around half of all clubs surveyed only have cash reserves to last up to six months.
 
In aggregate, community clubs need additional funding estimated at $1.2bn to help them survive – an “eye-watering” amount, to borrow a phrase used by Treasurer Josh Frydenberg in his recent economic update.
 
More concerning still is the social crisis these financial issues are driving. At a community level, the importance of sport is not about who wins or who loses, but about the positive impact sport has on our physical and mental health. It is about the sense of community that shared activities and shared interests foster. And it is about the volunteers who run the line or roster the canteen, as much as the participants themselves. A contemporaneous study by Victoria, Federation and Flinders Universities tracked the health of community sports participants before and during the sporting shutdown. It showed that 31 per cent reported worse mental health and 29 per cent worse physical health than pre-shutdown.
 
The survey results show that thousands of clubs may cease to exist if financial support cannot be provided – depriving millions of Australians the opportunity to participate in organised sport. Our study also showed that around 70 per cent of clubs forecast a decline in participation caused by personal financial hardship and/or health concerns, while over 40 per cent of clubs also forecast a decline in volunteers for similar reasons. When set against the tangible worsening of physical and mental health tracked by the Universities’ recent study, this presents a serious threat to our national wellbeing.
 
As a nation, our mental health is under unprecedented pressure, with everyday life turned upside down in almost every way. In the months and years ahead, community sport’s ability to provide a semblance of normality, to release stress and pressure, and to help sustain and restore community resilience will be needed as never before. It is incumbent on all who care about the health of our communities – including the philanthropic community, businesses and all levels of Government – to come together to ensure that our local sports clubs survive, so they can help us all build the resilience to deal with the challenges of living in a post-COVID world.
 
For more information, or to find out how you can help our community clubs survive, please visit https://covid.sportsfoundation.org.au/help
About the authors
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Patrick Walker

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Patrick Walker is the CEO of the Australian Sports Foundation, Australia’s leading non-profit sports fundraising organisation and charity, and the only organisation to which donations for sport are tax-deductible.

In the last 30 years the Sports Foundation has distributed hundreds of millions of dollars to Aussie sports clubs to help develop an inclusive and active sporting nation, and to strengthen local communities.

Patrick joined the Sports Foundation following a successful business career as a partner with the world's largest professional services firm, PwC. His roles with PwC included CEO, Board and global leadership positions in the UK, Europe and Australia. He is a member of the Fundraising Institute of Australia and is also the Board Chair of a charity in the sustainability sector.

 

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