Sports Business

I Want My Money Back!

Late last week, economist Bruce Chapman brought up an idea for Australian athletes.

The proposal was to make Australian athletes pay back their scholarships from the Australian Institute of Sport (AIS) under a HECS style system. [Sports stars could pay HECS]

HECS stands for Higher Education Contribution Scheme, and is similar to student loans. It is a way of providing financial assistance to students undertaking University studies. When your income reaches a certain level (currently in the high 30K’s), you are forced to pay a portion of your earnings over this amount off your debt.

The argument is that many athletes such as Lleyton Hewitt have used the AIS to further enhance their career and should be forced to pay back what was provided to them. A year’s scholarship at the AIS is worth about $50,000.

An argument for the athletes is that for the money that has been invested in them, they have returned intangible rewards to the public. Also, many athletes have donated their time to helping out their local clubs, communities etc. at no charge.

The proposal put forward is not entirely without merit. If you received HECS funded assistance to become a lawyer or an accountant, then when you have reached the threshold, you would have to pay.  So why shouldn’t sports stars?

There are a lot athletes who have held an AIS Scholarship and are barely scraping by. Less financially rewarding sports such as hockey and squash do not bring their athletes a large, if even sustainable income, so should they be exempt?

Also, an argument could be put forward that these athletes incur a large amount of expenses in plying their trade. Travel, meals and managers are all not cheap.

What would be a fair system? As I previously said, the current income level threshold is in the high 30K’s. Do we make it higher for athletes? One figure proposed was $200,000. Do you take into account their return to the community in the form of entertainment? How do you quantify that?

This topic is full of many arguments on both sides. On one hand being an athlete is a job, and their education should be treated like any other profession. The other side is that although being an athlete is a job, they are not the only ones gaining rewards from their play.