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The MCG
The Melbourne Cricket Ground
History
By an Order in Council dated 9 December 1861 land known as the Melbourne Cricket Ground was permanently reserved as a metropolitan cricket ground.
By a Crown grant dated 17 June 1862 the Melbourne Cricket Ground was granted to the trustees of the Melbourne Cricket Ground upon trust that the Ground and the buildings on it be maintained and used as and for a place for playing cricket and for related conveniences.
The MCG Trust
The first Trustees of the Melbourne Cricket Ground (“MCG”) were appointed by the Victorian Government in 1861. The Trust was established as a body corporate incorporated under the provisions of the Melbourne Cricket Ground Trust Act 1989 as the
successor to the unincorporated Trustees who held office under the Melbourne Cricket Ground Act 1933. The 1989 Act provided that the assets and liabilities of the Trustees became the assets and liabilities of the Trust.
The 1933 and 1989 Acts were repealed in 2009 with the provisions re-enacted in the Melbourne Cricket Ground Act 2009 (“The Act”). The Trust was appointed as the Committee of Management for Yarra Park effective from 15 March 2010 under the terms of the Melbourne Cricket Ground and Yarra Park Amendment Act 2009 (“Yarra Park Amendment Act”).
The Trust was deemed to become the grantee of the MCG’s land reserved under an Order in Council dated 20 February 1934.
The Trust earned a net result of $5,162,000 in 2013/14 (before contributions to the Melbourne Cricket Club (MCC / Club) for redevelopment debt repayment purposes and including the $1,000,000 State Government grant for landscaping upgrade in Yarra Park) compared with $6,033,000 in 2012/13. Payments to the Club totalled $5,070,000 (2012/13, $5,960,000).
At 31 March 2014 the Trust held assets valued at over $196 million (2013 $177 million) including $1.2 million in cash and term deposits. Land asset values increased during this year as a result of a revaluation of the MCG land in accordance with the requirements of a new accounting standard and an indexing of the value of the Yarra Park land to reflect the movement in values of land in the East Melbourne area.
The Trust’s income primarily consists of ground rental from the MCC. The Trust then contributes most of its net income to the MCC to assist in the repayment of ground redevelopment debt. The rent charged is determined in accordance with the ground lease under which the MCG is leased to the MCC until 2042
The Melbourne Cricket Club
The Club is party to a “Deed of Variation of Lease” with the MCG Trust pursuant to which the Club’s existing tenancy of the MCG was extended until 31 March 2042 with an option to extend its lease over the members’ reserve for a further 25 years.
Under a separate management agreement with the MCG Trust and the State of Victoria, the Club’s role as ground manager of the MCG has also been extended until 31 March 2042.
Under the MCG Act (2009) there is no requirement to put management of the ground to tender, as long as the MCC is the grounds manager.
During the 2014 year, the Club paid the MCG Trust $4.195 million (2013: $4.092million) in respect of its lease rental of the MCG.
The club recorded a net profit for the financial year ending March 31, 2014 of $9.865 million, which was impacted by government grants of $1.2 million for the Great Southern Stand and Yarra Park landscape projects. The redevelopment debt stands at $242 million (down from $266 million in 2012/13) at year’s end.
Football and the MCG
The first games of Australian football were first played next to the MCG, and it wasnt until 1869 that Australian football was played on the ground itself.
Football was originally played in Yarra Park and wasnt until 1869 that the first games of Australian football would be played on the ground itself. In 1879, the first night game of football was played between Collingwood Rifles and East Melbourne Artillery.
In 1889, the MCC assumed total control of the Melbourne Football Club, moving its games from the separate ground to the MCG.
In 1902, the first VFL grand final was played at the MCG.
In 1940 the Melbourne Argus reported that a renewal of the old deal had taken place with the only variation to the deal being a change in the percentage of gate receipts claimed by the cricket club (rising from 10% to 12.5%). This 1940 deal was for a further 15 years.
At the time, the Argus reported that the VFA were looking to also use the MCG, and the VFA were looking to gain some traction in parliament, with the stated aim of building up Association finances to help poach leading players from the VFL.
In 1948, The VFL looked at putting up the price of admittance at the MCG for finals matches, but the Argus reported that they were opposed by the MCC on the grounds that football was a working mans game, and shouldnt be so commercialised they cant afford it.
According to the Argus, the league wanted the extra money to pay the ANFC, at the time the leagues commitment as seven and half thousand pounds.
In 1952, the League began to examine the possibility of moving its headquarters to the Carlton ground at Princes Park after the 1952 Grand Final venue hosted more than 62,000. This failed to eventuate when the MCG was developed for the Olympics instead.
In 1955, Ian Johnson wrote in the Argus that the ground rental agreement at the MCG was for 12.5%.
In 1981, the League announced that the Grand Final would no longer be played at the MCG, and from 1984 would be played at VFL Park. The Government began negotiations which were reported to include an upgrade to facilities if the League stayed.
In 1983, the MCG Ground rental was reported to be 15% of the gate reciepts for the league. The league said during negotiations that the MCC had wanted a 33% increase on the previous amount.
In 2013, the MCC reported that it had paid more than $30 million to the league and its clubs.
Ross Oakley wrote in the Phoenix Rises that match rental at the MCG for a club is about $100,000 per game plus 15% of the gate/reserved seat takings.
Home Clubs
The Melbourne Football Club were the first ones to move ostenisbly doing so when the MCC took over the club in 1889.
With Princes Park seemingly likely to be taken over by the Olympic Committee, Carlton could well have been the second major tenant at the MCG in 1952. The move was strongly opposed by both Melbourne and Richmond, while the MCC were already complaining about damage to the ground done by footballers.
Richmond first proposed a move to the MCG from Punt Road Oval in 1955 when a remapping of the cities roads caused a big cut into the Punt Road Outer, and as a result it was thought the ground was unlikely to be able to host a decent crowd. Other clubs were opposed because it was thought that Richmond would gain an unfair advantage, however in late 1956 it was being reported that the move was heavily favoured due to economic factors and the support of the Melbourne club. The move was completed in 1960.
North Melbourne moved to the MCG in 1985 from Arden street, while retaining training and administration at its traditional home. Its present status is somewhat nebulous, it has no contract at Docklands or the MCG, but plays all its Melbourne home games at Docklands since it opened, other than matches sold interstate.
Essendon were briefly based at the MCG after shiting from Windy Hill in 1991, although administration and training were kept at Windy hill until 2013. Essendon would later be a founding tenant at the Docklands stadium in 2000. Currently plays blockbuster games under 7 Docklands - 4 MCG arrangement.
Collingwood began to move to the MCG in 1994, when it was playing up to 8 games a year at the MCG. By 1997, they were playing 9 games a year at the MCG, and by 1999, they were playing all their home games at the MCG. They are presently a home team at the MCG, with the current MCG Contract requiring they play 14 games a season at the ground to make up for a loss of finals.
Hawthorn moved to the MCG in 2000 with the closure of Waverly Park for AFL games. Other than games sold to Tasmania, Hawthorn remains a tenant at the MCG.
Carlton began playing blockbuster matches against the likes of Collingwood and Essendon at the MCG in the 80s and 90s, and while officially a tenant at Docklands, is contracted to play 5 games a year at the MCG.
The AFL and the MCC/MCG Trust and Victorian Government
Pre 1980
The agreement was made in September, 1932, be tween the three parties, to continue to the end of the 1940 football season. It was signed for the M.C.C. by Sir L. F. Cussen and Mr. Hugh Trumble, for the V.F.L. by Dr. W. C. McClelland and Mr. L. H. McBrlcn, and for the trustees by Mr. W. A. Watt. Clause 11 makes the Melbourne cricket ground available for the home matches of the club's first football teams between May 1 and the second Saturday In September each year It makes provision for the posting of football results on the scoring board under the conditions of clause 2 (which ts not quoted), and then continues with the important proviso: — "Any other matches the League may desire played on the DI.C.G. during the football sea son, and all matches in connection there with, shall be a matter of mutual agree ment between the club and the League,"
1940
League rental costs at the MCG rose from 10% of the gate to 12.5%.
The 1980's
In 1981, after a unanimous vote of the VFL Board, the League announced the Grand Final would move to VFL Park for 1984[2] as the VFL set about its $14 million plan to expand and inprove the facilities at Waverly Park[3]. As 1983 approached the premier was threatening to force the Trust to intervene, and the MCC was flat out refusing to lease the ground to the VFL instead offering to waive a $250,000 rental fee[4]. The Government also declined to approve the VFL plan to extend the seating capacity at VFL Park to 104,000. The plan had the support of the then PM, Malcom Fraser who felt the VFL should be able to spend their money on their own facilities.[5]
According to The Phoenix Rises (Ross Oakley)
Matters that had festered for 20 years had come to a head over the VFL’s determination to hold the 1984 Grand Final at VFL Park. The government of John Cain junior wasn’t having a bar of it, and the MCG trustees and the MCC were digging in on a VFL claim for a better financial deal on the use of the MCG by football. Dr John Lill, former secretary of the MCC, told me that at one stage Aylett — who was quite correctly pushing for a reduction in the percentage of gate receipts paid to the Trust, from 17.5 to 15 per cent—had been confronted with a “dead bat” from Trust chair and former premier Sir Henry Bolte. Aylett stated that if the Trust would not move, then the next game between Collingwood and Melbourne would not be played at the MCG. Bolte, in typical style, said, “That’s a chance I’m prepared to take.”
But the Grand Final discussion was at a stalemate, as Aylett recalls, and the VFL offered a“compromise": “Late in 1983, when the matter was deadlocked, the League said we would consider the MCG as the 1984 Grand Final venue if we could lease the entire ground (including the MCC Members’ section) for the Grand Final day … VFL Park members would have had exclusive use of the MCC Members’ reserve.”
In the end Cain drew a line in the sand and threatened to prevent the Grand Final moving through legislation if he had to. The thing was a mess, but in many ways summed up the state of play and the strange, obstinate alternative realities inhabited by the MCC and the VFL. In truth, each needed the other and both could claim, with good reason, strong bonds to the MCG turf.
Our estimate was that football accounted for more than 70 per cent of revenues at the MCG, and yet the calendar of usage of the ground was split 50-50 between cricket and football and we had to put up with a wicket in the middle of the ground that routinely reduced the place to a mud heap in a wet winter. As we saw it, most cricket matches other than Tests and international one-day games could be played at smaller venues (John Lill told me money was spent on Punt Road Oval for this purpose64).
In all the research it was very clear that the majority of our supporters saw the MCG as the home of football. They weren’t too keen on Waverley. So it was clear that if we pushed on with Waverley we were making a rod for our backs. It would have been a total disaster. Waverley had a great surface and good corporate facilities, but it was in the wrong location for transport, and wasn’t a pleasant place to visit as it was in Melbourne’s rain belt.
Two things dominated our focus. First, we needed to lock in the Grand Final at the MCG on favourable terms, and we might need to sign a very long-term deal in order to do that. Second, we needed to gain rights for our VFL members and provide them with appropriate facilities at the G.
In early April 1987, Browne and I met with Cordner and Lill with the specific intention of getting the sticking-point issues formally on the table. Browne was a great sounding board in all the negotiations; he played a big part in what was eventually achieved. I reported back to the commission at the meeting of 7 April. As recorded in the minutes, “Chairman advised that the purpose of the meeting was to determine the areas of common interest between the MCC and the VFL … it was agreed this objective was now more approachable after the meeting.” There were seven key points to the discussion:
This was a turning point. What emerged through our negotiations with the MCC was the pressing need for a refurbishment of the ground. It wasn’t spoken about at first but soon became increasingly apparent, in large part through one of those strange mergings of fate and common interest that played such a big part in the story of football through these tricky and eventful years.
In 1988, with negotiations between the League and the MCC progressing but really no closer to a firm and mutually agreeable conclusion—an impasse caused by the ground’s physical limitations as much as anything — a routine inspection of the structure of the 50-year-old Southern Stand found “concrete cancer”.
A disaster? No, a blessing. The balance between the MCC and the VFL shifted subtly. They had a major $150 million project to undertake, and to get it done they needed our help. An offer came from the MCC (how things had changed!): if we rebuild it, will you be involved? The conversation started along those lines. A letter from me to Cordner dated 8 June 1988 set out the deal. The League agreed to pay $1 million a year during the building process, and a section of the new Daryl Jackson-designed stand would be set aside for our members.
The eventual deal on the construction of the Great Southern Stand between the League and the MCC was for 30 years, and saw us in the new stand and pretty much looking at a new future for the game in 1992. Indeed, the capital payback had been budgeted at 27 years—which, with the increased crowds and more games at the ground, was achieved in about 17 years.
According to Football Limited (Gary Linell)
By 1988, the Melbourne Cricket Club and the MCG Trust was facing a delicate problem. The Souther Stand, completed in 1937, had developed a form of concrete cancer. Workers at the ground would able around it and discover large chunks of concrete on the ground. The stand, a sweeping to level viewing area that spanned much of the outer side of the ground, was falling apart.
Its condition was regarded as terminal, repair work could be carried out but there was no guarantee the cancer would not reappear elsewhere. It was a shame but also a blessing. The Southern Stand had been the true home to the people for half a century. Bay 13 at ground level had become an institution of its own, playing host to countless generations of barechested, beer-swilling Australian men who chanted during the dull moments in Test matches and entertained the rest of the crowd with their banners and wit. But, as the decade drew toward a close, Bay 13 had deteriorated along with the rest of the stand, the wit and repartee replaced by abuse and profanity.
The stand too had never kept pace with modern life. The toilet facilities had been abominal for many years whenever a big crowd was present, and food outlets were also scares or barely worth visiting.
The cricket club and the trust commissioned several reports into the problem. They all reported back that to scrap the stand and build a new one, which seemed the only feasible long term solution, about $100 million would be required. The cricket club required a partner, it had to chance of raising that sort of cash because it had no assets.
In early June, an envelope arrived at the MCC addressed to Donald Cordner. Lill, who had been granted permission as secretary to sort through Cordneres mail, opened it and began reading a letter many thought would have been impossible a few years before. Oakley was proposing a long term arrangement that would see football and cricket share the MCG for 30 years.
2000 Broadcast Rights and MCG Development
The AFL 2000 Annual Report
Negotiations continued during the past year with the Melbourne Cricket Ground and the MCG Trust following claims by those bodies for a share of the AFL's broadcasting rights. The issue first arose in 1998 when the MCC indicated that it did not recognise the Leagues exclusive rights with the Seven Network and the MCC intended to deal in on the AFL's broadcast rights from 2001. This siutation arose despite a 40 year agreement from 1992.
Some two years ago, discussions started between the AFL and the MCC and MCG Trust as to how the AFL might be able to assist the MCC and MCG Trust with the continued development of the MCG. It soon became clear, however, that the MCC and MCG Trust were still demanding a share of the AFL's broadcasting rights and their demands were not linked to any particular re-development plan for the ground.
The AFL's position in relation to the MCG is as follows:
In 2001, the AFL Commission reached an in-principle agreement with the Melbourne Cricket Ground Trust and Melbourne Cricket Club to contribute an additional $5 million per year - indexed for the next 32 years - for the redevelopment of the MCG. This represents a significant contribution by football and its supporters to the redevelopment of the MCG. The work, scheduled to be completed by 2006, includes the demolition and replacement of the Ponsford and Olympic Stands and will deliver first-class facilities for MCG tenant clubs and supporters. Football's contribution to the redevelopment will be funded, in part, by a user-pays levy of $1 on all adults attending AFL premiership season home and away matches at the MCG, $5 for finals matches and $8 for the Grand Final. The balance will come from consolidated revenue. Between 70 and 80 per cent of the total revenue generated by the operation of the MCG is directly attributable to AFL games.
The 2002 Renegotiation
During the course of negotiation it emerged that the AFL had offered to pay the MCC for the loss of any finals, but for the MCC it was about more than just the money. The Government felt that the economic benefits to having the preliminary final and Grand Final in Victoria outweighed the compensation on offer.
Demetriou said the AFL had offered the MCC financial compensation in return for giving up the automatic preliminary final, but, for the MCC, it was not simply a matter of financial compensation. Demetriou said the preliminary finals were a key to the selling of the MCC's corporate packages and boxes, not to mention its membership, while the Victorian Government - which has a substantial hand in the development of the MCG - believes the preliminary and grand finals have "a massive economic impact" on the Victorian economy and wishes to retain them in the state.[6]
The AFL 2002 Annual Report
The AFL annual Report states that Final Agreement was reached the the MCG Trust and the Melbourne Cricket Club to pay an additional $5 million per year, indexed for 32 years, for the redevelopment of the MCG, a process that will be completed by the 2006 Commonwealth Games.
Between 70 and 80 percent of the total revenue generated by operation of the MCG is directly related to AFL matches held at the Stadium.
The additional $5 million per year is a further investment by football and its supporters. In part the redevelopment is paid for by a user-pays levy of $1 on all adults attending AFL premierships season matches, $5 for finals and $8 for the Grand Final. The balance will come from AFL consolidated revenue.
Finals and the MCG
During negotiations with the MCC we were not able to substantially change the condition of our 1989 agreement between our respective organisations which requires us to play 1 game per week at the MCG during the finals.
The new agreement does, however, allow us to "bank" finals so that during any three year period, we will average four finals at the MCG each year including a Preliminary Final and a grand Final.
This agreement was challenged by the then Premier of South Australia, Mike Rann who complained to the ACCC who advised that since the AFL, MCC and MCG Trust were not competitors they could not be in voliation of competition law.[7]
The 2005 renegotiation
According to the 2005 Annual Report [8]
Finals scheduling
After lengthy negotiations, we successfully concluded a new agreement with the Melbourne Cricket Club and the MCG Trust regarding the scheduling of finals at the MCG. The key elements were:
The AFL also reconfi rmed that the Grand Final would remain at the MCG until 2032, when the current contract expires.
The Melbourne Cricket Ground
- Dimensions 173.6m x 148.3m
- Capacity: 100,018
History
By an Order in Council dated 9 December 1861 land known as the Melbourne Cricket Ground was permanently reserved as a metropolitan cricket ground.
By a Crown grant dated 17 June 1862 the Melbourne Cricket Ground was granted to the trustees of the Melbourne Cricket Ground upon trust that the Ground and the buildings on it be maintained and used as and for a place for playing cricket and for related conveniences.
The MCG Trust
The first Trustees of the Melbourne Cricket Ground (“MCG”) were appointed by the Victorian Government in 1861. The Trust was established as a body corporate incorporated under the provisions of the Melbourne Cricket Ground Trust Act 1989 as the
successor to the unincorporated Trustees who held office under the Melbourne Cricket Ground Act 1933. The 1989 Act provided that the assets and liabilities of the Trustees became the assets and liabilities of the Trust.
The 1933 and 1989 Acts were repealed in 2009 with the provisions re-enacted in the Melbourne Cricket Ground Act 2009 (“The Act”). The Trust was appointed as the Committee of Management for Yarra Park effective from 15 March 2010 under the terms of the Melbourne Cricket Ground and Yarra Park Amendment Act 2009 (“Yarra Park Amendment Act”).
The Trust was deemed to become the grantee of the MCG’s land reserved under an Order in Council dated 20 February 1934.
The Trust earned a net result of $5,162,000 in 2013/14 (before contributions to the Melbourne Cricket Club (MCC / Club) for redevelopment debt repayment purposes and including the $1,000,000 State Government grant for landscaping upgrade in Yarra Park) compared with $6,033,000 in 2012/13. Payments to the Club totalled $5,070,000 (2012/13, $5,960,000).
At 31 March 2014 the Trust held assets valued at over $196 million (2013 $177 million) including $1.2 million in cash and term deposits. Land asset values increased during this year as a result of a revaluation of the MCG land in accordance with the requirements of a new accounting standard and an indexing of the value of the Yarra Park land to reflect the movement in values of land in the East Melbourne area.
The Trust’s income primarily consists of ground rental from the MCC. The Trust then contributes most of its net income to the MCC to assist in the repayment of ground redevelopment debt. The rent charged is determined in accordance with the ground lease under which the MCG is leased to the MCC until 2042
The Melbourne Cricket Club
The Club is party to a “Deed of Variation of Lease” with the MCG Trust pursuant to which the Club’s existing tenancy of the MCG was extended until 31 March 2042 with an option to extend its lease over the members’ reserve for a further 25 years.
Under a separate management agreement with the MCG Trust and the State of Victoria, the Club’s role as ground manager of the MCG has also been extended until 31 March 2042.
Under the MCG Act (2009) there is no requirement to put management of the ground to tender, as long as the MCC is the grounds manager.
During the 2014 year, the Club paid the MCG Trust $4.195 million (2013: $4.092million) in respect of its lease rental of the MCG.
The club recorded a net profit for the financial year ending March 31, 2014 of $9.865 million, which was impacted by government grants of $1.2 million for the Great Southern Stand and Yarra Park landscape projects. The redevelopment debt stands at $242 million (down from $266 million in 2012/13) at year’s end.
Football and the MCG
The first games of Australian football were first played next to the MCG, and it wasnt until 1869 that Australian football was played on the ground itself.
Football was originally played in Yarra Park and wasnt until 1869 that the first games of Australian football would be played on the ground itself. In 1879, the first night game of football was played between Collingwood Rifles and East Melbourne Artillery.
In 1889, the MCC assumed total control of the Melbourne Football Club, moving its games from the separate ground to the MCG.
In 1902, the first VFL grand final was played at the MCG.
In 1940 the Melbourne Argus reported that a renewal of the old deal had taken place with the only variation to the deal being a change in the percentage of gate receipts claimed by the cricket club (rising from 10% to 12.5%). This 1940 deal was for a further 15 years.
At the time, the Argus reported that the VFA were looking to also use the MCG, and the VFA were looking to gain some traction in parliament, with the stated aim of building up Association finances to help poach leading players from the VFL.
In 1948, The VFL looked at putting up the price of admittance at the MCG for finals matches, but the Argus reported that they were opposed by the MCC on the grounds that football was a working mans game, and shouldnt be so commercialised they cant afford it.
According to the Argus, the league wanted the extra money to pay the ANFC, at the time the leagues commitment as seven and half thousand pounds.
In 1952, the League began to examine the possibility of moving its headquarters to the Carlton ground at Princes Park after the 1952 Grand Final venue hosted more than 62,000. This failed to eventuate when the MCG was developed for the Olympics instead.
In 1955, Ian Johnson wrote in the Argus that the ground rental agreement at the MCG was for 12.5%.
In 1981, the League announced that the Grand Final would no longer be played at the MCG, and from 1984 would be played at VFL Park. The Government began negotiations which were reported to include an upgrade to facilities if the League stayed.
In 1983, the MCG Ground rental was reported to be 15% of the gate reciepts for the league. The league said during negotiations that the MCC had wanted a 33% increase on the previous amount.
In 2013, the MCC reported that it had paid more than $30 million to the league and its clubs.
Ross Oakley wrote in the Phoenix Rises that match rental at the MCG for a club is about $100,000 per game plus 15% of the gate/reserved seat takings.
Home Clubs
The Melbourne Football Club were the first ones to move ostenisbly doing so when the MCC took over the club in 1889.
With Princes Park seemingly likely to be taken over by the Olympic Committee, Carlton could well have been the second major tenant at the MCG in 1952. The move was strongly opposed by both Melbourne and Richmond, while the MCC were already complaining about damage to the ground done by footballers.
Richmond first proposed a move to the MCG from Punt Road Oval in 1955 when a remapping of the cities roads caused a big cut into the Punt Road Outer, and as a result it was thought the ground was unlikely to be able to host a decent crowd. Other clubs were opposed because it was thought that Richmond would gain an unfair advantage, however in late 1956 it was being reported that the move was heavily favoured due to economic factors and the support of the Melbourne club. The move was completed in 1960.
North Melbourne moved to the MCG in 1985 from Arden street, while retaining training and administration at its traditional home. Its present status is somewhat nebulous, it has no contract at Docklands or the MCG, but plays all its Melbourne home games at Docklands since it opened, other than matches sold interstate.
Essendon were briefly based at the MCG after shiting from Windy Hill in 1991, although administration and training were kept at Windy hill until 2013. Essendon would later be a founding tenant at the Docklands stadium in 2000. Currently plays blockbuster games under 7 Docklands - 4 MCG arrangement.
Collingwood began to move to the MCG in 1994, when it was playing up to 8 games a year at the MCG. By 1997, they were playing 9 games a year at the MCG, and by 1999, they were playing all their home games at the MCG. They are presently a home team at the MCG, with the current MCG Contract requiring they play 14 games a season at the ground to make up for a loss of finals.
Hawthorn moved to the MCG in 2000 with the closure of Waverly Park for AFL games. Other than games sold to Tasmania, Hawthorn remains a tenant at the MCG.
Carlton began playing blockbuster matches against the likes of Collingwood and Essendon at the MCG in the 80s and 90s, and while officially a tenant at Docklands, is contracted to play 5 games a year at the MCG.
The AFL and the MCC/MCG Trust and Victorian Government
Pre 1980
- MCC Rent - 1946 - £3,713
The agreement was made in September, 1932, be tween the three parties, to continue to the end of the 1940 football season. It was signed for the M.C.C. by Sir L. F. Cussen and Mr. Hugh Trumble, for the V.F.L. by Dr. W. C. McClelland and Mr. L. H. McBrlcn, and for the trustees by Mr. W. A. Watt. Clause 11 makes the Melbourne cricket ground available for the home matches of the club's first football teams between May 1 and the second Saturday In September each year It makes provision for the posting of football results on the scoring board under the conditions of clause 2 (which ts not quoted), and then continues with the important proviso: — "Any other matches the League may desire played on the DI.C.G. during the football sea son, and all matches in connection there with, shall be a matter of mutual agree ment between the club and the League,"
1940
League rental costs at the MCG rose from 10% of the gate to 12.5%.
The 1980's
In 1981, after a unanimous vote of the VFL Board, the League announced the Grand Final would move to VFL Park for 1984[2] as the VFL set about its $14 million plan to expand and inprove the facilities at Waverly Park[3]. As 1983 approached the premier was threatening to force the Trust to intervene, and the MCC was flat out refusing to lease the ground to the VFL instead offering to waive a $250,000 rental fee[4]. The Government also declined to approve the VFL plan to extend the seating capacity at VFL Park to 104,000. The plan had the support of the then PM, Malcom Fraser who felt the VFL should be able to spend their money on their own facilities.[5]
According to The Phoenix Rises (Ross Oakley)
Matters that had festered for 20 years had come to a head over the VFL’s determination to hold the 1984 Grand Final at VFL Park. The government of John Cain junior wasn’t having a bar of it, and the MCG trustees and the MCC were digging in on a VFL claim for a better financial deal on the use of the MCG by football. Dr John Lill, former secretary of the MCC, told me that at one stage Aylett — who was quite correctly pushing for a reduction in the percentage of gate receipts paid to the Trust, from 17.5 to 15 per cent—had been confronted with a “dead bat” from Trust chair and former premier Sir Henry Bolte. Aylett stated that if the Trust would not move, then the next game between Collingwood and Melbourne would not be played at the MCG. Bolte, in typical style, said, “That’s a chance I’m prepared to take.”
But the Grand Final discussion was at a stalemate, as Aylett recalls, and the VFL offered a“compromise": “Late in 1983, when the matter was deadlocked, the League said we would consider the MCG as the 1984 Grand Final venue if we could lease the entire ground (including the MCC Members’ section) for the Grand Final day … VFL Park members would have had exclusive use of the MCC Members’ reserve.”
In the end Cain drew a line in the sand and threatened to prevent the Grand Final moving through legislation if he had to. The thing was a mess, but in many ways summed up the state of play and the strange, obstinate alternative realities inhabited by the MCC and the VFL. In truth, each needed the other and both could claim, with good reason, strong bonds to the MCG turf.
Our estimate was that football accounted for more than 70 per cent of revenues at the MCG, and yet the calendar of usage of the ground was split 50-50 between cricket and football and we had to put up with a wicket in the middle of the ground that routinely reduced the place to a mud heap in a wet winter. As we saw it, most cricket matches other than Tests and international one-day games could be played at smaller venues (John Lill told me money was spent on Punt Road Oval for this purpose64).
In all the research it was very clear that the majority of our supporters saw the MCG as the home of football. They weren’t too keen on Waverley. So it was clear that if we pushed on with Waverley we were making a rod for our backs. It would have been a total disaster. Waverley had a great surface and good corporate facilities, but it was in the wrong location for transport, and wasn’t a pleasant place to visit as it was in Melbourne’s rain belt.
Two things dominated our focus. First, we needed to lock in the Grand Final at the MCG on favourable terms, and we might need to sign a very long-term deal in order to do that. Second, we needed to gain rights for our VFL members and provide them with appropriate facilities at the G.
In early April 1987, Browne and I met with Cordner and Lill with the specific intention of getting the sticking-point issues formally on the table. Browne was a great sounding board in all the negotiations; he played a big part in what was eventually achieved. I reported back to the commission at the meeting of 7 April. As recorded in the minutes, “Chairman advised that the purpose of the meeting was to determine the areas of common interest between the MCC and the VFL … it was agreed this objective was now more approachable after the meeting.” There were seven key points to the discussion:
- The general accommodation of 32,000 VFL Park full members at the MCG and the availability of acceptable seating and dining facilities
- Future development plans for the Melbourne Cricket Ground and their impact on VFL involvement/tenancy
- The issue of splitting the available accommodation for members between VFL Park and MCC members, i.e. MCC Members—traditional area, VFL Park Members—Northern Stand
- Available advertising exposure for the VFL on fences and matrix screen
- Season starting time, noting present occupancy arrangements in favour of cricket in February, and the availability of the ground for pre-season night series to be conducted by the League
- Reciprocal membership arrangements between VFL Park and the MCC and the availability of rights during cricket season to VFL Park members
- Length of tenure of any agreement to be entered into between the two parties.
This was a turning point. What emerged through our negotiations with the MCC was the pressing need for a refurbishment of the ground. It wasn’t spoken about at first but soon became increasingly apparent, in large part through one of those strange mergings of fate and common interest that played such a big part in the story of football through these tricky and eventful years.
In 1988, with negotiations between the League and the MCC progressing but really no closer to a firm and mutually agreeable conclusion—an impasse caused by the ground’s physical limitations as much as anything — a routine inspection of the structure of the 50-year-old Southern Stand found “concrete cancer”.
A disaster? No, a blessing. The balance between the MCC and the VFL shifted subtly. They had a major $150 million project to undertake, and to get it done they needed our help. An offer came from the MCC (how things had changed!): if we rebuild it, will you be involved? The conversation started along those lines. A letter from me to Cordner dated 8 June 1988 set out the deal. The League agreed to pay $1 million a year during the building process, and a section of the new Daryl Jackson-designed stand would be set aside for our members.
The eventual deal on the construction of the Great Southern Stand between the League and the MCC was for 30 years, and saw us in the new stand and pretty much looking at a new future for the game in 1992. Indeed, the capital payback had been budgeted at 27 years—which, with the increased crowds and more games at the ground, was achieved in about 17 years.
According to Football Limited (Gary Linell)
By 1988, the Melbourne Cricket Club and the MCG Trust was facing a delicate problem. The Souther Stand, completed in 1937, had developed a form of concrete cancer. Workers at the ground would able around it and discover large chunks of concrete on the ground. The stand, a sweeping to level viewing area that spanned much of the outer side of the ground, was falling apart.
Its condition was regarded as terminal, repair work could be carried out but there was no guarantee the cancer would not reappear elsewhere. It was a shame but also a blessing. The Southern Stand had been the true home to the people for half a century. Bay 13 at ground level had become an institution of its own, playing host to countless generations of barechested, beer-swilling Australian men who chanted during the dull moments in Test matches and entertained the rest of the crowd with their banners and wit. But, as the decade drew toward a close, Bay 13 had deteriorated along with the rest of the stand, the wit and repartee replaced by abuse and profanity.
The stand too had never kept pace with modern life. The toilet facilities had been abominal for many years whenever a big crowd was present, and food outlets were also scares or barely worth visiting.
The cricket club and the trust commissioned several reports into the problem. They all reported back that to scrap the stand and build a new one, which seemed the only feasible long term solution, about $100 million would be required. The cricket club required a partner, it had to chance of raising that sort of cash because it had no assets.
In early June, an envelope arrived at the MCC addressed to Donald Cordner. Lill, who had been granted permission as secretary to sort through Cordneres mail, opened it and began reading a letter many thought would have been impossible a few years before. Oakley was proposing a long term arrangement that would see football and cricket share the MCG for 30 years.
2000 Broadcast Rights and MCG Development
The AFL 2000 Annual Report
Negotiations continued during the past year with the Melbourne Cricket Ground and the MCG Trust following claims by those bodies for a share of the AFL's broadcasting rights. The issue first arose in 1998 when the MCC indicated that it did not recognise the Leagues exclusive rights with the Seven Network and the MCC intended to deal in on the AFL's broadcast rights from 2001. This siutation arose despite a 40 year agreement from 1992.
Some two years ago, discussions started between the AFL and the MCC and MCG Trust as to how the AFL might be able to assist the MCC and MCG Trust with the continued development of the MCG. It soon became clear, however, that the MCC and MCG Trust were still demanding a share of the AFL's broadcasting rights and their demands were not linked to any particular re-development plan for the ground.
The AFL's position in relation to the MCG is as follows:
- The AFL is committed to the MCG as the primary venue for AFL matches including all Victorian 'big games' and the long-term home of the Grand Final.
- Directly and indirectly, the AFL, our clubs and supporters contribute between $33 million and $38 million of the Melbourne Cricket Club's annual revenue of about $48 million.
- Current AFL related direct annual payments to the MCC are about $5.8 million, plus match day costs of, on average, $60,500 per game.
- Re-development of the Northern Stand, Ponsford Stand and the MCC members' pavilion at the MCG is not critical for football, but the AFL recognises that major stadia require regular upgrading to provide first-class facilities now demanded by attendees at sporting events.
- The AFL, therefore, supports the re-development of the Northern Stand at this time. •
- The public capacity of the stadium should not be reduced.
- Establish a partnership between the AFL, Victorian Government, Melbourne Cricket Club and MCG Trust as occurred with the construction of the Great Southern Stand.
- Establish the scope and cost of the project.
- Establish a business plan for the project.
- Establish the financial contribution from each participant.
- During 2000, the AFL indicated it was prepared to contribute $4 million per year made up of a capital contribution of $1 million per year for the next 32 years from the AFL with the balance coming from a user-pays levy on adults attending matches at the MCG. This equates to a present day value of $90 million to $100 million.
- The user-pays principle for stadia development applies at all other AFL venues via seat premiums and from 2001, a $2 levy at Optus Oval. Adopting this approach at the MCG was therefore consistent with what is happening at all other stadia in Australia where AFL matches are played.
- The offer of $4 million was made without any precise advice as to the extent of the project. The AFL is also the only organisation associated with the MCG which has indicated a willingness to contribute.
- The AFL will not link any contribution to the cricket club and trust to our broadcasting rights at the MCG or any other stadium where AFL matches are played.
- The AFL has 32 years to run on an existing contract which the MCC and MCG Trust have sought to break by their demand for a share of our broadcasting revenue.
- We also believe it is reasonable for the AFL to not be expected to contribute to the cost of facilities for MCC members or what is required for the Commonwealth Games in 2006. The AFL's focus is on facilities for our AFL clubs and their supporters and our need to invest in grassroots football.
In 2001, the AFL Commission reached an in-principle agreement with the Melbourne Cricket Ground Trust and Melbourne Cricket Club to contribute an additional $5 million per year - indexed for the next 32 years - for the redevelopment of the MCG. This represents a significant contribution by football and its supporters to the redevelopment of the MCG. The work, scheduled to be completed by 2006, includes the demolition and replacement of the Ponsford and Olympic Stands and will deliver first-class facilities for MCG tenant clubs and supporters. Football's contribution to the redevelopment will be funded, in part, by a user-pays levy of $1 on all adults attending AFL premiership season home and away matches at the MCG, $5 for finals matches and $8 for the Grand Final. The balance will come from consolidated revenue. Between 70 and 80 per cent of the total revenue generated by the operation of the MCG is directly attributable to AFL games.
The 2002 Renegotiation
During the course of negotiation it emerged that the AFL had offered to pay the MCC for the loss of any finals, but for the MCC it was about more than just the money. The Government felt that the economic benefits to having the preliminary final and Grand Final in Victoria outweighed the compensation on offer.
Demetriou said the AFL had offered the MCC financial compensation in return for giving up the automatic preliminary final, but, for the MCC, it was not simply a matter of financial compensation. Demetriou said the preliminary finals were a key to the selling of the MCC's corporate packages and boxes, not to mention its membership, while the Victorian Government - which has a substantial hand in the development of the MCG - believes the preliminary and grand finals have "a massive economic impact" on the Victorian economy and wishes to retain them in the state.[6]
The AFL 2002 Annual Report
The AFL annual Report states that Final Agreement was reached the the MCG Trust and the Melbourne Cricket Club to pay an additional $5 million per year, indexed for 32 years, for the redevelopment of the MCG, a process that will be completed by the 2006 Commonwealth Games.
Between 70 and 80 percent of the total revenue generated by operation of the MCG is directly related to AFL matches held at the Stadium.
The additional $5 million per year is a further investment by football and its supporters. In part the redevelopment is paid for by a user-pays levy of $1 on all adults attending AFL premierships season matches, $5 for finals and $8 for the Grand Final. The balance will come from AFL consolidated revenue.
Finals and the MCG
During negotiations with the MCC we were not able to substantially change the condition of our 1989 agreement between our respective organisations which requires us to play 1 game per week at the MCG during the finals.
The new agreement does, however, allow us to "bank" finals so that during any three year period, we will average four finals at the MCG each year including a Preliminary Final and a grand Final.
This agreement was challenged by the then Premier of South Australia, Mike Rann who complained to the ACCC who advised that since the AFL, MCC and MCG Trust were not competitors they could not be in voliation of competition law.[7]
The 2005 renegotiation
According to the 2005 Annual Report [8]
Finals scheduling
After lengthy negotiations, we successfully concluded a new agreement with the Melbourne Cricket Club and the MCG Trust regarding the scheduling of finals at the MCG. The key elements were:
- Removing the requirement to play one preliminary final per year at the MCG in the event that two non-Victorian teams earn the right to host a preliminary final in their home states.
- Ensuring all preliminary finals in Victoria are played at the MCG.
- Allowing greater flexibility to bank finals in weeks one and two, with the clause amended to ensure that 10 matches are played over five years.
- Delivering an additional four premiership season games to the MCG each year, taking the number of matches played to 45.
- Delivering 14 Collingwood home and away games to the MCG
- The AFL making the MCG available for other major sporting events on a limited basis.
The AFL also reconfi rmed that the Grand Final would remain at the MCG until 2032, when the current contract expires.
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