Bad Sports Hub deal

Straits Times
$2.3b cost of ending Sports Hub public-private tie-up represented ‘fair deal’ for Govt: Edwin Tong
1 Aug 2022

Mr Tong claimed that the termination fee of about $1.5 billion for the Sportshub public private partnership is comparable to the $1.2 billion that the Government would have had to bear to build it plus $0.3 billion open market value for the Sports Hub

If the government had spent $1.2 billion in the first place to build the Sports Hub, it would have owned the Sports Hub already, why would it have to pay an extra $0.3 billion for the Sportshub’s open market value?

It seems therefore that the $1.5 billion termination fee is marked up by $0.3 billion over the $1.2 billion cost of the Sportshub.

Mr Tong said that after taking back the Sportshub, the annual running cost amounts to $68 million. But he also said that under the original public private partnership, SportSG would have had to pay SHPL $193.7 million yearly from 2014 to 2035.

Why did the government negotiate a $193.7 million a year deal with SHPL when it could have operated the premises by itself for just $68 million a year which is a whopping 65% discount?


In the original agrement: sum of 12 future annual payments of $193.7 million from 2023 to 2035 = 12 * $193.7 million = $2.32 billion

After termination of agreement: sum of 12 future payments of $68 million from 2023 to 2035 = 12 * $68 million = $816 million which is fairly close to the $800 million figure quoted by Mr Tong

Mr Tong rounded down the figure after termination but did not round down the figure in the original agreement


Leave a Reply

Fill in your details below or click an icon to log in: Logo

You are commenting using your account. Log Out /  Change )

Twitter picture

You are commenting using your Twitter account. Log Out /  Change )

Facebook photo

You are commenting using your Facebook account. Log Out /  Change )

Connecting to %s

%d bloggers like this: