Back in the late 1980s, a site of the present Laguna National Golf & Country Club was earmarked for a Formula One circuit. But NatSteel, the iron and steel mill that secured the site in a tender, decided to build a golf course instead. In 2007, the Republic announced plans for a circuit that can host races other than F1. The project was to be up by the end of 2010, but it crashed and burned in December 2011 when the consortium picked to build it ran out of money amidst accusations of corruption.
In 2012, another attempt was made at inviting the private sector to build such a facility. But in June this year, the Singapore Sports Council (SSC), the body tasked with getting the project off the ground six years ago, said it will not go ahead with a second tender.
Why did the endeavours fail? Well, there were several factors at play, but the biggest one must have been the failure to realise the magnitude, complexity and uniqueness of the project. For one, racing circuits are not commercially viable on their own. Most, if not all, incur losses consistently. So, for them to exist there has to be some form of public subsidy.
To expect the private sector to fully finance, build and operate such a facility is unrealistic. Some form of public private partnership would have been the preferred way. That is, if the country viewed a motorsports venue as a bona fi de sports facility (like Kallang’s Singapore Sports Hub) in the first place.
That doesn’t appear to be the case with the Changi racetrack project. While some quarters in Government view it as an endeavour of some value, others see it as little more than a playground for the rich. If this had been the case, we should not have started in the first place. The fiasco is a major embarrassment to Singapore. From a policy standpoint, the initiative could have been better thought through.
And such a project would have benefitted from a strong champion – perhaps a powerful ministry, which would have paved a much smoother path.
On another front, the cost of the land plot as well as its relatively short lease of 30 years proved to be a major hurdle, too. SG Changi, the consortium that won the bid to build the project in March 2010, paid $36 million for the 41-hectare site. Interestingly, the Marina Bay Golf Course was built on a prime 68-hectare site for $45 million. Is golf a sport for the masses?
Of course, one wonders if the selection process could have been more thorough. If SG Changi was the only party to have put serious money down, alarm bells should have rung. The background of the group, track record of the partners, or where they got their funds, should have been scrutinised. Ditto a document similar to a banker’s guarantee provided by the bidder, which is alleged to have been forged. (The CPIB and CAD have been investigating the case since late 2010.)
Was there wrongdoing? If so, who should be held responsible? These questions and many more must be answered if Singapore’s reputation for accountability is to be preserved.
This article was written by Christopher Tan, consulting editor for Torque.