The Sports Hub was supposed to have been completed earlier. Now it will be ready by 2015, a few years behind schedule. The delay was due to financing problems faced by the developer.They were not able to raise the funds during the financial crisis and had to stop work.
I have always considered that public infrastructure and facilities should be owned by the state. The funding of these assets should not be privatized, as this would bring along a host of problems, such as the rate of return to be allowed to the investors on the monopoly. In this particular case, the financiers, i.e. the banks, had to deal with the problem of the viability of the project and the financial standing of the asset owner and hub operator.
If the state owns the assets, they will also have to deal with these issues. But, there is now a culture in Singapore to avoid taking the responsibility to make the hard decisions and to pass the them to the private sector and the market and let them find a solution.
A problem does not get solved when it is made by complicated or passed to people who have less resources to handle them. The private sector has to deal with all of the viability and operational issues, and also have to worry about raising the funds and, unlike the state, it does not have a AAA credit rating.
A better approach is for the state to own the Sports Hub and to lease it to the operator at an annual fee. I hope that the lesson of the Sports Hub will be learned and that the funding of mega-projects are not outsourced to the private sector in the future.
Tan Kin Lian
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