BCCI asserts ICC to Cap Expenses

 . Last updated on February 10, 2017, 12:52 PM
BCCI asserts ICC to Cap Expenses
Ex-CAG Vinod Rai, the new head of BCCI administration, warns a sharp decline in Board’s revenue.
Image BCCI


BCCI’s concern on the recent cuts by ICC on revenues have more grounds. Per the board, the new revenue model will have direct hits in revenues of all members. In the last ICC meet at Dubai, BCCI’s revenue was cut short from USD 570 million to USD 255 million scrapping the Big Three Model for the new constitution. Per the new rules, ICC’s expenditure became flexible, which is certain to impact on earnings of all cricket boards. In contrast to ICC’s previously projected revenue, the current figures have a surplus of USD160 million. This is added as contingency fund and boards are expected to have shares from this amount. However, per an official, even if contingency fund is increased, an increase in ICC’s expenditure will automatically cut short revenue shares of its member boards.

ICC revised its revenue system to a new distribution model. In the new system, BCCI might lose USD 330 million, which would further scale up to USD 400 million if ICC schedules two extra world events. This is what BCCI calculates. But, per ICC, the reduction amount will be not more than USD 200 million, that too, for the period till 2023. The difference is also because BCCI is following the Big Three Model to work on its calculation, while ICC is following the new distribution model. The prime concern for BCCI was the fact that ICC increased its expenses by USD 160 million, which reduced the share of member boards. Previously, the Indian Board claimed about 18% of the share that scaled down to 11%.

Meanwhile, Shashank Manohar, ICC Chairman, explained the increase of expenditure as event expenses, which was USD 50 million surplus, central revenues of 50 million and the rest 60 million allotted as reserve and contingency fund. Under Manohar, the new working committee also removed contribution cost borne by ICC. The previous model allotted shares of contribution cost to Full Members from its gross revenue, which was scraped in the new distribution model.

Now BCCI is pressing ICC to limit its expenses. If it does not, the CoA fears other boards too will face sharp revenue cuts in future. Presently, distribution cost received from ICC is reduced by about USD 11 million.

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