Silverstone questions Circuit of Wales funding

Silverstone questions Circuit of Wales funding

Silverstone has written to Prime Minister David Cameron asking for clarification over the funding of the new Circuit of Wales project.0755LW1D40028

It recently emerged that developers of the Ebbw Vale track, Heads of the Valleys Development Company, are seeking financial backing from the Welsh Assembly, which Silverstone fears would give the it “an economic and selective advantage over other circuits” in the UK.

The developers claim the £280 million venue could generate 6,000 jobs and attract 750,000 visitors annually. Silverstone said in a statement that their own application for government support, when they were looking to secure the future of the British Grand Prix, was rejected “on the basis that this would be classed as illegal state aid.”

It continued: “In the absence of such aid, Silverstone had to sell off assets to ensure the Formula 1 British Grand Prix was retained in the UK. Silverstone has been advised that an injection of funds by the Welsh and/or UK governments to the Circuit of Wales project could also amount to illegal State aid.

“There are currently a number of well established, privately funded circuits in the UK, including Wales, that feel that the British motor sport industry would be threatened by the addition of a government funded circuit.”

The Northamptonshire track says it has no objection to competition but that there has to be a level playing-field. “It is Silverstone’s view that the Circuit of Wales project is unviable,” the statement added.

“Silverstone reiterates that it is sympathetic to the economic situation in Ebbw Vale, but motor sport at circuit level is not particularly profitable and is often loss making. Many UK circuits are under-utilised and struggle for revenue. It is unrealistic to suggest Circuit of Wales will be the exception.”

SMITH’S VIEW – GOVERNMENT FUNDING FOR FORMULA 1

This situation has an air of childish tattling about it. “If he’s having ice cream, how come I can’t have ice cream!?”

Only in this case, ice cream is the equivalent to millions of pounds worth of funding. Big bucks indeed.

The main reason behind Formula 1’s venture eastwards is because that is where rich governments – often involving a monarchy – are happy to foot the bill for a race. When speaking at the Autosport International Show in January, the chief of the Bahrain International Circuit said he wasn’t bothered by dwindling attendances – the fans simply aren’t needed. Even if just the teams turned up, the Bahrain GP would go ahead.

Singapore is the perfect example of how to run a government-funded race. The state picks up the biggest chunk of the bill, but in return makes it a great event for tourists. It’s a win-win situation.

At the other end of the spectrum: India. The government will have nothing to do with the race, and as a result, we won’t be going back there any time soon.

Silverstone, without government funding, has to rely on the fans to come in their droves. More often than not, they do, but last year 05 - harvey_passing_rsw_malcolm-griffiths-gp3there was a last minute panic as ticket sales were low, prompting the circuit to sell them on the gate on race day.

The government funding that the circuit is chasing would go a long way to helping the BRDC run the race, so you can understand why there is this gripe if indeed finance is being given to the Circuit of Wales.

Perhaps the statement didn’t need to be so scathing as to call the project “unviable”; a new national level circuit in the UK would be great. However, you can see where they’re coming from…

Images courtesy of Octane Photographic and GP3 Media Service.