It is becoming too much: Suresh Kalmadi
Kadambari Murali Wade, Hindustan Times
The man in the eye of the raging controversy over the Commonwealth Games, Suresh Kalmadi, says he’s “had enough” of accusations of impropriety being levelled at him personally and the Organising Committee as a whole. Kalmadi speaks to Kadambari Murali Wade
HT Exclusive
Under fire, Kalmadi speaks out on spend
Why is everything such a mess? All things are on track, it’s just that a few issues have been raised by the media. I’ve appointed a committee to look into things, let’s see what comes of it. Infrastructure does not come under me. All these things that are being shown — this is not ready, that is not ready — that is the job of the SAI (Sports Authority of India), the NDMC or Delhi Government. So you say you’re just getting flak because you’re the face of the Games?
I am taking it. I will not say no… but it’s becoming too much.
What of the reported Central Vigilance Commission’s issues?
In the CVC report, there’s nothing mentioned about me. It’s all about construction activity. We (the Organizing Committee) are not named in the CVC report at all. We have nothing to do with tenders etc. I am responsible for Rs 1600 crore, I am not responsible for the 20-25000 crore given by the central government for various things. Out of this 1600 crore there is the salaries of all the staff, which is 400-500 crore, then there is the rental for this building, about 300 crore. From my budget of Rs 1600 crore, half straightaway goes in administrative expenses. The balance remains for the Games as such. So I don’t have a very big budget.
Then why the perception that you control so much of the money?
It’s very wrong. Everybody else has been given a grant. I’m the only one who has got money as a loan, so it has to be paid back. I will try and pay back as much possible. Till now, I’ve got Rs 900 crore from the government. I’ve already collected 700 crore revenue through sponsorship, TV rights, merchandising and ticket sales. I can’t touch that money that comes in as I have to give it back to the government. The target for TV rights was $30 million, but we’ve already collected about $50 million.
The Organising Committee signed a contract with Australian firm SMAM where SMAM promised to generate US$122.58 million. How much of this has been generated? The contract also says that about 20 per cent will be given to SMAM. Isn’t that too high for a commission?
We signed with SMAM in 2007 and this was passed by the Executive Board. It’s not true that 20 per cent has to be given as commission. In the first slab it’s 15 per cent, then, if it exceeds a certain amount, for the second slab it’s 20 per cent and if it exceeds even that, it’s 23 per cent. This includes their expenses. They have a staff of 10-12 people sitting here. Their salaries are paid by SMAM, including boarding, lodging. It’s the same amount as Melbourne (2006 Commonwealth Games) or China (2008 Beijing Olympics), and they’re the same people who did both those events.
Has the sponsorship been generated?
The sponsorship usually comes in the last three months. In Melbourne, 60 per cent came in the last three months. Here also we have to negotiate with a lot of people. We have raised sponsorship money. The issue with SMAM was that we have signed with public sector companies but we are not paying a pie to SMAM from the money that the Railways is giving us. Services, branding, that’s a hell of a task.
But it looks very odd to have money paid as commission to an Australian firm from money generated by the government’s own units
Just because I, Suresh Kalmadi, pick up the phone and speak to a PSU, they are not going to just give the money. SMAM have gone to the PSUs, presented their case. If they want a commercial deal they have to pay SMAM. It depends on whether they’re (the PSUs) entering a commercial deal or giving a donation. Everyone wants branding, hoardings, TV presence, tickets … Still, because of the perception that we are helping SMAM, in the last one year, we amended the contract so they’ll get only 50 per cent of public sector money for servicing and for branding etc.
So suppose ONGC gives you 100 crore, just as a figure...
Nobody’s giving me 100 crore, so maybe 25 crore
Suppose they give you 20crore, you would normally give SMAM four crore as a 20 per cent commission, but in this case, as it’s amended, you give them 50 per cent of that, so two crore plus something or just a flat total.
Just a flat total… We negotiated with them saying the public reaction is that you’re getting too much money. So they showed us, we’ve done this, that… But we said if they’re public sector units, and they don’t want branding, they are making donations, then we’ll give you nothing.
Are you getting donations?
No, we are not, everybody wants commercial rights, but the choice is there… if somebody doesn’t want branding, that choice is there. With the Railways like I said, we’re not giving them a pie.
So how much sponsorship have you got so far?
We have contracted about 400 crore so far in sponsorship.
So your total shortfall is about 550 crore? (From the 960 crore targeted)
One minute… As I said, we’ve already got 900 crore from the govt, plus we’ve got these two figures, 400 crore plus 230 crore from TV rights. If there’s a shortfall in any expenditure or income, then the government will pay but having said that we don’t want that kind of a situation.
The CAG reportedly says in a report to the Prime Minister’s Office that the Indian Olympic Association gets five per cent of all revenue, not just the surplus.
That’s not true. In case of a surplus, and after money is returned to the government, then the IOA can get some money.
The Games were awarded in November 2003, why did everything, all work, start in late 2007 or early 2008?
Because of Mani Shankar Aiyar, he was sports minister then and nothing moved. He was totally against the Games and there was nothing I could do about it. It was a sad period at that time and after a few attempts we didn’t even bother sending anything to him as it would not be moved.
Then there were international clearances needed for the infrastructure, those took time. For instance, take the velodrome …we started constriction, got the concrete structure done but when we sent it to the international federation for approval, their rules had changed and they said it’s a wooden surface, asked us to enclose the thing and make it air-conditioned. But now the velodrome is next only to Beijing’s. Then, the various systems in Delhi for getting clearances, the NDMC, MCD, the Delhi government, getting permissions is not a simple job. Then after that, environmental clearances. After that, some matters went to court, there were budget and government processes to be followed in the tender process. But now we have world class stadiums.
So why are they falling apart?
The CAG report deals with infrastructure, I’m not qualified to speak on that because I am not handling it. You have to ask the various government agencies, the SAI, DDA, MCD, Delhi government etcetera for that. The field of play is where I have to make sure things are okay and I am satisfied with that.
The OC is a mix of all the people organizing the Games in totality. Last year you said the stadium deadline was 31st December, pushed back from October, then it became March. But they’re still not completely ready.
Well, the heavy rainfall came…it’s good it happened now instead of at the Commonwealth Games…it’s all like a test event. When people come they will have no problems.
So the OC doesn’t ask for accountability?
(Shrugs) My job is organise the games…we have to oversee the games…but other jobs — tenders, getting venues completed — is their (the MCD, DDA, Delhi government etc) job, not mine. The Games Village is being looked after by the DDA and there are issues with the village also. We don’t have that much time though, something like 45 days, the athletes are coming in by September 16.
When is the Games Village going to be ready?
End of the month…furnished
There is a thinking that contracts are being given out at the last minute so there won’t be time to vet them.
No. Like, my problem with the Games Village…10000 people to be fed, different cuisines, Asian for the Asians, Continental for the some, like that, no Indians can manage all that. When we issued the first tender for the catering, only one company had applied so we said re-tendered, and the same Australian company came forward again. This time, they realized they were the only one, so they jacked up their prices. What could I do? If I accepted a single tender then I would be questioned by the audit.
How many tickets will be given as passes?
We have to categorise… we’re thinking of giving slum children some so that they can watch…some will go the venue owners, the DDA, MCD etc.
Are you looking at sponsorship from any liquor company due to a shortfall in sponsorship revenue?
No, not in the field of play, maybe perhaps at some hospitality event.
What is the truth behind the alleged forged email documents?
How the e-mails are going are for the technology chaps to check. I’ve ordered a probe and we are waiting for the report, it will be submitted tomorrow.
The Queen’s Baton Relay dates were finalised three to four months before the event itself on October 29. Why was there no time to sign and vet contracts with AM Films or its sister concern? Why this mess?
We had signed the contracts with (international marketing agency) Jack Morton as a dual tender. Many of the things were being done by them. What happened in this case was that when the President of India said she will come, we had to scale up the budgets. The clearance of the (OC’s) executive board was taken and we reapplied to the Reserve Bank of India for more finances. In London, we didn’t expect much trouble.
Then, on October 23, there was a meeting with the London Mayor’s office, the London police and the Buckingham Palace people. They told us to stop the publicity campaign as otherwise more people would come. They said we could expect a crowd of a minimum of 15,000-20,000 people and we had better have barricading, toilets, ambulances etc and video screens put up. They told us that if this was not done then the QBR would not go ahead. We had not time to call for a tender. We called Morton , but they said they had their hands. I needed to get the Games going, so this firm (AM Films) we were already using had a sister concern (AM Cars and Vans) and we took their help. Four to five days before the event, we had no time for anything. We had not time to call for a tender, so we asked this firm, a sister concern of a firm (AM Films) who we were already working with, to step in. It was last minute and was obviously more expensive.
I am taking it. I will not say no… but it’s becoming too much.
What of the reported Central Vigilance Commission’s issues?
In the CVC report, there’s nothing mentioned about me. It’s all about construction activity. We (the Organizing Committee) are not named in the CVC report at all. We have nothing to do with tenders etc. I am responsible for Rs 1600 crore, I am not responsible for the 20-25000 crore given by the central government for various things. Out of this 1600 crore there is the salaries of all the staff, which is 400-500 crore, then there is the rental for this building, about 300 crore. From my budget of Rs 1600 crore, half straightaway goes in administrative expenses. The balance remains for the Games as such. So I don’t have a very big budget.
Then why the perception that you control so much of the money?
It’s very wrong. Everybody else has been given a grant. I’m the only one who has got money as a loan, so it has to be paid back. I will try and pay back as much possible. Till now, I’ve got Rs 900 crore from the government. I’ve already collected 700 crore revenue through sponsorship, TV rights, merchandising and ticket sales. I can’t touch that money that comes in as I have to give it back to the government. The target for TV rights was $30 million, but we’ve already collected about $50 million.
The Organising Committee signed a contract with Australian firm SMAM where SMAM promised to generate US$122.58 million. How much of this has been generated? The contract also says that about 20 per cent will be given to SMAM. Isn’t that too high for a commission?
We signed with SMAM in 2007 and this was passed by the Executive Board. It’s not true that 20 per cent has to be given as commission. In the first slab it’s 15 per cent, then, if it exceeds a certain amount, for the second slab it’s 20 per cent and if it exceeds even that, it’s 23 per cent. This includes their expenses. They have a staff of 10-12 people sitting here. Their salaries are paid by SMAM, including boarding, lodging. It’s the same amount as Melbourne (2006 Commonwealth Games) or China (2008 Beijing Olympics), and they’re the same people who did both those events.
Has the sponsorship been generated?
The sponsorship usually comes in the last three months. In Melbourne, 60 per cent came in the last three months. Here also we have to negotiate with a lot of people. We have raised sponsorship money. The issue with SMAM was that we have signed with public sector companies but we are not paying a pie to SMAM from the money that the Railways is giving us. Services, branding, that’s a hell of a task.
But it looks very odd to have money paid as commission to an Australian firm from money generated by the government’s own units
Just because I, Suresh Kalmadi, pick up the phone and speak to a PSU, they are not going to just give the money. SMAM have gone to the PSUs, presented their case. If they want a commercial deal they have to pay SMAM. It depends on whether they’re (the PSUs) entering a commercial deal or giving a donation. Everyone wants branding, hoardings, TV presence, tickets … Still, because of the perception that we are helping SMAM, in the last one year, we amended the contract so they’ll get only 50 per cent of public sector money for servicing and for branding etc.
So suppose ONGC gives you 100 crore, just as a figure...
Nobody’s giving me 100 crore, so maybe 25 crore
Suppose they give you 20crore, you would normally give SMAM four crore as a 20 per cent commission, but in this case, as it’s amended, you give them 50 per cent of that, so two crore plus something or just a flat total.
Just a flat total… We negotiated with them saying the public reaction is that you’re getting too much money. So they showed us, we’ve done this, that… But we said if they’re public sector units, and they don’t want branding, they are making donations, then we’ll give you nothing.
Are you getting donations?
No, we are not, everybody wants commercial rights, but the choice is there… if somebody doesn’t want branding, that choice is there. With the Railways like I said, we’re not giving them a pie.
So how much sponsorship have you got so far?
We have contracted about 400 crore so far in sponsorship.
So your total shortfall is about 550 crore? (From the 960 crore targeted)
One minute… As I said, we’ve already got 900 crore from the govt, plus we’ve got these two figures, 400 crore plus 230 crore from TV rights. If there’s a shortfall in any expenditure or income, then the government will pay but having said that we don’t want that kind of a situation.
The CAG reportedly says in a report to the Prime Minister’s Office that the Indian Olympic Association gets five per cent of all revenue, not just the surplus.
That’s not true. In case of a surplus, and after money is returned to the government, then the IOA can get some money.
The Games were awarded in November 2003, why did everything, all work, start in late 2007 or early 2008?
Because of Mani Shankar Aiyar, he was sports minister then and nothing moved. He was totally against the Games and there was nothing I could do about it. It was a sad period at that time and after a few attempts we didn’t even bother sending anything to him as it would not be moved.
Then there were international clearances needed for the infrastructure, those took time. For instance, take the velodrome …we started constriction, got the concrete structure done but when we sent it to the international federation for approval, their rules had changed and they said it’s a wooden surface, asked us to enclose the thing and make it air-conditioned. But now the velodrome is next only to Beijing’s. Then, the various systems in Delhi for getting clearances, the NDMC, MCD, the Delhi government, getting permissions is not a simple job. Then after that, environmental clearances. After that, some matters went to court, there were budget and government processes to be followed in the tender process. But now we have world class stadiums.
So why are they falling apart?
The CAG report deals with infrastructure, I’m not qualified to speak on that because I am not handling it. You have to ask the various government agencies, the SAI, DDA, MCD, Delhi government etcetera for that. The field of play is where I have to make sure things are okay and I am satisfied with that.
The OC is a mix of all the people organizing the Games in totality. Last year you said the stadium deadline was 31st December, pushed back from October, then it became March. But they’re still not completely ready.
Well, the heavy rainfall came…it’s good it happened now instead of at the Commonwealth Games…it’s all like a test event. When people come they will have no problems.
So the OC doesn’t ask for accountability?
(Shrugs) My job is organise the games…we have to oversee the games…but other jobs — tenders, getting venues completed — is their (the MCD, DDA, Delhi government etc) job, not mine. The Games Village is being looked after by the DDA and there are issues with the village also. We don’t have that much time though, something like 45 days, the athletes are coming in by September 16.
When is the Games Village going to be ready?
End of the month…furnished
There is a thinking that contracts are being given out at the last minute so there won’t be time to vet them.
No. Like, my problem with the Games Village…10000 people to be fed, different cuisines, Asian for the Asians, Continental for the some, like that, no Indians can manage all that. When we issued the first tender for the catering, only one company had applied so we said re-tendered, and the same Australian company came forward again. This time, they realized they were the only one, so they jacked up their prices. What could I do? If I accepted a single tender then I would be questioned by the audit.
How many tickets will be given as passes?
We have to categorise… we’re thinking of giving slum children some so that they can watch…some will go the venue owners, the DDA, MCD etc.
Are you looking at sponsorship from any liquor company due to a shortfall in sponsorship revenue?
No, not in the field of play, maybe perhaps at some hospitality event.
What is the truth behind the alleged forged email documents?
How the e-mails are going are for the technology chaps to check. I’ve ordered a probe and we are waiting for the report, it will be submitted tomorrow.
The Queen’s Baton Relay dates were finalised three to four months before the event itself on October 29. Why was there no time to sign and vet contracts with AM Films or its sister concern? Why this mess?
We had signed the contracts with (international marketing agency) Jack Morton as a dual tender. Many of the things were being done by them. What happened in this case was that when the President of India said she will come, we had to scale up the budgets. The clearance of the (OC’s) executive board was taken and we reapplied to the Reserve Bank of India for more finances. In London, we didn’t expect much trouble.
Then, on October 23, there was a meeting with the London Mayor’s office, the London police and the Buckingham Palace people. They told us to stop the publicity campaign as otherwise more people would come. They said we could expect a crowd of a minimum of 15,000-20,000 people and we had better have barricading, toilets, ambulances etc and video screens put up. They told us that if this was not done then the QBR would not go ahead. We had not time to call for a tender. We called Morton , but they said they had their hands. I needed to get the Games going, so this firm (AM Films) we were already using had a sister concern (AM Cars and Vans) and we took their help. Four to five days before the event, we had no time for anything. We had not time to call for a tender, so we asked this firm, a sister concern of a firm (AM Films) who we were already working with, to step in. It was last minute and was obviously more expensive.
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