Canada's sport organizations fear funding shortfall caused by pandemic disruption

As professional sports leagues across North America continue to come up with hypothetical scenarios regarding how to return to play in the midst of the COVID-19 pandemic, Canada's national sport organizations (NSOs) are trying to find ways just to survive.

"There has already been a significant financial impact on the organization and if we lose the entire season the impact will never be recoverable without increased investment by our public and private partners," said David Bedford, CEO of Athletics Canada.

While Athletics Canada is considered one of the juggernauts in Canada's sport system, smaller organizations such as boxing are facing closure should they not get necessary funding.

"Our usual funding is in place for 2020-2021 but it is not enough to survive under the present situation," Boxing Canada said in an email to CBC Sports.

A similar pinch is being felt by Rowing Canada.

"Should this government funding be reduced, to create economic stimulus or to alleviate debt created by the pandemic, we would not be able to operate in our current form," CEO Terry Dillon said.

CBC Sports contacted dozens of of the Canada's NSOs and while many of the organizations say it's still too early to tell how much they're going to be impacted by the shutdown of sports, some admit it's getting dire.

"Gymnastics Canada will survive this downturn, but it will be a hard road to travel to survive it," CEO Ian Moss said. "We are presuming that the impact of the new funding initiatives will not be significant, so we are planning on the assumption that no new money is coming in from external funding sources."

Federal Heritage Minister Steven Guilbeault has said help is on the way, committing $500 million to arts, sports and culture. But NSO officials say they need more details regarding when that money is coming and how much is going to be available to them.

"We have no idea yet on when this money will flow, how much of that will be for sport, and how we apply (or they allocate), and for what," Bedford said.  

In an email to CBC Sports on Tuesday, the Office of the Minister of Canadian Heritage said it is finalizing details regarding the rollout of the funds.

Bleak picture

"An announcement should be made in the upcoming days. The process will be streamlined and will mostly use existing programs to disburse the funds as quickly as possible," a spokesperson wrote.

Swimming Canada CEO Ahmed El-Awadi is painting a bleak picture when it comes to the situation facing most sport organizations in Canada right now.

"I think there's a chance some NSOs might not survive. There's also a greater possibility NSOs will look very different after this," he said.

The organizations govern all aspects of a sport in the country, including managing the high-performance programs, including national teams, sanctioning competitions and tournaments and providing development for coaches and officials.

Canada's sports funding framework is complicated and difficult to navigate — even the people closest to the process have difficulty explaining the streams of cash eventually making its way to the NSOs.

There are a variety of government funding initiatives to prop up the NSOs, totalling more than $230 million per year. They include:

• Core funding, which is essentially a lump sum of cash split between the nearly 70 sport organizations. That money is not equally shared with some NSOs getting more cash than others.
• Own the Podium money, which is based on an organization's performance and probability of success and is not equally distributed. 
• NextGen fund for up-and-coming athletes.
• Gender equity funding which was announced last year.

NSOs are usually pitted against one another in many cases, fighting for every penny of government funding. But the funding crisis has forced them to rethink the approach.

In a conference call two weeks ago, about 70 NSO leaders gathered to discuss the current state of funding and issues facing them.

There is a common understanding that not all NSOs are equal and that it's possible some might get more money than others.- Ahmed El-Awadi, CEO of Swimming Canada

During that call, CBC Sports has learned, it was agreed that when the Heritage funding becomes available NSOs will attempt to distribute cash in a way to ensure all organizations survive.

"There is a common understanding that not all NSOs are equal and that it's possible some might get more money than others," El-Awadi said. "Each NSO is going to be looked at individually to see where we are. It may not be a one size fits all for each NSO. If one is in more dire straits than another, as a system we have to be healthy and not just individual sports."

Higher profile sport organizations face a somewhat double-edged sword scenario when it comes to their revenue streams – when times are good and they're able to host world championships, the money is flowing. But when those world championships don't happen, the hit hurts that much more.

Sports such as curling, figure skating and hockey were preparing for big paydays by hosting world championships in March and April.

Curling Canada was set to host the women's world championship in Prince George, followed by the mixed doubles and senior worlds in Kelowna in April. Montreal was the host site for the world figure skating championship in March. And the women's world hockey championship was set for Halifax in March.

All of these events would typically take in hundreds of thousands of dollars for the respective sport organizations.

Then everything was cancelled.

"A worlds is a huge part of our revenue stream. It's everything from ticket sales, sponsorship," said Katherine Henderson, CEO of Curling Canada CEO. "This will be pretty devastating for us."

For Skate Canada, the loss of the world championships is not only impacting programming and finances now but will also impact decisions far into the future.

"It's a significant opportunity lost as the event is typically awarded to us on a five- to seven-year basis and provides an opportunity to create a financial legacy to support strategic initiatives for several years in the future," a spokesperson said via email.

Then there's the case of Tennis Canada, which has recently cut dozens of staff after the cancellation of the women's Rogers Cup event in Montreal in August. The men's event, held simultaneously in Toronto, is still scheduled. Both generate millions of dollars of revenue for the sport organization.

Swimming Canada took notice of Tennis Canada's layoffs and its CEO admits it sent a shockwave through the sporting landscape.

"It's resonated through the NSO world and has scared a lot of staff. It's something we've had to address," El Awadi said.

Swimming Canada had to cancel its Olympic and Paralympic qualifiers that were set to take place at the beginning of April. The sport organization has now cancelled every event until December.

"It's caused havoc. Absolutely no doubt," El-Awadi said.

Most importantly, NSOs are asking the federal government to have more control over how they spend their money. Currently there are a number of funding restrictions regarding what NSOs spend money on.

Athletes are going to be the hardest hit by this and with two Olympic and Paralympic Games scheduled seven months apart starting summer 2021 and winter 2022, NSO CEOs are hoping the federal government gives them more autonomy over their funding.

Massive hit

Some of Canada's brightest athletics stars are the track and field athletes. Athletics Canada's Bedford said they're taking a massive hit right now.

"The biggest impact has been on our athletes," he said. "The disappointment at not being able to compete in Tokyo this summer is big, even though they all know Canada did the right thing in leading the world in pulling out of Tokyo 2020."

"We need to recover losses, but more important is providing maximum flexibility with our funding so as to manage our resources most efficiently."

If there's a silver lining, some organizations say the challenge to survive has united the country's high-performance sport framework.

'Stronger relationships'

"The challenging circumstances have allowed us to forge stronger relationships with parts of our community that we had less contact with prior to COVID-19," said Penny Joyce, CEO of Diving Canada. "With everyone facing a common adversary, it has enhanced our sense of community and unity."

It's forcing sport organizations to ask bigger picture questions about what sport brings to the lives of their athletes and the community as a whole.

"Let's not let the only legacy of COVID-19 be that we all stand further apart in the grocery queue," said Terry Dillon, Rowing Canada CEO.

"We believe it is important to look beyond just recovering from the COVID-19 pandemic. This is an opportunity to have a genuinely big conversation about the role that sport and activity can play in addressing the downward spiral of mental health issues in our society and the ever escalating costs of caring for an aging population."