North Sumatra Transforms Sports into Industry to Boost Regional Revenue

The Provincial Government of North Sumatra is embarking on a strategic transformation of its sports sector, aiming to convert it into a self-sustaining industry. The core of this initiative is the establishment of a Regional Public Service Agency (BLUD), a move designed to unlock the economic potential of the province's sports assets.

“

We haven't had a legal umbrella that allows for the optimal management of revenue from these various assets.

Currently, North Sumatra manages 146 sports-related assets, ranging from major stadiums like the Stadion Utama Sumatera Utara and the Sport Centre Sumut to facilities such as athletic stadiums, sports halls, futsal courts, and swimming pools. However, these valuable assets have largely been a drain on the provincial budget, requiring annual allocations for maintenance. The BLUD model seeks to change this by enabling optimal revenue generation from these facilities.

Mahfullah Daulay, Head of the Youth and Sports Office (Dispora) of North Sumatra Province, explained that the lack of a legal framework has hindered the effective monetization of these assets. "We haven't had a legal umbrella that allows for the optimal management of revenue from these various assets," he stated. The BLUD aims to rectify this by creating a system where revenue generated from venue rentals, parking, lodging, and potentially broadcasting rights can be reinvested into asset maintenance.

“

The revenue we obtain will be used for the maintenance of our assets. So the venues we have will be more independent, no longer dependent on the APBD. If there is a surplus, we will channel it as PAD (regional original revenue).

This initiative is projected to foster greater financial independence for sports venues, reducing their reliance on the provincial budget. Any surplus revenue beyond maintenance costs will directly contribute to the region's original revenue (PAD). The Dispora is currently finalizing seven gubernatorial regulations to govern the BLUD's formation and operation, with a target launch for next year. The plan has received positive feedback from the National Sports Committee of Sumatra Utara (KONI Sumut), which anticipates increased flexibility in funding athlete development and event organization, potentially streamlining processes like the Provincial Sports Week (Porprov).

“

If now we need to consider the APBD, for example, the Provincial Sports Week must be held in November because we are waiting for the P-APBD, as is athlete development.