Privatisation of the public realm is increasingly seen by governments as a relatively painless user-pays way of addressing their budget problems and parks have not escaped the trend.
Public spaces such as parks are seen as ripe targets for fee income generated from commercial activities such as ticketed music festivals and corporate events, as well as private gatherings such as weddings. There are plenty of private event organisers willing to pay top dollar for a setting of trees and rolling lawns, scenic vistas and wide open green spaces.
But what about the cost of such activities, such as the disruption to ordinary park users?
If private functions can fund the necessary upkeep with little loss of ordinary use, they have some justification. But it is a question of degree: there is certainly a case for limiting private functions so that the parks are still perceived as places that are an essential part of the public domain and can still be enjoyed as such.
More events, more often
In Sydney, the number of event bookings in the Botanic Gardens was over 2000 in 2012-13, more than twice as many as in 2009-10.
The Royal Botanic Gardens and Domain Trust, a NSW government body that manages the Gardens and Domain, has forecast an increase in the number of large and corporate events held in those spaces from around 60 last year to up to 100 annually over the next five years.
It has applied to the City of Sydney council for an extension of its current approval to host such events. But city councillors have called for limits on the number of private events in both spaces.
The drive for holding private events is the NSW government’s mission to cut general spending to finance burgeoning health costs in particular, and consequent cutting of grants for operating and maintaining the Gardens and Domain.
The Sydney Morning Herald reported last week that the trust said it was increasingly reliant on generating its own revenue to cover operating costs because the government was contributing a smaller proportion of its income. Government funding will be cut by 6% in 2013-14.
Different city, same story
The closest parallel in other Australian cities is Perth, which has a similar authority: the Botanic Gardens and Parks Authority, which looks after the Gardens and Kings Park. In 2011-12, the Authority received 60% of its income from the government and 7% from fees and user charges from events and functions. In the same year, the Sydney trust got 59% of revenue from the state and 12% from fees.
So the Botanic Gardens and Domain are already receiving nearly twice as large a share of their revenue from user fees as their Perth counterparts, even before the projected large increase in major events.
In London, there has been an outcry about the decision earlier this year to charge non-profit sporting clubs for the use of the football pitch areas of Hyde Park. The private company hired to do this says it is needed to raise funds to maintain and improve the space.
In New York, however, most of the funds needed to maintain Central Park are raised by public donations, a situation unlikely to be accepted or possible in Australia.
As in London, it is possible that enough private function revenue could be raised in Sydney to improve the parks beyond the level possible with state funding, so that the experience for ordinary park users is better. But there is no indication that this is likely.
Private use of public goods
Society sees public parks such as the Botanic Gardens and Domain as “public goods” that provide socially needed services (centring on the benefits of open space availability and use) that can’t be provided by the private sector.
But public parks can, if councils or the state wish, be gated and users made to pay and generate revenue, contrary to the community’s understanding of the purpose of public parks.
The critical issue in terms of private functions in those parks is whether the experience of park users, as consumers of this public good, is diminished because of use exclusions required for the private functions.
It is easy to imagine many ways that ordinary use could, in fact, be impacted. In economic terms, the issue would then be whether the private function revenue was sufficient to cover the extra wear and tear on the parks and also the loss of enjoyment of ordinary users. But quantifying the loss of enjoyment is a difficult exercise.
Nevertheless, the City of Sydney council does not have strong legitimacy in attempting to fight the trust and call for new limits on the number of private events in The Domain and the Botanic Gardens.
The Botanic Gardens and Domain are state assets that provide services to city workers and residents, as well as tourists and the wider Sydney population. This saves the council having to provide these services, and also produces extra rate income because of the higher land values of properties within walking distance of the parks.
So the City of Sydney council is receiving open space benefits, courtesy of these NSW government assets, that would normally have to be paid for by other councils.
The wider issue concerns what governments should be expected to provide in this day and age, and how this should be paid for.
Major parks such as the Botanic Gardens and the Domain provide wider benefits to society such as free recreation opportunities and associated health benefits, civic beauty, and positive micro-climate effects, that are not part of a private sector calculus.
It’s crucial that governments take those benefits into account when balancing the fund-raising advantages of hiring out parks against the cost to public enjoyment of open space.