With the great Australian group hug of nationalistic pride over — it’s time to start crunching the numbers and assessing the real cost of Olympic glory. You might think that sports funding would be fairly transparent — after all the AIS is run through the Australian Sports Commission (ASC), a fully federally funded statutory body.

Not so, sports funding is spread across governments, agencies and sporting organisations, all with different reporting requirements and, perhaps more importantly, agendas to run.

Fundamentally, there are two key problems with sport funding in Australia: it is not transparent and we waste money on duplication and internal competition.

Funding for elite athletes comes from a range of sources. We have the Australian Sports Commission, which spends around $150 million a year on elite sport. We then have the second, state and territory tier of funding, such as the Victorian, NSW and Queensland Institutes of Sport.

The Victorians sink about $7 million into their institute, the Queenslanders are spending about $10 million and NSW has another $15 million to spend, including a re-current $1 million from clubs in NSW – a gambling reward. There are also institutes/academies in the ACT, Tasmania, South Australia and Western Australia.

A further complexity enters the mix when we consider that many local governments maintain the bread and butter of sport — the fields, parks and pools that many of our athletes start in. Fundamentally we can never have a swimming Olympic gold medallist without the pools spread across the country. But estimating cost attribution, given the myriad of other benefits that a pool provides, is almost impossible.

In addition to this there are the individual sports and their organisations. Swimming Australia has a budget of around $15 million, with $5 million from the ASC and the remainder from sponsorship, other grants and revenues. Conversely the poor sports, such as fencing, badminton and handball have organisations running on an oily rag — and lots of free volunteer time.

The inevitable effect of so many different organisations is the duplication of bureaucracy and a farcical system of manufactured internal competition for “star” athletes and the bragging rights these bring.

The inequality in funding between sports is due to an historical bias towards certain core sports at the Olympics such as swimming, athletics, rowing and cycling. This sets up an unfortunate feedback loop. Those sports which are successful get more funding, which buys them better coaches, more scholarships and improved facilities.

The poor sports are just that — poor — and barring outrageous luck will never get an Olympic medal. This particular funding model does not encourage broad participation in sport. It was originally designed with a view to targeting sports that Australia might win medals in. Of course, there will be some very tough questions asked of several sports now that Beijing is over. Cycling in particular will have to justify its costs given the single silver won.

The suggestion that we should adopt a lottery system, like the British have done to fund their Olympic success (and build up to London 2012), is populist and unlikely. Do we really want one addiction to fund another? Not to mention the problem that the States run gambling in Australia and would not look kindly upon the Federal Government muscling in on their revenue. If we really want more gold medals then we should fund it through taxation, not more revenue raising by stealth – otherwise known as gambling.

The Minister for Sport has announced a wide ranging inquiry into elite sport funding. These are the questions we need answering:

How does the ASC assess high performance and dole out its largesse, and when will there be proper oversight?

Why, in such a small country, do we have three levels of sport funding, and worse, competition and duplication between levels – particularly the State institutes/academies?

Is it reasonable to fund elite sport to the extent we do and have the U-10s footy game cancelled because they can’t find a field of grass not pot-holes?

We also need to establish if there is any trickle-down effect from elite sport activity into the general population, particularly kids. Lastly, we need to consider the Canadian system of funding mass-participation, not elites.

The big picture question we need to ask ourselves is do we really need gold medals at an Olympics to make us feel good to be Australian? Maybe we should move on from the parochial sport obsessed stereotype this perpetuates.

Meanwhile, Bernard Keane writes:

The AOC would be pretty cranky with Matthew Mitcham, Ken Wallace and Steve Hooker. Late last week they had the perfect story to tell about how Australia’s gold drought showed the need for more funding when those blokes came along and inconveniently won the diving and kayaking and pole vault.

Downright unAustralian, in a way.

The use of taxpayer funding for elite sport is outrageous, particularly when directed at the corrupt, repressive and corporatised Olympics “movement”. It’s a statement of how warped Australians’ values are that we accept it so happily. But there’s no point railing against it — Australians want sports funding, and no government is going to take it away.

Kate Ellis is talking about using existing funding more effectively. That’s promising, because that’s exactly the sort of thing politicians say when they’re not going to hand out more money.

And the Prime Minister on AM this morning was talking eminent good sense when he said the Government’s priority was to increase sports participation at a junior and mass level, as part of its goal of addressing health issues. If we’re going to waste money on sport, let it be on getting kids off their bums and running around rather than the Stephanie Rices of the world.

Naturally, Brendan Nelson wants more sports funding. But Nelson, like Shirley MacLaine, apparently believes in everything.

In a couple of weeks, the cries for more sports funding will have fallen silent. We just have to hang tough until then.

But if Ellis is serious about using funding more effectively — and can actually get the Health Department bureaucracy to think about more than just handing out money — James Connor has pointed out a bunch of areas where we could get better value for money. Of course, that might shake up a few little empires within the sporting fraternity, but that’s no bad thing.