You have a very narrow splashwell and the cup is actually a relief for the steering cable and steering link arm when turning all the way to the right. Some part of the link arm or cable is hitting the cup causing the hole.
You should not be getting so much water there to run into the bilge. Some splashing, but not torrents.
I wish people would back up when taking photos. We need to see what you can see.
I’ll get another shot from a little farther back. I did have more area on the pic but then, i could not load it onto the post, file too big and had to crop it.
that cup is on the left side of the transom well and yes, the steering control rod extends into it when turning that direction. The damage had been done before the son bought the boat.
the engine is very tired and could not get enough speed to get onto plane, that created a lot of back wash into that area and so it would flood the bilge.
I’ll do a repair on this one then spin it 180 so that the repaired area will be towards the top and front.
It is the number 5 in the parts diagram and I thank You very much for that image.
PS; Now I know, I will never run water into the hull of the boat again.