Andrews' $6bn Games cost 'doubled in a month'
ELLIE DUDLEY
The Commonwealth Games Federation says it was given eight hours notice of Victoria's move to pull out of the 2026 event, despite Daniel Andrews saying there had been multiple meetings about the decision.
"We were informed today that the Victorian government has walked away from their agreement to host the 2026 Commonwealth Games," a statement from the Federation read.
"This is hugely disappointing for the Commonwealth Sport Movement, for athletes around the Commonwealth and the Organising Committee who are well advanced in their planning and preparation.
"The reasons given are financial. The numbers quoted to us today of $6bn are 50 per cent more than those advised to the Organising Committee board at its meeting in June."
The Federation said the Victorian government had elected to include more sports and an additional regional hub – against the advice of the Federation and Commonwealth Games Australia – which bolstered the additional expenses.
“We are disappointed that we were only given eight hours’ notice and that no consideration was given to discussing the situation to jointly find solutions prior to this decision being reached by the government," the statement read.
Daniel Andrews on Tuesday said conversations were ongoing about the costs of terminating the host agreement, but said meetings so far had been "cordial".
"We are going to let our team that are in London work through these issues and as I said, it has been cordial, it has been particularly productive and we have had a couple of meetings already," he said.
I have a suspicion that he was never going to hold the games.Own goal.
To his credit, at least he cancelled it rather than get the state into even greater debt.
This has happened due to rushed decisions made on the run from poor advice. Very inept. An election losing decision.
The Commonwealth Games were never going to go near the budget set aside. I know because I worked on the previous games.
I would like to know who gave the advice?
The Public Service with due process or one of the big 4 accounting firms together with the Premier's staff? I would bet hands on it is the latter. Poor governance.
I have a suspicion that he was never going to hold the games.
The announcements about regional expenditure were all about the election.
Promises of new stadia, pools, cycling tracks, social housing, all commitments to regional areas to shore up regional seats like Bendigo, Ballarat, Geelong etc.
Then once the election is done and dusted, some serious number crunching done that shows it was never going to work, but I suspect that the State Govt already knew that.
Mick
Probably partially that and also incompetence.I have a suspicion that he was never going to hold the games.
The announcements about regional expenditure were all about the election.
Promises of new stadia, pools, cycling tracks, social housing, all commitments to regional areas to shore up regional seats like Bendigo, Ballarat, Geelong etc.
Then once the election is done and dusted, some serious number crunching done that shows it was never going to work, but I suspect that the State Govt already knew that.
Mick
As the article pointed out, Jacinta Allan, the anointed one to perform the spotted dress Kirner impersonations , is also the minister for sport, and thus responsible for the games.Probably partially that and also incompetence.
He will retire soon as he knows he is gone.
I can't get over that Daniels years ago, smugly paid out $1billion contract break fees, for cancelling a road (east/west link I think) now the States in huge debt, I hope he chokes on his smugness. Obviously spending other peoples money is his forte, absolute wank@r IMO.
An easy get...I would like to know who gave the advice?
The Public Service with due process or one of the big 4 accounting firms together with the Premier's staff? I would bet hands on it is the latter. Poor governance.
An easy get...
Insiders say the initial work by government, Ernst & Young and the Commonwealth Games was inadequate with the uniquely decentralised event not having been properly accounted for.
Shock dawn phone call: sorry but your Commonwealth Games are off
It was not until his phone rang at 6.30am on Tuesday that Commonwealth Games Australia chief executive Craig Phillips learned of the ‘gross exaggeration’ that Daniel Andrews was about to make.
It was not until his phone rang at 6.30am on Tuesday that Commonwealth Games Australia chief executive Craig Phillips learned of the “gross exaggeration” that Victorian Premier Daniel Andrews was about to make to justify walking away from hosting the 2026 games. As recently as its board meeting in June, the Commonwealth Games Organising Committee was told by the Andrews government that the estimated cost of hosting the games was still less than $3bn, similar to the original budget of $2.6bn. In the Victorian parliament as recently as June 8 the government reconfirmed the $2.6bn cost estimate for the games.
Yet in his press conference on Tuesday – just a month later – the Premier suddenly claimed that the cost of the games awarded to Victorian in April 2022 had ballooned from $2.6bn to between $6bn and $7bn.
What’s more Andrews claimed he had “looked at every conceivable option” to cut the soaring costs of the games, including holding more events in Melbourne rather than in regional cities as originally planned.
Phillips was stunned. He had never heard anything like a $6bn cost estimate. But he did realise that inflationary pressures were sending estimates “north” and as such, he had discussed with the Andrews government possible ways to reduce costs.
These included more Melbourne events rather than building temporary facilities in regional centres.
But those cost-cutting suggestions were ignored by government officials. Phillips received push-back from them whenever he suggested ways to cut costs. The officials even argued for more events to be included in the program. So when Andrews announced Victoria would not host the games, claiming hospitals and schools would have borne the brunt of the cost blowouts, a furious Phillips chose to deliver a brutal take-down of the Premier’s spin.
“The stated cost overrun, in our opinion, is a gross exaggeration and not reflective of the operational costs presented to the Victoria 2026 Organisation Committee as recently as June,” Phillips said. “Gold Coast was $1.2bn to run the Games. Birmingham was $1.8bn. I’m not sure how we get a leap of more than double that to run the Games. I find it a little hard to believe.
“Beyond this the Victorian government wilfully ignored recommendations to move events to purpose-built stadia in Melbourne and in fact remained wedded to proceeding with expensive temporary venues in regional Victoria.”
In a statement the Commonwealth Games Federation added: “Since awarding Victoria the Games, the government has made decisions to include more sports and an additional regional hub, and changed plans for venues, all of which have added considerable expense, often against the advice of the Commonwealth Games Federation and Commonwealth Games Australia.”
Games organisers had been left in the dark. The Andrews government gave no clue that it was about to pull the plug on the 2026 Games just 15 months after it agreed to host them. Even when he announced the decision, Andrews gave no details nor a clear timeline about the escalation of costs that he claims forced the government to abandon the games. He released no evidence to back up the claims of a cost blowout. What’s more the Premier gave no explanation as to how his government could have got their financial estimates so drastically wrong in such a short space of time.
He refused to say how much the state had already spent to prepare for the games and refused to comment on the potentially eye-watering amount that taxpayers may have to fork out for breaking the contract to host the event.
Above all, Andrews refused to admit any blame for one of the most astonishing episodes of mismanagement of a global sporting event.
No apologies were forthcoming for the athletes or for the fans or for the five regional centres that were due to host the events.
Instead, Andrews dismissed the Commonwealth Games as merely “a 12-day sporting event” and cast himself as a saviour of schools and hospitals by choosing to abandon the event and the accompanying debt. It was hard to imagine that this was the same Premier who chased so hard for the right to secure the games, sending former tourism and trade minister Martin Pakula to Europe in March 2022 to lock in Victoria as host of the 2026 games.
Andrews saw the global event as a potential vote-winner and further confirmation of Victoria’s reputation as Australia’s sporting capital. He proposed that the games be held in five regional centres, an unusual move that would add significantly to the cost of holding the event but one that was designed to maximise Labor’s vote in those regions.
Labor holds most of the seats in the regional centres where the events were to be held: Geelong, Ballarat, Bendigo, Shepparton and Gippsland.
When Victoria was awarded the games in April 2022, Andrews described it as a “great honour” that would boost jobs, hospitality and the economy. He predicted that the games would contribute more than $3bn to Victoria’s economy, creating more than 600 full-time equivalent jobs before the games, 3900 jobs during the games and a further 3,000 jobs beyond the closing ceremony.
Andrews’ enthusiasm for hosting the games was likely undermined by the growing criticism he has received over mismanagement of the state’s finances. Victoria’s net debt is forecast to jump from $135.4bn this financial year to $171.4bn by 2027, the highest of any state.
Yet the Premier’s sudden decision to walk away from the games has delivered a sharp blow to Victoria’s reputation as the nation’s sporting capital – the very thing that Andrews wanted the games to promote.
“This is a terrible embarrassment to Australian sport,” said John Coates, vice-president of the International Olympic Committee and former long-time president of the Australian Olympic Committee.
“We shouldn’t be bidding for events unless we know that we have the necessary commitments and support of the various governments. I haven’t studied the financials for it, but I was always sceptical about the viability of a regional games … how the government could have got it so wrong – I don’t know.”
Phillips says he was misled by the Premier and by his government about their commitment to host such a major sporting event.
“We thought we had a willing host in Victoria but obviously that wasn’t the case,” he said.
“I would be very careful if I was an international sporting body coming in and doing business in this state in the future.”
CAMERON STEWART CHIEF INTERNATIONAL CORRESPONDENT
I can see some of the advertising execs licking their lips as they start to dream up the ad campaign for the next Victorian election.Well this fiasco, goes a long way to explaining Victoria's financial mess, a one man band Govt works great, untill the boss is shown to be a sandwich short of a picnic. Lol
Are they really expecting people to believe that they weren't aware of the financial implications ages ago, I mean really? It isn't as though Victoria is a start up business, with no historical data and minimal staff. Lol
I can see some of the advertising execs licking their lips as they start to dream up the ad campaign for the next Victorian election.
They have been given some massive amounts of material to work with.
I assume that the tiddlers in opposition will bring on a well deserved no confidence motion in Dan Andrews, but it will go nowhere, unless some of his enemies in the party decide to knife him.
Mick
Of course. They never planned for it to actually take place once they won the election.But those cost-cutting suggestions were ignored by government officials. Phillips received push-back from them whenever he suggested ways to cut costs. The officials even argued for more events to be included in the program.
Of course. They are the ones benefitting from Government excesses.He has strong backing from the unions.
I would rather see the question, should Victoria have offered to hold the Commonwealth games in the first place, when they couldn't afford it?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?
We use cookies and similar technologies for the following purposes:
Do you accept cookies and these technologies?