After withdrawing as the host for the 2026 Commonwealth Games, Victoria stated it was not prepared to spend as much as $7 billion on “a 12-day sporting event.” This raises the possibility that the games may not be held.
In a statement that was described as “hugely disappointing” by the Commonwealth Games Federation, the Premier of Victoria, Daniel Andrews, stated that the initial estimate of $2.6 billion for the cost of organizing the event had blown out of proportion, resulting in a much higher actual cost.
Andrews declared that his administration would reinvest the funds in the construction of regional housing and sporting facilities.
“The Games will not proceed in Victoria in 2026,” Andrews stated.
“We have informed Commonwealth Games authorities of our decision to seek to terminate the contract and to… not host the games,” the statement reads. “We will not be hosting the games.”
The Commonwealth Government Finance (CGF) took issue with the reason provided by the Victorian premier and stated that it was only given eight hours’ notice of the announcement.
“Since awarding Victoria the Games, the government has made decisions to include more sports and an additional regional hub and changed plans for venues,” the Commonwealth Games Federation (CGF) said in a statement. “All of these decisions have added considerable expense, and they have been made against the advice of the CGF and Commonwealth Games Australia (CGA) in many cases,” the CGF added. “The Commonwealth Games Federation & Commonwealth Games Australia (CGA) have been largely ignored.”
“We are dismayed that we were only given eight hours’ notice and that there was no consideration given to discussing the situation in order to jointly find solutions prior to the government reaching this decision. We are disappointed that this occurred.”
“Up until this point, the government had indicated that sufficient funding was available to deliver the Victoria 2026 Commonwealth Games,” the sentence reads.
“What’s become clear is that the cost of hosting these games in 2026 is not the $2.6 billion that was budgeted and allocated,” he added. “What’s become clear is that the cost of hosting these games in 2026 is not $2.6 billion.”
“It is, in fact, at least $6 billion as well as could be as high as $7 billion,” she said. “And I cannot stand here and tell you that I have any confidence that even [the] $7 billion number would appropriately and adequately fund these Games.”
Anthony Albanese, the Prime Minister of Australia, stated to the press that the decision was “made by the Victorian government” and that he would not comment further on the specifics of the matter.
When asked if the choice was embarrassing, Albanese pointed out Australia’s “fine record of hosting events,” giving as examples the next World Cup for women’s football and the Olympics in Brisbane in 2032.
Other states in Australia have withdrawn their applications to host the games.
Craig Phillips, the chief executive of the Commonwealth Games Australia, stated that the first time he learned of the updated cost estimates was early on Tuesday morning.
“The stated cost overrun, in our opinion, is a gross exaggeration and is not reflective of the operational costs that were presented to the board of the Victoria 2026 Organising Committee as recently as June,” he said.
After it was reported that the CGF had been having trouble finding a location, the state government of Victoria made the announcement in 2022 that the Games would be hosted among multiple regional centres in the state, including Ballarat, Bendigo, and Shepparton.
Andrews stated on Tuesday that the administration investigated how much it would cost to relocate the Games to Melbourne, the capital of the state, but he added that doing so would have cost more than $4 billion.
He stated that the funds that were allotted for the Games would instead be utilized to develop permanent athletic facilities that it had promised communities. One example of this would be a projected update of Ballarat’s stadium, as well as “social and affordable” housing across regional Victoria.
“That is a much better way to go forward, and we are simply not going to invest that sort of money and have to take it from key service delivery, from other parts of government,” he added. “We are simply not going to invest that sort of money in order to deliver a 12-day sporting event.”
Andrews stated that the government has had a “amicable” and “productive” meeting with the authorities in charge of the Games in London and that they have informed them of the difficulties about the costs.
He stated that any costs related to cancelling the Games were being negotiated with the governing organization at this time.
Birmingham, which was originally planned to host the Games in 2026 but was bumped because of financial concerns, was given the right to stage the 2022 Games instead of Durban, which is located in South Africa. This decision resulted in the creation of a vacancy.
John Pesutto, who is the leader of the opposition in Victoria, referred to the postponement as a “massive humiliation.”
According to Pesutto, “This decision is a betrayal of regional Victoria and confirms that Victoria is broke and that Labor is simply unable to manage major projects without huge cost blowouts.”
The Labor administration was condemned by the Victorian Greens for squandering “too much time and money” on the Games. The money and effort that were wasted should have been spent on public and affordable housing.
More than one billion dollars, out of a total commitment of $3.4 billion, was included in the budget that the Albanese government presented in May for the 2032 Olympic Games in Brisbane. However, there was not a single dollar put aside for the 2026 Commonwealth Games.
On Tuesday, Andrews stated that the cancellation had “absolutely nothing” to do with money from the federal government.