Andrews blames cost blow out as Victoria bails on Commonwealth Games

commonwealth games
Geelong's GMHBA Stadium at Kardinia Park.

Victoria has bailed on hosting the 2026 Commonwealth Games citing a blow out in costs to an estimated $6 billion.

Premier Daniel Andrews made the announcement this morning, saying the initial $2.6 billion budget was set to blow out to $6 billion, making it “well and truly too much for a 12-day sporting event”.

“I think all Victorians would agree that more than $6bn is just too much,” he said.

The state government signed up to host the Commonwealth Games in 2022 without any funding commitment from the Federal Government. But funding for the Comm Games was conspicuously absent from the recent Federal Budget.

Prime Minister Anthony Albanese sidestepped the issue saying he was focused on the upcoming Matildas game and the 2032 Brisbane Olympic Games.

“I’m certainly focused on a sporting event that will happen in two days time with the Matildas and I think that the whole of Australia will be cheering them on with the opportunity that we have of hosting a World Cup here,” he said.

“We’re hosting the Olympics in southeast Queensland of course in 2032 and Australia has a fine record of hosting events.”

However, Opposition Leader John Pesutto said the decision was a “betrayal of regional Victoria”.

“This decision is a betrayal of regional Victoria and confirms that Victoria is broke and Labor simply cannot manage major projects without huge cost blowouts,” he said.

“The cancellation of the Commonwealth Games is hugely damaging to Victoria’s reputation as a global events leader.”

Commonwealth Games Australia president Ben Houston said it was “an extremely disappointing outcome”.

“We are working with the Commonwealth Games Federation to understand the broad impacts on the Games in 2026,” he said.

“We were notified of the decision this morning and are responding in real time.

“We will keep you across developments as they come to hand through the course of the day.”

The decision to dump the Comm Games will have ramifications across regional Victoria including the accommodation sector.

Victorian Tourism Industry Council chief executive Felicia Mariani said the plans had “faced many challenges from the outset”.

“The host regions will suffer, not just from the visitors they expected to welcome in this period, but also the global exposure they expected to receive,” she said.

“The biggest risk right now for Victoria will be in managing the reputational fallout as a destination for hosting major international events.

“Pulling the pin at such a crucial time on a major event like this will create concern that needs to be managed carefully.”

To mitigate the shockwaves from the announcement, Andrews said there would still be a $2 billion support package for regional Victoria.

“First and foremost, each and every one of the permanent sporting facilities that were to be legacy benefits from the Games will be built,” he said.

“There is a very substantial regional tourism fund and a substantial package of support for community-based sport and perhaps most importantly they will be a $1 billion boost for social and affordable housing right across regional Victoria and not just in those hub cities but they will be at least 1300 new homes constructed across regional Victoria.”

There was a lot of detail missing from the announcement, including the amount that has already been spent in preparations for the Comm Games, any potential penalties that might be incurred from breaking the contract and why the cost estimate had increased so dramatically. The 2018 Gold Coast Comm Games only cost $1.8 billion.

“In the meantime, we are going to let our team in London work through these issues,” Andrews said.