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Irrespective of how Premier Daniel Andrews might fashion it, his government’s decision to cancel Victoria’s promise to host the 2026 Commonwealth Games is a colossal embarrassment.
Globally, it pitches Victoria as a state that does not follow through on major commitments, one that cannot afford to develop, manage and sustain long-term multibillion-dollar projects. It also raises questions about the Andrews government’s trustworthiness, transparency and integrity in dealing with partners.
Put bluntly, the manner in which this unilateral decision came about has been shambolic. The Commonwealth Games Federation, Commonwealth Games Australia, local mayors in regional cities, members of parliament and others have been blindsided.
The London-based federation was given only eight hours’ notice of the formal decision. The locally based supervising body, Commonwealth Games Australia, says it was told at 8am on Tuesday, just 90 minutes before Andrews’ press conference.
If the extraordinary cost blowout as stated by the government is close to accurate, then the decision to cancel was the right one. To continue to pursue a high-cost decentralised model for the Commonwealth Games, when Victorians have already been saddled with an intergenerational debt burden, would have been reckless.
But exactly why costs would have blown out so much – from $2.6 billion budgeted after Victoria secured the Games in April 2022, to beyond $6 billion – is far from clear. We’ve asked; they won’t say.
Minister for Commonwealth Games Delivery Jacinta Allan (left), Minister for Commonwealth Games Legacy Harriet Shing and Premier Daniel Andrews on Tuesday.Credit: AAP
Commonwealth Games Australia, for its part, seriously doubts the government’s revised costs forecasts are honest, describing them as a “gross exaggeration”. It warned against taking the figure
at face value. At the same time, the Commonwealth Games Federation says the $6 billion is 50 per cent more than it was told at a board meeting in June, implying the board was told last month that costs were running close to $4 billion. Already, that would have been about 43 per cent more than the budgeted estimate.
Deputy Premier and Minister for the erstwhile Commonwealth Games Jacinta Allan was keen to highlight the involvement of consulting firm EY costings, at a time when the big four consultancies are out of favour thanks to the PwC tax scandal. But the government must be answerable for the financial commitments it makes, the projects it oversees, the consultants it engages and the increasingly large amount of taxpayer money it spends outsourcing advice and research.
Many questions remain. The federation says expanding the sporting line-up and adding Shepparton to the list of regional cities hosting sporting events – changes that were announced in 2022 in the months before the state election – increased the expense and were done “often against the advice” of both the international federation and Commonwealth Games Australia.
CGA sheets blame to the government, saying it “wilfully ignored” recommendations to curb expense by transferring some events to established venues in Melbourne, and instead “remained wedded to proceeding with expensive, temporary venues in regional Victoria”.
To be clear, the decentralised, regionally based Games program was entirely a creation of the Andrews government. It trumpeted the model as one that would inject vast economic and social benefits to host cities and regions of Geelong, Ballarat, Bendigo, Shepparton and Gippsland. A noble aim but one it clearly could not afford. The government says it will proceed with some regional housing projects already planned under the Games proposal, and with proposed upgrades to some sporting facilities.
It has not been transparent or honest about the costs of this now-abandoned sporting project. It is not remotely plausible that the government has only just discovered that building materials and labour costs have increased sharply. After all, the government is the single biggest, and busiest, entity behind infrastructure development in this state. And it was clearly warned a year ago by Infrastructure Australia and Skills Victoria, via a report in The Age, about future labour shortages, rising costs of materials and bottlenecks in infrastructure development.
What lies ahead should also concern the government. The Commonwealth Games Federation has warned it is taking advice about its options, a barely veiled warning that it may sue for compensation. At home, Commonwealth Games Australia has mentioned the cancellation brings into play the necessary severance of multiple contracts.
As recently as a month ago, the state government was triumphantly touting the 2026 Games as a showcase for Victoria, saying the legacy of the Games would last for years.
But the model that spread the 2026 Games sporting schedule predominantly across the regions was fundamentally flawed from the outset. It was foolishly optimistic because it mostly overlooked logistical constraints on the regions’ accommodation, transport and ancillary infrastructure.
In April, the government postponed the construction of the much-awaited rail link to Tullamarine airport – again blindsiding vested interests and its own backbenchers. And construction of the Geelong Fast Rail project depends on the outcome of the federal government’s ongoing 90-day strategic review of federal-funded proposed infrastructure projects.
This latest decision to cancel the Games raises questions about competency, but it also underscores deserved criticism of the state government for excessive secrecy in its dealings with the public and its decision to persistently ignore warnings about rising debt levels.
Andrews bears responsibility for this and so does his loyal deputy Jacinta Allan, who is not only Minister for Commonwealth Games Delivery but the Minister for the Suburban Rail Loop and the heir apparent to the Labor leadership.
In a normal government, the person or people responsible for the Commonwealth Games debacle would resign. This is no normal government, however, and accountability will not be counted among its virtues.
Victorians are entitled to an assurance that this humiliating and expensive mistake is never repeated. While the people responsible for this omnishambles remain in positions of power, any such assurance would count for nothing.
Patrick Elligett sends an exclusive newsletter to subscribers each week. Sign up to receive his Note from the Editor.
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