No Australian politician would have missed the community backlash in Hobart earlier this year over a decision to spend more than $700 million on a new stadium.
Announcing funds for a new stadium, in a state desperate to attract its own AFL team, might once have been considered political gold. But not during a cost-of-living and housing crisis.
Both the Liberal premier (who committed $375 million to the project) and the Labor prime minister (who committed $240 million) were loudly heckled by locals with placards declaring, “We need homes not a stadium” and “We can’t eat stadiums”.
Tasmanian Senator Jacqui Lambie picked up on the vibe and with her characteristic cut-through told a rally in Hobart that “Tasmanians have had a bloody gutful over your stadium, and you can stick it up your bum!”.
Bad news for the Commonwealth Games
Victorian Premier Dan Andrews certainly didn’t miss the memo.
In defending this week’s contentious decision to axe the 2026 Commonwealth Games in Victoria, the premier is drawing a direct link to housing. After announcing the cancellation, Andrews immediately committed more than $1 billion to social and affordable housing in regional Victoria.
To critics who say he’s trashed Victoria’s reputation, the premier says: “I don’t want us to have a reputation as being a place where people can’t find a place to live.”
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The only problem is the Victorian Government was only recently arguing it could deliver on both priorities: public housing and the Commonwealth Games. Before winning his third election in November, Andrews promised a “Games like no other” based in regional Victoria at a cost of $2.6 billion.
How that figure was arrived at, and why the estimate has apparently shot up to $6 or $7 billion only 15 months later, remains unclear. These costings are at the centre of an extraordinary decision by Andrews to commit to and then cancel the games.
Yesterday, the premier defended his decision but shed little light on how the estimates shifted so dramatically.
Various options were costed, he suggested, and even the cheap option of a pared-back games held entirely in Melbourne with all its existing facilities would still be “well over $4 billion”, according to the premier.
Commonwealth Games Australia chief executive Craig Phillips simply doesn’t believe the numbers. He says the new figures are “grossly exaggerated” and he is not alone in questioning how they’ve been put together.
The premier, however, is giving little away.
“Estimates are just that, they’re not actuals, they’re estimates,” he says of the initial $2.6 billion costing.
“You then go and start the work of market soundings and requests for proposals and tallying up all the different elements of cost and then you get what is close to an actual number.”
This suggests “market soundings” and “tallying up” either weren’t possible or simply weren’t done before Victoria committed to hosting the games.
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Who’s behind the initial estimate?
Estimating the cost of such things certainly isn’t easy. Oxford University researchers have found every Olympics since 1960 has run over budget, with “non-sports-related costs” typically the culprit.
But even by historical standards, this is a dramatic increase in the forecast cost in just 15 months.
Had the original cost estimate been more realistic, perhaps Victoria never would have agreed to host the games in the first place. Perhaps Victorian taxpayers now wouldn’t be on the hook for an unknown compensation bill.
So, who did the original estimate for the Victorian Government and who’s now come up with the new figure?
There was “lots of different analysis”, according to the premier, “it wasn’t one document”.
That analysis, he says, won’t be released while lawyers are negotiating with the Commonwealth Games Federation in London over the cost of cancelling.
Nine newspapers report one of the big four consultancy firms — Ernst & Young (EY) — was commissioned by the Victorian Government to provide both the original and the latest cost estimate.
Given the scepticism from Commonwealth Games Australia over the figures and the outcry from athletes and regional communities, the pressure to release the “different analysis” the premier is relying on will only build.
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Good news for some
Not everyone, however, is unhappy with this decision. Even at the original cost estimate, there are some who couldn’t care less about the Commonwealth Games and see these things as an enormous waste of money. There are those who would much rather invest taxpayers’ money in housing and other regional infrastructure.
The prime minister — while shocked and only given a “very short heads up” about the cancellation — has been careful to offer neither support nor criticism of the decision.
The federal opposition, meanwhile, is trying to turn this into a test for Anthony Albanese. “We actually need a prime minister who takes responsibility for Australia’s reputation when it comes to sport,” acting Opposition Leader Sussan Ley says. Exactly what this might involve, however, is unclear.
Andrews says he originally asked the Commonwealth to fund the Games 50-50 when he thought the cost was only $2.6 billion. The feds made no commitment and Andrews denies that’s been a factor in his decision.
The cancellation has created a sense of some chaos and it’s still unclear how the cost estimates were done and why they ballooned so quickly. But amid a housing crisis, Andrews is hoping to at least win some credit for his priorities.
David Speers is National Political Lead and host of Insiders, which airs on ABC TV at 9am on Sunday or on iview.
