State Premier Daniel Andrews Tuesday pulled the plug on the Victoria 2026 Commonwealth Games only 967 days ahead of the planned opening ceremony. The sudden decision, based on a revised forecast budget that has more than doubled, has left the Commonwealth Games Federation (CGF) with very few alternatives for staging the event as scheduled.
“What’s become clear is that the cost of hosting these games in 2026 is not the (AUD) $2.6 billion which was budgeted and allocated,” Andrews said during a press conference Tuesday.
“It is in fact at least $6 billion and could be as high as $7 billion, and I cannot stand here and say to you that I have any confidence that even $7 billion number would appropriately and adequately fund these Games,” he added.
In a statement, the CGF placed blame on Victoria 2026 for ignoring advice that could have prevented the massive cost overruns.
“The reasons given [for the cancellation] are financial. The numbers quoted to us today of [AUD] $6 billion are 50 percent more than those advised to the Organizing Committee board at its meeting in June,” the statement read
“These figures are attributed to price escalation primarily due to the unique regional delivery model that Victoria chose for these Games, and in particular relate to village and venue builds and transport infrastructure.
“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 (CGF) and Commonwealth Games Australia (CGA).
“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.
“Up until this point, the Government had advised that sufficient funding was available to deliver the Victoria 2026 Commonwealth Games.”
The organizing committee represented by Chair Peggy O’Neal and CEO Jeroen Weimar released a joint statement on Twitter Tuesday explaining “We are confident that the vision for the Victoria 2026 Commonwealth Games could be delivered – to the original scope and time frame – but the costs of doing so would significantly exceed the original estimates provided to the Government in conjunction with the bid. We recognize the difficult decision the Government has made and understand why it was made.”
— Victoria 2026 (@CommGames_) July 18, 2023
Andrews told reporters that there could be contractual costs due to the Games’ cancelation and negotiations with the CGF are ongoing to determine the damage.
The Games were awarded to Victoria on April 12, 2022 with events planned to be staged across the state with the opening ceremony in Melbourne.
Victoria had been singled out as the only interested candidate after Hamilton in Canada walked away from an exclusive opportunity to host the 2026 edition. The The CGF was already almost two years behind schedule when the Games were awarded, and it may be an even greater challenge to find a replacement with less than three years to go.
Difficulties for the CGF began when Durban in South Africa was elected to host the 2022 Games. That city was stripped of the hosting rights by the CGF two years later when it missed financial milestones, leaving executives scrambling to find a replacement host. Birmingham, then one of the 2026 candidates, was chosen as the new 2022 host in an abbreviated selection process.
With Birmingham and the rest of England now out of the 2026 race, the availability of suitable candidates was slim and the CGF missed its intended 2019 election date. The onset of the COVID-19 pandemic further complicated matters forcing the CGF to make an unusual offer to Hamilton, Canada already preparing a bid to host the 100th anniversary of the inaugural Games first held in the same city in 1930. The CGF gave Hamilton the exclusive offer to host the 2026 Games if it were to pivot from its sentimental 2030 plans.
Hamilton city council later rejected the offer, leaving the CGF with few other options and a window-of-preparation that was getting smaller by the day. The ongoing health and economic crisis saw cities across Australia and the rest of the Commonwealth turn away from possible bids.
Now the CGF finds itself in a similar situation.
“We are taking advice on the options available to us and remain committed to finding a solution for the Games in 2026 that is in the best interest of our athletes and the wider Commonwealth Sport Movement,” the CGF statement read.
Canadian cities Calgary and Edmonton have joined for an Alberta provincial bid to host the 2030 Games and they might get a call from the CGF to consider the earlier date. Victoria in Canada had considered a 2026 bid but plans did not evolve.
India has also expressed interested in staging the 2030 edition – Delhi hosted the Games in 2010.
Malaysia discussed interest in hosting in 2026 but a formal bid never came to fruition.
Other Australian cities including Adelaide and Sydney had considered 2026 bids but were not willing to take the financial risks amid the post-COVID economic downturn.
With the Birmingham 2022 legacy still fresh, and feedback from that quickly-organized edition generally positive, a back-to-back Games in England could be a possible solution for the CGF with such short notice.
With the Commonwealth Games now facing an existential threat, the CGF needs a quick solution.