The 2026 Commonwealth Games have been thrown into chaos after the Games’ Australian hosts pulled out due to spiralling costs.
Victorian Premier Daniel Andrews announced on Tuesday that it would be “wrong” to host the showpiece event because the estimated budget of $2.6 billion (£1.4 billion) had tripled to at least $6 billion and could potentially cost the state as much as $7 billion.
“What has become clear is that the cost of hosting these games in 2026 is not the $2.6 billion that was budgeted and allocated,” Mr Andrews told reporters on Tuesday.
“It’s at least $6 billion and could be as high as $7 billion. I can’t stand here with any confidence that the $7 billion dollars could fund these games – it could be more than that.”
Mr Andrews said the sum was “well and truly too much for a 12-day sporting event” and did not represent value for money.
“I will not take money out of hospitals and schools in order to fund an event that is three times the cost that was estimated and budgeted for last year.
“We don’t just make popular decisions, we do what’s right and it would simply be wrong.”
The state has informed Commonwealth Games officials of its decision to terminate the contract, Mr Andrews said, adding that “productive meetings” were held in London on Monday night. Additional meetings are set to take place on Tuesday.
The premier described the discussions as “amicable”. However, in a statement on Tuesday the Commonwealth Games Federation (CGF) said the Victorian Government walking away from the agreement was “hugely disappointing”.
“The reasons given are financial. The numbers quoted to us today of $6 million are 50 per cent more than those advised to the Organising Committee board at its meeting in June,” the statement read.
The CGF said the price escalation was primarily due to the “unique regional delivery model” the state chose, in particular the village and venue builds and transport infrastructure.
The Government also made decisions to include more sports, an additional regional hub and changed plans for venues, “all of which added considerable expense” and was often against the advice of the CGF and Commonwealth Games Australia, the CGF said.
“We are disappointed 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.”
Jeroen Weimar, chief executive of Victoria’s organising committee, admitted the axing of the Games was a “disappointment”, but the costs made it unviable.
Victoria’s withdrawal places the future of the Games in doubt given the challenge of finding replacement hosts three years before the event.
The CGF said it was “taking advice” on the options available and remain committed to “finding a solution” for the Games in 2026.
The Games have struggled to spark global appeal in recent years. No countries other than Australia bid for the 2026 Games and only one country other than Britain and Australia has hosted the event since 1998.
In 2017, Durban was stripped of the 2022 Games after the South African city failed to meet project deadlines. The event was later awarded to Birmingham.
The budgeted $2.6 billion for the 2026 Games, due to take place between March 17-29, would have seen them held across five sites in regional Victoria: Geelong, Bendigo, Ballarat, Gippsland and Shepparton. The state was initially expecting the Federal Government to foot the bill for half of the costs, the majority of which would have gone towards infrastructure.
However, the Federal Government’s budget in May included more than $1 billion towards the 2032 Brisbane Olympic Games, but nothing for the 2026 Games.
Prime Minister Anthony Albanese did not provide further insight when quizzed about the cancellation on Tuesday.
“That’s a decision made by the Victorian Government,” he told reporters.
Mr Andrews said factors such as security, transport and other logistical services contributed to the rising costs.
The premier faced a barrage of questions from reporters, who grilled him over how the cost estimates could have been so far off the mark, with one reporter comparing it to building a house.
“I don’t think you’d build it, mate,” Mr Andrews replied.
The legacy benefits from the Games will still be delivered, Mr Andrews claimed, as he announced a regional package worth over $2 billion to build the permanent sporting facilities in the state.
Australian swimmer and double Paralympic gold medalist, Rowan Crothers, said the Games were a “great opportunity” to raise awareness for disabled sport and “seeing the Games cancelled will suck for the state of inclusion”.
It is understood there has been no appetite from other neighbouring states such as South Australia, New South Wales or Queensland to host the Games.