Victorian Premier Jacinta Allan was warned four months before the state government abandoned the 2026 Commonwealth Games that the event’s costs had nearly doubled, an inquiry has heard, casting into doubt her claim she only knew of cost blowouts in the weeks leading up to the cancellation.
The evidence was presented to the first day of hearings of a parliamentary inquiry into the government’s decision to axe the 12-day sporting program.
Department of Jobs, Skills, Industry and Regions secretary Tim Ada revealed the department told Ms Allan, who was the minister for Commonwealth Games Delivery, about billions of dollars in cost blowouts months before a public announcement was made to abandon the games.
“In early March 2023, the department briefed the minister for Commonwealth Games Delivery on revised budget requirements to deliver the Games,” Mr Ada told the inquiry.
“An updated budget estimate of $4.5 billion was not approved, with the department asked to further explore opportunities to reduce costs while still meeting the government’s commitment to host the Games in regional Victoria.”
Three months later on June 13, Ms Allan spruiked the Commonwealth Games at a parliament budget inquiry, and denied last week that she had misled parliament by telling the committee progress was being made on the event.
Then-premier Daniel Andrews stood alongside Ms Allan at a press conference on July 18 to announce the cancellation of the Commonwealth Games and blamed unforeseen cost overruns that were expected to see the $2.6 billion event blow out to almost $7 billion.
Ms Allan has repeatedly told parliament she only knew of the cost blowouts weeks before the government announced its decision to cancel the event.
“I don’t have the advice on the exact date,” she told question time last week.
“But what I can say is that when it became clear that the costs to run a 12-day sporting event were going to exceed $6 billion, that just became too much, and that became clear in the weeks leading up to the announcement.”
In his evidence to the inquiry, Mr Ada said the original business case grossly underestimated how much it would cost to deliver the event and did not factor in rising construction costs.
The inquiry heard the department was told by Ms Allan to try to reduce costs in March, but it again warned her in June that it needed $4.2 billion to deliver the Games.
Games-related costs from the Department of Jobs, Skills, Industry and Regions alone are expected to reach $200 million, the inquiry heard.
That is on top of the $380 million taxpayers were forced to pay in compensation to cancel the event.
The opposition criticised Ms Allan for refusing to front the upper house parliamentary inquiry.
“Less than two weeks into the job, Jacinta Allan’s credibility is already on the line as she continues to avoid scrutiny over her role in the Commonwealth Games debacle,” Opposition Leader John Pesutto said.
(ABC)
