No more blowouts: Clock ticking to confirm 2032 budget, audit office warns

The news

A total budget for the Brisbane 2032 Games is yet to be consolidated and confirmed, with the state audit office warning a failure to do so would heighten the risk of unforseen and unmanaged cost blowouts.

The report into Games preparations noted the new co-ordination authority was unlikely to have more clarity about whether the $7.1 billion infrastructure portion was “adequate” until later next year.

While Auditor-General Rachel Vagg said those responsible had been able to begin planning despite changes in governance structures across the abnormally long lead-time, “uncertainty remains”.

An estimated $4.9 billion cost set out in 2021 bid documents focused only on the Games’ organising committee.Credit: AP

“With this additional four years, time has not yet been a crucial factor, but with an immovable deadline it will increasingly become so,” the report’s summary said.

Why it matters

The state government carries the greatest liability, having underwritten the financial risk of the Brisbane 2032 Organising Committee delivering the event tipped to bring 20-year economic and social benefits of up to $8.1 billion for Queensland and $17.6 billion nationwide.

An estimated $4.9 billion cost set out in 2021 bid documents focused only on the committee and was expected to be entirely offset by event revenue and International Olympic Committee contributions.

The accuracy of the $7.1 billion set down for venue infrastructure is unlikely to see “greater clarity” until after a final project validation report “likely in 2025″ – based on the 100-day review results.

And whether almost $600 million more in other infrastructure and operational costs will be included is also unclear, as sporting codes increase pressure for a new stadium to replace the ageing Gabba.

What they said

The report notes the bodies set up to drive much of the work – the organising committee and Games Independent Infrastructure and Coordination Authority – now “more closely reflect” those pitched.

But other state government agencies had also prepared, or were preparing, estimates for the cost of services such as security and transport. Council partners’ costs were also not included.

“Currently, there is no budget that captures all estimated costs to deliver the Games across the entities,” the report notes.

“Without a consolidated games budget that clearly defines what will be included and excluded, there is an increased risk of unforeseen and unmanaged cost escalations.”

“It is also necessary to manage perceptions of cost escalations and to effectively evaluate the legacy of the Games.”

We found no evidence or reason to suggest the current governance arrangements are not fit-for-purpose.

The audit office report

Such work is already being by a dedicated Games office within the Department of Sport, Racing and Olympic and Paralympic Games, the report notes.

Another perspective

But in a response included in the report, department director-general Andrew Hopper appears to suggest this would only be to the extent of “Queensland government activities”.

The report also notes the state government spent $8.5 million on planning for the previous Gabba rebuild plans – dumped by the former Labor government and back on the table under the LNP.

This week, Cricket Australia revealed it hoped to play 2032 Games matches at the Gabba before moving permanently to a new venue at Victoria Park, a view to be shared with the 100-day review.

It is understood the Brisbane Lions AFL club is backing CA’s pitch to the review and may prepare its own submission. Chief executive Greg Swann said in September that “Victoria Park is the best option for us”.

What you need to know

The report also recommended the organising committee and coordination authority ensure greater transparency around how they will ensure and show the Games will remove more carbon emissions from the atmosphere than it creates.

“Further work is needed to define how the two ministerial portfolios [of Jarrod Bleijie and Tim Mander] will work together,” it added.

With William Davis