Revealed: The Panthers Stadium budget blowout that will blow your mind

My mistook.

In my rant a couple of weeks ago lauding Premier Dominic Perrottet for telling the NRL to get nicked on building new boutique stadiums, I made an error re the largesse still being shown to the Penrith Panthers. No, it wasn’t on Nigel Gladstone’s story on how $12 million of community sports grants “ended up building an underground carpark [for the Panthers].”

The Dominic Perrottet-led government has committed to building the Penrith Panthers a new stadium.Credit: Sydney Morning Herald/Supplied

That’s all documented.

It was about the new stadium that the government is still committed to building for them with taxpayer dollars. I wrote “something like $300 million of our dosh is going to give them a new stadium.”

And herein lies the error.

For after it I was contacted on the QT by a once very senior figure in the NSW government, who pointed out with strong reasoning that the actual figure is likely to be more to the order of $600m to $650m!

Yes, you read that right, and I’m about to back it up. But can we gaze in horror for a moment at the situation? Of all the clubs in all the NRL, right now it is team backed by the rich Penrith Panthers Pokie Palace that looks to be getting as much public money as the original rebuild of the SFS was projected to cost in the first place!

My expert source, who – if not quite a deep throat, is at least as credible on knowing the way these things work in big budget government constructions – points out:

1. “Government says a 25,000-seat new stadium will cost $300m. This is nonsense.

2. “The going rate for new stadia is between $15,000 to $20,000 per seat.

3. “This means a 25,000-seat new stadium at Penrith will range between $375m to $500m.

4. “Current construction industry price escalator is between 5% to 7% per annum.

(I looked that up and it means how much a bid can be expected to actually cost when it’s finally finished, taking into account the annual rise in building costs.)

“So for a new stadium assuming three-year construction, add another $70m to $100m at least in escalation.

5. “These costs do not include compulsory acquisition of paceway.

(They do harness racing at the Penrith Paceway, and that is where they want to build the new stadium.)

6. “Paceway land currently valued at $20m. This is land only.

Are you still with me, tree people? God bless you, I am singing for you too. Onwards!

7. “Of course to move the paceway to new site will also need the government to fund associated infrastructure for new paceway – track, training facilities, stewards facilities, drug testing, stables, training facilities, clubhouse, grandstand, seating, betting facilities.

8. “Estimated cost of this around $80m. So added all up you get a new stadium with a total cost of well over $500m, and more likely closer to $600-$650m.”

Staggering, yes?

My source points out that a refurb on existing site is engineering-wise very easy and would be much more cost effective. (And all the more cost effective, can we agree, if – and stay with me on this one, because it is a revolutionary idea – the Panthers kicked in some money, too?)

For those who still doubt his figures, my source had an even neater way of calculating its likely final cost.

“Parramatta Stadium (30,000 seats) opened in April 2019 at end cost of $360m = $12,000 per seat.

“Allianz, which will open in two weeks, 42,000 seats at total end cost of $820m = $19,500 per seat. Right there is a glaring example of the cost escalation in just a couple of years.

“So Penrith at 25,000 seats on today’s construction cost of $19,500 per seat will be $500m if they start this year. Of course they won’t. So by the time they do tender (2023) the cost will have escalated another 7% minimum = $535m to start if they are lucky. This [stadium] will end up costing in excess of $600m given a three-year construction time frame.”

My source had one last killer point.

“There has been almost no focus or scrutiny of even more largesse to the NRL:

“Almost $200m in two rounds for centres of excellence, which is for the exclusive use of NRL clubs. There is even less justification for these. A few weeks ago the government announced round two of funding, with $130m for four more centres of excellence. Dragons gifted $50m! Of course you can bet your life, the final cost of these centres will far exceed the figures contained in the announcement (given construction industry price escalations.)”

All up, you get the drift. I always knew this kind of expenditure was outrageous. Until drawing on the inside knowledge of this expert, I had no idea just how outrageous.

Premier Perrottet, you received a lot of deserved kudos for standing up to the NRL. But the job’s not done. Stop the Penrith outrage, too. Refurb instead, instead, after you refurb Leichhardt Oval, to at least make it safe!

Yes, the NRL will hate you. But they already hate you, and in this struggle between the needs of the people and the needs of the NRL, you have already demonstrated that you get the needs of the people must come first. I humbly submit you need to act on that instinct once more.

Twitter: @Peter_Fitz

Stream the NRL Premiership 2022 live and free on 9Now.

Sports news, results and expert commentary. Sign up for our Sport newsletter.