Victorian Premier Daniel Andrews in Commonwealth Games budget scramble

Confidential budget talks are under way to find a funding model to deliver the 2026 Commonwealth Games in country and regional Victoria.

Victorian Premier Daniel Andrews on Thursday. Picture: NCA NewsWire / David Geraghty

Dan Andrews’ government is scrambling to stitch together a workable funding model for the $2.6bn Commonwealth Games in Victoria amid concerns about the size of Canberra’s commitment to the event and financial woes in the state’s second city.

Confidential pre-budget talks are under way over the size of the federal contribution and the role of several councils, which are still anxiously awaiting basic financial information on what the 2026 Games will cost them.

The debt-riddled Victorian budget combined with the decision to run the Games in regional and country centres has ignited concerns about the ability of the state to deliver the Games to a global standard in just three years, particularly given capacity constraints in the building sector, and the large distances between events.

The Albanese government has pledged $3.4bn for Queensland’s 2032 Olympics but is yet to say whether its contribution in Victoria will be 50 per cent of the $2.6bn preliminary cost estimate for Victoria, which is being sought by Mr Andrews.

Councils across the five main regional Games areas including Geelong are worried that they have not received their funding schedules. The two biggest Victorian cities outside Melbourne will need hundreds of millions of dollars for headline projects including a swimming centre in Geelong and athletics facilities in Ballarat, with significant spending on transport and athletes’ villages in four centres.

Ballarat’s main sporting stadium will receive a $150m upgrade and hundreds of millions will go to sports facilities in Geelong.

Four athletes villages, rather than the usual one, will be built around Victoria and a tourist ­accommodation crisis is virtually guaranteed due to the lack of ­hotels and motels in each centre for a Games this size. The City of Greater Geelong, which is facing a $150m budget blowout, is unsure whether it can afford the Games.

Mayor Trent Sullivan said the council supported the event, which would deliver $650m of infrastructure but money was an issue.

“We have made it clear that we have very limited funding available, given the huge escalation in costs we’re already facing to ­deliver our own planned capital projects program,” he said.

But the Victorian government has made clear that each council must pay its way.

“We’re continuing to work with the City of Geelong and local governments to determine their financial contribution to the Games – councils are aware they’re expected to contribute,” a spokesman for Mr Andrews said.

The Victorian opposition has urged the Victorian government “to get their skates on” and warned that the funding uncertainty is undermining the lead-in to the construction phase, with extensive building needed to provide accommodation for 7000 athletes and support staff and volunteers, many of whom will be in Geelong. Others will be in Bendigo, Ballarat and Gippsland.

Melbourne has some of the world’s finest sporting assets that will be idle during the Games.

City of Greater Bendigo director of Commonwealth Games Andrew Cooney said the council, which backs the Games, was still working through the budget to determine spending priorities and could not forecast the total cost.

Ballarat mayor Des Hudson, who also supports the Games, said the council was heavily ­reliant on the state government to deliver funding, adding that he believed local government should not be made to deal with unreasonable costs.

Latrobe City mayor Sharon Gibson said the region would “never say no” to the opportunity of a Commonwealth Games but there were issues with ongoing costs that needed to be addressed.