Grand prix 'slipping' as $36m bill forecast

A LICENCE fee deal with Bernie Ecclestone has endangered Melbourne Formula One grand prix's chances of remaining in Victoria.

REVELATIONS of a licence fee deal worth $30 million-plus a year with Bernie Ecclestone have endangered the Melbourne Formula One grand prix's chances of remaining in Victoria.

The Baillieu government and race officials warned yesterday that leaking of details of the confidential fee would make it harder to negotiate a new agreement. The government all but confirmed a report detailing that the fee for the race would climb to as high as $36m by 2015.

With the government facing declining revenues, the cost of the event is a relentless subject of debate in Victoria.

Australian Grand Prix Corporation chief Andrew Westacott said Victorians "won't know what we've lost until it's gone" while the government indicated the state's hold on the race was slipping.

The race costs taxpayers a total of more than $50m each year, including the licence fee.

The Tourism Minister Louise, Asher, said yesterday the taxpayer subsidy of the race was too high, adding that deep thought would be given when the post-2015 contract was negotiated.

"We think that the taxpayer subsidy is too high. There are two issues here; one is the fee that is given to Mr Ecclestone, the other one is the total taxpayer subsidy for the event, and (the) fee of course is part of that," she said.

The size of the licence fee has been debated for nearly two decades and the apparently confirmed figure is in line with expectations. But contract details are considered sacrosanct by Mr Ecclestone, who demands confidentiality.

The ALP is being accused by the government of having leaked the deal because the existing contract was signed by Labor. But here is also speculation the government was behind the leak to generate debate about the high cost of the race.

Melbourne's grand prix chairman, Ron Walker, is overseas and did not respond to inquiries.