‘Hasty political decision’: Final report slams Commonwealth Games failures

Taking on the now-cancelled 2026 Commonwealth Games was a hasty political decision by the Victorian government, which used flawed modelling and refused to heed warnings about costs, a final report into the saga has found.

A select committee investigating the Games’ cancellation – which cost taxpayers $589 million – released its final report on Tuesday and identified major failings in how the then-Andrews government bid for the event, costed the project and ignored warnings about its future.

Former Victorian major events minister Martin Pakula and former premier Daniel Andrews at the Commonwealth Games announcement in April 2022. Credit: Luis Enrique Ascui

However, the committee agreed with the government’s decision to ultimately walk away from the event.

The committee was composed of three Labor MPs, three Coalition MPs and one crossbencher each from the Libertarian, Greens and One Nation parties.

The report found that the cabinet was the ultimate decision maker in bidding for and approving the budget for the Games, but described the methods relied upon by ministers as “inadequate and flawed”.

It says proper processes typically used to justify spending on the event were either cut back or not taken at all and withdrawal from the event stemmed from a “series of failures”.

“A hasty political decision was made by the then-Andrews Labor government to support the Commonwealth Games in the proposed multi-city model, but the government
did not undertake proper due diligence,” the report says.

Four key ministers – former premier Daniel Andrews, former Commonwealth Games minister and current Premier Jacinta Allan, former major events minister Martin Pakula and former treasurer Tim Pallas – are identified as senior officials who bore responsibility for the project, alongside senior department figures.

Committee chair David Limbrick said: “Victorians, especially regional Victorians, were let down by a string of decision-making failures by the Victorian government, as well as inadequate due diligence and planning processes at both the departmental and ministerial level.

“To put it simply, the high cost and inability to host the Games as proposed should have been discovered far earlier by the Victorian government.”

Limbrick also said that key witnesses, including the former premier and ministers, declined to appear at public hearings.“Requests for relevant documentation were met with broad claims of executive privilege,” he said.

The business case relied on to justify hosting the Games was written in just six weeks and used a “top-down approach” where costs from the 2018 Gold Coast event were used as a base. Secrecy around the event also prevented consultation with bodies such as local councils.

In May 2022, the event had an approved budget of $2.6 billion, at the low end of the costings provided by the department; by April 2023, estimates had increased to $4.5 billion.

In the weeks leading up to the cancellation, cabinet received advice that the final cost of the Games could be between $6 billion and $7 billion, which was used to justify the decision. The committee found this figure was not transparent and potentially overblown.

One of the biggest challenges to the event was the decision to use a multi-city model entirely in regional Victoria, which significantly increased the cost of hosting.

There were also major blowouts on projects, with the athletes’ village increasing from a price tag of up to $265 million in 2022 to more than $1 billion by July 2023.

Former Department of Treasury and Finance secretary David Martine told the committee this was a “huge differential” in the cost of the event.

The committee criticised the department for failing its responsibility to ensure well-researched information was available to support cabinet decision-making.

Daniel Andrews and Jacinta Allan announced the cancellation of the Commonwealth Games in July 2023.Credit: Joe Armao

They also found warnings about cost overruns and issues with the project’s business case were not heeded.

“The high cost and inability to host the Games as proposed should have been discovered far earlier by the Victorian government,” the report says.

Repeated requests to change the scope of the event were also refused. The government did not appear to have ever explored the option of hosting the Games in Melbourne, the report says.

Credit: Matt Golding

The event will now be held in Glasgow, with almost $200 million used to fund the event to come from the compensation paid by Victoria for withdrawing from hosting the Games.

In a minority report written by Labor MPs Michael Galea, Tom McIntosh and Jacinta Ermacora, the three wrote that a $2 billion package for regional Victoria would still provide legacy benefits of the Games.

“In some cases, the legacy benefits which are now being delivered are more beneficial than would have been the case had the Games proceeded,” the report says.

Opposition tourism spokesman Sam Groth said: “The business case was rushed, based entirely on desktop research, and approved without site visits or consultation. Infrastructure costs exploded, warnings were ignored, and yet cabinet signed off on it anyway.”

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