July 18 (CNN) – Plans for one of the world’s biggest sporting events have been thrown into disarray after the Australian state of Victoria pulled out of hosting the 2026 Commonwealth Games due to cost overruns.
Premier Daniel Andrews told reporters in Melbourne Tuesday that initial estimates had put the cost of the Games at 2.6 billion Australian dollars ($1.7 billion), but new estimates suggested it would be closer to 7 billion Australian dollars ($4.77 billion).
“I’ve made a lot of difficult calls, a lot of very difficult decisions, in this job. This is not one of them,” he added. “Frankly, 6 to $7 billion for a 12-day sporting event. We are not doing that. That does not represent value for money. That is all cost and no benefit.”
The Commonwealth Games is a multi-sport event involving thousands of athletes representing 72 Commonwealth countries and territories, held every four years. The last edition of the event, held in Birmingham, England in 2022, was the largest Games on record.
Victoria was announced as 2026 host last March after organizers had struggled to find an appropriate location due to lack of interest and Covid-19 disruptions.
The decision to pull out appears to have surprised the event’s organizing committees, who say they had no warning about cost overruns, nor any opportunity to work on alternative proposals.
The Commonwealth Games Federation (CGF) said in a statement Tuesday the decision was “hugely disappointing for the Commonwealth Sport Movement,” and suggested that Victorian authorities hadn’t previously raised cost concerns.
“We are disappointed that we were only given eight hours’ notice and that no consideration was given to discussing the situation to jointly find solutions prior to this decision being reached by the Government,” the statement said.
The statement said the estimated cost of 6 billion Australian dollars quoted by Victorian authorities on Tuesday was 50% higher than the figure advised to the Organizing Committee board in June.
The CGF said decisions the state had made concerning sports and venues had “added considerable expense” often against its advice and that of the Commonwealth Games Australia (CGA).”
CGA Chief Executive Officer Craig Phillips said in a statement that the government had “willfully ignored” recommendations to move events to Melbourne to lower the cost.
He said the multi-city concept was pitched by Victoria after the CGA sought interest from other states, and that the stated cost overuns were, in their opinion, “a gross exaggeration.”
“CGA would welcome the opportunity to review the financial analysis prepared independently of those who have been involved at the coal face of planning and delivery,” he added.
According to the Victoria 2026 website, the Games were to have been held from March 17 to 29 of that year in regional Victoria, giving areas outside the state capital Melbourne much-needed investment and international exposure.
“Geelong, Bendigo, Ballarat, Gippsland and Shepparton will be on the world stage, attracting millions of viewers and creating thousands of jobs,” the site said.
Five regional centers were to host 20 sports and 9 “fully-integrated” Para sports, including weightlifting, lawn bowls and track cycling.
Instead of hosting the Games, Victoria will build at least 1,300 affordable homes and the permanent sporting facilities it had promised in an effort to boost regional tourism and events, Andrews said.
The Federation said it was “taking advice on the options available” and remained committed to finding a solution so the Games could go ahead.