Victorian taxpayers have forked out over $1.2 million (US$762 million) in legal fees following the decision by the state’s former premier to cancel the 2026 Commonwealth Games.
The additional hit to Victoria’s ballooning debt comes as the true cost blowout from the Commonwealth Games fiasco was revealed in an upper house inquiry.
The costs involved paying lawyers’ travel to London to negotiate a compensation deal and includes work performed for the government until September.
The amount is on top of the $380 million the state was forced to pay in compensation following mediation between the State of Victoria, the Commonwealth Games Federation (CGF), Commonwealth Games Federation Partnerships (CGFP), and Commonwealth Games Australia (CGA).
Former state premier Daniel Andrews announced on July 18 that Victoria would not host the event due to an estimated cost blowout of $2.6 billion to $7 billion, which he said the state could not afford.
However, law firm Arnold Bloch Leibler was engaged to provide advice about the cancellation to the Andrews government on the afternoon of June 14—one month before the announcement was made.
Recently appointed premier Jacinta Allan refused to confirm when she first learned of the law firm’s engagement, saying that she only became aware of it when Mr. Andrews was “handling” the case.
“In terms of the date, the handling of those legal arrangements were being handled by the then-premier,” Ms. Allan said on Oct. 4, adding that she only became aware of lawyers involvement, cost blow-outs, and the fate of the games “as tender processes materialised” in the lead up to the July 18 announcement.
“Often when you’re weighing options, making decisions, that does include legal advice,” she said.
“These serious revelations cast fresh doubt on Jacinta Allan’s version of events and confirm that the Labor Government was planning in secret to cancel the Games for weeks prior to the public announcement,” Mr. Pesutto said.
On June 13—one day before the cancellation announcement—Ms. Allan said she was confident that the Commonwealth Games could be delivered in regional Victoria.
“The games are in 1,008 days,” Ms. Allan told the Public Accounts and Estimates Committee (PAEC) on June 13.
“The team is already doing significant planning work with, again, the local community to ensure how we move people—not just to Ballarat, there are five host cities that we have to move people around—and we are confident that we can do that.
“It is going to be one of the biggest logistical challenges of the running of the games, and I am confident we can do it.”
More Than $20 Million Paid to Athletes Village Consultants
The documents also revealed approximately $21.6 million was paid to consultants for the Athletes Village, despite an allocation of only $1.02 million by Development Victoria.Civil engineering design fees cost taxpayers $5.8 million, followed by $2 million for architectural services and $1.9 million for cultural heritage management.
An additional $10 million was paid to external consultants, including Ernst & Young, who were paid just under $55,000 for hosting advice.
Just over $19 million was spent on delivering major competition venues in Geelong, Bendigo, Shepparton, Ballarat, and Gippsland, which will still go ahead.
”This is another $21 million torched by the Labor Government for an event that never happened,” Mr. Pesutto said.
“They had a budget of $1 million but it blew out to $21 million because Labor simply can’t manage money.
“Jacinta Allan must come clean with Victorians about exactly how much money was wasted on the Commonwealth Games.”
“It is becoming increasingly clear that the bid for the games may have been an exercise in political opportunism designed to win votes in regional areas in the lead-up to the 2022 state election,” Mr. Andrews wrote.
“Having milked the Games for all it was worth at the state election less than a year ago, the secretive Andrews government has abandoned the very regional areas it courted with the promise of a massive injection of facilities and sporting tourism.
‘Right Decision’: Allan Says
Yet Ms. Allan maintains that the games’ cancellation was the “right decision.”“It was the right decision because $6 billion to $7 billion to hold a 12-day sporting event didn’t stack up,” she on Oct. 3.
Mr. Pesutto has accused Ms. Allan of misleading parliament and the PAEC.
“We learned today that contrary to what Jacinta Allan has told this parliament and the Victorian people, she obviously knew at the time she told everybody the Commonwealth Games was costed at $2.6 billion, she obviously knew with lawyers engaged to get Victoria out of the Commonwealth Games that that was not in fact true,” Mr. Pesutto said.
“We’ll be pursuing the serious issue of whether Jacinta Allan misled the Victorian parliament, when in PAEC, when in question time and in various other statements, she asserted that the Commonwealth Games at $2.6 billion was locked in.”
