The Memo: 2026 Commonwealth Games in doubt after Australian state of Victoria cancels plans to host

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2026 Commonwealth Games in doubt after Australian state of Victoria cancels plans to host

James Westmacott – 7 August 2023

With preparations for the 2026 Commonwealth Games in full swing, it’s fair to say that the Australian state of Victoria’s withdrawal from hosting the quadrennial showpiece came as a surprise to many. Citing reasons of financial peril, the Victorian government announced as a justification of its decision that the costs of hosting the Games had sky-rocketed from its original cost projection of A$2.6bn to an eye-watering A$6bn, and was therefore no longer affordable. According to The Conversation, the bleak economic outlook facing the state – most notably its projected A$36bn debt burden increase by 2026 - undoubtedly exacerbated the controversial decision.

Though the legal implications of such a withdrawal relate mainly to Victoria’s contractual breach with the Commonwealth Games Federation – the organisation responsible for the Games. Whilst every detail of the contract cannot be known, the reality remains that both parties had a deal in place that meant that the Games were going ahead and that the Australian state was in a contractually-obligated position to host. The federation can now argue that any concerns over the costs of financing the tournament should have been effectively thought through and sorted before signing any contract. With the contract signed and the federation fully expectant of the Games’ delivery, Victoria reneging on its decision is a clear contractual breach.

But the controversy doesn’t end there. As The Telegraph reported, many have already questioned the accuracy of the state government’s projections, hinting at claims of exaggeration, as when looking at Gov.UK statistical data from the most recent Games in England’s second-city Birmingham, it’s clear that it accrued total costs congruent with initial cost projections. In fact, Birmingham City Council confirmed in its aftermath that the Games contributed £870m to the UK economy, indicating the financial benefit of playing host.

The rarity of such a case is striking, as very few hosts of major sporting events have ever pulled out quite so dramatically. Hung out to dry and faced with the arduous and costly task of finding another willing host, it’s also fair to say that Victoria has caused a degree of reputational damage to the Games. As a result, the case poses stark existential questions for the Games themselves. Forever in the shadow of the Olympics, and with a questionable colonial legacy, has Victoria given the Commonwealth Games the death knell?