Public Cost Of Melbourne Formula 1 Race Revealed: Report
The Australian Formula One Grand Prix costs Victorians over AU$30 million in licence fees annually, according to figures revealed by Melbourne's Herald Sun newspaper. The annual fees have long been kept under wraps by successive Victorian state
The Australian Formula One Grand Prix costs Victorians over AU$30 million in licence fees annually, according to figures revealed by Melbourne's Herald Sun newspaper.
The annual fees have long been kept under wraps by successive Victorian state governments because of contractual confidentiality.
According to documents reportedly sighted by the paper, Melbourne’s contract with Bernie Ecclestone’s Formula One Group includes licence fees totalling US$171.4 million (AU$162.5 million at current exchange rates) over its five-year term.
This total is the sum of annual payments, commencing with US$31 million for the 2011 race, and escalating by five percent each year for the duration of the contract - regardless of the event's commercial performance.
The Albert Park event endures a welter of criticism every year for its net cost to taxpayers (AU$56.7 million in 2012).
It is now widely-known that a decision on whether to renew the Australian Formula One Grand Prix contract beyond the 2015 race will be made within 12 months.
The current contract was agreed upon by the previous Labor John Brumby government, but a renewal will be the responsibility of the current Liberal Ted Baillieu government.
Current Tourism and Major Events Minister Louise Asher reportedly acknowledged that the Grand Prix cost to taxpayers is too great under the current strategy, and that it is her responsibility to improve this deficit.
"I'm going to go to the table in good faith, to have a proper discussion about whether Melbourne can retain this Grand Prix,” Asher told the Herald Sun.
"I think the event is terrific, but at the moment it's costing too much money."
Despite these taxpayer-subsidised annual losses, Ms Asher told the HS that the Grand Prix’s wider economic benefit is valued at between AU$32-39 million per year, through international publicity and the strengthening of Melbourne as a brand.
"In terms of tourism, Sydney has the Opera House, Queensland has the Great Barrier Reef, central Australia has Ayers Rock. We in Victoria, both sides of politics, have tried to position Melbourne as a major events capital," she told the Herald Sun
2024 Toyota BZ4X FWD review
0
