Victorians are proud of Melbourne as the sport and major events capital of the country. But few bother asking: is that title worth the money? This week's formula one Grand Prix will cost the state's taxpayers at least $30 million. The World Swimming Championships, starting on Saturday, will cost more than $50 million.
To put these amounts into context, State Government spending on these two events alone is equal to every adult Victorian making a compulsory payment of $20 to the organisers. Some Victorians would gladly hand over $20 for the privilege of Melbourne hosting a car race and a swimming carnival, but most wouldn't. So why have governments (Labor and Liberal) been allowed to get away with spending hundreds of millions of dollars on such activities?
The lack of public curiosity about the cost of major events seems to encourage ministers to make increasingly extravagant promises to promoters. Governments have little incentive to seek value for money when they can make secret deals exempt from parliamentary and public scrutiny. The Grand Prix contract remains a secret, while the cost of security for the swimming championships has not been revealed and probably never will be.
The usual justification is that major events spending provides economic benefits for the state through additional employment, increased tourism and international advertising exposure. This is true. However, it ignores one obvious point: any sort of government spending, whether it is for worthwhile purposes or wasteful purposes, has economic benefits.
If the Government decided to devote an additional $80 million to recruiting extra literacy teachers in primary schools, there would be economic benefits. Better educated students will be more productive once they are in the workforce. But if the Government chose to use the money to have the rocks at the bottom of the Yarra painted red, there would also be economic benefits: paint would be purchased, painters employed and tourists would flock to see a river that was red instead of brown. Such a stunt would certainly generate worldwide headlines.
The question for Victoria is not whether there are economic benefits from taxpayer-subsidised major events, because obviously there are. The question is whether there are better alternative uses for the money.
In some circumstances, government financial support for major events may be justified. But those circumstances are rare. There shouldn't be a situation, as exists now, where any major event offered to Victoria is greeted with an open chequebook.
When Melbourne won the Grand Prix from Adelaide in 1993, the dilapidated parks and ovals of Albert Park were restored. Thanks to the Grand Prix, substantially improved sports and recreational facilities are now available to the public. There are isolated instances of long-term public benefit from spending on major events, but those instances are rare.
Victoria spends four times more on major events than any other state. But then no other state suffers from the same sort of inferiority complex as does Victoria. NSW has Australia's international city, and Queensland and Western Australia power the nation's resources boom. Meanwhile, Victoria prides itself on winning the right to host the World Hot Air Balloon Championships and have formula one racing cars travel at 60 km/h down Lygon Street.
Major events have as much to do with the political benefit for the party in power as they do with any economic benefits for the state. The line about giving the people "bread and circuses" is true enough, but in Victoria it increasingly seems to be all circus and no bread.
In the midst of a water crisis that everyone saw coming except the Government, and while Melbourne's public transport system lurches from problem to disaster, it is convenient for Premier Steve Bracks to spend his time discussing the gold medal prospects of swimmer Pieter van den Hoogenband.
Achieving a reassessment of the state's major events strategy is not going to be easy. The major events industry will have to learn that it can't rely indefinitely on taxpayer-funded bail-outs. Politicians won't like being separated from their photo opportunities. Spectators at major events might have to pay more because ticket prices will no longer be subsidised by taxpayers.
It truly would be a major event if Victorians started to question the cost of our major events. But hopefully that will happen sooner rather than later.
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