Australia's state of Victoria will not host the 2026 Commonwealth Games due to projected cost overruns, placing the future of the quadrennial multi-sport gathering in doubt.
Victoria state Premier Dan Andrews said the cost of the Games, which were to have been held in four regional hubs, could blow out to more than $[AU]7 billion ($4.8 billion) from a budgeted $[AU]2.6 billion if they went ahead.
"Frankly $[AU]6-$[AU]7 billion for a 12-day sporting event, we're not doing that," Andrews said at a media conference.
"I will not take money out of hospitals and schools to fund an event that is three times the cost as estimated and budgeted for last year."
Andrews said Victoria had already informed the global governing body Commonwealth Games Federation (CGF) in "amicable meetings" but the cost of breaking the 2026 contract was yet to be decided.
The CGF and local governing body Commonwealth Games Australia did not provide immediate comment.
The sporting event for mostly former British colonies has struggled to remain relevant, with four of the last five editions held in Australia or Britain.
English city Birmingham stepped in to host the 2022 Games after South Africa were stripped of them in 2017 over a lack of progress in preparations.
Victoria stepped in to bid for the 2026 Games when no other countries showed interest.
Officials had talked up the legacy benefits from new infrastructure in the regional hubs of Geelong, Ballarat, Bendigo and Gippsland, and an economic boost of more than A$3 billion from tourism and thousands of new jobs.
"As a state, of course we were willing to help out, but of course not at any price and only if there were lasting benefits for Victorian communities and benefit for the whole state," Andrews said.
The government would instead spend more than $[AU]2 billion on a "regional package" which would include building all permanent sporting facilities intended for the Games, along with $[AU]1 billion earmarked for social and affordable housing.
But Craig Phillips, chief executive of Commonwealth Games Australia [CGA], slammed the decision made by the Andrews Government and declared the cited cost increase as being a "gross exaggeration" of the actual figures.
"The announcement made by the Victorian Government today is beyond disappointing," Phillip said via a media release. "It's a comprehensive let down for the athletes, the excited host communities, First Nations Australians who were at the heart of the Games, and the millions of fans that would have embraced a sixth home Games in Australia.
"The multi-city model for delivering Victoria 2026 was an approach proposed by the Victorian Government, in accordance with strategic roadmap of the Commonwealth Games Federation (CGF).
"It was pitched to the CGF after Commonwealth Games Australia (CGA) had sought interest to host the Games from several states. They did not step in as hosts at the last minute, as indicated by the Premier earlier today.
"The detailed budgetary implications announced today have not been sighted or discussed with the CGF [Commonwealth Games Federation] or CGA ahead of being notified of the Government's decision.
"The stated costs overrun, in our opinion, are a gross exaggeration and not reflective of the operational costs presented to the Victoria 2026 Organising Committee board as recently as June."
Phillips also said that the decision had "jeopardised Melbourne and Victoria's standing as a sporting capital of the world."
Soon after the announcement, Australian sport officials were touting the country's largest state of New South Wales as an alternative host for 2026.
NSW state capital Sydney hosted the 2000 Olympics.
"There's no question we've got the venues ... and March would be a good time to host it," John Coates, an International Olympic Committee Vice-President and former Australian Olympic Committee boss, said in comments published by Sydney's Daily Telegraph.
"I'd love to see it come here ... The sports have the ability to organise it."