Australian Grand Prix melbourne racing
(Image: AAP/Julian Smith)

Another year and another Australian Grand Prix has zoomed by. It’s become a cliché, one that’s bellowed from within Melbourne’s hipster-belt suburbs, that the GP is a waste of taxpayers’ money. But, as tired as that saying is, it’s not any less true.

The grand prix sits among a healthy set of major sporting events that form part of Melbourne’s tourism push and rhetoric about being the national, if not the world, capital of sports. Though its worthiness is hotly debated every year, the government of the day always staunchly defends its cost and relevance. It’s a defence that doesn’t follow the shape of other discussions involving public money.

The numbers

In 1996, the event’s first year in Melbourne, about 400,000 attended the grand prix. It’s a highly respectable number — although down 20% compared to the previous year, when Adelaide last hosted. The following year, numbers plummeted by a further 25%, to 289,000. 2004 saw the highest numbers since the event’s inaugural year: 360,885 people went through the gates. Since then, numbers have fluctuated between low-300,000s and high-200,000s. 2016 had the smallest crowd to date: 272,300.

Compare this to the Australian Open. Yes it’s a longer event, but its numbers have grown significantly every year since 2014. Its attendance has jumped from 643,280 to a record 780,000 earlier this year.

Of course crowd figures aren’t the only way to measure success or failure. But the GP is also plagued by its annual loses, which are handily picked up by the taxpayers every year: $57.1 million in 2017, $61 million in 2016, $61.7 million in 2015 and $59.97 million in 2014. This is more than double the subsidy of $26.6 million in 2005.

In contrast, a 2016 report released by Tennis Australia reported their event injected $278.1 million into the state economy that year and produced an annual return of about 27.8%. Whenever the GP’s losses are mentioned, we hear about other economic benefits (interstate and international visitors, increased hospitality revenues etc). “[The grand prix is] strengthening Melbourne’s and Victoria’s liveability and civic pride,” Grand Prix Corporation chairman John Harnden wrote in a recent report. But trying to glean tangible figures about the value of these benefits are disputed at best, and nebulous at worst; how much is gained in media value has never been clear, for example. These benefits also come with “invisible” additional costs such as pollution, traffic congestion and the loss of access to Albert Park for eight weeks preceding the event.

Is it worth it?

Another marker of success — although it’s not one that is likely to be picked up by KPIs — is how major sporting events fit into the cultural zeitgeist.

The Australian Open, held in Melbourne every January, has the sun-streaked vibes of a beach party that reverberates throughout the city. There’s a build-up of excitement weeks in advance with announcements of star players and prize money. Organisers have also created an increasingly popular mix of live music and family-friendly options that have become more like a festival than solely a sporting event.

Then there’s the Melbourne Cup: an event with a historical grip on the city so tight that not only do we have a public holiday in its honour, but workplaces will routinely shut down to watch the main race in their respective tea rooms. BYO the most unfortunate hat you can find in Lincraft.

All of these sporting events play a part in Melbourne’s story. They’re not just for their biggest fans, but have found a home in the cultural calendar in a way that transcends sport.

It’s true that not all sporting events need to attract huge numbers, that there should be space for more niche events, but when it comes to significant government and taxpayer support, it’s a matter of business. And the business case for the grand prix has rarely left its life-support system.

Melburnians have never truly embraced the grand prix; no matter how hard it’s been pushed, no matter which celebrities have been flown in, and no matter how hard sponsors try to whip up a frenzy. There is no build up of excitement, no frenzy of media reports, no real enthusiasm in the air.

Melbourne is contracted to host the grand prix until at least 2023. When it does finally find a new home, it won’t be because of its cost or the damage it did to the environment, it will be because Melbourne didn’t care.

Should the grand prix run its final lap? Send us your thoughts at [email protected].

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Peter Fray
Peter Fray
Editor-in-chief of Crikey
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