Australian GP in doubt with rising costs to taxpayers

The increasing costs to the Australian taxpayer has again placed the Melbourne Formula One Grand Prix. The Victoria state government announced the 2011 edition cost Melbourne taxpayers $US54 million.

The current contract for the Australian race runs until 2015 and Victoria Tourism Minister Louise Asher said the state government could only guarantee its support of the Australian GP that time.

The minister said “This is a very, very large taxpayer subsidy about which I am not comfortable,” Asher told reporters.

Asher said the fee paid to Ecclestone by the Australian Grand Prix Corporation for the right to host the race, reportedly to be at least $US27 million which is one of the largest single financial demands on the event paid to Bernie Ecclestone, the CEO of Formula One.

Figures released on Friday revealed an almost nine-fold increase in the taxpayer contribution to the Grand Prix since 2001 under the contract negotiated by the previous state Labor government.

Figures also show that Melbourne’s 16 Grand Prixs have been propped up by a total of more than $US 325 million in public funds. Previously it was round was ran in Adelaide

Against the $US54 million taxpayer-funded shortfall is an annual return to the Victorian state’s economy of between $US34 million and $US 42 million, according to an economic impact study.