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Hosting an Olympic Games – Ultimate Governance Test

July 12, 2021

Ultimate Governance Test

Kiri Parr | Director, Kiri Parr Pty Ltd

Queensland has been named as the preferred bid city of the 2032 Olympic Games.

Queensland’s bid is the first regional bid with the event hosted across Brisbane, Gold Coast, Sunshine Coast and beyond. It’s been described as the thrifty and creative games. The bid presumes extensive use of existing facilities with very few new facilities required and a promise of $7.4bn in economic benefits against a budget of $4.45bn.

Yet the public cry for more has already begun. Loudest amongst them is whether the Olympic Games demands a fast rail link connecting the Sunshine Coast, Brisbane and the Gold Coast.

But did you know that the Olympic Games share something in common with all mega projects, pandemics and earthquakes. 

They have no average level of poor performance. You simply don’t know how bad the next earthquake is going to be and there is always a chance it could be worse than every earthquake that has gone before. 

The same applies to hosting Olympic games. All Olympic games have had cost overruns, without exception. The Average cost overrun is 213% for the Summer Games. 

Some of the key reasons for these overruns include the fact that the timetable for an Olympic Games is unmovable (with the notable exception of the Tokyo games but not in a good way), the host city is obliged to carry the cost overruns whilst meeting an enormous number of standards and requirements and the long planning horizon can lead to any number of unpredictable variables emerging. For more, you can read Ben Flyvberg’s paper Six Reasons Why Olympic Costs Blow Up, Over and Over.

Risk mitigation strategy Number 1 – not to host the games – has gotten away from us.

Risk Mitigation strategy Number 2 is to mitigate the risk like crazy. 

There is no greater governance challenge before Queensland over the next decade than the one before the leaders responsible for hosting the Brisbane 2032 Olympic Games.

A conversation about the complexities Queensland might face hosting the games locally and how they could be addressed is a necessary start. Delivering a fast rail project on its own is fraught, can it be delivered successfully with the added pressure of an Olympics Games deadline is a particularly fraught scenario.

If the cost overrun risk of the Games is going to be mitigated, the governance model and team will need to be very skilled to manage the “go for gold” mentality and hold firm to the promise to deliver a cut-price games.