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MELBOURNE, Australia - The 2014 Australian Grand Prix posted a record loss equivalent to R604-million thanks to soaring costs and declining revenue, state government officials reported.
The loss, subsidised by taxpayers in Victoria, the host state of the Melbourne Formula 1 race, outstrips the 2013 deficit of R504-million by more than 18%.
Louise Asher, Victoria state's major events minister, said sales revenue was down R19-million and expenditure was up R74-million.
LOSSES FOR SEVERAL YEARS
The race, traditional opener for the F1 season, has recorded an accumulated loss of R498-million over a number of years, sparking a backlash from local critics who see it as a waste of public money, but the controversy was brushed aside in August 2014 when the state's Liberal-led government signed a new five-year deal with F1's management.
Local politicians from both major parties have long justified the costs by quoting the claimed economic impact and branding effect the race had for the state. A statement released by Asher's office read: "The F1 Australian GP alone generates between 350 and 411 full-time equivalent jobs and up to R388-million in economic benefits as well as up to R348-million in media or advertising-equivalent."
Critics have strongly questioned the accuracy of those figures. Denis Napthine, head of the Victoria state government, said the terms of the new 2015-20 deal would reduce the annual burden on taxpayers.
The government also announced the 2013 Australian MotoGP held on the Phillip Island circuit near Melbourne, lost the equivalent of R112-million, nearly double the previous year's R58-million.