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Geoff: I've been a member of the Audit and Risk Committee of the City of Gold Coast for the past two years, and that's a committee that comprises both the executive and key council members. So, individuals that understand what's happening and needed within the community. The executive needs to drive the right outcomes, drive what is effectively a AUD16 billion business.
My role as part of the committee is governance – risk and oversight. When you've got to deliver infrastructure, assets, community planning, and bringing Environmental Social Governance (ESG) into the equation, bringing sustainability into the equation, the role of the committee is providing an oversight, prioritising the right people and the right initiatives for the right outcomes.
With the 2032 Brisbane Games coming up, that's obviously a key part of it. They're very concerned with making sure that the outcomes are aligned to what the community is expecting and it's well aligned to the infrastructure that's already in place and needs to be built. There's a lot that needs to be converted, having successfully delivered the Commonwealth Games in 2018. So, the infrastructure is already there. It's a question of how do we repurpose that? How do you align that? How do you convert that to the existing standards?
The Climate Change Adaptation Plan is in place and one of the big components that need to be considered as part of these Games is there's 57 kilometers of coastline, which is quite unique in that environment. For that to be effective, climate adaptation is a key component. Sustainability is a big driver. So, if you’re building the infrastructure, you're designing the infrastructure, there's a lot that needs to be considered from a design perspective. What are the options we need to look at? And then how do you effectively design change? It's going to take a long time to get that right. So, the earlier we get on to that is probably going to be the better outcome.
Geoff: For this project, and it is probably a programme of projects, to be successful, we've got to see it as a mega-project. Probably the biggest insight you can start thinking about right now is if you look back at the Sydney Games back in 2000, that cost AUD6.91 billion. The budget overspend was about 90 per cent. If you look at the Rio Games, fast forward 16 years later, that cost nearly AUD19 billion, and the cost per athlete was about AUD1.8 million – a 350 per cent overspend. That had some particular challenges.
If we have a look at the Sochi games in 2014, that was probably the worst-case scenario. AUD30 billion was the cost, a 289 per cent overspend and the cost per athlete was a staggering nearly AUD11 million.
There are a lot of lessons learned from each of these, and we need to make sure that's properly understood, to fully understand what's coming at us. If you look at what's unique about the 2032 Brisbane Games it’s that these have got to be sustainable, which is very different – a very different profile, aspect, and expectation. Plus, we've had COVID lockdowns, and we've got a world supply chain crisis that's happening at the moment. We're looking at projects that are already doubling in costs, potentially tripling. We're looking at costs of steel, which is over 40 per cent more than what we expected at the start.
We also have other projects that are competing in the Southeast corner of Queensland. Queensland Health is spending AUD15 billion on new projects, three brand new hospitals, including one at the Gold Coast. That's AUD1.5 billion. So, there's a lot of competing projects with only so many Tier 1 builders; a lot that needs to be considered from a macroeconomic perspective.
For us to really get this right we need to understand what drives people, what drives projects, and what drives performance. Unfortunately, a lot of the participants in these projects, in this programme, often overestimate costs. They underestimate the impact of environmental challenges, and they also overestimate the benefits that actually really has. So, for us to start playing together, getting the transparency right, we need to get risk management right, from the outset. And that also starts driving behaviours. So, including how do we risk share and what are the options we could potentially be putting in place to start sharing that load. And that includes contracts.
We have ten years to prepare, which is probably two years more than what we've had in any other Olympic Games, but there's a lot more for us to look at as part of that. So, in reality, we have 3,444 days left. Let's make that count.
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Director, Risk & Resilience – QLD, Australia