Ecclestone: Australia “shouldn’t complain” about fee

2013 F1 season

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Bernie Ecclestone says the Australian Grand Prix organisers “shouldn’t complain” about the cost of holding their race.

The cost of the Melbourne race, which is paid for by the government of Victoria, is often a focus of debate in run-up to the Grand Prix.

Yesterday the Herald Sun newspaper leaked details of how much Formula One Management receive from the race. It claimed to have seen documents from 2010 which showed its current five-year deal, which ends in 2015, cost $171 (108m) in total.

The fee for the 2011 race was $31m, which rises by around 5% every year and should reach $37.7m in 2015.

Speaking to The Age today Ecclestone refused to confirm the figures due to confidentiality clauses but he did say the fee was not enough to cover the teams’ costs:

“That race probably costs the teams probably something like 17 million, 18 million maybe, something like that,” he said. “The money [paid] to the teams nowhere near covers the cost of that. The teams are subsidised by the sponsors.”

Asked whether Australia should retain its race Ecclestone said: “Well it’s up to them isn’t it? It’s up to the people who are responsible. I can’t make them sign a contract, they do it of their own free will. They shouldn’t complain after they sign.

“Most of the people I think, or the same person I’ve been dealing with, Mr [Ron] Walker, for years – he looks over 21, in fact I know he is. And I think he should know what he’s doing.”

Ecclestone added he was hoping to be at this year’s Grand Prix: “They put a good race on”.

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Keith Collantine
Lifelong motor sport fan Keith set up RaceFans in 2005 - when it was originally called F1 Fanatic. Having previously worked as a motoring...

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24 comments on “Ecclestone: Australia “shouldn’t complain” about fee”

  1. What’s wrong with the Australians? Nobody else is complaining.

    1. What’s wrong with the Australians?

      Nothing. It’s just our media pushing an agenda. The newspapers don’t like the Grand Prix, or what it represents. They know that taken on its own, the phrase “it costs Victorian taxpayers $30 million to host the Grand Prix” is enough to get blood boiling with the average man on the street. Never mind that that figure represents just a fraction of the state government’s budget, or the economic benefits that the race brings to Melbourne: journalists and their editors know that they can stir up controversy by talking about the cost of the Grand Prix.

      1. Well said.

    2. Chris (@tophercheese21)
      24th January 2013, 12:40

      Do not assume that just because a few media outlets stir up the financial debate every year, that all “the Australians” are complaining about it. I find that a little insulting that you think there’s something wrong with us.

      1. vuelve kowalsky
        24th January 2013, 18:03

        somebody said once that money and sex move the world. In this case it’s money and politics.

    3. Guys, be aware this guy, I think he is employing sarcasm. :D

  2. just typical tabloid moaning about what the government is spending taxpayer money on. All the feedback suggests that the Ozzie GP is very popular, always well attended, and is a great thing for the host city. And, as an added bonus, it’s not being used to draw attention away from huge violations of human rights, or to maintain the power of a malevolent dictator.

    It’s expensive, but there doesn’t seem to be any reason to assume that it’s significantly more than others pay. In fact I’m willing to bet there are others who pay far more. As Bernie says, you can’t make a deal and then moan about it after. If I go into a shop and spend a hundred quid on some awesome new Nike Air trainers, I’d be a bit of a fool if I then went back after two weeks of looking like a boss, and moaned that I’d paid more than I wanted to. What’s the problem? I paid my money and got some sweet Nikes. End of the day, they paid their money and they got to host the race – everyone has upheld their ends of the deal. It’s not even like it’s a giant amount of money in the scheme of things.

    It’s not like they made a deal to host a race and then the organisers turned up with timing equipment which didn’t work, and failed to deliver the TV coverage to several major markets…

    1. @mazdachris I agree that the event is a popular one, and the newspaper articles of recent days aren’t necessarily reflective of broader community enthusiasm for the GP.

      However, I don’t think your analogy is a good one. No one is seriously suggesting that the State Government break the existing contract – it is going to be honoured. What is being debated is whether the contract should be renewed post 2015.

      I think that the contract will be renewed (assuming the hosting fee can be agreed) and the public subsidy will continue, after the benefits to the city and state are weighed up against the costs. However, it is right and proper in any democracy that this be the subject of open debate. I don’t agree with those who say the contract should not be renewed, but I endorse their right to say it.

  3. Teams are having trouble getting their ever-growing budgets together and are taking paydrivers to survive. Meanwhile Bernie gets 30-40 million times 20 races + television fees + etc. F1 goes PayTV which in turn gives team less viewers and less coverage for spornsors. A deathspiral?

    1. Did you read the article @f1lauri ? If you do you will that the fees go to the teams to cover the costs of the race to them. Sure there is some profit but you shouldn’t do such simplified calculations, this sport doesn’t work that way!

      1. Yes. The thing is I don’t believe it (my problem). Unfortunately the Concorde agreement is secretive so we don’t have any clue what’s really going on. At least so I’ve only heard about TV rights money being shared with teams. Has this changed now?

        Ok, it’s pointless to argue about other peoples’ money. And seems that teams are happy enough to have all agreed with new deals so… but I personally still have a bit bitter taste.

          1. @danbrown180

            The link doesn’t seem to work. Would you be able to private message it to me. I’d quite like to see an agreement of this magnitude. Thanks.

  4. It’s completely normal that taxpayers and newspapers in democratic countries care about how the public money is being spent and that there are open discussions about it. Yes, there is probably more turmoil around the Australian GP costs than around other races but would we feel better if they had just silently dropped the race like Valencia did?

    For sure, F1 races are always good for the hosting countries but these are mostly indirect gains that you cannot measure exactly so, if the hosting fee costs tens of millions of dollars, then the question ‘Is it really worth it?’ will be inevitable. If FOM doesn’t listen to the objections, there will be more and more ‘Bahrain’ GPs on the calendar because people in countries such as Bahrain don’t complain about high costs and, if they do, they get visited by ‘the silent majority‘.

    1. Well said @girts. Unsurprisingly, I’m a fan of the Australian GP and hope/expect it will continue after 2014, but at the end of the day the event is substantially subsidised by the taxpayers. It’s the sign of a healthy democracy that the merits of the subsidy are the subject of free debate.

  5. If a proportion of the fee goes to the teams, shouldn’t it have a clause that allows for recalculation upon a team pulling out, such as HRT. With fewer teams to divide money between surely the price should be reduced accordingly to reflect this. A minor detail I will agree, but it’s still something that should be taken into consideration.

    Also, can somebody explain the main purpose of the somewhat ruthless 5% anual increase in the fee? Inflation isn’t that much each year.

    1. Unless of course the contract says a certain perventage goes to the comepting teams, that would prevent this issue. Would just mean the present teams got a bit more this year. Probably just answered my own first point.

  6. Funny how we never hear any complaints about a certain tennis championship going on at the moment in that fair city. That spent initially over 500 Million to build the stadiums and outside courts, in todays terms ?????. That costs xx millions to maintain and xx millions to put on each year.

    1. @w-k
      Exactly. But I think that it’s a lot easier to make F1 look bad, because everything it stands for shouts ‘money’. Endless car development, front wings which costs more then the average car. Super star drivers, supported by industry giants. Cars that drink fuel like Kimi Raikönnen drinks Vodka. A track which takes up the public roads and so on.
      Tennis on the other hand is mostly just a couple players running on energy drinks and apples. When watching a tennis match it just doesn’t appear very expensive. Regardless of what it actually costs the local government it will always be easier to make people believe that F1 is THE money drain, where tax payers waste their hard earned dollars to get a show for a few car enthusiasts and nerdy mates.

  7. Agree with much of what everyone is saying here. There is the cost that BE demands, but then there is the economic benefit to the community and the country to consider, on the other side of the coin.

    That said, looking here in Canada as an example…we almost lost the Montreal GP (and did briefly) because BE wanted a guarantee (from our Federal Government, in conjunction with the Provincial and Municipal Governments of Quebec and Montreal) of 50 mill per year for 5 years…and the Government(s) were having none of it. Just too much money, in spite of the economic benefits. In our case there was enough pressure from the teams, who insisted they needed the Canadian GP, and perhaps more specifically a North American race when there was no US GP, such that BE lowered his demands, Canada accepted the new fees (I think somewhere in the neighbourhood of 25 to 30 per year rather than 50) and here we are today with a race (for now). Perhaps the status of the race and/or BE’s demands will change when it comes up again, due to the fact that there is now another race in North America. But we do know Montreal is hugely popular for folks globally, within and without F1. And we do know there is pressure for Montreal to update it’s venue too.

    Personally, it seems to me the benefits to the community far outweigh the moneys that BE demands be guaranteed him. Nobody puts a gun to anyone’s head to sign a contract and guarantee the fees, and as we saw in Montreal, just because BE demands it, doesn’t mean he always gets his way entirely.

  8. ”..the same person I’ve been dealing with, Mr [Ron] Walker, for years – he looks over 21, in fact I know he is. And I think he should know what he’s doing.” – Bernie Ecclestone.

    What a figure! He surely will be missed when he eventually goes from the sport, if nothing else, for his utterances.

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