MOTORSPORT: GP Melbourne's till 2023 – at a price

Just months after extending its contract to stage a Formula 1 grand prix until 2020, the Victorian government has signed up for a further three years – but it still won't say how much it is paying.

"We will not be giving to all our competitors the number that they have to beat," Victorian premier Daniel Andrews has said.

In the latest round of one-upmanship with New South Wales' Liberal premier Mike Baird, Labor man Andrews chose Facebook on Saturday night to announce the latest three-year extension of the contract for the annual season-opening F1 race at Melbourne's Albert Park.

Andrews told the press on Sunday morning that there was a very competitive environment to secure the race's future and that, having done that, his government would not be revealing the cost.

Successive Victorian governments of both political persuasions, and the Australian Grand Prix Corporation that runs the event, have always claimed commercial confidentiality for not disclosing the fee paid to host the state's round of the F1 world championship.

However, the 84-year-old London-based F1 supremo Bernie Ecclestone's favoured journalist recently put a precise figure on Melbourne's GP contract.

In an article on the website of American business magazine Forbes 3½ months ago, Christian Sylt wrote that Melbourne's race fees, from its first event in 1996 until 2020, were "expected to generate a total of US$712 million for F1".

At today's exchange rate that amount tops A$1 billion, an average of A$40 million a year over the GP's quarter of a century in the Victorian capital, and now there are another three years on the contract.

Sylt reports regularly on the business of F1 and has frequent access to Ecclestone, who knows its workings best – he pulls most of the strings – and is seen to favour Sylt with information, much to the chagrin of some other correspondents.

Sylt wrote in the Forbes article on May 31 that the revenue from the Melbourne contract totalled the most for any GP and was second among deals Ecclestone has done for F1 only to that for US$1.4 billion with Germany's RTL to telecast the races in the world championship each year.

Newer races than Melbourne's in the Middle East and Asia are known to pay more than the Victorian government, but the totals are not as high yet because they have not been part of the championship as long.

Monaco, the crown jewel in the F1 world championship, does not pay any fee, while Italy's Autodromo Nazionale, which has staged that country's GP 65 times at Monza, is now being squeezed to fork out more to retain its race.

Melbourne snatched the Australian GP from Adelaide, where it was held from 1985 until 1995.

During this year's NSW election campaign Baird proclaimed that he was going to do all he could to lure the GP to Sydney.

But, not only did Melbourne renew its deal with Ecclestone's F1 empire – officially a company called Delta Topco based on the island of Jersey and in which private equity company CVC is the biggest shareholder with 35 per cent – but it has now stretched it further.

"NSW desperately wanted it," Victoria's Andrews said on Sunday.

"There are other states in Australia who are interested, other countries in our region that would do almost anything to have this race in their city.

"It is not our practice and we will not be giving to all our competitors the number that they have to beat."

In the 50-second video he posted on Facebook on Saturday night Andrews said: "I'm sorry Mike [Baird] but the Australian Formula One Grand Prix is here to stay exactly where it belongs, in the great city of Melbourne.

"The good news is that you and tens of thousands of others from NSW and right across Australia, and indeed right across the world, are more than welcome to come to Melbourne to be part of the great race.

"In fact, I'll even shout you a ticket."

Andrews insisted to the press on Sunday that the GP, which has operated at annual losses of about A$60 million in recent years, was "very good value for money" and was "about keeping people in work".

Andrews said recent data showed an economic benefit of about A$40 million a year and the event generated invaluable international exposure.

However, the Save Albert Park group – which has campaigned since news of the GP's switch from Adelaide to Melbourne for the event to be held on a permanent track rather than the temporary street circuit a couple of kilometres from the Victorian capital's CBD – said every major claim made about the GP was false.

"Premier Andrews has failed to demonstrate why he chose to prop up Melbourne's only unsuccessful major event," SAP said.

"Victorians [as taxpayers] are paying for this economic disaster because successive governments have used false and misleading claims to justify it.

"Continuing to stage this event ... will cost hundreds of millions of dollars that could be spent on education, health and public transport."

While GP race promoters invariably lose money on staging races and perhaps as many as seven of the 10 participating teams face financial difficulties, Sylt mentioned in a report for London's Telegraph newspaper on September 8 that CVC had made US$4.4 billion from dividends and selling some of its stake in F1 since it bought a majority share in 2005.

It stands to reap several billion dollars more if the business is floated on the stock market or any of several touted takeover offers from sovereign wealth funds and media moguls proceed.