F1 Pitlane Tales: Australian GP posts record financial loss

The 2014 Australian Grand Prix posted a record A$59.97 million ($55 million) loss amid soaring costs and declining revenue, government officials said on Wednesday.

The loss, subsidised by taxpayers in Victoria, the host state of the Melbourne Formula One race, outstrips last year's deficit of A$50.7 million by over 18 percent.

Sales revenue was down A$2 million while expenditure was up A$7.5 million, Victoria's Major Events minister Louise Asher told reporters.

The race, which has traditionally opened the F1 season, has recorded A$50 million-plus losses for a number of years, sparking a backlash from local critics who see it as a waste of public money.

The controversy was brushed aside last month, however, when the state's Liberal-led government inked a new five-year deal with Formula One management to keep the race in Melbourne until 2020.

Local politicians from both major parties have long justified the costs on the claimed economic impact and branding effect the race has for the state.

"The Formula 1 Australian Grand Prix alone generates between 351 and 411 full-time equivalent jobs and up to A$39 million in economic benefits as well as up to A$35 million in media or advertising-equivalent," a statement released by Asher's office said.

Critics have strongly questioned the accuracy of those figures.

Denis Napthine, the head of the Victoria 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 at Phillip Island circuit near Melbourne had posted a loss of A$11.27 million, nearly double the previous year's A$5.9 million.