The Queensland Government knew months before it pulled out of the Gold Coast SuperGP that the A1GP was in financial difficulty and was unlikely to turn up — but still paid the organisation $1.8m in appearance money.

That money is still missing.

Documents uncovered in a Freedom of Information investigation by goldcoast.com.au revealed that Sports Minister Phil Reeves was told by his own department as early as July 2009 — three months before A1GP admitted they could not fulfil their contract — that the company was financially unsound.

He was warned it had cancelled races, had failed to make a profit or attract significant finance sponsorship. He was warned by a senior adviser A1GP chairman Tony Teixeira had not fulfilled ‘assurances’.

However, Mr Reeves continued to accept the word of A1GP boss Tony Teixeira, relayed by state-owned race promoter Gold Coast Motor Events Company, that the wily South African would keep to his end of the bargain.

Contacted for comment this week, Mr Reeves said that he had ‘consistently sought and was given assurances’ by SuperGP General Manager Greg Hooton that A1GP was on track for the Gold Coast.

He said that the government’s hands had been tied by the contract with A1GP until the organisation indicated it would not fulfil its half of the bargain, and had then stepped in with ‘plan B’ to save the event.

He said the government was pursuing A1GP through the courts to recover the $1.8m it was paid.

However, a goldcoast.com.au investigation has uncovered that as early as September 8 last year GCMEC supremo Terry Mackenroth told Reeves there were no ‘assurances’ A1GP would pitch up.

He refused to guarantee that the A1GP would race even when explicitly asked to do so by the Sports Minister.

In fact, goldcoast.com.au has uncovered evidence that as the A1GP deal unravelled, GCMEC officials moved to stifle important information being made public, and revealed that scepticism about A1GP being able to fulfil its obligations existed at the top level of race organisers GCMEC long before A1GP reneged.

Still Mr Reeves believed Tony Teixeira, to the point where he approved the full $11.6m funding for the event 11 days later, fully knowing Mr Teixeira would get his cut.

Our investigation revealed that in July 2009, a document prepared by a senior Sports department official advised Mr Reeves that:

• Three A1GP races had been cancelled in the previous 2008-09 series.
• Since its conception, A1GP had failed to make a profit or attract significant financing or sponsorship.
• The first A1GP franchisee, A1GP Team Great Britain, was insolvent and an administrator had been appointed to the company.
• That A1GP creditors were owed $3.2m.
• Staff had not been paid following the collapse of the company’s logistical department.

The ‘advice’ given to Mr Reeves boiled down to the fact that there was only the word of A1GP boss Tony Teixeira ‘to the media’ that A1GP was viable and that he could ’sort the finances’. Mr Reeves believed Mr Teixeira’s assurance — not once, but over and over again — despite one email from a senior adviser on September 21 warning him that ‘none of the commitments given by the A1GP chairman on last week’s teleconference have been delivered.”

Three months after Mr Reeves received his initial warning A1GP finally admitted what motor sports insiders had known for months, that it would not be coming to the Gold Coast.

In the end it was up to goldcoast.com.au to reveal on October 16 that the circus would not be coming to town.

The end came after A1GP was paid $1.8m of its $3.6m ’sanction’ fee, money the state has yet to recover.

Not surprisingly, a personal pledge by A1GP boss Tony Teixeira that he would donate $50 000 to charity for not turning up has also been dishonoured.