THE AFL underestimated the cost of expansion clubs Gold Coast and Greater Western Sydney despite warnings they would blow out, according to former AFL Commissioner Bill Kelty.
Kelty told AFL.com.au the League had made "brave decisions" introducing the fledgling northern clubs to the competition but had hoped to keep the investments from broadening.
He conceded the League was cautioned by former Commissioner Ron Evans to be prepared to spend over its initial projections.
He also said the AFL had overlooked traditional clubs as they focused on establishing the new franchises.
"These are big investments, $100 million each. They are going to drain. You can pretend they're not, and say no, it doesn't happen. But they're a lot more than we originally budgeted for. They're $100 million, they were always going to be $100 million," Kelty said.
"On the very first day we talked about it, Ron Evans said 'Don’t contemplate this unless you are prepared to invest $100 million each team'.
"We thought we could do it on [the] cheap, on margin, on marginal costs. But they're $100 million, so of course it was a priority."
Gold Coast has come under sharp focus this year as it struggles at the bottom of the ladder and faces questions about its culture after allegations of illicit drug use by Suns players.
The club was registered as a business by the League in 2007, and fielded a team in the TAC Cup in 2009. In the middle of 2010 the AFL handed over the business to the Suns before they played their first game in 2011.
The Giants were registered as the competition's 18th club in 2008 and they made their debut in the AFL in 2012.
Neither club is forced by the AFL to release its financial results.
Kelty, who departed the Commission in February after 17 years, is heading a national review of the game at second-tier, under-18 and community levels.
He said the League didn't do enough with the last major report of grassroots football, which was chaired by former commissioner and current Geelong president Colin Carter in 2001.
He also suggested the AFL could not grow content with its place in the pecking order of sports in Australia, saying soccer remained a legitimate threat.
"I think the biggest risk for AFL football is complacency. That is [thinking] we're very, very good, we've got a high level of support, generate a lot of income, generate a good TV deal," Kelty said.
"What hurts you over time is [when] you don't have women involved to the same certain extent, [and when] you missed a whole part of the population, [because] it's an older game and more older people like the game.
"So suddenly, the underlying demography gets away from you. And when that gets away from you, one big change then starts to hurt you. A super soccer team that gets in the top six in the world suddenly hurts you.
"I don't think bringing Real Madrid and these other teams here really hurts us, because it's entertainment. But what really hurts you is if you've got a super Australian soccer team in the top six in the world, in terms of men and women, then people are really interested in it and the kids want to play it and the players get super paid."
The Australian women's soccer team, the Matildas, last week reached the quarter-final of the women's World Cup in Canada and are now ranked 10th in the world.
Part of Kelty's comprehensive agenda includes growing women's involvement in the game, with the AFL understood to be keen to introduce a national women's league by 2017.