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Eden Park will be the venue for the final of the 2011 Rugby World Cup after Cabinet today abandoned its preferred waterfront site in the face of Auckland opposition.

Sports Minister Trevor Mallard said North Harbour Stadium would be the back-up option if unforeseen problems emerged with the Eden Park redevelopment.

Mr Mallard, the minister in charge of the Rugby World Cup, said he was "disappointed" the Government's preferred waterfront stadium was not going ahead as this had been a chance to do something different.

>>Read Eden Park's plans

Mr Mallard has said previously that Eden Park would be a "poor second option" which showed Auckland lacked vision.

"I think the people now should just focus on going forward and to having a wonderful Rugby World Cup, having a stadium which can be used for other things as well and having one which is probably better designed as a result of this process," he said today.

Last Thursday, Auckland City Council voted 12-8 in favour of a new stadium on the waterfront -- although in a different spot to the site suggested by the Government -- and on Friday morning Auckland Regional council voted 12-0 in favour of developing Eden Park.

Mr Mallard put forward two options to Cabinet today including getting a working party to further evaluate "Auckland City Council's interest in a Bledisloe Wharf site".

But Cabinet opted for the second -- the redevelopment of Eden Park, subject to resolution of design, funding and governance issues.

Mr Mallard said Cabinet had in August decided to explore the alternatives after the cost of redeveloping Eden Park into a 60,000-seat stadium went from around $150m, when the bid to host the World Cup was won, to an estimated $320m.

Its redevelopment was now expected to cost around $385m although final costings would not be available until around June next year once more design work was done.

A Cabinet paper said the Eden Park Trust Board would provide $60m -- made up of $17.5m debt and $42.5m from non-public sector sources for instance corporate box and membership sales.

The trust board expected central Government "and related sources" to provide $175m.

"Some uncertainty" sat with the figures, particularly the trust board's ability to service the level of debt and the actual contribution Auckland City Council would make, the Cabinet paper said.

There was no allowance for a contribution from Auckland Regional Council and no undertaking to meet any shortfall, it said.

Mr Mallard said he understood the Auckland City Council had put aside $50m for the stadium proposal.

"I'm still waiting to hear from the ARC the level of their contribution towards their favoured solution."

The trust board is also forecasting $20m from trust grants, $30m from Rugby New Zealand 2011 and $50m from the Lotteries Commission.

Mr Mallard could give no commitment that ratepayers would not be hit up to pay for the stadium.

Bed and airport taxes would not be used to fund the project because the feedback from the tourism industry had been that such levies would not be welcomed, Mr Mallard said.

The Eden Park Trust Board is a private trust and there would have to be governance changes before the Government could put money into it.

The board has proposed several options including a new eight-member board with two appointed by the trust board and six appointed by the Government.

The trust board had said it could get resource consents under the Resource Management Act for the redevelopment.

If anything needed to be done with North Harbour, building work could start as late as 2008 and still be completed in time.

Eden Park chief executive John Alexander said the decision to go with the Eden Park redevelopment was the "right one for Auckland and for New Zealand".

Green MP Keith Locke and ACT leader Rodney Hide also applauded the decision as a great victory for the people of Auckland.