The forthcoming interior refurbishment of Australia’s iconic Sydney Opera House by Danish architect Jorn Utzon, who designed the exterior 40 years ago, is in crisis.

According to a report in the Sunday Telegraph plans to excavate into Sydney Harbour and slice through a concrete beam holding the building's shells together is estimated to cost £290m (AUS$700m, EUR420m, US$500m) – ten times the state government's allocation for the refit.

Financial options under consideration include funding from the federal government, bonds, private donations and setting up a special Opera House lottery. Otherwise the plans will have to be modified, shelved or even scrapped.

Currently a quarter of the seats in the Opera House have an obstructed view, the acoustics have been deemed inadequate, the orchestra pit is too cramped for the musicians, the wings are too small for the performers, and the air conditioning, electrical and mechanical systems need replacing.

David Hughes, design team leader, has said that the price tag and scope of work involved, along with the need to close the building for several years to achieve the best possible result, is presenting management problems.

Speaking to the Sunday Telegraph Hughes said: “This is a heavily utilized, iconic building on its way to World Heritage recognition, and to refurbish it for the next 50 years requires vision. Utzon has that vision but whether it’s deliverable and affordable is a really moot point.”

Utzon Architects has agreed with the Sydney Opera House Trust and Australian government to design a more colourful interior. Details: www.sydneyoperahouse.com