V8 Supercar racing will continue in Queensland thanks to a new three-year funding deal but the state government is believed to have slashed the amount it provides.

A new deal will be announced later on Monday, ensuring the future of the races in Townsville, Ipswich and on the Gold Coast until 2016.

It’s believed the new deal will cut collective government funding for the three events from $9.3 million to $7.3 million, with the Gold Coast event copping the brunt of the reduction.

Reports before the release of this year’s state budget in June suggested the future of the Surfers Paradise street race was in doubt as the government sought to cut costs.

While the Townsville and Ipswich races, which received $3 million and $300,000 in government funds respectively, were always likely to continue the decline of the once-iconic Gold Coast event left its future up in air.

Operating since 1991, the Gold Coast race was one of the highlights of the Queensland events calendar during its heyday from the mid-1990s to the early 2000s when it was run in conjunction with an American IndyCar series event.

Since IndyCars stopped coming to Australia in 2008 the event has struggled to justify its estimated $6 million in government funds as a stand-alone V8 Supercars event.

Queensland Events Minister Jann Stuckey said she could not reveal the level of funding under the new deal.

“The funding amount for these combined events in our new negotiations can’t be disclosed because of our contractual arrangements,” Ms Stuckey told ABC Radio.

“I can say though we can expect a lot more excitement around this event, with a refreshed look and other events planned that involve our community.”

V8 Supercars have already announced plans to turn the event into a week-long festival featuring parades, concerts and a Miss V8 Supercar beauty pageant in the days before the October 25-27 motorsports event.

It’s believed the Gold Coast event brings up to $45 million into the local economy.