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Australian Open organisers have reached a deal with the local state government to redevelop the facilities at Melbourne Park to ensure the grand slam remains at its current site.

Melbourne Park had a contract to host the first grand slam of the year until 2016 but tennis and government officials unveiled plans Monday to keep it there permanently.

The Victoria state government said the plans include increasing the seating capacity on the showcourts, building a roof over the Margaret Court Arena, a massive undercover courtyard for spectators and improving player and media facilities.

"It is the biggest event by far of any event which is held around Australia and we need to keep it post-2016 because the world is a more competitive place," Victoria state premier told reporters Monday.

Tennis Australia president Geoff Pollard said he hoped the redevelopments would also end the annual argument about the timing of the event.

The scheduling of the Australian Open has always been a sensitive issue. Local organisers like to run it in January during school holidays to attract bigger crowds.

But players have been calling for the event to be moved back to February or March when the weather is cooler and so they can have a longer off-season.

"I think most of the players now have realised that (the Open) has been a success in January," Pollard said.

"Sure, it's early in the year. My personal view is the (tour tennis) year finishes too late.

"The U.S. Open (in August-September) is the end of the tennis year and it drags on for too long (afterwards), so it's not quite as early as some people might think."

The Australian Open has become the centre of a tug of war between the country's two most populated states after New South Wales announced plans to poach the event from Victoria.

Although the tournament has been shared between Melbourne, Sydney, Adelaide, Brisbane, Perth and even New Zealand since it's inception in 1905, it has been played continually at Melbourne Park since 1988.

(Source: Reuters)