Olympics bill will rocket to £5m a day

Expenditure now stands at £1 million per day but will rocket as Europe's largest building project gets into full swing.

The disclosure was made during a grilling by MPs of Olympics chiefs in the first parliamentary inquiry into Games finances since the budget was tripled to £9.3 billion in March.

Senior 2012 figures told the public accounts committee the £2.7 billion fund reserved for cost overruns will almost certainly be spent in its entirety.

Officials from the Department for Culture, Media and Sport were accused of ignoring Treasury guidelines after failing to include the contingency figure in the bid budget. Jonathan Stephens, permanent secretary at the DCMS, said: "It is realistic to expect a significant amount if not all of the contingency will be required."

David Higgins, head of the Olympic Delivery Authority, said a key budget pressure would be construction inflation, now set at six per cent - or £167million - one per cent up on the bid figure.

Olympics chiefs came under further fire for apparent miscalculations in the original budget. Mr Stephens admitted pricing programme management - ensuring deadlines are met - at £16million only to increase that cost to £570 million, had been a "significant underestimate". He said the increase was due to the 2012 team choosing a different "delivery vehicle".

Conservative chairman of the committee, Edward Leigh, accused Mr Stephens of an "appalling negation of your duties as government accounting officer" in overestimating the £738 million private sector contribution to the budget, now downgraded to £165million.

Mr Leigh told Olympic chiefs: "It seems to me you have grossly underestimated entirely foreseeable costs."

Olympics chiefs have pledged to give Parliament a more detailed breakdown early next year. Meanwhile, they face "growing political pressure" to find a use for venues after 2012, according to a leaked London Development Agency memo.

The LDA, which paid about £1billion for the Olympic Park, recommends responsibility for the "legacy" is given to the Lee Valley Regional Park Authority.

No anchor tenant has been signed up for any venue. Greece spends £60million a year maintaining its 2004 Games sites.