Olympic chiefs today insisted it would be "fundamentally wrong" to demolish the main 2012 stadium after the Games to make way for a Premiership football club.

The prospect of bulldozing the £500 million venue has emerged amid concerns it may become a white elephant.

Games bosses have failed to sign up a sports team to move into the stadium when it is reduced in capacity after the Games from an 80,000 to a 25,000-seat venue, mainly for athletics.

But today John Armitt, chairman of the Olympic Delivery Authority, ruled out a demolition job. Speaking at a fringe meeting of the Conservative Party conference he also closed off any move to the Stratford site by football clubs West Ham or Tottenham Hotspur, saying building was already too advanced to make design changes such as installing temporary seats over the running track.

He said: "I think at the moment there is no prospect of the venue becoming home to a Premiership club and you don't seriously just knock it down and not meet the obligations to athletics bodies.

"People complain that we are taking an 80,000-seat stadium and reducing it to 25,000 and that it's a waste of money.

"We are very consciously taking it back to a size that will be used by football or rugby but not Premiership football. The prospect of demolishing something that has been built for the Olympics on that scale is fundamentally wrong." Insiders believe a new purpose-built stadium would be reliant on a billionaire foreign investor and cost £400 million.

It is thought speculation about demolition may have been prompted by West Ham Football Club, which is unhappy with the Parcelforce site adjacent to the Olympic Park that it has been offered by the London Mayor as an alternative to its Upton Park ground.

Boris Johnson publicly supports the plan for the stadium and athletics venue but he remains concerned about its long-term viability and insiders at the London Development Agency admit that demolition may be a last resort.

Escalating security costs will drive the budget for the 2012 Games over the £10 billion mark, it has been claimed. Anti-terrorism measures will push the security cost to an estimated £1.5 billion, nearly three times the original estimate, according to insiders.

The claim comes amid delays over a full security plan being devised by the Home Office and the Met. The two-week event is classed as a major terrorist target. If the security bill reaches £1.5 billion it would break pledges from Olympics minister Tessa Jowell and London Mayor Boris Johnson that the overall budget will not top £9.3 billion.