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Olympics pay price of efficiency as Government tries to claw back funds
Matthew Beard, Olympics Editor1 Jul 2010
The Government is hoping for £400 million cashback from the Olympic budget thanks to the smooth running of the 2012 construction project.
Ministers think the £1.2 billion contingency fund granted to the Olympic Delivery Authority is no longer necessary.
The move is being billed in Whitehall as a vote of confidence in the ODA, the Government's Olympic construction agency, and comes as the venues and infrastructure programme is almost three-quarters complete.
Ministers will argue that the cash should be reallocated to other government departments that are expected to be hit with extra Olympics costs.
Under the plan, the Home Office could receive extra funding for offering a fast-track visa service for the Games. The Foreign Office could also receive a subsidy for providing VIP escorts to visiting heads of state.
The proposals will be put to the Treasury by the Department for Culture, Media and Sport ahead of the comprehensive spending review in October. The plan is seen as a way of contributing to cross-Whitehall cuts while retaining the cash for the Olympics.
It is also intended to fend off attempts by the Treasury to order wholesale cuts to the £9.3 billion project.
Last month Olympics minister Hugh Robertson warned that more pain was inevitable as he ordered the ODA to find £27 million in cuts.
He told the Standard: “I foresee the contingency fund being less of a strictly building fund and becoming a wider contingency fund. It's difficult to say (where the cash will go) until we get the shape of the CSR. There are all sorts of things between now and 2012 that may require further investment which is probably why you need a contingency fund.”
Cash would be taken away from the ODA, which has so far allocated £800 million of its £2 billion contingency fund. It has a total budget of £8 billion.
Mr Robertson added: “It is one of the miracles of this process that we have absorbed the [effects of the recession]. There is £1.2 billion sitting in the contingency fund. There is a tranche of that which will need to be transferred to a wider project contingency.”
Reader views (5)
We are talking about a few weeks of sporting events here, we already have all the facilities,so what is the problem,stop this eyesore and its associated oddities which are being built,and lets pay off our debts!!!
- Davey_buoy, Chertsey, 01/07/2010 14:26
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It would've been better if London hadn't won the 2012 games. To cut costs is wrong. It's shameful to things "on the cheap".
- jb, sussex, 01/07/2010 12:28
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What happened to my Walnut Whip? I distinctly remember being told that the Olympics would only cost me the price of a Walnut Whip. So how many Walnut Whips will this £9.3bn be costing me now? It would be very nice if the govt cut them back to the original Walnut Whip. Do they really need more than a bit of grass marked out in white paint and some seating. We got it by accident, y'know. Can we not palm it back-off on Paris like it should have been from the start?
- Edward, Airstrip One, 01/07/2010 11:18
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Oh hands off Games!
We knew what is required to produce this event and no point moaning on about the costs....We know it would be expensive!
At this rate we just have dishevelled Boris standing in the middle waving the British flag for our opening ceremony….a sight not worth ever seeing again!
- James, London, 01/07/2010 11:14
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You might want to look under the advisory committees collective mattresses whilst you're at it too.
- Bob, Cheam, 01/07/2010 10:50
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