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£9.3 budget will be enough, insists Jowell
Ross Lydall and Pippa Crerar, Evening Standard10.12.07
THE cost of constructing the London Olympics
could come in about £1 billion under budget, the
Government said today.
But the total cost is likely to remain at £9.325 billion because of the increasing costs of security and unforeseen events. The most detailed analysis of the capital's 2012 costs was published today following concerns raised by spending watchdogs this summer.
Experts at the Department for Culture, Media and Sport found there was an 80 per cent chance that the Olympic Delivery Authority, which is building the Games venues in Stratford, would spend only £7 billion of its £8.1 billion allocation. But the additional £1.2 billion set aside for security, the Paralympics and elite and community sports may yet need to be boosted with any savings made by the ODA.
Olympics Minister Tessa Jowell, in a written statement to Parliament, said that there had been a "thorough assessment" of all potential risks and it had been found that the budget was "consistent" with the package she outlined to MPs in March.
She said: "Months of careful scrutiny have confirmed that the ODA has the money it needs to deliver the venues and infrastructure for a terrific summer of sport."
A total of £1.2 billion has already been set aside for security in the Olympic Park and for policing during the Games. This includes a contingency of £238 million. Today it emerged all the ODA's initial £500 million contingency has been drawn to allow it to start awarding contracts - some £1 billion of work has been commissioned already with all major contracts due to be awarded by next summer.
The official breakdown shows £1.171 billion will be spent on venues - £496 million on the main stadium, £574 million on other facilities such as the aquatic centre and cycling velodrome, and £101 million on facilities outside Stratford such as the white-water canoeing venue earmarked for Hertfordshire. Some £897 million is going on transport, £1.942 billion on preparation of the 500-acre Stratford site and associated infrastructure, and £868 million on other projects in the Olympic Park. There is also a second contingency fund of just over £2 billion.
Today's figures provide the fullest financial detail released by the Government, though precise amounts for some projects have been withheld to protect the ODA's finances and to ensure commercial confidentiality.
The budget excludes the £2 billion being raised through ticket sales, merchandising and TV rights by London 2012. It also excludes the £1 billion plus incurred by the Mayor's London Development Agency.
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Reader views (5)
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Remember it's not just Londoners that are being ripped off by the almost-four-times-over-original- estimate budget. The Heritage Lottery Fund has been diverted into this project too. It means that grants for thousands of small heritage and community projects are being axed (I am aware of several in my own area right now that won't get their funding). And all to feed this huge white elephant... oh, and to make a lot of people very, very rich indeed off the backs of us all.
- Carolyn, London, UK
Is anyone really naive enough to believe this rubbish about staying within a budget? There are two very good reasons to support this view - first it is a Government project when all is said and done and they will just spend money, second it is a building project and they never run to time or budget either.
- Roger, England
I would think that seeing as they have a £1billion contingency budget, it is almost certain that a lot of these money grabbers will have already found a way to siphon off this money.
- David Kitemaker-Hall, London, UK
