Home Companies Industry Politics Money Opinion LoungeMultimedia Science Education Sports TechnologyConsumerSpecialsMint on Sunday

Cost of London 2012 Olympics soars

Cost of London 2012 Olympics soars
Comment E-mail Print Share
First Published: Thu, Mar 15 2007. 09 55 PM IST
Updated: Thu, Mar 15 2007. 09 55 PM IST
London: Britain’s government more than doubled the estimated cost of staging the 2012 London Olympics to 9.3 billion pounds ($18 billion) on 16 March, drawing charges of “massive financial incompetence” from an opposition party.
Sports minister Tessa Jowell’s announcement confirmed the expense of staging the Olympics would be far higher than thought when Britain was awarded the games in July 2005.
London’s bid estimated the cost of building the main Olympic sports infrastructure in east London at about 3 billion pounds and threw in another 1 billion pounds for regeneration of the dilapidated surrounding area.
Now the government is budgeting billions more for construction, security, tax and contingency funds.
Jowell said the government would stump up an extra 4.93 billion pounds to fund the games and urban regeneration and that nearly 1 billion pounds more would be needed from London taxpayers and the proceeds of Britain’s national lottery.
The new funding comes on top of the 2.38 billion pounds in London tax and lottery proceeds and 1 billion pounds from the government that were originally earmarked for the Olympics.
“The London Olympics are a project that will change Britain for the better, forever,” Jowell told parliament.
The games would bring “huge financial gain” to Britain and act as a catalyst for the most ambitious regeneration programme in recent memory, she said.
Britain has a history of delays and cost overruns for major projects such as the Millennium Dome, the centrepiece of Britain’s millennial celebrations, and Wembley stadium.
Hugh Robertson, sports spokesman for the opposition Conservative Party, slammed the government for not including value-added tax and a contingency fund in its original estimate.
“The fact that the Olympic budget has almost trebled in just a year is a sign of massive financial incompetence from the government,” he said in a statement.
“If the costs can treble in just one year ... what confidence can we have that the government will not be back asking for yet more money in years to come?,” Robertson said.
London Mayor Ken Livingstone said local taxes and transport fares would not rise to finance the Olympics.
“The Olympics will bring huge benefits to London — 40,000 new homes, record investment in transport, an unparalleled opportunity to promote our city,” he said in a statement.
The government has been under pressure from the International Olympic Committee, legislators and the public auditor to be clearer about the cost of the Games.
Fears over spiralling costs have soured the euphoria that gripped the British capital when it was awarded the Olympics.
Jowell said on Thursday that the budget for construction costs was now estimated at 5.3 billion pounds, including 3.1 billion pounds for building the main Olympic Park and other sports venues, 1.7 billion pounds for Olympic infrastructure and regeneration and 500 million pounds for a contingency fund.
The government also budgeted 388 million pounds for the Paralympics, 600 million pounds for policing, 836 million for tax and 2.25 billion for a further contingency fund.
A day after Britain won the right to hold the Games, four British Islamist suicide bombers killed 52 people on the London transport system. The capital’s police chief has said the 2012 Olympics would be a “huge target” for terrorists.
Comment E-mail Print Share
First Published: Thu, Mar 15 2007. 09 55 PM IST
More Topics: International News | Europe |