LOCOG Question New Cost Report

January 27, 2012

London 2012 chairman Sebastian Coe has disputed claims that the cost of staging the event is already over budget.

Coe moved to insist preparations for the Games remain within budget after a report claimed that costs were already in excess of £12 billion ($19 billion).

The UK government’s public sector budget for the 2012 Olympics is listed as £9.3 billion ($14.6 billion).

Coe commented, “We will maintain a balanced budget to the completion of the project and the infrastructure will be delivered within the budget that has already been agreed by government. Occasionally some things are slightly more than you expect. On a lot of occasions they’re slightly less than you expect, but overall those changes have taken place within that £9.3 billion ($14.6 billion) envelope”.

The figure of £9.3 billion ($14.6 billion), which includes all venue construction and infrastructure projects, is already almost a four-fold rise on the original £2.37 billion ($3.72 billion) sum quoted when London won the right to stage the Games in 2005.

Sky News claims that an additional £2.4 billion ($3.8 billion) has now been added to public sector spending to cater for a number of supplementary services.

These include extra anti-doping control officers, additional funds for workers to prevent a London Underground strike, governmental operational costs and legal bills over the Olympic Stadium tenancy.

Sky also contends that security costs will further swell the £12 billion figure ($19 billion). They claim police are being given £1.1 billion ($1.7 billion) in counter-terrorism funding and a £4.4 billion ($6.9 billion) budget for security and intelligence services.

Sky believe that, overall, these extra costs, together with having 12,000 police officers on duty during the Games and the £6.5 billion ($10.2 billion) sum invested in transport upgrades, could bring the total cost of the Olympics to more than £24 billion ($38 billion).

The Department for Culture, Media and Sport (DCMS) has poured scorn on the report and emphasised that it erroneously includes costs, such as policing and transport, which are needed every year in the capital not just in Olympic year.

A DCMS spokesman stated, “It is simply not right to start adding on top of that budgets that would have been in existence regardless of 2012 and claim that as being an Olympic cost.

“We have always been transparent about the cost of the Games and have rigorously managed the budget to ensure the programme remains within the £9.3 billion ($14.6 billion).

“London 2012 is an investment in our country that is already bringing in economic benefits that would otherwise not have been possible. It is an incredible opportunity for the United Kingdom – not a burden”.