London 2012: Olympic security cost raises concern among MPs

 
The Olympic Stadium on 6 March 2012 The Olympic Stadium "must not become a white elephant", say MPs

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MPs have raised concerns the London 2012 Olympics may go over budget and said it was "staggering" initial estimates about security costs were so wrong.

The Public Accounts Committee's report also warned the stadium must not become a white elephant.

The government insists it is confident the event will come in under budget.

The Games and legacy projects are expected to cost about £11bn, the report said.

Margaret Hodge, who chairs the Public Accounts Committee (PAC), said: "The venues and infrastructure of the London Olympic Games are on track to be delivered on time and within budget.

The minister for sport Hugh Robertson denied any overspend

"The Olympic Delivery Authority's management of the building programme has been exemplary.

"However, the £9.3bn public sector funding package is close to being used up and we are concerned about whether the running of the Games will be held within budget.

"Taking into account costs outside the package, the full cost to the public of the Games and legacy projects is already heading for around £11bn."

'Weak negotiating position'

Mrs Hodge said the committee was "particularly concerned" about the significant increases in the security bill.

"Locog (the London organising committee) now needs more than twice the number of security guards it originally estimated and the costs have roughly doubled.

"It is staggering that the original estimates were so wrong."

Margaret Hodge, MP: 'There are question marks over whether the taxpayer is getting value for money'

The report states Locog has been forced to renegotiate its contract with G4S for venue security from a "weak negotiating position".

Mrs Hodge added: "There is a big question mark over whether it secured a good deal for the taxpayer."

Locog's original estimate for the number of security guards in and around the venues was 10,000 - a "finger in the air estimate", according to the PAC report.

The government announced in December that figure had more than doubled to 23,700.

Security costs from the Olympics budget have risen from £282m to £553m.

The report said: "Locog itself now has almost no contingency left to meet further costs, even though it has done well in its revenue generation."

On legacy, the PAC report raises concerns over sports participation targets and the stadium after a deal for West Ham United Football Club to take it over was scrapped.

Start Quote

Most people will look at all this and find it meaningless to quibble over which department is spending what on the Olympics”

End Quote David Bond BBC Sports Editor

Mrs Hodge added: "We were promised a strong Olympic legacy but the government has chosen not to adopt the target of one million more people participating in sport by 2013 and plans for the stadium have fallen through.

"It must not become a white elephant.

Legacy 'unclear'

"The government is dispersing responsibility for delivering the legacy and we need clarity about who is accountable."

The report states that with only 109,000 new people regularly participating in sport against the original one million target - which the new government chose not to adopt - the Department for Culture, Media and Sport (DCMS) had got "poor value for money" for the £450m spent through national governing bodies.

"It is unclear what the sporting participation legacy of the Games is intended to be," says the report.

The DCMS rejected the figure of £11bn of public money being spent on the Games and defended the legacy aims.

London 2012 - One extraordinary year

London 2012 One extraordinary year graphic

A DCMS spokesman said: "With 140 days to go until the Olympic Games, we are on time and under budget, with over £500m worth of uncommitted contingency remaining.

"We are in a strong position and, while we can't be complacent, are confident that we can deliver the Games under budget.

"As we told the PAC in December we do not recognise the figure of £11bn. We have always been transparent about what is included in the £9.3bn.

"The cost of purchasing the Olympic Park land will ultimately come back to the public purse through the resale of the land after the Games and was therefore not included.

"Funding for the legacy programmes, that the PAC refer to, comes from existing business-as-usual budgets and we have been clear about this. These are for projects designed to capitalise on hosting London 2012 but are not an additional Olympic cost."

The DCMS said the legacy included regenerating part of east London and tenants had been secured for six out of eight venues on the Olympic Park.

 

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  • rate this
    0

    Comment number 251.

    I am just amazed that people are surprised by this. When we secured the Olympics I think we all knew that most ordinary British citizens would not be able to get tickets. We also knew that it would probably end up over budget and that security would be a real issue at an international event held in the UK. I was not in favour of hosting the Olympics, but now we must make the best of it.

  • rate this
    +5

    Comment number 217.

    How much more is this going to cost us - the taxpayer- so that we can be inundated on tv watching people run around a track. The price is staggering and still rising. Why oh why did France not get it. France must now be very very happy that they did not win the prize.£9.3 billion - how many people have been put on the dole to pay the way for some athletes to strut their stuff.

  • rate this
    +25

    Comment number 148.

    £9.3 billion (gasp!) - that is money that could have been used to reduce the deficit in this country/prevent frontline job cuts and etc etc. Sigh! The beauty is after all that money the govt spent on the Olympics, the ordinaary man in this country is priced out from even attending it. Classic.

  • rate this
    +10

    Comment number 147.

    The original estimate for the olympics was £2.4 billion, now the government says it will come in on budget at £9.6 billion! They insult all of us by playing with words while spending our money. Think what this sum could have been used for in a true economic fashion rather than this charade.

  • rate this
    -9

    Comment number 126.

    So £9.3bn gets spent. It goes to firms who employ workers who spend it. They create work for others. Money circulates, the faster it circulates the stronger becomes the economy. At least on the Olympics we get visitors who spend lots of money too as well as a wonderful sports spectacle. There are many worse projects to have spent money on than this one.

 

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