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Cash row blights 2012 build-up

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David Bond | 10:41 UK time, Thursday, 10 March 2011

For London 2012, the row with the British Olympic Association is an unwanted distraction at a crucial time.

Next Tuesday is 500 days to go to the start of the Games and all the attention should have been on the first public offering of tickets.

Instead, Lord Coe's organising committee (Locog) found themselves embroiled in an unseemly public spat with the BOA after the BBC broke the news of their extraordinary and unprecedented decision to take a row over money to the International Olympic Committee.

Numerous sources I spoke to on Wednesday expressed disbelief at the stance being adopted by BOA chairman Lord Moynihan. Tessa Jowell, the shadow Olympics minister - and the minister in charge at the time of London's successful bid - described it as "pugnacious" and called on the BOA to resolve the dispute quickly to avoid destabilising the happy London 2012 consensus.

The IOC is expected to come out in favour of Lord Coe

Even the measured PR machine at Locog issued a testy statement expressing sadness at the BOA's tactics. In fact, it was hard to find a voice outside the BOA's plush new offices on Charlotte Street who had a good word to say about the BOA and Moynihan.

But he and the BOA clearly feel the previous chairman and IOC member Sir Craig Reedie did a bad deal with Locog back in 2004.

At that time, as all host Olympic committees must do when they win a bid, they signed over all their marketing rights to the five rings to the organising committee in return for a share of the monies generated by the Games.

That deal was worth around £28m from 2005 to 2012, with £19m being provided in cash and the rest as value-in-kind deals, such as air fares and kit for athletes going to Beijing and Vancouver.

A further £6m was handed over by Locog in 2007, when the BOA made it clear they needed more money.

Now Moynihan and his chief executive Andy Hunt are asking for an even greater share in any surplus from London, pointing to the £100m Rio de Janeiro negotiated with the Brazilian Olympic Committee for the 2014 Games. Sources have indicated to me, however, that he would settle for just under £10m.

The BOA are at pains to insist that this has nothing to do with the concerns over their finances - a story broken last week by my BBC colleague James Pearce. They say this is about the future of the BOA and the legacy that will be left after the Games.

Few people I spoke to about this story believe that to be credible. Many feel that, under Moynihan, the BOA have overstretched themselves by taking on a highly paid coaching, marketing and executive team at a time when they actually had very little to do.

I tried to put these points to Moynihan on Wednesday but he declined to comment. At some stage, he will put his side of the story and it may well be that those lining up to attack him have got it wrong.

But one senior figure in the Olympic movement said he was "simply bewildered" by what has been going on at the BOA.

So now it is up to the IOC to rule on this dispute. My understanding is that they will come out in support of Lord Coe.

Lord Moynihan's argument is that the BOA should be getting a share of London's revenues before the costs of staging the Paralympics are taken into account.

Locog dismiss this, saying the deal is clear and that the share is worked out based on the surplus from the Olympics and Paralympic Games.

The joint marketing agreement signed by the BOA and Locog includes a clause which states that any disputes will be judged by the IOC, whose ruling will be final and binding.

And IOC sources made it clear to me that their understanding was that the costs of the Paralympics had to be taken into account.

But even that might not be the end of it. As Moynihan has made it clear, he is prepared to go to the Court of Arbitration for Sport if he does not get the answer he wants.

With Britain's 500-strong team being funded largely by UK Sport, all this will have little or no impact on the preparedness of athletes in London next summer.

Yet many in British sport find it an embarrassing spectacle that two key bodies are falling out over a relatively small sum of money just as the home straight is coming into view.


  • Comment number 1.

    The very fact that staff salaries at BOA have more than doubled to over £4.2 million in the last 2 years is astonishing. Both Hunt and Moynihan have lost all credibility for this financial black hole that they have created at the BOA. The manner in which they are attempting to hijack more funds is pathetic. I believe the position of both men is now untenable and they should be replaced forthwith.

  • Comment number 2.

    Why 'unwanted distraction'? Do you imagine that Olympics no matter what it costs is what the public want? Hopefully the British public will not be fooled by a 'bread and circus's' distraction by the Olympics of a desparate financial situation that this country finds itself in.

  • Comment number 3.

    This comment was removed because the moderators found it broke the house rules. Explain.

  • Comment number 4.

    here the BOA has really failed, in my opinion, is their misguided belief that they would win the game of cash roulette that they have played over the past five years. They have always known that they would have a limited budget leading up to 2012. But they have continued to pursue expensive programmes (Clive Woodward and others) on the assumption that more money would be squeezed out of LOCOG. They have cashed in on their historic home in Wandsworth and are now paying expensive (they would argue below market) property rentals in central London.

    These decisions have been profligate and the resulting damage to the organisation is now plain to see. My real concern is that we are about to see our NOC go bankrupt - if not before the Games, then shortly after it.

    The pity is that few people in British sport will weep if this happens. I believe a strong and independent BOA is healthy for Olympic sport in this country. Whether those responsible for guiding the ship to its current destination deserve that is another matter.

  • Comment number 5.

    I had no idea david that the rio games has moved to 2014!

    as for this debacle, time for the BOA to be abandoned and the English Olympic Association to be born.

  • Comment number 6.

    "Now Moynihan and his chief executive Andy Hunt are asking for an even greater share in any surplus from London... "

    OK let them have it but only if they agree to fund the same % share of any losses?

    Thought not!


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