A new budget is being negotiated for the 2012 Olympics to include extensive regeneration work in east London. The original funding package is expected to be substantially increased, possibly by £2bn, to take account of work needed to prepare the site for 40,000 new homes after the games, David Higgins, chief executive of the Olympic Delivery Authority, said yesterday.
He told the Commons culture, media and sport select committee, that the creation of the new homes and 60,000 jobs in the Lower Lea Valley had not been planned at the time of the bid. “It seems crazy to complete the games and then in 2013 fit out the entire site,” he said. The ODA wanted to use the games as a catalyst for the regeneration of some of London’s most deprived boroughs.
A new budget will be submitted to the DCMS, which will in turn have to agree it with the Treasury. The existing funding package is £2.375bn to build the Olympic village and venues, plus an additional £1.044bn set aside for infrastructure work.
Higgins said: “We do not want to take a lot of short cuts and do a lot of superficial regeneration of the valley. The responsible thing to do is to look at what all government departments intend to spend in the Thames Gateway in the next five years. We need to co-ordinate the expenditure.” It is thought that could push the Olympic project’s total price tag up by between £1.5 to £2bn.
He would not be drawn on the likely additional costs of security for the games. He said London 2012 would take responsibility for in-venue security, but the police and Home Office were responsible for the broader budget outside.
From: London Games set for £2bn budget increase for new homes, Andrew Culf, October 25 10 06, The Guardian
More at: Joined-up costing
See also: Costs rising
The cabinet was given an upbeat assessment of London’s preparations for the 2012 Olympics yesterday by Tessa Jowell, the culture secretary, who said it was substantially ahead of other host cities at this stage of the process. She told ministers that London was two years ahead of Sydney at the comparative stage.
All the costs of the project were being re-examined to ensure the games deliver value for money. Negotiations are under way with the Treasury to put together a revised funding package which is likely to be agreed by the end of the year.
The cost of building venues, infrastructure and regeneration is put at £3.42bn, but the budget may be expanded to include up to £2bn of extra regeneration work associated with building 40,000 homes and creating 60,000 jobs. The security budget is expected to exceed the £220m in London’s bid document.
Opposition MPs and the Central Council for Physical Recreation attacked the government this week for failing to devise a strategy for using the games to increase participation in sport.
From: Olympics work ‘ahead of time’, Andrew Culf, sports, Guardian, 27 10 06
More at: Three Card Trick