As predicted on this site, the bill for the London 2012 Olympics is already way out of control.
The bill is now expect to be above £5BN, the original budget of £3.4BN has been thrown away.
Many excuses have been given for this appalling lack of cost control, and poor budgeting; extra security costs, an unforeseen VAT bill and private Treasury predictions of enormous cost overruns.
However, the overriding reason is clear; never, ever trust politicians to prepare accurate budgets or control costs. They are incapable, especially when the costs and budgets relate to an ego boosting extravaganza such as the Olympics.
Ken Livingstone, Mayor of London, claims that council taxpayers in London should not have to contribute more than the £625M already pledged. He would say that, and it should be remembered that he promised faithfully not to increase the congestion charge; a promise he promptly reneged on, once he was re-elected to office.
The lesson?
Don't trust politicians.
A new Olympics cost estimate is being worked out between Olympic project managers, the Treasury and the Department of Culture, Media and Sport. Needless to say this will be reviewed in the fullness of time as well.
The Chancellor's officials are so scared about the prospect of further budgetary disaster, that they are insisting on a contingency fund of 60% of the estimated £1BN building costs.
Hugh Robertson, the Tory spokesman, said:
"This is a story of monumental incompetence."
Jack Lemley, the American engineer who quit as chairman of the Olympic Delivery Authority (ODA), raised the alarm the other week when he cited political interference and cost overruns as the reason for his unexpected departure.
As expected, this will be a shambles.
Sensible countries should do all they can to avoid hosting the Olympics, they are nothing but trouble and a waste time and money.
Thursday, November 16, 2006
Wednesday, November 15, 2006
London Struggles
London politicians will meet today, in special session, to debate the financial health of the London 2012 Olympics games.
The special meeting has been arranged as a result of claims from the former chairman of the Olympic Delivery Authority, Jack Lemley, that London will struggle to come in on time and on budget.
Mr Lemley resigned from his Olympics post recently, due to his fears that the Olympics would fail.
The special meeting has been arranged as a result of claims from the former chairman of the Olympic Delivery Authority, Jack Lemley, that London will struggle to come in on time and on budget.
Mr Lemley resigned from his Olympics post recently, due to his fears that the Olympics would fail.
Monday, November 13, 2006
Olympics Bill Soars
The costs of the 2012 Olympics in London are already rising well beyond those originally budgeted for, not helped by the fact that the VAT element had been conveniently "forgotten" by those who put together the original budget.
It is now feared that these rising costs could have a damaging impact on the national lottery's ability to fund good causes.
John Whittingdale, a Tory MP who chairs the culture, media and sport select committee, said:
"The lack of clarity over the Olympic budget is of considerable concern. It is all very murky - the status of the regeneration budget is unclear and the question of VAT on construction work has not been clarified.
The impact on traditional lottery good causes could be horrendous. It is ringing all kinds of alarm bells at every lottery distributor."
Negotiations are taking place between the Treasury and the Department for Culture, Media and Sport to provide new funds for the games.
The long suffering tax payers of London are expected to foot some of the bill, even though they weren't consulted in the first place as to whether they wanted the Olympics.
Additional funding will also come from the national lottery. On the existing budget the lottery has to raise £1.5BN.
Mr Whittingdale said:
"The Olympic lottery games have already top-sliced a lot of money from the main game to the Olympics; if it is top-sliced even more, it will mean further hits to the distribution bodies."
A culture department spokesman said:
"It has always been the case that the lottery would be a major part of the funding package. The Olympics present a fantastic opportunity to get people taking up sport, and [for] regenerating an area."
As ever it will be the tax payer who has to fund the ambitions of politicians.
It is now feared that these rising costs could have a damaging impact on the national lottery's ability to fund good causes.
John Whittingdale, a Tory MP who chairs the culture, media and sport select committee, said:
"The lack of clarity over the Olympic budget is of considerable concern. It is all very murky - the status of the regeneration budget is unclear and the question of VAT on construction work has not been clarified.
The impact on traditional lottery good causes could be horrendous. It is ringing all kinds of alarm bells at every lottery distributor."
Negotiations are taking place between the Treasury and the Department for Culture, Media and Sport to provide new funds for the games.
The long suffering tax payers of London are expected to foot some of the bill, even though they weren't consulted in the first place as to whether they wanted the Olympics.
Additional funding will also come from the national lottery. On the existing budget the lottery has to raise £1.5BN.
Mr Whittingdale said:
"The Olympic lottery games have already top-sliced a lot of money from the main game to the Olympics; if it is top-sliced even more, it will mean further hits to the distribution bodies."
A culture department spokesman said:
"It has always been the case that the lottery would be a major part of the funding package. The Olympics present a fantastic opportunity to get people taking up sport, and [for] regenerating an area."
As ever it will be the tax payer who has to fund the ambitions of politicians.
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