Press Release - Preparations for the
London 2012 Olympic and Paralympic Games: Progress report February
2010
26 February 2010
Venues and infrastructure for the 2012 London Olympic and
Paralympic Games are on track to be delivered on time for the Games
and the cost is currently forecast to be within the £9,325 million
budget for the Games announced in March 2007, according to a
progress report to Parliament by the National Audit Office.
However, there is potential for further calls on the contingency
fund, which is part of the budget for the Games. Previous
experience shows that financial pressures and risks are likely to
occur right up to the Games.
In 2009, it was decided that the Olympic Village and the Media
Centre would be publicly funded after the economic downturn left
the private finance plans untenable. These decisions were made on
clear value for money grounds, but required some £621 million of
contingency funding from within the budget, with the requirement
reduced by savings elsewhere on the Olympic Delivery Authority’s
programme.
The location of the Media Centre in the North West corner of the
Olympic Park away from the main public transport hub at Stratford
is a potential challenge to achieving the legacy aim of employment
creation, at least in the short term. The recently formed Olympic
Park Legacy Company is now responsible for securing the intended
legacy benefits from the Olympic Park and associated venues,
including the Media Centre.
During 2009, the Government Olympic Executive made progress in
bringing together the delivery plans of the various organisations
involved and developing an integrated programme. These plans need
to be finalised so that testing can start in early 2011. The Home
Office has prepared costed plans for its Olympic safety and
security programme. However, the Home Office and the London
Organising Committee for the Olympic and Paralympic Games (LOCOG)
have not yet agreed the precise responsibilities, scope and costs
for venues security operations.
LOCOG is intended to be self financing – raising income from
sponsorship, ticket and merchandising sales, and revenues from the
International Olympic Committee. While LOCOG is currently ahead of
schedule in securing income, the Government – as the ultimate
guarantor – has always been financially exposed should LOCOG’s
costs exceed its income. To manage the risk of LOCOG’s being in
deficit after the Games, the Government Olympic Executive is
working closely with LOCOG to agree by October 2010 a balanced
budget with a funded contingency.
Mr Amyas Morse, head of the National Audit Office, said
today:
"The Olympic Delivery
Authority has done well to keep its programme on track, and it is
increasingly likely that the venues and infrastructure are going to
be delivered on time and budget. Nevertheless, there is still a
long way to go, with less contingency funding available to meet
unforeseen cost
pressures.
"Plans for the delivery of
the Games themselves need to be fleshed out, in particular making
sure that LOCOG is on track at least to break even. In addition,
securing long-term use of facilities such as the Media Centre and
the Main Stadium should remain a priority to get the best out of
the Games both for the taxpayer and local
people."
Notes for Editors
-
This is the fourth report produced by the National Audit Office
into the preparations for the 2012 Olympic and Paralympic Games in
London. Press notices and reports are available from the date of
publication on the NAO website, which is at www.nao.org.uk. Hard
copies can be obtained from The Stationery Office on 0845 702
3474.
-
The Comptroller and Auditor General, Amyas Morse, is the head of
the National Audit Office which employs some 900 staff. He and the
NAO are totally independent of Government. He certifies the
accounts of all Government departments and a wide range of other
public sector bodies; and he has statutory authority to report to
Parliament on the economy, efficiency and effectiveness with which
departments and other bodies have used their resources.
Press Notice
12/10
All enquiries to Phil
Groves, NAO Press
Office:
Tel: 020 7798
5339
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678477