Public Accounts Committee chairman Edward Leigh said ministers ‘ignored major foreseeable factors’ including tax obligations and security costs, and described estimates of the extent of private sector funding as ‘wishful thinking’.
Unplanned costs highlighted by the Committee include the fall in the prediction for the level of private funding from £738 million to £165 million, and the addition to the budget of a ‘contingency sum’ of £2.747 billion. The Committee pointed out that there had been a lack of private sector competition for key building projects, including the main stadium.
At the time of the bid, the cost estimate for the games was £4 billion; last year, the revised budget was £9.325 billion. Olympics Minister Tessa Jowell said that ‘a lot had changed’ since the early stages of the budget planning, and that the £9.325 billion budget remained ‘unchanged and robust’.
Olympic Delivery Authority chief executive David Higgins said he believed the budget was realistic and they could ‘deliver within it’, and added that: ‘75p of every £1 we are spending is for long-term regeneration’.
