London 2012 Games Costs Could Soar

The cost of London hosting the 2012 Summer Olympic Games could rise to almost four times its original estimate. According to a report the Games could cost nine billion pounds, up from 2.35 billion pounds.

The BBC says the Treasury and the Department for Culture, Media and Sport (DCMS) are discussing the price, prompting some ministers to urge officials not to write a blank cheque for the Games.

The government reportedly believes construction alone could cost 3.3 billion pounds, with an extra two billion pounds allocated as a contingency fund. The nine billion pound figure also includes regeneration costs of 1.8 billion pounds and a one billion pound VAT bill, reports the Telegraph.

According to the report security costs have also risen to at least 900 million pounds.

Shadow Culture Secretary Hugo Swire MP told the BBC, “there is no doubt that there will be real worries across the country about the huge increase in costs. It is time we got a proper explanation from (Chancellor) Gordon Brown on what has gone on and assurances as to what the government is doing to control the ever-increasing budget”.

The DCMS dismissed the report Saturday as “just the latest of many figures” that have surfaced in the press.

A spokesman said, “discussions are going on across government to resolve outstanding issues and we will make an announcement about long-term budget figures when these have concluded”.

Meanwhile London’s Mayor Ken Livingstone announced that Londoners will not have to pay the rising costs of hosting the Games. He said he was freezing the Olympic element of the council tax precept at 38p a week for the average council taxpayer.

Londoners are expected to contribute 625 million pounds to the cost of the Games.

Livingstone said, “today is the first instalment of the guarantee that we will keep to our commitments on the council tax. Next year there will be no increase in the 38 pence payment and my commitment is that it will remain the same the year after that and in every succeeding year”.

Amidst the controversy over rising costs a poll, conducted earlier this month, shows that public support for the Games is at it highest since London was awarded the Games in July 2005.

According to market research commissioned by London 2012 organizers, 79 per cent of the public supported the Games – a four per cent rise from September 2005.