A report by MPs into the financial management of the 2012 Olympic costs has demanded that the Games organisers should not rely on the National Lottery and increased taxes to offset the upward revision of the budget.
The MPs’ report, presented at a DCMS hearing today, indicated that ministers are ‘disturbed’ at the £900m rise in costings of the 2012 project from its original budget due principally to compliance issues and an unexpected VAT bill.
The document also outlined surprise that an extra £400m was needed for a ‘delivery partner to exercise cost control’.
The recommendation from MPs was that any extra funding required for the project should be met head on by the Treasury and not, as has been suggested in some circles, by reliance on lottery funding and increased taxes.
‘We can only conclude that cost-control procedures were not fully thought through at the time the bid was submitted,’ the report said.
'The committee is concerned about the distance between the figures submitted in the bid and the true costs, which will not become evident until after the Games.’
The committee's chairman, Conservative MP John Whittingdale, said grassroots sport would lose out if the Lottery had to contribute any more money.
In response to the report, a Department for Culture, Media and Sport spokesman said: ‘We are applying rigorous financial controls to ensure that every pound we spend is well-spent.
‘Some costs have risen, but that is principally because of the importance of ensuring a long-term legacy from 2012.’