Private security firm G4S initially suggested its problems supplying Olympic guards were “teething problems” which would be resolved, Theresa May said today.
On a tour of the Olympic Park's security centre, the Home Secretary said G4S, the world's second largest private sector employer, told officials last month that any problems were temporary and would be sorted out.
She denied being selective in what she told MPs, insisting that the gap in the numbers only became clear on July 11, not two weeks earlier when the firm first reported problems.
Mrs May said that at the start of the month G4S's problems looked like "teething problems" which they would resolve.
"Crucially, it was not until July 11 that G4S finally said 'Actually we can't resolve those initial problems, we won't be able to provide the personnel'," she said.
Asked what the Home Office was told at a meeting with G4S and Olympic organisers Locog on June 27, Mrs May added: "What happened was there were some early signs of a problem with rostering staff for G4S.
"It was clear that G4S felt they were capable of dealing with that, that it would be resolved, and it was on July 11 as the chief executive of G4S told Parliament, the Home Affairs Select Committee, that G4S said 'Actually, we now believe we cannot produce the staff we were contracted to produce'."
Asked if G4S should have acted sooner, Mrs May said they believed they had identified a "temporary problem which was capable of resolution".
During the visit to the control room with Scotland Yard commissioner Bernard Hogan-Howe and London 2012 chairman Lord Coe, Mrs May saw G4S staff and others at work in front of a bank of more than 30 large screens covering the park.
She also met Colonel Gary Wilkinson, the venue's senior military representative, and Superintendent Neil Seabridge, the Met's bronze commander at the park today.
Yesterday, Mrs May was accused of giving MPs a "selective account" about when she knew G4S were having problems supplying enough guards.
The Home Secretary admitted the Government and organisers Locog knew there were problems as early as June 27.
It came after the company's under-pressure chief executive Nick Buckles told MPs he was informed of the problems a week later on July 3 and Mrs May told the Commons the "absolute gap in numbers" was not known until July 11.
The number of military personnel involved in Olympics security is now 17,000, including 11,000 who will help secure Games venues, with the rest working in specialist roles.
A further 1,200 are on 48 hours notice to move.
Mrs May said the Government needed to be ready for any contingencies.
But the Government said the numbers of G4S staff were rising and there was currently no need to deploy more military personnel.
Shadow home secretary Yvette Cooper said Mrs May needed "to explain urgently how she justifies having given Parliament and the public such a selective account, and why the Home Office were so slow to respond".
The details were revealed by Mrs May in a letter to the Commons Home Affairs Select Committee.
Labour MP Keith Vaz, the committee's chairman, said: "The Home Secretary told the House that she only became aware of a shortfall on July 11.
"However, this letter clearly states they were warned of a possible shortfall in guards on June 27 at the Olympic Security Board, two weeks before."
He called for any updates on the figures contained in monthly internal assurance reports to be released and for an explanation of "why they did not ring alarm bells sooner".
While 750 troops were put on 24 hours notice last month, the extra 3,500 servicemen and women who will plug the gap left by G4S were not called in until two weeks later after the company confirmed its "absolute" shortfall.
In a statement last night, a G4S spokesman said the firm "believes that, even if some or all of the additional troops now on standby were to be deployed, the overall losses to be incurred on this contract would remain within the previously stated estimate of £35-£50 million."