Cost of staging Olympic Games could be twice original estimate

Planners of the 2012 London Olympics have admitted for the first time that the cost of staging the Games would be "significantly higher" than previous estimates.

The original architects of the London Games had claimed that £2.4bn from the public purse was a "robust" figure but that now looks certain to climb above £5bn.

An emergency debate at the Greater London Authority yesterday was prompted by the resignation of the project's engineer-in-chief, Jack Lemley, who went on to claim the Olympics were running behind schedule, were over budget and prone to political interference.

Sir Roy McNulty, the acting chairman of the Olympic Delivery Authority (ODA), responsible for the infrastructure of the Games, admitted: "There were issues between Jack and the ODA and other stakeholders. There was a mismatch that led to serious differences and it was in everybody's interests that he return to the US."

The previous official line said only that Mr Lemley left to attend to his engineering consultancy.

Further pressure on costs has come because the ODA is not exempt from VAT as previously thought. The Olympic bill will also increase due to increased security requirements and the widening scope of the regeneration of the Lower Lea Valley, the low-rent industrial site earmarked for the Olympic Park.

A Treasury review of a new Olympic's budget is expected to conclude by Christmas, and £5bn is seen as a conservative estimate.

The new budget will include a contingency fund of up to 60 per cent, desired by the Treasury. Building in such a large margin for error was labelled as "absolutely, breathtakingly ridiculous" by Ken Livingstone, the Mayor of London.

"If you start out on this huge infrastructure project and say it might overrun by 60 per cent, everybody bidding for contract knows you have set aside this huge pot of money for when they screw up," he said. "That sends all the wrong signals."

Mr Livingstone believes that a 60 per cent figure would encourage potential Games contractors to hike their prices for work in developing sites. Sources at the GLA say the 60 per cent figure is a Treasury shot across the bows to other government departments to budget for the Games. Mr Livingstone said he would reluctantly sanction 20 per cent to preserve "unanimity" on the Olympic Board.

He could offer no guaranteed council-tax cap: Londoners pay an average of 38p a week towards the Games. To plug any potential gap he raised the prospect of a windfall charge on property developers in the East End. The Mayor also called on the Government to waive a 12 per cent tax on sale of Olympic lottery scratch cards.

Policing the Games will cost £300m and securing the Olympic Park is bound to increase from the £190m estimated before the 7 July attacks. The bill was £1bn for the Athens Olympics.

In his parting shot, Mr Lemley also touched on concerns that the main Olympic stadium would be added to a long list of white elephants created by previous Olympics. He said an 80,000-seat stadium could not easily be converted into a 60,000-seat venue for a football club, such as West Ham United or Tottenham Hotspur, a plan backed by the Government.

David Higgins, chief executive of the ODA said it was now "highly unlikely" that such a club would meet the £150m cost of this and that the stadium would most likely become a 25,000-seater venue mainly for athletics after 2012.

Mr Higgins said it would be a "waste of public money" not to dovetail the plans for the Olympic project with a broader regeneration of the so-called Thames Gateway area.

He said: "It would be a significant waste of public money not to put in the utilities and infrastructure for the community that will have had to put up with six years of disruption."

Sport
Laura Trott with her gold
Commonwealth GamesJust 48 hours earlier cyclist was under the care of a doctor
Life and Style
Upright, everything’s all right (to a point): remaining on one’s feet has its health benefits – though in moderation
HealthIf sitting is bad for your health, what happens when you stay on your feet for a whole month?
Arts and Entertainment
Peter Griffin holds forth in The Simpsons Family Guy crossover episode
arts + ents
News
Orville and Keith Harris. He covered up his condition by getting people to read out scripts to him
People
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
Sport
France striker Loic Remy
sportThe QPR striker flew to Boston earlier in the week to complete deal
Arts and Entertainment
Gal Gadot as Wonder Woman
arts + entsFilmmaker posted a picture of Israeli actress Gal Gadot on Twitter
Sport
Vincenzo Nibali rides into Paris on the final stage of the 2014 Tour de France
Tour de FranceVincenzo Nibali is first Italian winner since Marco Pantani in 1998
News
Bryan had a bracelet given to him by his late father stolen during the raid
people
Arts and Entertainment
Chris Pratt stars in Guardians of the Galaxy
arts + ents
Arts and Entertainment
Pedro Pascal gives a weird look at the camera in the blooper reel
arts + entsPrince Oberyn nearly sets himself on fire with a flaming torch
News
Danny Nickerson, 6, has received 15,000 cards and presents from well-wishers around the world
newsDanny loves to see his name on paper, so his mother put out a request for cards - it went viral
Arts and Entertainment
Zoe Saldana stars in this summer's big hope Guardians of the Galaxy
filmHollywood's summer blockbusters are no longer money-spinners
Sport
Red Bull Racing's Australian driver Daniel Ricciardo (C) celebrates with Scuderia Ferrari's Spanish driver Fernando Alonso (L) and Mercedes' British driver Lewis Hamilton
sport
Arts and Entertainment
comedy
Arts and Entertainment
Public vote: Art Everywhere poster in a bus shelter featuring John Hoyland
art
Arts and Entertainment
Judd Apatow’s make-it-up-as-you-go-along approach is ideal for comedies about stoners and slackers slouching towards adulthood
filmComedy was dominated by the romcom at its most insufferable
Sport
Tour de France competitor Bartosz Huzarski’s legs have highlighted the gruelling nature of the race, after he posted a picture on Facebook showing extremely prominent veins stretching from his feet and all the way up his legs
Commonwealth Games
Life and Style
Elle Kaye demonstrates the art of taxidermy
food + drinkFood revolution taken a step further in new ‘edible taxidermy’ class
News
A rub on the tummy sprang Casey back to life
video
Sport
Halsall broke her personal best in the 50m butterfly
Commonwealth GamesEnglish swimmer is reborn after disastrous time at London 2012
Arts and Entertainment
O'Shaughnessy pictured at the Unicorn Theatre in London
tvFiona O'Shaughnessy explains where she ends and her strange and wonderful character begins
Life and Style
Workers in Seattle are paid 100 times as much as workers in Bangladesh
fashionSeattle company lets customers create their own clothes, then click 'buy' and wait for delivery
Arts and Entertainment
Red Bastard: Where self-realisation is delivered through monstrous clowning and audience interaction
comedy
Arts and Entertainment
booksForget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks
Voices
The Express offices in the 1930s when writers (such as Orwell) were paid around £2 weekly
voicesWebsites offering your ebooks for nothing is only the latest disrespect the modern writer is subjected to, says DJ Taylor
Life and Style
A cut above: Katy Guest at The Ginger Pig
food + drinkThe Ginger Pig's hands-on approach to primary cuts
Caption competition
Caption competition
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Daily Quiz
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

Day In a Page

A new Russian revolution: Cracks start to appear in Putin’s Kremlin power bloc

A new Russian revolution

Cracks start to appear in Putin’s Kremlin power bloc
Eugene de Kock: Apartheid’s sadistic killer that his country cannot forgive

Apartheid’s sadistic killer that his country cannot forgive

The debate rages in South Africa over whether Eugene de Kock should ever be released from jail
Standing my ground: If sitting is bad for your health, what happens when you stay on your feet for a whole month?

Standing my ground

If sitting is bad for your health, what happens when you stay on your feet for a whole month?
Commonwealth Games 2014: Dai Greene prays for chance to rebuild after injury agony

Greene prays for chance to rebuild after injury agony

Welsh hurdler was World, European and Commonwealth champion, but then the injuries crept in
Israel-Gaza conflict: Secret report helps Israelis to hide facts

Patrick Cockburn: Secret report helps Israel to hide facts

The slickness of Israel's spokesmen is rooted in directions set down by pollster Frank Luntz
The man who dared to go on holiday

The man who dared to go on holiday

New York's mayor has taken a vacation - in a nation that has still to enforce paid leave, it caused quite a stir, reports Rupert Cornwell
Best comedians: How the professionals go about their funny business, from Sarah Millican to Marcus Brigstocke

Best comedians: How the professionals go about their funny business

For all those wanting to know how stand-ups keep standing, here are some of the best moments
The Guest List 2014: Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks

The Guest List 2014

Forget the Man Booker longlist, Literary Editor Katy Guest offers her alternative picks
Jokes on Hollywood: 'With comedy film audiences shrinking, it’s time to move on'

Jokes on Hollywood

With comedy film audiences shrinking, it’s time to move on
It's the best of British art... but not all is on display

It's the best of British art... but not all is on display

Voted for by the British public, the artworks on Art Everywhere posters may be the only place where they can be seen
Critic claims 'I was the inspiration for Blanche DuBois'

Critic claims 'I was the inspiration for Blanche DuBois'

Blanche Marvin reveals how Tennessee Williams used her name and an off-the-cuff remark to create an iconic character
Sometimes it's hard to be a literary novelist

Sometimes it's hard to be a literary novelist

Websites offering your ebooks for nothing is only the latest disrespect the modern writer is subjected to, says DJ Taylor
Edinburgh Fringe 2014: The comedy highlights, from Bridget Christie to Jack Dee

Edinburgh Fringe 2014

The comedy highlights, from Bridget Christie to Jack Dee
Dame Jenny Abramsky: 'We have to rethink. If not, museums and parks will close'

Dame Jenny Abramsky: 'We have to rethink. If not, museums and parks will close'

The woman stepping down as chair of the Heritage Lottery Fund is worried