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Olympics 2012

Volume 456: debated on Monday 29 January 2007

The budget for the Olympic Delivery Authority for the next financial year will be finalised in March. The overall budget is under discussion in Government and with other stakeholders, and will be published in due course.

With the huge increase in the cost of the Olympics, will the Secretary of State assure people in my constituency and throughout London that the cost will not be borne by the London taxpayer? The games are a United Kingdom event, so will she undertake to ensure that the costs are spread across the country, and are not paid just from the pockets of people in London?

My right hon. Friend the Minister for Sport has set out clearly the agreement that was reached and signed up to by all parties in the memorandum of understanding, which defines how any cost overrun for the Olympics will be met, so, at a point where we are discussing the apportionment of responsibility for paying for any increase, I will not rule anything out. This is an example of politics at its worst. The Conservatives support the Olympics publicly, but then, in a narrow and populist way, seek to undermine every reasonable attempt by the Government to ensure a proper and sustainable budget.

Last summer, I had the pleasure of visiting the Sydney Olympics site, and was heartened to hear there that London was ahead of the game on transport and environmental aspects. Can my right hon. Friend assure my constituents that, when she is helping to set the budget for the Olympics, her eye will be closely and firmly on the ball of sustainable development—from water and transport, all the way through—which is a big concern, and that we will not lose sight of that?

I can give my hon. Friend that assurance. These will be the most sustainable games ever. Ambitious targets were set for a reduction in carbon emissions and especially for the use of waterways for transporting materials, and there are very demanding targets that exceed those of the Government generally for the disposal of waste. Sustainability was fundamental to the bid and will continue to be a driving discipline in achieving the games in 2012.

If the right hon. Gentleman would like to look at the bid document, he will find that the status of the Olympic Delivery Authority, which at that time did not exist and had not been legislated for, has now been established. There continues to be a discussion within Government about VAT and its recovery, but as the Chancellor has made absolutely clear, that is not an issue for the taxpayer, but a question of managing where the responsibility sits for VAT and its payment.

Teachers in my constituency are telling me that there is genuine enthusiasm among young sportsmen and women and that the thought of the Olympics in London in 2012 is a real motivation for them. That is not just the case in my constituency, but throughout Scotland. Would my right hon. Friend enlarge on any other benefits to Scotland and the rest of the UK from holding the Olympics here in London?

My hon. Friend is absolutely right about that. We will see more and more young people taking part in sport as part of their school day and competing through the establishment of inter and intra-school teams, and the pursuit of real excellence not just as part of the legacy, but in the years in the run-up to the games. We can congratulate all our young athletes who recently did so well and did their country proud in the youth Olympics in Australia.

Of course, Scotland will be a beneficiary not only of investment in sport but of increased tourism, and I hope that we shall see Scots from throughout the country offering to sign up as volunteers. In addition, Scotland will no doubt be looking at the commercial and business benefits that it can derive from the enormous increase in inward investment and visitors that will arise from the games.

Is not the Secretary of State concerned that everything is still under discussion? After all, in relation to VAT, is it not the case that the Government signed off a bid document that said that taxation would not be a problem, and is it not bizarre that the Treasury now wants a 60 per cent. contingency? Specifically in relation to announcements she made earlier about London council tax payers potentially having to pay more, does she recall that on 6 November last year, the Prime Minister said about the Mayor of London:

“Ken is basically right. We have said what should come from Londoners and I don’t think we are looking for more”?

Was the Prime Minister wrong to have said that?

The Prime Minister was expressing his view very clearly indeed, but I am involved in negotiation in Government about the fair and proportionate way in which we cover the costs. It is important that the House remembers that this is the biggest public construction project in Europe. It is like building two terminal 5s, but in half the time.

Precisely. I am in charge of a project where we are years ahead of where Sydney or Athens were at an equivalent stage. Sydney did not conclude its budget until two years before the games. Beijing has promised a revised budget, but the games are next year and that has not yet been published. As far as we can discern, Athens never published a final budget. We intend to proceed by ensuring that the money is there, that the costs are controlled and that we, in time, host the best games ever: a great tribute to the young people of this country.

A number of Members on both sides of the House have asked about the memorandum of understanding. The Secretary of State drew it up. Will she confirm now whether the Mayor does indeed have the power to block any future increase—yes or no?

The responsibility for any further increase in council tax would sit with the Greater London authority, which would have to approve it.

I think that we can take that as a yes.

The Select Committee on Culture, Media and Sport has just produced a highly critical report of the Government’s management of the Olympic budget. When the London Olympics Bill was going through this House, the Minister for Sport said:

“when the organisers have to ask for more funding…it is seen as a failure.”—[Official Report, Standing Committee D, 13 October 2005; c. 42.]

Does the Secretary of State stand by that, and if so, whose failure is it?

Look, the Select Committee did not criticise the financial management of the games. Such quoting is highly selective. That is the trick that the Conservatives are now trying to play, and people see through it. The Conservatives pick away at specific criticisms while saying publicly, “We are right behind the games.” They are seeking to undermine public support for the games, which has remained remarkably robust throughout this period. On the specific point made by the hon. Gentleman, we will study the Select Committee’s recommendations closely. It was a very balanced, authoritative and measured report and its conclusions are not at all surprising. I am proud of the progress that has been made with the Olympic games and I think that the Opposition should stop talking the Olympic games down.