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Olympic Budget

Volume 458: debated on Thursday 29 March 2007

2. What discussions he has had with the Secretary of State for Culture, Media and Sport on the changes to the Olympic budget; and if he will make a statement. (130440)

My right hon. Friend and I had several discussions prior to her announcement on 15 March of a fully funded budget for the 2012 Olympic and Paralympic games. That places the games on a secure financial footing, and does so earlier than any recent Olympics. May I also draw the attention of the House to my right hon. Friend the Chancellor’s recent statement announcing that Her Majesty the Queen has approved his recommendations on coins to be issued in 2008, including a £2 coin to mark the 100th anniversary of the London Olympic games of 1908.

Upminster residents already have an Olympic levy on their council tax. The talk of cost overruns has concerned them that there might be a subsequent Olympic levy. Can the Minister confirm that this is the final budget?

There is a degree of uncertainty about the policing costs, as my right hon. Friend the Secretary of State for Culture, Media and Sport made clear in her statement. At the moment, there is an allowance of £600 million for the policing costs, but—given developments—that figure will need to be reviewed. Subject to that, however, it is a firm budget and a firm basis on which the games can proceed. I hope that, like me, the hon. Lady is proud of the fact that the Olympic games are coming to east London. I am sure that her constituents are excited about it and I hope that all of us can look forward to a fantastic games in five years’ time.

The Olympics is already bringing huge benefits to my constituency, with investment in transport links, cleaning up the environment and cleaning up waterways. Much of that would have happened anyway, but it is happening faster because of the Olympics, although it is not coming directly out of the Olympics budget. Can my right hon. Friend tell me whether that investment would have been possible had he adopted a third fiscal rule?

The answer is almost certainly no. The renewal that we have seen in public services over the past decade would have been impossible if there had been a third fiscal rule in place. My hon. Friend is right that changes are happening in east London, with regeneration gains that would not have happened on the time scale that is now possible. I am pleased that she is also looking forward to the games.

In the context of a very firm budget, does the Chief Secretary accept that without a long-term regeneration legacy in the lower Lea valley, the 2012 Olympics should be considered to be a failure?

I did not entirely catch the point that the hon. Gentleman made. I certainly do not envisage any failures on any aspect of the Olympics. There will be very big, long-term regeneration gains and the games themselves will be a success. I would have thought that everybody, including the hon. Gentleman, would want to be confident about the prospects for the games and the value of the investment. I am sure that his constituents are also looking forward to fantastic celebrations over the period of the games.

What is certain and completely firm about the Olympics is the opportunities that will be offered to young people. More young people than ever have been participating in voluntary work and in positive activities. All the youth services say that positive activities are one way to get young people out of crime and off the streets. Will my right hon. Friend tell the House what other opportunities this Government have afforded to young people?

My hon. Friend is absolutely right. I am sure that it is her experience, as it is mine while visiting schools in my constituency, that young people are excited at the prospect of the Olympic games. The budget for the games that my right hon. Friend the Secretary of State for Culture, Media and Sport announced contains provision for further training opportunities for athletes. My hon. Friend is right, too, that the Government have done an enormous amount to improve opportunities for young people, to boost the funding and support for sport in schools and to improve youth provision more generally. We are determined that those opportunities should continue to improve because they are so important for the future. If, by contrast, a third fiscal rule were in place, I am afraid that those opportunities would shrink. Because the Tory party has signally declined—

The Minister for Sport told the House in July 2005:

“I shall never forget the person who said, ‘Do not underestimate the budget. If you go higher, it will be seen as a failure so make sure that your calculations are realistic.”—[Official Report, 21 July 2005; Vol. 436, c.1505.]

The Secretary of State for Culture, Media and Sport told the House in November that year:

“we believe that our budget is sound.”—[Official Report, 21 November 2005; Vol. 439, c. 1224.]

A month later the Chancellor confirmed that the Olympics was

“working to an agreed public sector funding package.”

Why, then, has he allowed the budget almost to treble since then?

I hope that the hon. Lady is as proud of winning the Olympics as I am. It is right that as soon as we won the bid we thoroughly reassessed the costs. Now we have a secure financial basis on which to proceed. The International Olympic Committee said of the preparations earlier this month that it was assured and impressed across the board. That is a good position to be in and I hope that the hon. Lady will acknowledge that.

The Olympics have been welcomed by everybody in the country, but there is concern that the budget will mean that projects, such as the restoration of the Newbridge Memo in my constituency, may be starved of vital lottery cash. In his discussions with our right hon. Friend the Secretary of State for Culture, Media and Sport, will the Minister ensure that such projects across the country will not be put in direct competition with the Olympics for lottery funding?

A good deal of care has been taken to ensure that the voluntary sector is protected. The voluntary and community sector will continue to receive the promised £2 billion lottery funding from the Big Lottery Fund between now and 2012. Both existing programmes and future resources for the voluntary sector are protected. I hope that that reassures my right hon. Friend. The lottery contribution to the Olympics is of a similar amount and over a similar period to the lottery contribution to the millennium celebrations. That is about right for what we should expect the lottery to contribute to the games.