Skip to main content

Olympic Games: British Companies

Volume 737: debated on Tuesday 22 May 2012


Asked By

To ask Her Majesty’s Government why British companies which have supplied innovative products to the London Olympic Games and Paralympics Games are unable to publicise those products in order to gain further business.

My Lords, as suppliers are paid the full commercial rate for their goods and services and are bound by the no-marketing rights clauses in their contracts, sponsors who have collectively raised in excess of £1 billion towards staging the Games are granted exclusivity for marketing rights. As the Written Ministerial Statement that I made on 1 May clarified, businesses can state their contribution to the Games in various contexts, including client lists, pitch documents and informal business contexts.

My Lords, I apologise for raising this matter with your Lordships again today but the matter is urgent. Does the Minister recall that the companies that I spoke about yesterday have no wish to use the logo or the Olympic rings or to do anything that contravenes the branding guidelines? All they want to do is use the Olympics as a shop window for the products and materials that they have supplied to go out and get further orders from other countries—orders that Ministers are urging them to get. Will the Government now persuade LOCOG to lift its ban immediately so that they can get on with it—yes or no?

My Lords, it is not for the Government to persuade LOCOG to lift the ban because these firms will have signed a contractual arrangement when they made the contract with LOCOG in the first place. Of course they can promote their wares as long as they are within the context of the terms of the contract. As the noble Lord says, we have to ensure that they cannot promote their involvement in the Games in a way that undermines the exclusive marketing rights of the London 2012 sponsors. However, there are many other occasions and ways in which the Games will provide a focus for the very businesses that he wishes to support.

My Lords, while my noble friend the Minister has responded on behalf of LOCOG, would she support the decision of the British Olympic Association which, following the return of the Olympic rights from LOCOG to the BOA on 31 December this year, will seek to ensure that all contractors and subcontractors can seek recognition of their superb contribution to the London Olympic and Paralympic Games to help them win national and international contracts in the delivery of sports facilities in years to come?

Indeed, my Lords, the Government wholeheartedly support all the work that is going on to ensure that after the Games the contractors have a showcase for the outstanding work that they have done. Meanwhile, the Government in conjunction with UKTI and a number of other bodies are setting up visits, activities and promotional ways in which British business can be highlighted during the Games.

My Lords, the Minister will be aware that in spite of brave promises at the outset of a regional spread of these contracts, the amount of contracts going to the regions has been miniscule but the amount going to London and the south-east has been massive. What lessons has she learnt from the way in which public money has been used to buttress only those firms in areas which are already relatively prosperous?

My Lords, a number of regional contracts have been awarded as well. They may be small in comparison with some of the London-based ones but some very significant contracts have gone to the regions. We certainly hope that in the course of the Games when the highlight is on the UK generally, we will be able to promote those areas which are showing innovation and creativity in their business.

My Lords, does my noble friend agree that although there are some restrictions on the use of the Olympic symbol they are there for very good reasons, primarily to allow the Olympic movement, and those sports attached to it, to raise financing and protect their marketing? Will we ensure that that is not damaged? These Games will come and go but the Olympic movement supporting the athletes will go on.

My noble friend is absolutely right: the Olympic branding is a vital asset to the whole Olympic movement. We have to play our part in ensuring that that branding does not get misused while the Games are in London.

Does the Minister agree that, welcome as the statement of the noble Lord, Lord Moynihan, was, it is a case of better late than never? A number of companies have made substantial contributions to the infrastructure of the Games and have paid high levels of taxation towards the promotion of them. Should they not get some of the benefits, particularly as we are encouraged to believe that the answer to some of our economic problems is that free competition will sort everything out in the end?

My Lords, as I set out in my original Answer, they are able to publicise what they are doing in connection with the Olympics as long as it is within the context of the contract which they have signed with LOCOG. They will also be the beneficiaries of the initiatives going on during the Games to ensure that our businesses are highlighted when the international focus is on London during the Games.

My Lords, if one of the benefits of the Olympic Games is to encourage people to get more involved in sport, why not keep the site open next year and have an industrial exhibition to encourage people to be wealth creators?

As was explained in the debate yesterday, the Olympic site will be closed in order to be redeveloped for its legacy purposes into the future. It will be used for sport in the future. The athletics stadium will host the 2017 world athletics, for instance, and other events will be going on. However, there is a need to close parts of the site down immediately after the Games so that it can be redeveloped for its long-term future.

My Lords, I apologise to the House as I should have declared my interest as chairman of the British Olympic Association.

My Lords, just to get a flavour of what we are actually talking about, when the Olympic torch started out from Plymouth, LOCOG officials confiscated leaflets advertising an Olympic breakfast at a local café. The officials said that flaming torch bacon and egg baguettes were on the menu, which contradicted their guidelines. According to the Office for Budget Responsibility, GDP is set to grow by 0.1% because of the Olympics. Presumably, that figure would have been much higher if the enterprise of the supplier companies had not been so grievously shackled in their marketing and advertising operations that we have heard about. Is the conclusion that we have to draw from this sorry episode that the Government have missed a golden opportunity here by caving in to LOCOG and to the IOC, to the detriment of our supplier companies?

My Lords, I do not think that there is any question of the Government caving in to LOCOG. We reached agreement with LOCOG and the IOC on the way in which we would frame the Games. I remind the noble Lord that it was his Government who set up all these criteria in the first place. However, I agree that the case of the flaming torch sandwich will live on in the memory.