The Olympics

The Olympics


News, information and stories about the Olympic Games.

Tuesday, 22 April 2008

The Ostrich Budget

The Ostrich Budget
The government received a damning blow to its reputation for "financial competence" (I use that phrase with heavy irony) yesterday, when the Public Accounts Committee accused it of "wishful thinking" over the "budget" (an exaggerated term for the back of an envelope calculations) prepared by those "in charge" of the London 2012 Olympics.

The Committee warned that taxpayers may well have to pay more than the current £12BN (including £2BN running costs) estimated for the games. My own "thumb in the air" estimate is that the final bill will be around £20BN.

The Public Accounts Committee said that the Government excluded key costs from its original budget and more money would be needed, despite an "astonishing" injection of an extra £5BN.

The Committee found serious fault in the way ministers drew up and presented their original budget, and accused the DCMS of ignoring predictable costs.

Edward Leigh, the chairman, said that the department "ignored foreseeable major factors" such as contingency planning, tax obligations, and policing and wider security requirements.

"At the same time, the estimate of the extent to which the private sector would contribute funding towards the Games has proved little more than wishful thinking."

The Committee warned that the revised official public sector funding package "does not include all of the activities on which delivery of the Games and its legacy depends".

In other words, the costs will go beyond £12BN; the government, like an ostrich, has had its head in the sand when it prepared the "budget".

For example, the costs of Government departments working on the Games, as well as the costs of improving wider transport links are outside the budget.


-What kind of budget was this?

-Did anyone competent actually participate in its formulation?

Never entrust major long term projects to politicians. They do not have the skills, experience, qualifications or desire to manage them through from start to finish.

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