The £1BN Black Hole II

The government has denied the existence of £1BN blackhole in the London 2012 Olympics budget.

Well they would wouldn't they?

Culture Secretary, James Purnell, promised yesterday that no more money would be transferred if MPs voted to take take almost £1.1BN from the National Lottery to pay for the 2012 London Olympics.

The MPs duly agreed like sheep.

Purnell claims that the £12BN budget (including £2BN running costs) was "robust", and dismissed claims of a £1.1BN "black hole".

Bullshit!

Where was dear old Tessa Jowell during this discussion?

The £1BN Black Hole

Well, well, well after months of warning on this site that the London Olympics budget was built of sand guess what?

It seems that I was right.

A £1BN black hole has been unearthed in the budget for the London 2012 Olympics. It appears that property projections, that were backed by ministers, have turned out to be ludicrous.

A report commissioned for the London Development Agency (LDA) notes that the Government's estimates for the amount it will recoup in land sales after the Games are unrealistic.

What a surprise!

Given that the budget has skyrocketed from under £3BN to £12BN (including running costs of £2BN), and is likely to rise ever further, why is anyone remotely surprised that ministers are incapable of presenting reliable figures.

Needless to say, someone will end up having to foot the bill for this shortfall. That will of course be the hapless taxpayers, and the projects that they think that some of their tax money is funding such as; heritage, sports and arts.

Ken Livingstone, the Mayor of London, and the soon to be expunged Tessa Jowell the Olympics Minister, signed a memorandum of understanding last year stating that at least £1.8BN would be raised in land sales after the Games. This figure was based on a staggering, and absurd, 16% per annum estimate in the rise of land values over the next 15 to 20 years.

The latest figure shows a more modest £800M figure expected to be raised, a mere £1BN short of Jowell's estimate.

Mark Dorman, the director of development consultancy for Savills, told the Times that any idea of raising 16 per cent per annum "is complete madness to me".

Jowell, who is living in the past, is sticking to her guns and is still relying on the fact that land rose in value by 20% per annum over the last 20 years:

"[That] gives me confidence that enough will be raised from the land sales both to build the new houses and parts of the community in the Lower Lea Valley, but also to repay the National Lottery."

Well Minister, as the old stock market warning says "past performance is no guide to future performance".

Politicians, least of all "Nu Labour" politicians, should not be left in charge of large scale projects and budgets such as the Olympics; they are simply not qualified, capable or competent enough to handle them.

The Olympics, a living memorial to the folly that is "New Labour".

The True Cost of The Games

The Big Lottery Fund, which is responsible for handing out half the money for good causes raised by the Lotto, has reduced the amount distributed from £696M to £469M.

Why?

The government has diverted funds to the London 2012 Olympics.

Arsenic and Old Oil

The ground for the London Olympics site is so polluted with oil, arsenic and other contaminants that giant soil 'washing machines' have been brought in to process the soil in order that construction may start.

The two square miles between Stratford and Hackney Wick are now being cleaned, before construction starts in two months.

This has the "honour" of being Europe's largest land cleansing operation, it will remove over a century's worth of contamination.

Over 1.5 million cubic metres of soil has to be processed.

The Olympics Delivery authority's Utilities director, Simon Wright, said:

"It's enough to fill 600 Olympic sized swimming pools."

Droids To Patrol Olympics

The RAF will use MQ-9 "Reaper" robo-planes to patrol the skies over London during the Olympics in 2012.

The unmanned droids will fly above London to provide surveillance for the security of the Games. They are equipped with a multi-spectral telescopic imaging system, which can locate a human's body heat and see in the dark. They also carry a synthetic-aperture radar which can track people walking on the ground.

The droids are remotely controlled by pilots based on the ground.

Olympics Tax Hike

Given the ever ballooning budget for the London Olympics 2012, which currently stands at £12BN, it is hardly surprising that fears are being expressed that the cost of these unwanted games will be supplemented by an increase in council tax.

The Conservatives have reported that the Lee Valley Regional Park Authority has been handed the land and liabilities for the Olympics, leaving it facing the bill for any potential budget overrun.

They suggest that it would be used as a "Trojan horse" to increase local taxpayers' share of the Olympics bill.

However, have no fear, the Department for Culture, Media and Sport (DCMS) has rejected this claim.

A spokesman for the DCMS said:

"The Lea Valley Regional Parks Authority does not have the legal powers to do what is suggested.

There is no way in which any 2012-related cost overruns could be the responsibility of the Park Authority, let alone lead to it seeking to burden council tax payers, in London or beyond, with them.

We have a robust budget for 2012 that will guard against cost overruns."

So that's alright then!

It's The Money Stupid

Not wishing to be left off the gravy train, that is the London 2012 Olympics, the building union Ucatt has warned that the games could be hit by strikes and delays unless a uniform rate of pay for workers is agreed.

Ucatt said that not doing so was "recipe for industrial disharmony".

It claims varying rates among 10,000 staff working on projects, including the main stadium, will cause delays as they switch jobs to get the best pay.

As noted many times before on this site, the Olympics are not about sport they are about money.