Select Committee on Culture, Media and Sport Third Report


187. Our principal conclusions and recommendations are as follows:

(i)The staging of international sporting events must be seen as a means, not an end. Public support for the staging of events must be justified by proper analysis of the extent to which events are an effective means towards other ends, both sporting and non-sporting. The staging of events cannot be justified simply by vague assertions about national prestige (paragraph 8).
(ii)We welcome the statement by the Minister for Sport that there is little point in investing in major events if there is no broader support for grass-roots development and her wider commitment to the development of the grass-roots of sport. The staging of events can play a part in this development, and can contribute towards encouraging improved elite performance, but the wider sporting benefits of events must be planned for and measured. In due course, the Government and the Sports Councils should undertake a cost-benefit analysis comparing the sports development impact of events with such impact resulting from other forms of public investment in sport (paragraph 17).
(iii)The motivation of sports governing bodies in seeking to stage major events is primarily sporting. That is understandable, but public investment cannot always be justified on sporting grounds alone and must be seen in the context of the wider benefits that events can bring. Because the Government has ultimate responsibility for the necessary public investment, we recommend that the Government periodically as appropriate undertake and publish its own analysis of the financial and other benefits of staging events, including the regenerative impact of events (paragraph 22).
(iv)In the past, there have been occasions when facility development may have been unduly focused on the short-term needs of staging one particular event rather than on the long-term viability and benefit of facilities. In future, it will be essential to ensure that strategies for bidding for and staging events and for associated facility development are fully integrated with national facilities strategies for particular sports and reflect the eventual outcome of the national facilities audit, which is more than due (paragraph 23).
(v)The admirable record of the United Kingdom in securing and staging major events is sometimes over-shadowed by the failure of this country to attract certain very high profile events such as the FIFA World Cup and the Olympics, but it is a myth that this country does not act as host for major events that are sometimes the focus of world attention. Nevertheless, there are important lessons to be learned from past events and from failed bids, and there remains scope for improvement in public sector support for governing bodies and for local authorities in the bidding process and in the staging of events (paragraph 25).
(vi)We agree with the Government's view that the failure of the England bid for the 2006 FIFA World Cup was "not for want of commitment or imagination". We agree with Sport England's judgement that its decision to invest £3.14 million in the bid was justified (paragraph 37).
(vii)We recommend that the Government convene discussions involving the sports authorities, the hotel industry and those concerned with hotel contracts for international events to prevent a repetition of the problems with the hotel contract for the 2006 FIFA World Cup in relation to future bids. We expect the Government to report on the progress of those discussions in its response to this Report (paragraph 39).
(viii)We were impressed by the evidence that we received from the Football Association and in particular by the organisation's willingness to recognise the weaknesses within its control identified during the bidding process and, where appropriate, to seek to rectify them (paragraph 40).
(ix)We recommend that the Minister for Sport initiate a review to establish what further practical support might be provided by the Government itself to British representatives on international sporting bodies (paragraph 41).
(x)The most important lesson of the England bid for the 2006 World Cup is that extraneous factors and the politics of international sport will always matter as much as if not more than the inherent technical strengths of a bid. In consequence, bidding for events of this nature will remain a hazardous business. This is a lesson that should not be lost on other sports and other sporting organisations in this country (paragraph 42).
(xi)No new evidence has emerged in the Government response or in other submissions received by this Committee that leads us to consider that the conclusions of our Report on Wembley National Stadium were other than well-founded (paragraph 49).
(xii)We commend the Wembley Task Force and the participating organisations for their endeavours so far, which should ensure that the transport infrastructure and environment developed at Wembley befit a National Stadium (paragraph 56).
(xiii)The continuing dispute, despite attempted clarification, about precisely who are the parties to the agreement to pay £20 million represents a symptom of the uncertainties that have surrounded the payment since its inception. The payment appears to have originated with a handshake between Sir Nigel Mobbs and Mr David Richards, Chairman of the FA Premier League. It was then the subject of a second handshake between the Secretary of State and Mr Bates. More than fifteen months after those handshakes, the agreement has still not been given final documentary and legal form and even the timetable for payment remains open to doubt. The delays and difficulties arise from the extremely unusual manner in which the payment was negotiated (paragraph 82).
(xiv)We welcome the changes made to the management of the Manchester 2002 Commonwealth Games to streamline the organisation and to broaden its expertise (paragraph 88).
(xv)It is essential that all future accounts from Manchester 2002 Limited distinguish clearly between sponsorship income in monetary form, sponsorship-in-kind that replaces expenditure which would otherwise have been incurred and sponsorship-in-kind which is enhancing the Games but not directly affecting the finances. We would be reassured by a growth in the proportion of sponsorship that takes monetary form (paragraph 101).
(xvi)The Manchester Commonwealth Games lack the immediate brand identity that helped to give the Sydney Olympic merchandising effort such a high-profile, but the lack of such a clear profile means that the effort should be greater not less. The Sydney Games merchandise was very visible across Australia more than eighteen months before the Games themselves. Effective merchandising creates profit for the organisers and enhances national awareness of, and engagement with, an event. We are concerned that merchandising for the Manchester Commonwealth Games is still almost invisible. We recommend that merchandising opportunities be put in place as a high priority and, in particular, that Commonwealth Games shops should be established outside Manchester, or that a commercial agreement be made speedily facilitating nationwide sale of Manchester Commonwealth Games merchandise (paragraph 103).
(xvii)We were impressed by the evidence that we received from Mr McCartney and, more importantly, by the clear signs that the designation of a Minister with special responsibility for the Manchester 2002 Commonwealth Games has had the positive impact that we sought in 1999 on Government involvement with the event (paragraph 108).
(xviii)Councillor Leese told us that Manchester City Council had made a commitment that council taxpayers would not pay for the Games either through increases in their council tax or reductions in services. He said that the Council would seek to mitigate risk by putting reserves in place, funded in part from capital receipts from commercial development around the Eastlands site. We accept that ultimate responsibility to underwrite certain losses is an important discipline on a local authority engaged in organising a major event. Manchester City Council is seeking clearly identified local gains from the Commonwealth Games and cannot be relieved of all risk. However, the success of the Games is dependent to some extent on the event being seen as a national event with national ownership. The Prime Minister has acknowledged that the Manchester 2002 Commonwealth Games "will be a tremendous showcase not just for Manchester, but for the whole of Britain". This national element requires a national commitment. It is incumbent upon the Government to keep the finances of the Games under constant review to ensure that opportunities for expenditure on the Games of national benefit are not lost because of Manchester City Council's legitimate primary concern for the interests of the council taxpayers of Manchester. If certain national requirements are identified in the current budgetary review, we would expect them to be funded from the Exchequer (paragraph 111).
(xix)We recommend that specific expertise be recruited within the Cabinet Office, initially to support the relevant Minister in his work in relation to the Manchester 2002 Commonwealth Games, but thereafter to serve as the kernel of a dedicated team within the Government to advise and assist with the staging of major events (paragraph 113).
(xx)We are encouraged by the range of investment already attracted to the East Manchester area and by the long-term commitment voiced by the Minister. Nevertheless, it is vital that Sport City itself is maintained and funded appropriately to ensure that it can continue to provide a stimulus to the wider regeneration of East Manchester (paragraph 115).
(xxi)We recommend that the organisers of the Manchester Commonwealth Games, or the Government as appropriate, contact all local authorities in the United Kingdom to inform them about the national dimension of the event and the many opportunities for involvement by communities and individuals across the United Kingdom with the Games (paragraph 119).
(xxii)We expect that this Committee or its successor will wish to examine progress in preparations for the Manchester 2002 Commonwealth Games later in 2001 or early in 2002 (paragraph 121).
(xxiii)We commend Birmingham City Council for its initial investment in the National Indoor Arena for Sport and for its lead role in bringing the 2003 World Indoor Athletics Championships to the United Kingdom (paragraph 124).
(xxiv)If the Government were to underwrite the London 2005 World Athletics Championships, it would be incumbent upon the Government to explain why that privilege was being afforded to that one event when such a privilege has been specifically and repeatedly withheld from other events, including the Manchester 2002 Commonwealth Games and the Birmingham 2003 World Indoor Athletics Championships. If the Government were to underwrite the 2005 event directly or indirectly, it would also be essential that a Minister takes a direct role in the organisation of the Championships to ensure that there would be proper responsibility and accountability for the Exchequer funds committed in consequence of such a decision (paragraph 131).
(xxv)We consider it essential that one of the crucial lessons of the Wembley National Stadium project is learnt and that funding for essential improvements in transport infrastructure at Picketts Lock is in place at an early stage in the development of the project (paragraph 141).
(xxvi)We have no doubt that a viable new national stadium for athletics would represent an important addition to the elite sporting facilities of this country. We hope that the Secretary of State's confidence will prove justified. However, there are important issues that remain to be resolved with regard to the Picketts Lock Stadium project. Satisfactory solutions to the problems of underwriting, cost control, risk management, timetable guarantees and long-term viability must be firmly in place before Lottery funding is granted. Sport England must judge the project by its usual criteria for capital projects and must also bear in mind the need to consider both the issues relating to the 2005 World Athletics Championships and the distinct and strong case for a National Stadium for Athletics (paragraph 148).
(xxvii)We recommend that, once Sport England and UK Sport have received copies of the feasibility study on a London Olympic bid, their views be sought by the Government. We further recommend that this advice, insofar as it does not contain commercially confidential information, be published before the end of July 2001 (paragraph 153).
(xxviii)It would be wrong for the British Olympic Association, the Government and other agencies involved to decide in haste whether or not to bid for the Olympics in 2012 and then to repent at leisure. For this reason, our conclusions in this section are not couched in terms of definitive recommendations, but seek to identify the issues that must be considered and discussed fully before a decision on a bid is reached (paragraph 155).
(xxix)We recommend that the Government set out in advance of any decision to bid for the Olympic Games its assessment of the rationale for any bid—both sporting and non-sporting—and the objectives that would be sought from the staging of the Games. This assessment must be clearly focused on a specific analysis on the rationale for London and the United Kingdom and not simply rely on telling good news stories from previous Olympic Games. It must also explain the Government's strategy to ensure that any London Games have enduring economic, social and regenerative benefits (paragraph 159).
(xxx)We recommend that the Government make its views known on where in London an Olympic bid should be concentrated well in advance of a decision to bid. In doing so, the Government must respond explicitly to the challenge of preserving the opportunity to stage the Games on identified sites while not jeopardising the opportunity for appropriate regenerative development of that land (paragraph 160).
(xxxi)We recommend that, as soon as possible after a decision on sites in London and in advance of any decision to bid, the Government publish an assessment of the facilities for a London Olympic bid including (a) those that ought to be developed as a priority regardless of whether London is awarded the Olympic Games, (b) those that would be developed as permanent facilities with a viable long-term use in the event of London being awarded the Olympic Games, and (c) those that would be built on a temporary basis for a London Olympic Games with no long-term legacy. For each facility, the Government should also specify the likely sources of funding (paragraph 161).
(xxxii)We recommend that, in advance of any decision to bid for the Olympics, the Government set out its proposals for a Stadium for a London Olympic Games. These proposals must be specific about the site, the funding arrangements for both the Stadium itself and the surrounding infrastructure, the proposed design concept for the Stadium and arrangements to ensure the long-term use and viability of the Stadium (paragraph 162).
(xxxiii)We recommend that, in advance of any decision to bid, the Government publish an assessment of the transport and wider infrastructure changes required if London is to stage the Olympic Games, clearly distinguishing between investment that would be justified on other grounds and costs that would be specific to the Games (paragraph 163).
(xxxiv)We recommend that the Government commission and publish an independent analysis of the likely total cost of a London Olympic Games in advance of a decision to bid. Publication of this analysis should be accompanied by a statement from the Government about the extent of the Exchequer commitment both to meet these costs and to underwrite the Games (paragraph 164).
(xxxv)We consider it essential that any London Olympic bid—and the organisation of any subsequent London Olympic Games—must be led by a Minister with direct budgetary control and consequent political responsibility and accountability. The Government cannot be at arm's length from these processes. If the Government is not prepared to accept the ultimate responsibility implied by this approach, it should not embark upon the venture (paragraph 165).
(xxxvi)We recommend that, in advance of any decision to bid, the Government explain how it proposes to ensure that the massive investment in London's sporting infrastructure implied by a London Olympic Games is reconciled with the Government's general commitment to an equitable spread of facilities. We further recommend that the Government explain how it proposes to ensure that concentration on elite facilities will not lead to a neglect of investment in community facilities in London (paragraph 166).
(xxxvii)Should there be a London Olympic bid, we recommend that the Government establish as one of its priorities that plans for the Paralympic Games represent an integrated and prominent aspect of such a bid (paragraph 167).
(xxxviii)We recommend that the Government state explicitly before the end of July 2001 whether or not it considers that the conditions for its support for a London Olympic bid established in February 1999 relating to the IOC's selection process have been met (paragraph 168).
(xxxix)We recommend that the Government commission an independent assessment of the prospects for success of a London Olympic bid, including an explicit comparison with other likely bidding cities. We would wish to see the assessment undertaken if at all possible by a team including non-British members of the IOC or of international sports federations with appropriate experience (paragraph 171).
(xl)We recommend that UK Sport and Sport England commission an independent study of the benefits that might accrue from more systematic support for events in minority sports or sports not so far covered by them, including support for broadcasting costs (paragraph 175).
(xli)The piecemeal approach towards the management of events and of public sector support for them is no longer acceptable. Even though we admire the work accomplished by Mr McCartney, we do not consider it sensible to appoint a separate Minister for each event deemed to be of sufficient importance, with each new Minister seeking to acquire the skills and knowledge for the role from scratch. We repeat for the third time our recommendation that a serving Minister in the Cabinet Office be designated as Minister for Events (paragraph 184).
(xlii)In this Report, we wish to go further. Our examination of events has exposed many problems of overlapping responsibilities in the governance of sport and of too many issues that fall into the gaps between bodies. In the wider context, there is a need for a full consideration of the future role of the Minister for Sport (paragraph 185).
(xliii)In the specific context of events, there is an overwhelming need for institutional reform and simplification. We recommend that the Major Events Steering Group of UK Sport and the Government and Agencies Committee within Government be abolished and that they both be replaced by a single decision-making body within Government chaired by the Minister for Events and with a membership including the Ministers responsible for sport in the United Kingdom Government and in the devolved administrations. We further recommend that this body have the final decision-making power on all bids and all events where the commitment of State resources is an essential prerequisite for the event. Finally, we recommend that the Minister for Events have direct control over the necessary financial resources to support events of national importance (paragraph 186).

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