Examination of Witnesses (Questions 60-79)
RT HON
JAMES PURNELL
MP AND MR
JONATHAN STEPHENS
25 OCTOBER 2007
Q60 Chairman: Would you like to see
it debated on the floor of the House?
James Purnell: I should like to
see it debated in the appropriate way.
Q61 Alan Keen: Can you bring us up
to date on what I thought was a peculiar aim? I understand millions
of pounds are being put in for the Olympics by persuading athletes
at a second level down from the very top to take up and train
for events which are not normally played in this country. It seems
to me a waste of money if we do that. If we do not do wrestling
or tiddlywinks or whatever it might be, why waste the nation's
money on trying to get athletes to compete in every event?
James Purnell: Clearly it is a
matter for UK Sport who are world leaders in terms of performance
support. One of the goals in the Olympics is not just to train
people for 2008 and 2012 but to have a legacy of a performance
support system in this country which has been taken to a higher
level. That is what UK Sport are trying to achieve. I actually
think that in the UK there are many people who take up individual
sports. In football, for example, there are lots of people who
are taken on when quite young by football clubs, who do not then
make the grade and who could easily make the grade in other sports.
If people have a natural sporting ability, it is worth seeing
whether there are other sports they can perform in. Anything which
gets us medals in 2008 and 2012 is something we should all investigate.
Q62 Alan Keen: You know my dedication
to football.
James Purnell: I do know that.
Q63 Alan Keen: I understand in the
Resource Accounts in the last fiscal year another £5.6 million
has gone to Wembley Stadium. I am not against that, but why?
James Purnell: It is not a new
grant. It is money which was originally agreed for Wembley but
because of the delays in the completion of that project the money
was counted in the latest period rather than previously. There
is no new money at all; it is exactly the same amount, the £20
million which was originally allocated.
Q64 Alan Keen: I am still in correspondence
with at least one person. I have been on this Committee for ten
years now and quite a few people think that really the FA still
owe £20 million back to Sport England, whoever it was who
gave them money, on the grounds that athletics were to have been
able to take place in Wembley Stadium and originally that was
why the £20 million extra was given. I have to respond, even
though I favour football over anything else, to the people who
do argue that £20 million is still owed in the opposite direction.
James Purnell: No one is going
to say that the construction of Wembley was a perfect process
but the original agreement was that DCMS would contribute that
£20 million and it has just accrued in this year. There is
nothing sinister about that.
Q65 Alan Keen: Nothing appears to
be written down anywhere so any answer you give can never be proved
right or wrong.
James Purnell: This ground has
been gone over many, many times.
Q66 Paul Farrelly: I declare my interest
as the Secretary of the Rugby Union Group in Parliament. I want
to return to what is euphemistically called the raid on the Lottery,
the extra money that has been taken out of the Lottery. Sport
England are clearly concerned about the effect on grassroots sport
and I can see it in constituencies such as mine. When you take
the list from the Amateur Swimming Association, for example, you
can see the point at which big amounts of funding for new swimming
pools have stopped because the Olympics have kicked in. My own
borough has 100-year-old swimming baths which need replacing now;
£5 million without Lottery support is a great deal of money
for a district council to afford. The way it has been done will
have an impact on things locally and may just continue to rankle
in the run-up to the Olympics. I know the Government have gone
some way in terms of addressing this and saying they hope value
from some of the assets and the legacy may be given back in the
future, but good causes, community sport, will suffer in the meantime.
Is there not a better way to pull everyone together from around
the country than extracting this money from the National Lottery?
James Purnell: The only alternative
is grant-in-aid funding, exchequer funding. The increase in the
contribution from the exchequer was £5 billion, far, far
outweighing the absolute amount and also the proportion coming
from the Lottery. I think that was an appropriate way of doing
that. If the money had all come out of grant-in-aid, then there
would obviously have been less to go round in terms of spending
review settlements. One of the things we have been able to do
is to achieve a spending review settlement which will mean that
the DCMS money overall will go up in line with inflation, thus
allowing us to give above-inflation increases to museums, above-inflation
increases to the arts. I hope what that can allow us to do is
to get away from the idea that somehow there is opposition between
sport and culture on this. I think that making the Cultural Olympiad
a real success is one of the great opportunities of the Olympics.
We will be in the world's shop window for the four years after
Beijing and the spending review settlement gives us a good platform
for doing that. When I talk to NDPBs they say the thing they absolutely
focus on is that grant-in-aid funding.
Q67 Paul Farrelly: I want briefly
to look at a couple of other options. One of the new Parliamentary
Private Secretaries to your Department, a former member of this
Committee, a former England rugby international, Derek Wyatt,
has long championed the Treasury giving up an extra slice of VAT
on Lottery tickets to fund the Olympics rather than it being taken
out of good causes. What do you think of that option?
James Purnell: I think he is a
fantastic MP and great representative for these arguments. I would
say that any reduction in Treasury income would obviously mean
less money available to be spent on other spending departments.
What we have been able to achieve is a far better than expected
spending review outcome and I hope that gives people the resources
they need to continue to invest in the grassroots and also in
excellence, whether in arts, heritage or indeed sport.
Q68 Paul Farrelly: Are you continuing
to make the argument that there might be different ways of doing
this? Do you see it as a closed-door decision?
James Purnell: I see it as a settled
package and that is why we are bringing it to Parliament today.
Q69 Paul Farrelly: We talked about
the £5 billion which the Treasury has made over and above.
A lot of that is not actually money which has been laid out. There
is a huge amount of contingency; depending on the way you calculate
it, it gets up to about 50%. People organising events round the
world would have died for that amount of contingency. As we go
along preparing for the Olympics, do you think it might be intelligent
to review the appropriate level of contingency and were it, for
example, found to be too high then revisit this issue and perhaps
release some more money back to the Lottery good causes?
James Purnell: I am very happy
to have Jonathan answer that who is also Permanent Secretary for
Tessa Jowell. Obviously that question falls predominantly within
her area of responsibility and I note that you have her coming
before your Committee at some point. Maybe Jonathan, as her Permanent
Secretary, can take that question, but I do not want to start
straying into Tessa's area.
Mr Stephens: We think the contingency
is a prudent allocation against the risks. On any major, huge
construction project like this a number of risks can be anticipated
and a number cannot. We think that is a prudent allocation against
it. Obviously we will keep on reviewing it, our intent is not
to draw down and use any more than is absolutely necessary and
we have the arrangements from land sales after the Games to ensure
that the Lottery can be paid back.
Q70 Paul Farrelly: In this important
area of detail I seem to have strayed into one of those grey areas
of responsibility.
James Purnell: There is nothing
grey about it at all. The reason I am not answering the question
is that it is not my responsibility.
Q71 Paul Farrelly: The question is:
would it not be an intelligent approach over time to keep reviewing
the level of contingency and were it to be found perhaps to be
over prudent then that might be, within that exchequer funding,
a source of funds to be released back to good causes and the Lottery?
Mr Stephens: We certainly will
review it regularly. We will not release funds from the contingency
unless it is justified by the risk that materialises. As we stand
now, this is a prudent allocation because we are very clear that
the public sector funding package totalling £9.3 billion
is it and the final budget and not to be exceeded. Over time some
of that contingency is being funded out of the Lottery. Clearly
if that is not needed then we will return it to where it came
from.
Q72 Paul Farrelly: So we should not
see it necessarily as being a closed door.
Mr Stephens: No. Equally, we know
that there are significant risks to be managed on a very large-scale
project of this sort. This is a prudent way of managing them at
this stage and we need to keep it under review, as you have suggested.
Q73 Chairman: Are you able to tell
us when the ODA is going to publish its budget?
Mr Stephens: The ODA already has
a budget for this year; it published its corporate plan earlier
in the year. It will publish a budget for each year as it approaches
the year.
Q74 Chairman: Will they not publish
a detailed current estimate of the cost of constructing the Olympic
Park?
Mr Stephens: We published a lifetime
budget; Tessa Jowell published that in March. The next stage on
that is a detailed allocation against the latest much more detailed
plans and a detailed assessment and allocation of risk. That is
still going on and will still need to be considered by the various
funding parties. I am sure that once that is concluded there will
be more detail which will be appropriately published, consistent
of course with the commercial considerations of making sure the
ODA is in a position to get the very best possible deal out of
the contractors it is currently negotiating with.
Q75 Chairman: Are you able to say
how much of the contingency has so far been committed for specific
expenditure?
Mr Stephens: The funders have
already approved commitment of £360 million; that is discussed
in the recent NAO report which was published which looked at the
budget set out in March. I should be clear that that is contingency
that has been allocated but not yet drawn down. The funders will
go on reviewing the allocation of contingency against risk as
we go forward.
Q76 Mr Evans: I am very keen on this
idea of getting youngsters to do five hours of sport a week; it
is something that is absolutely essential and necessary and sport
has always been seen, by some schools at least, as being the one
which could be squeezed, particularly within the curriculum. Is
this £100 million you have announced additional funding and
going to be year on year on year and protected? How is it being
distributed?
James Purnell: We are working
up the delivery plans with the Youth Sports Trust and with local
authorities, schools and Sport England and we shall come forward
with proposals shortly.
Q77 Mr Evans: My big fear is that
if it is given to local authorities without it being ring fenced
it is just going to be swallowed up in huge amounts.
James Purnell: We are not planning
to spend it through local authorities. The Youth Sports Trust
are the lead delivery body on that. They work very closely with
schools. They have funded, for example, sports co-ordinators.
This extra money will fund an expansion of competition managers,
which we hope will allow all schools to have competitive sport.
The DCMS part of the money is very much focused at community sport
and out-of-school sport. The five hours are in and out of school
and that can fund a whole range of activities from coaching at
the end of the day through to Friday evening and Saturday evening
sports activities which can have both a sporting part but also
a goal in terms of reducing anti-social behaviour. We are developing
the delivery plans and will happily share them with the Committee.
Q78 Mr Evans: The monitoring of this
is absolutely essential as well and also the spreading of the
money out to rural areas. I am President of Clitheroe Wolves which
has 400-plus kids playing football every Saturday which is brilliant,
also cricket organisations. I am sure we all have them in our
constituencies which are strapped for cash or they are not supported
in the way that we think they should be, particularly as getting
fit and the obesity problem are now very high on the agenda. Getting
that money right through is going to be important.
James Purnell: I totally agree
with that. In terms of the information we now have on participation
both by young people and adults, we now have that on a local authority
and maybe even a ward basis. You can monitor the changes from
different years and also the differences between your local authority
and other local authorities so you can benchmark them to see whether
they are doing a sufficient job. We now have the evidence to be
able to monitor that effectively. I also totally agree with what
you are saying about the importance of clubs. We have to widen
the participation base of the pyramid but we then need to have
a successful club infrastructure to which people can then go to
develop a lifetime sporting habit and to develop their talent.
I am very much focused on that and on working for national governing
bodies to achieve that.
Q79 Mr Evans: That is good because
clubs are fairly well self-selecting as far as the youngsters
who go and join them are concerned. If we are looking at keeping
another section of youngsters fit, then the school structure is
perhaps important. I had a number of youngsters here this week
from Ribblesdale School, a great school. I asked them how many
hours of sport they did a week and the answer was two. How we
get them from two to five is going to be important. I question
whether £100 million, which works out at roughly £12
per pupil, is going to be sufficient within the school year to
achieve that and also how it is going to be done imaginatively
within the curriculum which is already hard pressed. In a number
of rural areas you will find that schools tend to close earlier
because of transport problems; the youngsters have to finish about
quarter past or half past three and then they are away. May I
ask that you liaise very closely with Alan Johnson and the Minister
who is responsible for delivering this programme so that all these
little areas can be ironed out properly and you actually hit the
target most effectively by ensuring that the number of hours that
youngsters are doing sport is increasing for all of them?
James Purnell: We work very closely
with Alan Johnson and the Department of Health on the participation
goal and that is in a large part about getting people who are
not active at all now to start to do walking, cycling, physical
activity, which can then lead into sporting activity. We will
also work very closely with Ed Balls at DCSF to deliver the five
hours. The £100 million is the amount we were asked for and
the people who are delivering it were clear that they thought
they could deliver the five hours within that. We will monitor
it and you will be able to hold us to account if it is not delivered.
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