Memorandum submitted by the Department
for Culture, Media and Sport
1.1 The Government welcomes the opportunity
of this inquiry to summarise the excellent progress that has been
made in the 15 months since London was awarded the honour of hosting
the 2012 Olympic Games and Paralympic Games. The Government believes
that the Olympic Programme is on course to deliver the best Games
ever and a sustainable legacy for the East End, London as a whole
and the UK.
2. PROGRESS
2.1 In April 2006, London received its first
visit from the International Olympic Committee's Co-ordination
Commission since winning the Bid. Denis Oswald, Chairman of the
Commission, praised our achievements and noted that we had delivered
on all key milestones to date.
2.2 Strong and effective governance is in
place with the Olympic Board working well. The London Olympic
Games and Paralympic Games Act 2006 received Royal Assent on 30
March 2006—less than nine months after the Host City announcement.
The Act established the Olympic Delivery Authority (ODA), the
organisation charged with the delivery of the Olympic venues and
infrastructure. An impressive Board for the ODA is now in place
and in the six months since its inception, the ODA has finalised
the Olympic Park Masterplan, appointed a Delivery Partner and
announced the tender for the Olympic Stadium.
2.3 Ensuring the flow of funds to support
the Games is critical and the Olympic Lottery Distributor is up
and running. The first "Go for Gold" scratch-card sold
faster than any other new £1 scratch-card launched by Camelot
since November 2002 and Camelot's income target for Olympic Lottery
sales in 2005-06 was exceeded by £2.3 million.
2.4 Enthusiasm for the Games remains strong
throughout the UK. This has been borne out by research undertaken
by the London Organising Committee for the Olympic Games and Paralympic
Games (LOCOG) and was demonstrated during the UK-wide "Be
Part of 2012" Roadshow which DCMS and LOCOG ran during July.
The Department has also hosted two business summits this year
targeted at the UK's key business organisations.
2.5 Achieving a sustainable legacy for London
and the wider UK runs throughout the Olympic Programme and all
Government Departments, and nations and regions, are working on
identifying how we can maximise the economic, social, environmental,
cultural and sporting benefits for London and the wider UK.
3. FUNDING THE
GAMES
3.1 The funding arrangements for the Games
are outlined in the Government Response to "A London Olympic
Bid for 2012 (HC 268)"—"Report of the Culture,
Media and Sport Select Committee, Session 2002-03".
3.2 The Response explained that the level
of public subsidy provided for is:
|
| National Lottery | £1.500 billion
|
| London Council Tax | £0.625 billion
|
| London Development Agency | £0.250 billion
|
| Total | £2.375 billion
|
|
3.3 The Lottery contribution of £1.5 billion consists
of:
£750 million from hypothecated Olympic Lottery Games.
£410 million from the proceeds of mainstream National
Lottery Games from 2009.
£340 million from the Sports Lottery Distributors (£289.5
million of which is to meet the costs of elite sport and associated
sports investment, £40 million for the Aquatics Centre and
£10.5 million for the Velodrome).
3.4 Further work during 2004, in preparation for the
bid, indicated that to deliver the Games it would be necessary
to bring forward planned improvements in infrastructure including
the placing underground of the high voltage power lines that cross
the site of the Olympic Park. To fund the work the Government
agreed a further public subsidy of £1.044 billion, £405
million from this Spending Review period and £639 million
from the next.
3.5 The Response envisaged that "in excess of £2
billion will be available from a combination of the sale of rights,
ticket sales, sponsorship and other commercial support for the
Games". LOCOG is negotiating with potential sponsors. Money
raised in this way will fund LOCOG's operations. There has been
no increase in this £2 billion budget, which allows for outturn
inflation. Any difference between this figure and the figure shown
in the candidate file arises simply because the candidate file
required the budget to be set out net of inflation.
3.6 In the period from end July 2005 to 31 March 2006,
some £40 million was spent on the Olympic Project. In 2006-07
the ODA is budgeted to spend around £220 million. The ODA's
2007-08 budget is being developed.
3.7 The Government initiated an immediate review of Olympic
development costs as soon as the bid was won. The purpose of the
Review is to ensure that all relevant costs and opportunities
for savings have been identified. The exercise that we have already
conducted in relation to the reconfiguration of the Olympic site
has seen £600 million taken out of the costs both in relation
to the cost of land acquisition and the cost of facilities themselves.
3.8 As is the case with all Games and major projects,
there are a number of factors which may cause cost estimates to
be revised. For example, security costs have had to be revisited
by the Home Office, the Metropolitan Police and the security services
following the events of 7 July 2005. That work is continuing.
Similarly, before the bid was submitted in November 2004, no work
had been carried out on assessing the costs of site remediation
and preparation on what is a very difficult and constrained site
in an area of high deprivation. The nature of the project also
means that levels of contingency at programme level need to be
kept under constant review in line with assessments of risk. It
will be an early task of the Delivery Partner appointed by the
ODA on 31 August (CLM Consortium, comprising CH2M Hill International,
Laing O'Rourke and Mace) to look across the entire delivery programme
and bear down on costs. Clear incentives will be built into their
work programme to achieve this.
3.9 It is also critically important to strike the right
balance between minimising costs and securing the long-term legacy
of the Games in terms of the wider regeneration of the Lea Valley
and the Thames Gateway. For example, there is a choice between
remediating the land in the Olympic Park to bring it up to the
standard necessary to stage the Games, or to enhance it to provide
the basis for long-term provision of housing and associated infrastructure.
3.10 The Memorandum of Understanding between the Government
and the Mayor sets out the formula whereby in the event of an
increase in costs there could be a sharing arrangement between
them with the additional costs to be met from a combination of
funding from the lottery and the Mayor.
4. ENSURING A
SUSTAINABLE LEGACY
ACROSS THE
UK
4.1 The Government and all the Olympic partners are determined
that the 2012 Games should leave a sustainable legacy for London
and the UK. We do not underestimate the level of the challenge
to ensure we maximise benefits of the Games. This will require
a pro-active and sustained effort but the Government believes
the Olympic Board has put in place the right structures and processes
at an early stage to achieve this.
Legacy—governance and delivery
4.2 The overall vision for the Olympic Programme, as
agreed by the Olympic Board, is "to host an inspirational,
safe and inclusive Olympic and Paralympic Games and leave a sustainable
legacy for London and the UK". Four strategic objectives
underpin this and include the delivery of sustainable legacy benefits,
both "hard" physical legacy left on the Olympic Park
and in surrounding infrastructure, and the "softer",
wider legacy, including economic, environmental, sporting and
cultural benefits. A full set of objectives is at annex A.
4.3 The Olympic Board comprises the Secretary of State
for Culture, Media and Sport, the Mayor of London, the Chair of
the British Olympic Association (BOA) and the Chair of LOCOG,
and has overall responsibility for delivery of the Olympic Programme.
The Chair of the ODA attends meetings of the Board. The Board
is supported by a Group of senior officials from the Olympic partners.
4.4 The Government Olympic Executive (GOE) has been set
up within DCMS to lead and coordinate the Government contribution
to the delivery of the Olympic Programme. It sponsors the ODA,
the Olympic Lottery Distributor and LOCOG. GOE is working closely
with Government departments, the GLA and key stakeholders to develop
delivery plans for maximising the wider economic, social, environmental,
cultural and sporting benefits, both for London and the UK. Delivery
plans are being developed for each individual sub-objective, led
by the relevant Government department/s on sub-objectives for
which Government is responsible.
4.5 LOCOG has set up the 2012 Nations and Regions Group,
chaired by Charles Allen and the nations and regions have been
charged with developing national and regional plans for maximising
benefits and building a sustainable legacy. Both sports participation
and tourism have been identified as strategic priorities for the
nations and regions in these plans. These plans will be brought
together with the plans being led by the GLA and Government departments
to drive forward overall legacy.
4.6 The IOC is currently working up a series of Olympic
Games Global Impact Indicators to assess the socio-cultural, economic
and environmental impacts of the Games. The Olympic Programme
will be measured against these indicators.
London legacy and benefits
4.7 The heart of the Olympic programme is the regeneration
of one of the most deprived areas of the UK. The Lower Lea Valley
and surrounding areas in east London and beyond have enormous
untapped potential—with one of the youngest and most culturally
diverse populations in Europe. With two of the five Host Boroughs
ranked in the top five most deprived local authorities in England,
the 2012 Games present a tremendous opportunity to break the cycle
of deprivation and dramatically improve the quality of life for
people in the area. Building the Olympic Park will act as a catalyst,
rapidly accelerating the creation of a new, more prosperous and
sustainable sector within east London, with opportunities for
new jobs and skills, acting as a stimulus to the wider Thames
Gateway, the largest regeneration zone in Western Europe.
4.8 The Olympic Park, which will provide 9,000 homes
and 12,000 new jobs, will support wider plans for a phase of growth
across the Thames Gateway. Department for Communities and Local
Government figures suggest there could be at least 120,000 new
homes and 180,000 more jobs in the Gateway between 2001 and 2016.
The proposed new Stratford City development highlights the potential
of Stratford to become a major new commercial centre, with plans
for 460,000 square metres of commercial space and 150,000 square
metres of retail space, which the developers estimate could create
up to 33,000 jobs.
4.9 The Park itself will provide five major sports venues,
including the main stadium, an aquatics centre and indoor multi-sport
arena, the largest new urban park in Europe for 150 years, and
regeneration of extensive waterways. Vital transport links are
also being developed. These include the Channel Tunnel Rail Link
and extension of the Docklands Light Railway. An Olympic Park
Legacy Group, comprising representatives of the key stakeholders,
has been established to take an overview of the legacy of the
Park.
UK wide legacy and benefits
4.10 The whole of the UK stands to gain from the economic,
social, environmental, sporting and cultural opportunities brought
by the Games. The Government recognises that these benefits will
not necessarily happen of their own accord. Initiatives, such
as those summarised below, are already underway, or planned, to
maximise the benefits of the Games throughout the UK and to ensure
that the Games contribute wherever possible to achieving existing
targets.
4.11 The Olympic partners are working hard to ensure
that companies from across the UK are well placed to bid for the
thousands of Olympic contracts which will be issued by the ODA
and LOCOG. These contracts will cover a huge range of sectors
from construction, engineering and manufacturing to creative industries,
merchandising and retail. LOCOG is working with the Devolved Administrations
and the Regional Development Agencies on the potential for operating
a Business Opportunities Network to give business across the UK,
particularly SMEs, the opportunity to engage with potential partners
and compete successfully for Olympic-related contracts. The long
term prize is high—reports suggest that Australian companies
won 10% of the capital projects for the Beijing Games. The ODA
has issued a draft Procurement Policy, which invites comments
from industry and more widely on how the ODA will place and manage
contracts to deliver the Games. There is also an agreed set of
commitments between ODA and the construction industry.
4.12 DfES and DWP are working with the Learning and Skills
Council, sector skills councils and Jobcentre Plus to ensure that
the Games contribute to reducing worklessness and improving skills
levels throughout the workforce, leaving workers not only with
the skills to meet the demands of the Games but also to meet the
needs of the long-term global economy. Similarly, the GLA and
LDA have led work, through the London 2012 Employment and Skills
Task Force, to develop an action plan which will seek to maximise
the employment and skills benefits for Londoners, especially in
the Lower Lea Valley. The action plan sets challenging targets
including the establishment of the Olympic Park as a National
Skills Academy Site, the building up language and cultural awareness
skills and the launching of an "Employer Accord" to
drive up the quantity and quality of job/training-ready candidates
in the supply system.
4.13 A volunteering strategy is being developed by LOCOG
with support from the GLA, the Cabinet Office, and others in the
voluntary sector. 70,000 volunteers will be required for the Games
and over 100,000 have already registered an interest. The strategy
includes a pilot for a Pre-Games volunteering programme (PVP)
based on a similar programme at the Manchester Commonwealth Games
in 2002, and will target individuals in hard to reach groups with
low levels of skills and qualifications. The short course will
provide participants with the skills—such as hosting and
customer service skills—and the experience needed to re-enter
the workforce, as well as to participate in voluntary activity.
With increased confidence, participants will be also be encouraged
to volunteer in their local communities.
4.14 There is also a significant programme of work being
led by DfES focused on schools. This includes work led by LOCOG
with the BOA, British Paralympic Association and DfES to develop
a Games-related pack for schools. The "On Your Marks!"
website has now been launched and includes images and teaching
aides, building on the excitement of hosting the 2012 Games. DfES
will also be using the Games to help boost the nation's capability
in language learning and ensure that young people take a more
outward-looking approach to other countries.
4.15 The Games provides a great opportunity for increasing
participation in sport as part of the Government's overall drive
to strengthen community sport and encourage healthy lifestyles.
Sport England is developing a community sport legacy strategy
focused on making opportunities for sport participation more widely
available, particularly for hard to reach groups; building the
club structure; increasing the number of sport volunteers and
building programmes for talent identification and development.
The Government has also committed £34.5 million over the
next two years to the National Sports Foundation to fund a range
of projects to benefit grassroots sport, and we will be encouraging
the private sector to match this funding. The 2006 Budget announced
an extra £300 million for elite athletes up to 2012. The
UK School Games—which mirror the atmosphere of an Olympic
Games or Paralympic Games—will give talented youngsters
from across the UK the chance to compete at the highest level.
Over 1,000 talented young athletes took part in five sports over
four days at the inaugural Games in Glasgow in September; Coventry
will host the UK School Games in 2007.
4.16 From the closing ceremony of the Beijing 2008 Games,
the UK will commence its "Cultural Olympiad", a four-year
period celebration of culture, reflecting the diverse communities
which make up London and the UK. The Olympiad will encourage more
people, particularly children and young people, to experience
and participate in cultural activity. DCMS, the Millennium Commission,
the Big Lottery Fund, and Arts Council England are currently setting
up a charitable Trust to distribute £40 million for a range
of cultural and sporting initiatives.
4.17 Of course, in line with commitments made in the
bid and more widely, the 2012 Games must be delivered in a way
which is socially, economically and environmentally sustainable.
There are specific objectives on this within the Olympic programme
objectives and to ensure that these are delivered, the Olympic
Board has agreed an overarching sustainability policy, guiding
the work of each delivery body. Detailed work is also underway
to develop sustainability targets, with a focus on the five themes
identified in the policy (climate change, waste, biodiversity,
healthy living and inclusion) where the Games can make the biggest
impact. In line with the bid commitments, there will be independent
assurance of the Games by the London Sustainable Development Commission.
4.18 The profile of the Games internationally provides
an unrivalled opportunity to promote the UK overseas. Experience
from recent host cities indicates that tourism will increase significantly
across the UK, most notably after the Games. Estimates suggest
that the UK tourism sector will benefit from £1.4 to £2
billion. We are currently leading a major consultation to inform
a comprehensive Tourism Strategy for the 2012 Games, which will
set out clear actions and deliverables for the industry. The Games
also provide the opportunity to promote UK industry overseas and
attract inward investment to the UK. A report by PwC in Australia
found that the 2000 Games gave an equivalent of A$6.1 billion
(£2.3 billion) worth of international exposure for brand
Australia. There are also opportunities for pre-Games training
camps to be held across the UK, providing a further economic stimulus
(such camps injected A$70 million (£26.9 million) to the
New South Wales economy).
4.19 The mass appeal and worldwide status of the Games also
provides a long-term diplomatic opportunity to promote our modern,
diverse, dynamic country to a mass audience. LOCOG estimates that
over 20,000 members of the media will be based in the UK, with
a worldwide audience of billions, and the latest research suggests
that the association between a host city and the Games is a lasting
one. The Games will also give us a chance to showcase our position
on a number of important global issues, most notably the environment
and sustainable development, and our aspiration to use the Games
to inspire young people around the world to take up sport will
help reinvigorate friendships between the UK and other countries.
Annex A
OLYMPIC & PARALYMPIC GAMES PROGRAMME OBJECTIVES
VISION
To host an inspirational, safe and inclusive Olympic and
Paralympic Games and leave a substainable legacy for London and
the UK.
|
| Strategic Objectives | Lead Stakeholder
| Sub-Objective |
|
| 1. To stage an inspirational Olympic Games and Paralympic Games for the athletes, the Olympic Family and the viewing public.
| 1.1 | LOCOG
| Deliver an inspirational environment and experience for athletes and provide a first class experience for the Olympic Family and spectators.
|
| 1.2 |
LOCOG | Meet IOC and IPC needs and specifications, including venue over lays.
|
| 1.3 |
LOCOG | Ensure effective and efficient planning and operation of the Olympic and Paralympic Games (including security, transport, technology, health, volunteering and accessibility).
|
| 1.4 |
LOCOG | Maximise audience size at venues.
|
| 1.5 |
LOCOG | Secure support and engagement across all sections of the UK public.
|
| 1.6 |
LOCOG | Deliver effective media presentation and maximise global audience size.
|
| 1.7 |
LOCOG | Communicate Olympic values across the world, particularly amongst young people.
|
| 1.8 |
LOCOG | Stage inspiring ceremonies and cultural events.
|
| 1.9 |
LOCOG | Deliver an operating surplus from the Olympic Games and Paralympic Games.
|
| 1.10 |
LOCOG | Operate sustainable and environmentally responsible Olympic Games and Paralympic Games.
|
| 2. To deliver the Olympic Park and all venues on time, within agreed budget and to specification, minimising the call on public funds and providing for a sustainable legacy.
| 2.1
2.2 | LDA
ODA
| Assemble and remediate land for Games venues.
Create infrastructure and facilities associated with Games venues to time and agreed budget in accordance with the principles of sustainable development.
|
| 2.3 |
ODA | Deliver Olympic and Paralympic venues to time, to design and building specification and to agreed budget, providing for agreed legacy use.
|
| 2.4 |
HMG | Secure smooth flow of public funds to the ODA.
|
| 2.5 |
ODA | Deliver necessary transport infrastructure for Games, and devise and implement effective transport plans which provide for legacy use.
|
| 2.6 |
ODA | Deliver agreed sustainable legacy plans for the Olympic Park and all venues.
|
| 2.7 |
BOA | Deliver a viable Landon Olympic Institute.
|
| 3. To maximise the economic, social, health and environmental benefits of the Games for the UK, particularly through regeneration and sustainable development in East London.
| 3.1 | HMG
| Maximise the economic, social, health and environmental benefits the Games bring to the UK and all sections of the UK population.
|
| 3.1.1 |
HMG | Maximise the employment and skills benefits for the UK arising from Games—related business.
|
| 3.1.2 |
HMG | Maximise the wider economic benefits of the Games across the UK, Including those for tourism and business promotion.
|
| 3.1.3 |
HMG | Maximise cultural benefits from hosting the Games and the Cultural Olympiad.
|
| 3.1.4 |
HMG | Maximise social benefits, Including in health, education and volunteering, of hosting the Games.
|
| 3.1.5 |
HMG | Ensure that the Games contribute to Sustainable Communities priorities, including the wider Thames Gateway.
|
| 3.1.6 |
HMG | Agree and promote sustainable development and procurement policies, including commitments to sustainable energy and waste management goals.
|
| 3.1.7 |
HMG | Promote positive Images of the UK to an international audience. the Games for the UK.
|
| 3.1.8 |
HMG | Ensure the UK's diverse communities are engaged with, and benefit from, the changes and opportunities arising from hosting the Games In the UK.
|
| 3.2 |
Mayor | Maximise the economic, social, health and environmental benefits the Games bring to London and all Londoners.
|
| 3.2.1 |
Mayor | Maximise the employment and skills benefits for Londoners arising from Games—related business.
|
| 3.2.2 |
Mayor | Maximise the wider economic benefits of the Games to London, Including those for tourism and business promotion.
|
| 3.2.3 |
Mayor | Maximise cultural benefits to Londoners from hosting the Games and the Cultural Olympiad.
|
| 3.2.4 |
Mayor | Maximise social benefits Londoners, including in health, education and volunteering, of hosting the Games.
|
| 3.2.5 |
Mayor | Ensure that the Games contribute to Sustainable Communities priorities including the London Thames Gateway.
|
| 3.2.6 |
Mayor | Agree and promote sustainable development and procurement policies, including commitments to sustainable energy and waste management goals.
|
| 3.2.7 |
Mayor | Promote London's image a leading world city to an international audience.
|
| 3.2.8 |
Mayor | Ensure London's diverse communities are engaged with, and benefit from, the changes and opportunities arising from hosting the Games in London.
|
| 4. To achieve a sustained improvement in UK sport before, during and after the Games, in both elite performance—particularly in Olympic and Oaralympic sports—and grassroots participation.
| 4.1
| BOA
| Secure UK Olympic and Paralympic athletes' success in the Games.
|
| 4.2 |
HMG | Maximise British athlete success in the Olympic and Paralympic Games through investing funds in, and supporting, our most talented athletes.
|
| 4.3 |
HMG | Secure long-term benefits to elite sport competitors—particularly in Olympic and Paralympic Sports.
|
| 4.4 |
HMG | Maximise Increase in UK participation at community and grass—roots level In all sport and across all groups.
|
| 4.5 |
Mayor | Maximise increase in London participation at community and grass—roots level In all sport and across all groups.
|
| 4.6 |
HMG | Implement viable legacy use for Olympic sports facilities outside London.
|
| 4.7 |
Mayor | Implement viable legacy use for Olympic sports facilities in London.
|
| 4.8 |
HMG | Work with those in other countries, particularly those in development, to promote sport excellence and participation.
|
| 4.9 |
BOA | Promote, through sport, the Olympic ideals across the 2012 programme.
|
|
| 6 October 2006 | |
| |
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