House of Commons - Culture, Media and Sport

Select Committee on Culture, Media and Sport Sixth Report

3 Venues and their legacy

64. Almost all of the land on the Olympic site—on which there had initially been over 2,200 land interests—is now owned by the ODA or by the Lee Valley Regional Park Authority. All of it is under public sector control.[105] The LDA told us that, by the end of July 2007, it had supported 193 businesses in moving from the site.[106] When the LDA gave evidence to us in December 2007, it had effectively settled 85% of compensation claims, and it expected to settle the remaining 15% within the overall land settlement budget. By early February 2008, a total of £556.1 million had been paid in compensation to landowners and occupiers in compensation for the Compulsory Purchase Order: this was in line with estimates.[107] Compensation claims were split into two tranches. The LDA told us that most of the 15% of outstanding cases belonged to the second, later tranche of relocations. Nevertheless, in some cases the delay in settlement was because landowners had exercised their right to proceed to a Lands Tribunal.[108]

65. The Five Host Boroughs (in which the bulk of events at the Games will take place), while recognising that the process of land assembly had not been without its challenges and noting that errors had been made at the start, congratulated the LDA on the successful conclusion of the process. The Host Boroughs pointed out that the land assembly had been completed almost to timetable and with "the minimum amount of disruption and impact on surrounding communities".[109] We commend the LDA for completing the land assembly process within budget and without significant delay.

66. Outline planning permission for the Olympic Park was secured in September 2007, enabling "heavy" construction work to begin. In January 2008, the ODA's Programme Delivery Baseline Report stated that approximately 50% of the site had been cleared and that 70% of demolitions were complete.[110]

Venues in the Olympic Park

67. The Olympic Park will contain five new sporting venues: the Olympic Stadium, the Aquatics Centre, the Velopark, a sporting arena to be used during the Games for handball and commonly referred to as the Handball Arena, and the mixed-use Eton Manor site. There will also be one major venue suitable for commercial use: the International Broadcast Centre and Main Press Centre. Different venues are at slightly different stages on the road from concept through to construction; but all sporting venues have been the subject of detailed discussion between LOCOG and international and national sports bodies.[111]

68. Some of the main venues are unique in design. As a proposition for a construction company they are, in the words of the Chairman of the ODA, "unusual".[112] The Institution of Civil Engineers pointed out that the 2012 Games construction programme was being undertaken at a time of major growth in the global construction industry, which enabled contractors to be selective when bidding for work. As the Committee of Public Accounts has observed, the ODA has experienced difficulties in achieving competition for the main venues.[113] Several contractors have withdrawn from tenders for ODA projects, sometimes because of commitments elsewhere.[114] Mr Armitt, Chairman of the ODA, told us that there was considerably more competition for more standard infrastructure projects in the Olympic Park, which constitute the vast bulk of the work and which had generally attracted a "normal" level of interest—between four and six bids each.[115] Nonetheless, there is a clear risk that where the field is limited, or even limited to a single expression of interest which is acceptable, the ODA will be in a weak position to strike a deal on terms which are advantageous to the public purse.

The Olympic Stadium

69. The Olympic Stadium is the single largest venue and the one where most progress has been made. A cost figure of £496 million was announced on 10 October 2007; an outline design concept has been finalised and launched; a consortium led by building contractors Sir Robert McAlpine Ltd. has been awarded the contract to build it; and work is expected to begin in May, three months ahead of schedule.[116]

70. The design for the stadium was announced on 7 November 2007. It features a sunken bowl built into the ground, accommodating the field of play and lower permanent seating, as well as a cable-supported roof providing cover for two-thirds of spectators, and a fabric curtain "wrapping" round the structure, providing "additional protection and shelter for spectators".[117] The design has generally been well received and acknowledged as being both practical and suited to legacy use, even if not particularly radical.[118]

71. The intention for the Stadium after the Games is that it should "deliver a sustainable all-year round sporting and community legacy" and that it should be a "living stadium" accessible to local people and communities.[119] A commitment was made in the bid that athletics would be at the core of the Stadium's legacy use. That commitment has been sustained, and the Stadium will be capable of staging national and international athletics events, as well as premier league rugby and non-premiership football.[120]

72. Seating capacity during the Games will be 80,000; but only 25,000 seats will remain once the Games have ended. The decision on seating capacity was taken with the future multi-purpose use of the Stadium in mind. 25,000 was judged to be the optimum for athletics events, given that the biggest regular event in the British athletics calendar—the UK Grand Prix currently held at Crystal Palace—attracts a crowd of approximately 20,000. UK Athletics (the national governing body for the sport) spoke of "the clear preference of athletes, broadcasters and spectators […] for a packed stadium, creating an inspirational atmosphere".[121] We note that the permanent seating capacity at the Olympic Stadium will not be enough to allow it to host the biennial athletics World Championships, which typically generate an attendance of 50,000 or more.[122]

73. UK Athletics told us that the Stadium "will represent a major boost to athletics in the UK when it is delivered in full legacy mode".[123] It expects that the Stadium will "be the focus for an annual programme of high quality events", including international events and domestic competition for athletes of all ages, which it believes can inspire future generations and maintain the profile of the sport among young people after the 2012 Games have taken place.[124] UK Athletics told us that it had had to lobby "very hard" to ensure that there was a roof above spectator seating in legacy mode as well as provision for a warm-up track, which it viewed as "critical for community use" and essential in enabling bids for future major championships to be made.[125] The Host Boroughs welcomed the decision to allow for an athletics warm-up track in legacy mode.[126]

74. At the time that our previous Report on preparations for the 2012 Games was published, there was uncertainty about whether a major football or rugby club would become an "anchor tenant" for the Stadium, thereby ensuring regular use and providing a more secure financial future. Although discussions with the most local Premier League football team—West Ham United—have come to nothing,[127] there remains the possibility that Leyton Orient Football Club or a rugby union club might adopt the stadium as their home ground. The Host Boroughs lamented the "missed opportunity" to reach an agreement with a Premiership football club, a solution which it believed would have provided a "strong financial cornerstone" and "embedded community programmes".[128] Business in Sport and Leisure voiced similar regrets.[129] The Host Boroughs have nonetheless signalled their commitment to work towards the long-term viability of the Stadium under the proposed multi-purpose use, a solution which the Mayor of Newham described to us as "quite an imaginative and innovative legacy development".[130] The Chief Executive of the LDA spoke of "serious negotiated interest from rugby and football professional bodies" in use of the Stadium, at a level which suggested to him that they believed that it could work.[131] He told us that there were expressions of interest from three football and rugby clubs as potential anchor tenants.[132] Only Leyton Orient Football Club has chosen to make its interest public.[133]

75. We note that the Departments for Culture, Media and Sport and for Children, Schools and Families have commissioned a study to explore the possibility of establishing a school at the Olympic Stadium site after the 2012 Games. The school would "complement, rather than replace, the legacy use of the stadium field of play". The panel undertaking the review is expected to provide final advice to Ministers by June 2008.[134]

Aquatics Centre

76. A competition to design the Aquatics Centre was won in January 2005 by Zaha Hadid Architects. The distinctive winning design was applauded by Lord Rogers for its "exceptional sculptural quality" and was described as "outstanding" and "spectacular" by the then Chief Executive of London 2012.[135] In November 2006, it was announced that the design would be changed and that Centre would be smaller, with the roof area reduced in size from 35,000m²to 14,000m². The ODA describes the new design as being "just as visionary and exciting" as the original and points out that it retains an "eye-catching wave-shaped roof symbolising the flow of water in aquatic sports".[136]

77. On 8 April 2008, the ODA announced that Balfour Beatty—the sole remaining bidder—had been awarded the contract to build the Aquatics Centre. Work will begin in summer 2008 and should be completed by 2011. The ODA also announced that the budget for the Aquatics Centre itself would be £242 million and that the budget for the land bridge which will form part of the roof of the venue is £61 million. Figures include contract costs, an allowance for inflation, VAT and legacy conversion costs.[137] We understand that Sport England will make a contribution of £40 million to the £242 million budget for the Centre itself.[138] The total budget for the Aquatics Centre—£303 million—contrasts with figures cited in press reports earlier this year suggesting that the ODA was negotiating to keep the cost of the centre to between £160 million and £170 million rather than the £213 million reputedly sought by Balfour Beatty.[139] It dwarfs the $117 million/£73 million quoted in the Candidature File.[140]

78. After the Games, the Aquatics Centre will offer two 50 metre swimming pools and a 25 metre diving pool, allowing a mix of elite and community use.[141] Permanent seating capacity in legacy mode will be 2,500, with scope for a temporary increase to up to 3,500 for events such as the European Championships and the International Paralympic Committee World Disability Swimming Championships. We note that the Centre would be only a "support venue" for any World Championships hosted in the UK.[142]

79. British Swimming and the Amateur Swimming Association (ASA), the governing bodies representing the professional and the amateur sectors of the sport, envisage that the Aquatics Centre will be "the premier swimming facility in the UK" after the 2012 Games and will be heavily used for competition, attracting future international events. They also point out that the Centre could provide a venue for more training of coaches and teachers, something seen as essential if participation levels are to grow. We note that the number of athletes from the London area who reach international status in swimming disciplines lags behind the rest of the UK, possibly because of the historic underprovision of 50-metre pools in the London area.[143] There are presently only two 50-metre indoor pools in London (at Crystal Palace and in Ealing), although a third pool is due to open in Hillingdon in 2009.[144] By comparison, Paris has 18 indoor 50-metre pools, Berlin has 19, and Amsterdam, with a fraction of the population of London, has three. The disparities are also reflected at national level, with 23 indoor 50-metre pools in the UK, ninety in France and ninety-two in Germany.[145]

80. In evidence to our previous inquiry into preparations for the 2012 Games, the London Borough of Newham (in which the Aquatics Centre is to be located) told us that it believed that it was vital that the Centre should include "leisure water" in legacy mode if it was to be fully valued and used by the local community. Our awareness of the limited community use of aquatics centres in legacy mode in certain previous Host Cities (Seoul and Athens in particular) led us to recommend in our previous Report that the design of the London Aquatics Centre should provide "for a mix of leisure use and traditional "lane" swimming".[146] Agreement has now been reached that the design of the Aquatics Centre should include an extension to the main complex, including dry as well as wet play facilities, "subject to finance".[147] The London Boroughs of Newham and of Tower Hamlets have agreed to make a capital contribution to the costs of developing and constructing the leisure water facility, in exchange for a commitment to its continuing operation and affordable access to the Centre for Borough residents.[148] We welcome the willingness shown by all parties involved in determining the legacy use of the Aquatics Centre and associated facilities to reach a conclusion which is in the interests of local residents. We are, however, alarmed that the Aquatics Centre will cost over four times more than the forecast provided in the Candidature File submitted in 2004. The concept of the Aquatics Centre might be spectacular and eye-catching; but the saga so far suggests it has been over-designed and, with respect to the robustness of its legacy use, will be an expensive way of providing facilities for water sports needed during and after the Games. We are concerned that the ODA only managed to attract one firm bidder for the project, who would clearly have been aware of the huge level of contingency available to the Games as a whole. We note that in the press release of 8 April 2008, announcing the award of the contract, the ODA stated that "The total of £303 million has not changed throughout the procurement process". We find this simply incredible and call upon the ODA to provide a detailed justification of this statement and of the cost increases at each stage from the initial design to the signing of the contract with Balfour Beatty for the Aquatics Centre and the £61 million "land bridge". In our opinion, the history of the Aquatics Centre shows a risible approach to cost control and that the Games organisers seem to be prepared to spend money like water.

Velopark

81. No contractor has yet been appointed to build the Velopark; but the budget is now £80 million (including a contribution of £10.5 million from Sport England[149] and funding from Transport for London and the Lee Valley Regional Park Authority), as opposed to the $46 million/£29 million cited in the Candidature File.[150] As with the revised budget for the Aquatics Centre, the new figure includes the contract price, allowance for inflation, VAT and legacy conversion costs. The outline design concept has been agreed and will consist of a stadium (the Velodrome), seating 6,000 spectators, and a BMX track during the Games, with a one-mile road cycling circuit, a mountain bike course and a cycle speedway course being added for legacy use. The ODA expects to select a contractor shortly; and construction is due to start in 2009. All legacy facilities are to be owned and managed by the Lee Valley Regional Park Authority, which will provide revenue funding.[151]

82. British Cycling told us that the cycling facilities at the Velopark had "the potential to be absolutely world-class" and that they "should be the very best anywhere in the world".[152] There has nonetheless been a certain amount of controversy about the extent to which the Velopark will offer a suitable replacement for off-road facilities at the former Eastway Circuit, lost when land was assembled by the LDA for incorporation into the Olympic Park. The design currently proposed by the ODA for the Velopark offers most of the facilities previously available at Eastway, albeit in a more fragmented layout. British Cycling, despite being supportive of the proposed design for use during the Games and despite anticipating that, after the Games, the Velopark will "provide a boost for cycling",[153] initially lodged objections to the relevant planning applications on the grounds that they did "not provide an adequate or comparable replacement for the road and off-road facilities provided to cycling on the Eastway Circuit". British Cycling is now satisfied that the ODA has taken on board its concerns and that current plans for the Velopark offer an acceptable replacement for Eastway. The Eastway Users Group, which has campaigned for off-road cycling facilities in the Velopark in legacy mode, remains frustrated by the uncertainty about future provision, and it has pointed out to us that facilities at Eastway closed before the ODA or LDA had provided any suitable temporary alternative, causing much of the 2007 competitive season to be lost.[154] Limited facilities are now available at a site in London Docklands and work is well advanced on a more suitable temporary replacement site at Hog Hill in Redbridge.

83. It would be perverse and wrong if the facilities available to cycle sports in London were to be less extensive after the Games than before them. We are satisfied, however, that plans now being proposed for the Velopark will not only provide a stadium and facilities of the highest quality at the Velodrome but will also offer an adequate replacement for off-road facilities previously available at the Eastway Circuit. We encourage the ODA to confirm the plans currently being proposed.

Handball Arena

84. The Handball Arena will be a permanent 6,000-seat venue, to be retained in situ in legacy mode on the western side of the Park, to the south of the media centre. After the Games, the arena will be converted to an indoor multi-sport centre with a retractable seating arrangement, serving as a training and competition venue and a regional home for a range of indoor minority grassroots sports, with a likely focus on basketball.[155] A "concept design" team has been appointed, and the ODA expects to award the contract to design and build the Arena in early 2009.[156] No up-to-date baseline cost has been announced.

85. The Host Boroughs told us that "the range of legacy sports identified for the Arena matched the identified need in the surrounding boroughs", and they noted assessments which appeared to substantiate the basis for the Arena's viability after the Games. Anchor tenants are being sought; but the ODA and the LDA see the local boroughs as having a key role in helping to build a local base of community users.[157] In our previous report on the Games, we voiced scepticism about the future of this arena.[158] It is too early to tell whether our initial scepticism was well-founded.

Eton Manor

86. Eton Manor, an area to the north of the Olympic Park, will be a training base during the Olympic Games and the venue for wheelchair tennis and archery during the Paralympic Games. Plans for the site have changed since submission of the Candidature File.[159] Under present proposals, the Eton Manor site will include a hockey arena after the Games, comprising two competition standard pitches with seating for up to 5,000 around one of the pitches, as well as a tennis centre with indoor and outdoor tennis courts, and an indoor commercially-operated five-a-side football centre.[160] The Chief Executive of LOCOG cited the plans for Eton Manor as an example of how LOCOG and the ODA had listened to local representations and responded accordingly.[161]

Media and Press Centres

87. The site to be developed for the construction of the International Broadcast Centre and the Main Press Centre lies within the London Borough of Hackney.[162] An idea of their scale can be gained from the specification: during the period of the Games themselves, the two media centres will provide a combined gross internal floor area of 120,000m²for broadcast and print media.[163] There are two consortia on a shortlist to design, build, finance and operate the two centres. The Chairman of the ODA described the centres as "one of the most complex buildings" housing "probably the largest journalistic activity which takes place across the world every four years". He pointed out the high cost of failing to provide the media with the wherewithal to do their jobs.[164]

88. The ODA's view is that, in legacy mode, the buildings housing the two media centres will "have the potential to provide significant legacy employment and space for business which should become the economic driver for the whole area around Hackney Wick".[165] The Mayor of Hackney, Jules Pipe, recognised the potential of the media centres to change the reputation of the area and argued that the site was "absolutely ideal" as a centre for media and creative industries.[166] The ODA confirmed to us that press reports that it was considering a future for the media centres as a supermarket distribution depot were inaccurate.[167] No budget has yet been announced for the Media and Press Centre and we urge the Government and ODA to disclose this as soon as possible. In the meantime, given the huge cost increases recently announced for other venues, we await this announcement with trepidation.

Relocatable venues

89. Various facilities, including temporary arenas for volleyball and basketball and pools for water polo, were described in the Candidature File as being temporary venues which could be demounted at the end of the Games and allocated elsewhere in the UK "to provide a sporting legacy in the regions".[168] Relocation might apply to the venue shell, the field of play, courts, seating or fit-out elements.[169] Mr Coleman, speaking on behalf of the Mayor of London, observed that there was "a huge amount of what can appear quite incidental but is actually very valuable equipment […] that will be left after the Games and which will need to be reused".[170]

90. Responsibility for brokering any relocation of facilities and determining future use of equipment procured for the period of the Games rests with Sport England, which has undertaken a market testing exercise to establish what appetite for the structures exists among national governing bodies of individual sports, local authorities and others. In all, 72 expressions of interest were received, from all parts of the UK. Sport England told us that the bids were being evaluated "with a view to having further discussion".[171] We asked Sport England who would bear the costs of relocating facilities. Sport England replied that "we are not at that stage yet of looking at the financial implications with regard to the relocation of those facilities".[172] A week later, however, the Minister for the Olympics told us that relocation costs would be borne by recipients.[173]

91. As a result of changes to the Olympic Park Masterplan in January 2006,[174] volleyball events will take place not in the Olympic Park but at Earl's Court. There is now some uncertainty about the venue for fencing events, with press reports suggesting that these would be held at the ExCel Centre in Docklands rather than at a temporary venue to be constructed in the Olympic Park.[175] Lord Coe told us in December 2007 that final decisions had not yet been taken but that using existing facilities as venues "has to be a sensible way of approaching things".[176] The ODA's Programme Delivery Baseline Report, however, states that "as part of the review of scope, the responsibility for delivering the fencing venue has been transferred to LOCOG" and that "any change to the plans previously agreed with the IOC/IPC will be subject to International Federation and IOC/IPC approval".[177] LOCOG is now undertaking a review of temporary, relocatable venues, "to make sure that they remain the best option and that "where possible, they maximise any opportunities that have become apparent since the bid". The review is to be completed later this year.[178]

92. The relocation of temporary Games venues—or elements of them—was portrayed in the Candidature File as an innovative way of sharing some of the physical legacy of the Games around the UK. We are concerned at signs of a creeping reduction in relocatable venues. Every decision not to construct a temporary relocatable venue reduces the scope for the nations and regions to share in the physical legacy potential of the Games. We also believe that placing a requirement upon those acquiring such facilities to cover the costs of relocation, something which was not made clear when expressions of interest were invited, will kill off much of the interest. We recommend that the Olympic Delivery Authority or the London Development Agency should cover the costs of relocation, particularly as the alternative may be demolition or dismantling at the LDA's or ODA's expense.

Shooting events

93. There is dispute over the merits of the proposed venue for shooting events. The site initially selected and featured in the Candidature File—Bisley in Surrey—was dropped after the International Olympic Committee (IOC) reviewed venues and indicated that the family of Games venues needed to be "more compact". The substitute site is the Royal Artillery Barracks in Woolwich, where partially enclosed shooting ranges of different lengths will be constructed. Once competition had finished, all facilities will be removed.[179] LOCOG told us that the Woolwich site had been "signed off" by the IOC, the International Shooting Sports Federation (ISSF) (as international governing body) and the national governing body (the Great Britain Target Shooting Federation, then chaired by Mr John Hoare).[180]

94. The UK's national governing body for shooting is now known as British Shooting and is chaired by Mr Phil Boakes, who is adamantly opposed to the Woolwich site, as are all British Shooting's constituent bodies. Mr Boakes favours instead a site at Dartford which could provide a permanent legacy facility to international standards. In his view, the Woolwich site is also too small, is located in an inappropriate urban environment, and permits only three shotgun layouts, extending the time needed to complete the event programme.[181] He disagrees that the national governing body "signed off" the Woolwich venue.[182]

95. LOCOG told us that, in July 2004, it had sent the Great Britain Target Shooting Federation plans showing how shooting events at the Royal Artillery Barracks in Woolwich would be staged and had invited its Chairman, Mr Hoare, to take part in a site visit. It said that "following such consultation and receiving no negative feedback", it had submitted plans for use of the Woolwich venue to the ISSF, which had confirmed its support for the site in September 2004. It added that Mr Hoare had confirmed the support of shooting governing bodies for the venue in February 2005. LOCOG is considering the relocation of components of the Woolwich venue as well as assessing "what might be sustainable on the site". It also observed that Dartford Council had informed it of "the unsuitability of developing Games-time and legacy facilities for shooting" at the Dartford site proposed by Mr Boakes.[183]

96. There is considerable strength of feeling within the shooting sports that to hold shooting events at the 2012 Games in the Royal Artillery Barracks in Woolwich will be a lost opportunity for shooting and will do little if anything to provide any legacy for the sport. On the other hand, the Dartford site proposed by British Shooting is not ideal as a Games-time venue. Events at the Games must be presented to an audience which is wider than the established base of enthusiasts: this is the distinction between Olympic and Paralympic Games on one hand and national or international championships on the other. The argument for keeping the range of venues as compact as possible is also a strong one. We accept that it is now probably too late to find an alternative site for shooting events at the London 2012 Games, and we therefore accept, with reservations, LOCOG's policy of retaining shooting events at the Royal Artillery Barracks in Woolwich, a site which is likely to be attractive to the general public. However, we regard it as highly regrettable that the site chosen for shooting events is not one which commands the support of any of the constituent bodies of British Shooting, and we believe that more should have been done to explore alternative sites before the decision to select the Royal Artillery Barracks was taken. We believe that LOCOG should acknowledge that its proposals for shooting events at the 2012 Games offer almost no legacy outcome for the sport. We recommend that LOCOG should work with the shooting bodies to try to extract maximum long-term benefit for the sport and that it should cover the costs of relocating facilities from the Woolwich site to permanent sites for shooting sports.

Overall legacy strategy for Olympic Park venues

97. The ODA's approach to investment in the Park's legacy potential is set out in the Programme Delivery Baseline Report, published in January 2008:

"The ODA investment is concentrated on providing the maximum legacy benefit, installing infrastructure that is a known requirement to provide the strategic backbone for future development, whilst not restricting the freedom of the ultimate legacy owners, operators and investors (public and private). After the Games, much of the land will be opened up as development sites, with the assumption that developers will contribute to the costs of further infrastructure—social, physical and economic—through planning conditions and agreements".[184]

98. There has been a major break from previous Host Cities' practice, which was to consider legacy use of venues at a later stage of the programme. As the Chairman of LOCOG said:

"All our thinking in terms of design of facilities is predicated on what we use them for afterwards. The world has changed […] and leaving facilities in a community that, frankly, cannot use them in any credible way afterwards is not what this Games is about".[185]

The Chairman of the ODA made a similar point; he observed that discussions on legacy use and design were taking into account views on which sports were likely to take place at a particular venue in legacy mode, what seating capacity might be necessary and how much space might be needed for car parking.[186]Business in Sport and Leisure acknowledged the work already done on legacy use of facilities.[187]

99. The London Development Agency has been designated as the "interim legacy body for the Games". It told us that it had responsibility for:

"Acting as the legacy client and establishing a robust post-Games legacy structure for the future management of the parklands and venues;
Delivering the legacy master plan for the Games through a legacy master planning framework process;
Establishing and delivering a development strategy for the land and legacy;
Leading the legacy and business planning process for the Olympic parkland and venues;
Securing the socio-economic and sporting benefits arising from the Games".[188]

100. The LDA has begun work to produce a planning framework for the Olympic Park site after the Games. A team was appointed in January 2008 to develop a "Legacy Master Framework", which is to "set out the vision for the legacy of the Olympic Park and its relationship with the surrounding communities".[189] An Olympic Park Regeneration Steering Group has been established to "oversee" development of the Framework. The Group consists of the Minister for the Olympics and London, the Minister for Housing and Planning, the Mayor of London and the leaders of the Host Boroughs.[190]

101. The Mayor of London's Office and the LDA told us that in taking forward its various functions, the LDA was working closely with key partners, including the Government, the ODA, the London Thames Gateway Development Corporation, the local boroughs and the Lee Valley Regional Park Authority.[191] The Host Boroughs stressed the importance of providing timely information on site development and potential impacts on local communities[192] and said that "engagement is actually getting better all the time";[193] and they prize their membership of the Olympic Park Regeneration Steering Group.

102. As a parallel exercise to the development of the Legacy Master Framework, Grant Thornton and Partners has been appointed to develop an outline business plan for the transformation and longer-term management of the Olympic site after the Games. The LDA told us that the objectives of the business plan will be "to provide a robust funding and delivery model for the Park and venues in legacy, and to ensure their use is viable and sustainable on a long-term basis".[194] The Chief Executive of the LDA put it another way, saying that the aim was "a model which balances commercial delivery as well as community and socio-economic outcomes".[195]

103. The twin processes of drawing up a planning framework which will permit the establishment of sustainable communities and of identifying the optimal model for ownership and operation of venues—and the Olympic Park itself—are inextricably linked. The Chief Executive of the LDA told us that the Legacy Master Framework should be completed in March 2009,[196] and he implied that announcements on both the planning and the management aspects would be made "around spring 2009".[197] We note, however, recent Parliamentary Written Answers suggesting that decisions will be taken sooner, during 2008.[198]

104. A large part of the preparation of the business plan is likely to involve a market testing exercise to assess what scope there will be for individual venues to be self-financing in legacy mode. It may turn out that the most robust model in the long term would be for local authorities, perhaps as a consortium, or for a specially constituted body with trust status, or what the Chief Executive of the LDA described to us as a "special purpose vehicle",[199] to operate and maintain the Olympic Park and the various venues as a unit. Greenwich Leisure Limited, an operator of leisure facilities in the London area, told us that it would be "comfortable" with the LDA or the five Host Boroughs as possible owners or operators "in their approach as public guardians of the service".[200] We note that the Lee Valley Regional Park Authority already owns the land on which the Velopark will be located and that it will own and manage the Velopark facilities.[201] Press reports have suggested that the Authority might in due course become the eventual manager of more of the Olympic Park than just the Velopark.[202] Another option might be for venues to be managed from a fund to be established by contributions from private sector firms engaged in developing housing in the Park.

105. Whatever the final outcome, there are certain considerations which the LDA will need to take into account. We set out some of these below.

Density of development

106. The expectation is that approximately 4,000 housing units (at least 30% of which will be affordable housing) will be created from the Olympic Village, the residential complex where athletes will be accommodated during the Games. The development will include a school and a health centre. Approximately 5,000 further units will be created from other development parcels released by removal of temporary venues and infrastructure.[203]

107. The Host Boroughs expressed some anxiety to us that pressure to maximise revenue from sales of land and property could limit the quality of space and could lead to "unacceptable densities of housing development and/or inappropriate forms of economic activity, undermining the ability to create sustainable communities".[204] Mr Coleman, speaking on behalf of the Mayor of London, clearly recognised that Host Boroughs had "very strong interests and desires that we ensure that the development strategies which take place are appropriate in line with their plans and are producing new, sustainable communities"; and he noted that this was an issue to which the Mayor was personally committed. He stated categorically that "there is no question of us actually adopting an approach which says: 'We are going to maximise value come hell or high water'". He also gave an assurance that the planning framework would encompass a broad range of different types of housing, 44% of which would be family housing.[205] He acknowledged, however, that adjusting the mix of housing on the post-Games Olympic Park site will be one of the methods by which revenues from land and property sales might be massaged if there was doubt that the necessary level of returns would be achieved.[206]

108. Decisions on the intensity of development and the nature of housing on the Olympic Park site will have long-lasting consequences. The provision of sustainable communities should be the top priority for the site. Given that applications to develop land within the Park boundaries will undergo the usual planning process, we are reassured that the local authorities concerned will have a degree of control over the scale and type of development in the Olympic Park after the Games. The Mayor's Office acknowledged to us the importance of a sustainable legacy for the Olympic Park; we urge the Government and the LDA to respect that acknowledgement as the years pass and the pressures to extract maximum value from sales of land and property increase.

Economics of sporting facilities

109. The Minister for the Olympics told us that the question of how ongoing revenue costs of venues' legacy facilities would be met was something which "will be negotiated on a venue by venue basis".[207] The Chief Executive of the LDA spoke of the desire "to minimise the revenue subsidy" for the venues, in part by maximising usage.[208] The costs of operating a community leisure facility can be substantial: Business in Sport and Leisure told us that the average total subsidy required for sports and leisure facilities in the UK was £500 million per annum; and we note that the average annual subsidy required to operate a local authority sports and leisure facility has been estimated at £262,000 per annum.[209] Business in Sport and Leisure added that "it is not clear who will meet the revenue costs for the Olympic facilities over the next 25 years".[210] The Host Boroughs said that "securing sufficient funding to deliver and sustain a high quality legacy will require appropriate capital and revenue funding";[211] and Mr Armitt, Chairman of the ODA, warned that "sports venues, by and large, are not particularly profit-making" and that future commercial returns from the Park were more likely to come from the Olympic Village and other housing.[212]

110. We suspect that some if not all of the sports venues remaining in the Olympic Park after the 2012 Games will need revenue funding to cover the costs of year-round operation and maintenance. Conservative assumptions should be made on the commercial potential of sports venues after the Games. We note the decision by the bodies funding the 2010 Winter Games in Vancouver to establish a trust with a form of endowment which will generate enough capital to cover costs of operation and maintenance for venues where there appears to be little or no chance of self-financing or of commercial interest. The Government should remain open to the establishment of a trust, or similar vehicle, perhaps with funding pooled from the Exchequer, local authorities, the London Development Agency and others, to cover the revenue costs of sporting facilities in the Olympic Park after the Games have finished.

Affordability for users of facilities

111. There is a delicate balance between on the one hand operating a leisure centre so that it provides a commercial return and, on the other, operating a charging regime which enables enthusiasts and potential high performers to be able to afford to train regularly, with exclusive use of facilities when necessary. British Swimming and the Amateur Swimming Association (ASA) warned that many swimming clubs, many of whose members are under 16 years of age, "lead a precarious existence, having difficulty in obtaining access to appropriate pool time at an affordable hiring charge". They argued that the solution lay in "sympathetic management" but noted that commercial pressures often prevailed. British Swimming and the ASA welcomed initiatives in certain areas to provide access to pools free of charge for children and in some cases for vulnerable young people; and their joint memorandum proposed that the Government should lead an assessment of how concessionary schemes might be made more generally available to swimming clubs.[213] Greenwich Leisure Limited drew our attention to the Passport Scheme operated by the British Olympic Association and the British Paralympic Association, which gives identified elite athletes free access to sports facilities run by operators participating in the scheme.[214]

112. We note that the award of Lottery funding from Sport England as a contribution towards the costs of the Aquatics Centre and the Velodrome was subject to conditions requiring the design to take account of legacy use. Sport England also stated in its memorandum that it would develop funding conditions requiring future operators of the facilities to "deliver sports development and community participation outcomes".[215] We recommend that contracts to operate sporting facilities in the Olympic Park after the Games should specify that affordable access should be provided for local residents and for exclusive use by sports clubs.

Reflecting legacy use in design

113. It is of some concern to us that decisions are already being taken on venue design and that contracts are being let for construction only on the basis of a likely legacy use and before a future tenant has been confirmed. Business in Sport and Leisure told us that it was "essential that the LDA tender the contracts to operate these facilities as soon as possible" and that "without strong operator input at the design stage, there is a real danger that the facilities will be inoperable in legacy mode".[216] The Institution of Civil Engineers warned of a risk that "belated requirements" from legacy owners, once they had been identified, could delay the design and construction process.[217]

114. We note that the stadium designed for the Commonwealth Games in Manchester was built with a legacy tenant and use identified: it became the home ground for Manchester City Football Club. The Mayor of London has been quoted as saying that "it is really inconceivable that anyone would have signed up to occupy a stadium before they could see it";[218] but it seems to us perfectly possible for a potential tenant or operator of a venue to be able to draw enough information from an outline design to be able to register interest and perhaps become involved in negotiations, particularly if there is an opportunity to shape the final design.

115. The Host Boroughs summed up the dilemma:

"We recognise that the design development of the Park and key venues for the Games is now reaching critical path decision points and that decisions must be taken to ensure infrastructure is delivered on time for the Games. At the same time many of these decisions will establish critical "fixes" which will determine the scope of subsequent legacy opportunity".[219]

Jules Pipe, the Mayor of the London Borough of Hackney, gave the IBC/MPC as an example, saying that once a construction consortium had been appointed, it was "absolutely vital then that that consortium and the ODA talk to the array of broadcasters and recording industry people and others that we have put together that we want to see as the end-users, because they are saying to us they are not going to be interested in taking on that venue afterwards if they have not had some input into the spec, and it is something that they will be interested in".[220]

116. The ODA defended the principle of proceeding with letting contracts for construction before either end-use or legacy tenant had been confirmed. Taking the International Broadcast Centre/Main Press Centre as an example, it argued that "What you do not do today is decide […] precisely how [a] building was going to be used in 2013-14". It said that, instead, "what you do is say: what is the nature of the use and which of the two bidders is likely to give more flexibility for the LDA and the local authorities to determine how best they see the balance between accommodation, between housing, between office use, between factory use, whatever people have in mind for what is a very significant building?"[221]

117. We recognise that the priority is to ensure that venues are built in good time for the Games, and we accept that a possible six-month delay while commitment is secured from a future tenant could introduce a serious threat to the programme timetable. We also accept that strenuous efforts have been made to involve sports governing bodies and other interested parties in discussions with the ODA and the LDA on venue design. Nonetheless, by proceeding with design and construction without—in some cases—having confirmed a legacy operator or owner, the ODA runs the risk of building structures which need significant expenditure in post-Games conversion if they are to be attractive to future tenants or operators.

105 The Lee Valley Regional Park Authority has leased 83 acres of land to the LDA, enabling the LDA to grant a licence to the ODA allowing construction work to begin. See Lee Valley Regional Park Authority Annual Report for 2006-07, page 5 Back

106 Ev 76 Back

107 Ev 89 Back

108 Q 258 Back

109 Ev 90 and Q 319 Back

110 Page 3 Back

111 Ev 40 Back

112 Q 166 Back

113 Fourteenth Report from the Committee of Public Accounts, Session 2007-08, The budget for the London 2012 Olympic and Paralympic Games, HC 85, paragraph 25 Back

114 Ev 160 Back

115 QQ 166-7 Back

116 ODA Press Release 8 April 2008 Back