Examination of Witnesses (Questions 252
- 259)
TUESDAY 15 JANUARY 2008
MR NEALE
COLEMAN AND
MR MANNY
LEWIS
Chairman: Good morning, This is a further
session of the Committee's inquiry into preparations for the 2012
Games. We are today focusing specifically on the benefits to London.
I would like to begin by welcoming Neale Coleman, Director of
Business Planning and Regeneration from the Mayor's Office, and
Manny Lewis, Chief Executive of the LDA.
Q252 Mr Sanders:
We note there are going to be elections this year for the Mayor
of London. To what extent are the commitments and policies of
the present Mayor relating to the Games binding upon any successor?
Mr Coleman: My understanding of
the position is that the commitments which the Mayor made as part
of a preparation of London's bid for the Games, that were included
in the candidature file submission, and indeed other commitments
that he may have made in whatever form during the period of London's
bid, those are all incorporated as commitments into the host city
contract between the International Olympic Committee, the Mayor
of London representing the Host City, and the Organising Committee
and British Olympic Association. To that extent my understanding
is that those legal commitments bind the Mayor, whoever he or
she may happen to be, through until 2012.
Q253 Mr Sanders:
We know that the two main challengers, Lib Dem and Conservative,
are going to carry on. What if an Independent stood on a ticket
of wanting to break that contract and not host the Olympic Games
and they were successful in that election? What would happen in
those circumstances?
Mr Coleman: That is an interesting
question. I must confess, if it is not impertinent, my speculations
are probably no better than yours about that. These are binding
legal commitments, so plainly any candidate for Mayor who took
this point of view would be putting forward a pretty irresponsible
approach; and would clearly be advised, by the people whose job
it is to advise a Mayor of these things, that this was not a lawful
way to go on. I think it is worth saying I take comfort from the
fact that at the moment not only have we broadly pretty clearly
in London maintained very strong all party support for having
the Games in London—obviously a lot of debate and, at times,
disagreement around particular parts of what is going on—but
there is a broad consensus there. Also it remains the case, despite
a very lively and, at times, awkward series of debates in the
media, that all the opinion polling shows very strong support
from Londoners for the Games. Despite, as I say, what has often
been quite a difficult time in the media and press, the latest
opinion polling shows support higher even than when London won
the bid. I am not sure it would be the most attractive proposition
for someone to go to the electorate on; although who can say what
happens between now and 2012.
Q254 Chairman:
You will be aware that in the immediate run-up to a General Election
the opposition parties are given access to the civil servants
to discuss with them their plans should they win the Election
and form a Government. Is a similar arrangement in place for the
candidates for London Mayor?
Mr Coleman: Yes, my understanding
is that it is. Certainly I think the candidates have access (and
many people already have had some meetings with the Chief Executive
of the GLA) and certainly have the same sort of facilities you
describe as being available in the run-up to a General Election.
I am also aware that both the Olympic Delivery Authority and the
Organising Committee have made contact with the other candidates
in the Election to offer briefing and any assistance they would
find helpful.
Q255 Mr Sanders:
The LDA has a number of disparate roles in the 2012 Games programme:
are you confident that it has the specialist expertise to cover
such a wide field?
Mr Lewis: I am confident because
what we have experience of is bringing in the right levels of
expertise on these more sophisticated development projects—with
a track record, for example, for large-scale investments in Wembley
as an illustration of that. We are engaging some of the key consultants
who advise us, including Knight Frank on land development surveys,
including Grant Thornton on business planning for the Park, and
Deloittes on the constitution of the Lea Valley Regional Park
Authority. Combined with the experience we have in the Agency
and utilising the expertise of the private sector, we are confident
we can deliver. Of course our track-record to date on acquiring
the land and relocating businesses and development of business
parks and handing over to the ODA on time last summer demonstrates
that.
Q256 Adam Price:
May I ask Manny Lewis if he thinks the allegations of corruption
and collusion currently involving the LDA, although not directly
related to the Olympics, will impact on public confidence in your
ability to deliver such a large-scale programme as this?
Mr Lewis: I do not think it impacts
on public confidence in terms of our delivery capacity and our
delivery record. I think the issue it goes to is about the LDA's
reputation and about the aspects of managing projects that are
targeting diverse communities and local community groups. There
is no suggestion that the scale of delivery we are responsible
for in terms of the Olympics is affected by this sort of coverage.
Of course we are concerned to demonstrate that the LDA's smaller
level of projects are adequately managed; that there is no fraud,
collusion or impropriety; and the review of our Chief Finance
Officer has demonstrated that, insofar as our LDA grant-giving
process is concerned. So far as the evidence has been evaluated
todate there is no suggestion of fraud, collusion, impropriety
or corruption; but we will continue to review every single case
that is referred to. In terms of the proportion of LDA's spend,
we spend £400 million a year; those projects amount to less
than £2 million; so that is the sort of scale we need to
bear in mind.
Q257 Adam Price:
What additional steps are you taking to ensure transparency?
Mr Lewis: The LDA Board has already
signed off a programme of improvements which are well published
in terms of our new ways of working. This implementation programme
has been in process since 2006; it is nothing new. We have a whole
suite of project management systems. We have reorganised the Agency
to base it on project management disciplines. We have brought
in senior expertise in terms of the new group management team.
We have a policy and a preference now, as the Board has endorsed,
to publish all of its reports increasingly that go to the Board.
We have a very strong audit and scrutiny function. We have internal
auditors. Of course this whole process which has been focussed
on most recently has been overseen by the district auditor, the
Audit Commission.
Q258 Chairman:
Sticking with the LDA, the first stage of the process, the land
assembly, appears to have been completed relatively smoothly.
Have all the outstanding compensation claims now been settled?
Mr Lewis: They have not all been
settled, but the vast majority have reached either full or final
settlement, or advance payment; 85% of them in effect have been
settled. That 85% demonstrates a spend profile, a cost profile,
in accordance with our predictions. We will complete those settlements
within the overall land settlement budget we have already set
and published. Of the 15% of cases that have not yet been determined,
a small number are because they have a right to proceed to a Land
Tribunal, to negotiate and to challenge any offer that we have
made, and a small number are reserving that right. The majority
that remain to be settled are actually because they are in the
second tranche of relocations. There is a group of businesses
that will be relocating from 2009 in accordance with the overall
Olympic plan, and that is the majority of the ones that we have
not yet dealt with.
Q259 Chairman:
How much have you paid in compensation?
Mr Lewis: I cannot give you the
disaggregated figure immediately, Chairman, but we can certainly
give you that in writing straight after the meeting.[2]
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