Examination of Witnesses (Questinos 80-89)
DEPARTMENT FOR
CULTURE, MEDIA
AND SPORT
30 JUNE 2008
Q80 Mr Burstow: What is the total value
of those that have been agreed to so far?
Mr Higgins: Again, I do not know
that exact figure.
Q81 Mr Burstow: Perhaps you could
add that to your note.
Mr Higgins: Sure, yes. [7]
Q82 Chairman: Mr Stephens, how will you
know that these venues will deliver value for money when you do
not have a clear idea what you are going to do with them after
the Olympic Games?
Mr Stephens: We do have a clear
idea of the envisaged end use. It is set out in one of the tables
in the Report; on page 31, table 12 sets out the intended end
use. To take the first one, the Main Stadium, it is absolutely
fundamental to the design that has been adopted that we are moving
down from the 80,000-seater stadium required for the Games period
to the 25,000-seater stadium for legacy use. So that has been
absolutely fundamental to the design.
Q83 Chairman: What I do not understand
is in paragraph 3.39 on page 31 it says: "The London Development
Agency, working with the Olympic Delivery Authority, is now leading
work to develop a business plan for the future of the Olympic
Park." Why is it framed in those terms? The way you seemed
to have answered my question was: "Yes, we know exactly what
is going to happen already." Why is it written in this way
in the Report which you have agreed?
Mr Higgins: As we know, there
is a change-over from the ODA to the LDA, because the LDA own
the freehold to a reasonable part of the park and the rest of
the freehold is owned by the Lea Valley Park Authority. They are
the long-term legacy owner of the facilities such as the Velodrome
and the Eton Manor facilities. The LDA were designated by the
Olympic Board as the legacy owner for the southern end of the
park. They have appointed Grant Thornton as consultants to create
a business plan for the future revenues for the park but, as this
chart shows, much work has been done on knowing what the physical
side—
Q84 Chairman: So we now do have a
clear idea for the future of the Olympic Park, do we?
Mr Higgins: Indeed. We are putting
in a planning application for all the landscaping for the park
in October this year. So an enormous amount of work is going on
at the moment between the LDA, the ODA and local authorities as
to the final design of the park.
Q85 Chairman: Are you absolutely
sure that the legacy, which we are all very sensitive about, will
not be compromised by the need to deliver the Olympics to time
and to budget?
Mr Higgins: I am absolutely confident
because—
Q86 Chairman: You are confident of
that, are you?
Mr Higgins: Yes, I am.
Q87 Chairman: Because legacy can
be very expensive, and you only have so much, although Mr Bacon
describes it as a "humongously huge" contingency. You
are really giving a cast-iron assurance to the Committee that
the legacy will not be frozen out because of the need to deliver
to time and to budget?
Mr Higgins: No, it will not be
frozen out, because the biggest investments for legacy are long-term
jobs, economic development, and that is a platform we are building.
It is also the work we are doing to win jobs. Over 10% of all
of the people that work on the project are unemployed people,
and 70% of all our contracts let in the project are to small and
medium enterprises. These are long-term investments in the economic
regeneration of this valley, which needs that level of investment.
That is ultimately the legacy—much more important in the
end than a playing field is the economic regeneration of that
area.
Q88 Chairman: My very last question
is that there is a history; as the previous Olympics goes ahead,
important lessons are learned, and lots of people with a finger
in this particular Olympic pie start making all sorts of suggestions
to you about what went wrong in Beijing, what went right, and
a huge spotlight then descends on you. This, if previous Olympic
history is to be believed, can lead to a lot of changes. What
are your plans to deal with this?
Mr Stephens: You are absolutely
right, and that is a key risk that is identified in our strategic
risk registers which we have drawn up. One of the ways in which
we have managed that risk is to ensure on the construction programme
that the scope of the programme was defined and agreed when it
needed to be in order to draw up the budget, so that any changes
to that will be clearly identified and have to go through a process
of control and management of those changes. We are also making
sure that we are at a suitable level in Beijing to ourselves be
able to learn the lessons, and we are all clear that post Beijing
there must be continued and vigorous pressure downwards on costs
and any changes in scope.
Mr Higgins: That is absolutely
right. It is one of the biggest risks that people come back from
Beijing and decide to change everything. So we are getting as
much of the design tied down as possible before we let anyone
go there.
Q89 Chairman: When will we have detailed
financial forecasts on policing and wider security? When will
that be available to us?
Mr Stephens: We have the £600
million budget and all the planning that is being done is being
done within that £600 million budget. I do not see any reason
to expect that the costed plan will depart from that.
Chairman: Thank you very much for briefing
us on the progress you are making. We are very grateful. Thank
you, gentlemen. That concludes our public hearing.
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