UNCORRECTED TRANSCRIPT OF ORAL EVIDENCE
To be published as HC 689-v

House of commons

oral EVIDENCE

TAKEN BEFORE THE

Culture, Media and Sport Committee

London 2012 Olympic and ParalymPic Games

Tuesday 24 January 2012

Jeremy Hunt MP, Hugh Robertson MP and Jonathan Stephens

Evidence heard in Public Questions 365 - 422

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Oral Evidence

Taken before the Culture, Media and Sport Committee

on Tuesday 24 January 2012

Members present:

Mr John Whittingdale (Chair)

Dr Thérèse Coffey

Damian Collins

Philip Davies

Paul Farrelly

Mrs Louise Mensch

Steve Rotheram

Mr Adrian Sanders

Mr Gerry Sutcliffe

________________

Examination of Witnesses

Witnesses: Jeremy Hunt MP, Secretary of State for Culture, Olympics, Media and Sport, Hugh Robertson MP, Minister for Sport and the Olympics, and Jonathan Stephens, Permanent Secretary, Department for Culture, Media and Sport, gave evidence.

Q365 Chair: Good morning. This is a further session of the Committee’s ongoing examination of preparations for the London 2012 Olympic and Paralympic Games, and I would like to welcome the Secretary of State for Culture, Media and Sport, Jeremy Hunt; the Minister for the Olympics, Hugh Robertson, and the Permanent Secretary, Jonathan Stephens. I am going to invite Louise Mensch to begin.

Mrs Mensch: Secretary of State, we have six months to go now before the Games kick off. How confident is the Government that the budget, which at present is £9.3 billion, is not going to be exceeded?

Jeremy Hunt: You can never say never, but we are as confident as we reasonably can be. If you look at the overall numbers, of the £9.3 billion budget, we have committed £8.5 billion, so there is about £800 million that has not been committed, and of that £800 million there is about £300 million of known cost pressures. We may not need to spend all that. The last figure that we published in terms of unallocated contingency was for the end of quarter 3 2011, and that was £528 million. We will shortly be publishing the figures for the end of the last quarter of last year and we do not expect it to have changed significantly, which I think is an encouraging sign. Obviously, the closer you get to the Games, the less likely it is that you are going to end up being able to spend £500 million, and we continue to control costs very tightly. It is a very important objective of ours to deliver this project within budget.

Q366 Mrs Mensch: Do you see, then, any risk to the public sector funding package and, if so, how are you mitigating those risks? For example, is the nascent crisis in the eurozone a risk to the public sector funding package?

Jeremy Hunt: There are lots and lots of risks and we spend a great deal of time going through the risks, quantifying them and trying to estimate the likelihood of them happening. The purpose of that contingency, which currently is still around 25% of the total original contingency that was left, is to give us some headroom if there are unanticipated things that go wrong that we need money for; a change in the security situation, for example, would be an obvious one to point out. As I say, we have some headroom but we can never be complacent, and that is why it is very important to keep bearing down on costs to make sure that we maximise that headroom.

Q367 Mrs Mensch: As things stand, the national lottery have been promised a £675 million rebate. Are you confident you are going to be able to deliver that rebate? Perhaps Mr Robertson might answer that one.

Hugh Robertson: It all depends on the movement of land values on the park, and there was a bullish estimate done at the beginning of the process and then an extremely pessimistic one done just recently. Remember, of course, it is not strictly an either/or. You don’t get the whole £675 million or nothing. There are a variety of amounts in between those two. It is absolutely a commitment of this Government to ensure that that money is safeguarded, and that will be written in the new agreements when the Mayoral Development Corporation is formed next year. With a fair wind and good luck, that money will be repaid, but there is a time lag because it is dependent on land sales.

Mrs Mensch: Just to be absolutely clear, you at the moment are still anticipating returning the full £675 million.

Hugh Robertson: Correct.

Mrs Mensch: You are, thank you.

Hugh Robertson: But it is dependent on land sales.

Q368 Mr Sanders: In the context of a time of austerity, how can you possibly justify spending an additional £41 million on just the opening and closing ceremonies?

Jeremy Hunt: It was a decision that we looked at very hard. It is a lot of money, but it is not just less than the Chinese spent on the Beijing opening ceremony, because it is also less than the Canadians spent on their opening ceremony and less than the Russians are planning to spend on their opening ceremony. While I fully accept that you get a lot of flak for a decision like that, you would have been questioning me much more critically in a year’s time if we had not made the most of an absolutely unique moment that is potentially going to be seen by 4 billion of the world’s 7 billion population. Martin Sorrell estimated that it would be potentially worth £5 billion to the UK in terms of how it would promote the UK. It is not just a question of making sure that we put our best foot forward when we are at the centre of the global spotlight. I see it as an extraordinary business opportunity. There are tourists all over the world who are making decisions as to which countries to visit, there are students deciding which country to study in, there are businesses deciding which country to invest in, and if you get something like the opening ceremony for the Olympics right, you strengthen our national brand in a way that is very hard to quantify but that I have absolutely no doubt will be extremely positive for British businesses and British jobs.

Mr Sanders: But you cannot put a figure on it?

Jeremy Hunt: No, and we could get into some pettifogging-

Mr Sanders: For a lot of people, ceremonies are laughable events. It is actually the event as a whole that derives benefit. How much is this event going to cost if it has almost doubled in cost?

Jeremy Hunt: I think the proof of the pudding will be what people say after they have seen the opening ceremony.

Mr Sanders: That is after the money has been spent.

Jeremy Hunt: That is true.

Mr Sanders: Is it necessary to spend twice as much as you originally anticipated? It is irrelevant what other countries spent on this event at the end of the day because there are different costs at different times.

Jeremy Hunt: With respect, Mr Sanders, I don’t think you can be held accountable for something before you have seen what it is you are accountable for. I am sticking my neck out in a big way for this opening ceremony. We are, as a Government, saying that we are not accepting what the naysayers would say. We are not going with the conventional wisdom that in times of austerity you should rein back on absolutely everything, because we think this is a once in lifetime opportunity. You and 60 million other people will have a very strong view as to whether that was a good investment on 28 July, and I look forward to hearing what you say.

Q369 Mr Sanders: The Government is trying very, very hard to get across to people that we are all in this together, and here you are doubling a budget on two events. How long does each event last? A couple of hours, four hours? You are doubling the budget, £41 million, for four hours. You could do a rerun of the Royal Wedding on big screen television if you want to advertise some of our ability to run events.

Jeremy Hunt: I very much hope, as you do, that we never have a rerun of the Royal Wedding. All I would say is that this is not about throwing money at a big party. This is about an incredible investment opportunity in our national reputation. There will never be an opportunity like this in our history, and I think that our children and our grandchildren would look at us very askance if we did not embrace wholeheartedly the opportunity to massively strengthen our reputation across the world. I think it will be fantastic to remind the whole world that this is the country responsible for more of the inventions that have shaped humanity than probably any other country. This is the country that is the home of freedom and democracy. It is the country that is the home of more major sport than any other country in the world and the home of extraordinary literature, culture and art. This is the moment, if there was ever a moment, to get that message across and I am very happy to be held accountable for my decisions in wanting to be able to say to everyone that we did everything possible to make sure that we did not scrimp on such an extraordinary opportunity.

Mr Sanders: But that was the original plan, so why have you had to double the budget to do it?

Jeremy Hunt: The original plans were published many years ago and they were published with a contingency because, at the time, the then Government recognised that you do not always know every detail about every cost until you get nearer to the event. What happened was that Danny Boyle, who I think will do an extraordinary job with the opening ceremony, then finalised his plans and they came with a higher price tag than was in his budget and a higher price tag than we were prepared to pay. We then had an iterative process, as so often happens in these situations, and we came to an agreement over a ceremony that I think we will all be able to feel very proud of.

Chair: Are you suggesting Danny Boyle wanted to spend more than £80 million?

Jeremy Hunt: I think what I want to say is we had complete agreement that this had to be a fantastic ceremony and we managed to come to the right place.

Q370 Mr Sutcliffe: I was fortunate enough to be at the opening event in Beijing, which was a fantastic event and went on for four hours with a tremendous amount of fireworks. What we said at that time was we would not try to compete with the opening ceremony at Beijing because of the expense that they went to. You say this was your decision, and that is the question I would ask. Was this your decision or was it the Prime Minister’s decision? Who made the decision to increase the budget by £41 million, and what consultation did you have with athletes? For instance, Paula Radcliffe has described this as a frivolous spend of money that would have been better spent on the legacy. Surely the judgement on the Games will not be about the opening and closing ceremonies. It will be about the whole content of the Games, both the Olympics and the Paralympics.

Jeremy Hunt: I completely agree with that. Can I congratulate you on your presence on the Committee and say that you create a very high bar for Hugh and I to climb over with your bet against the Australian Sports Minister about the performance of Team GB versus the Australian team?

The point I would make is this, and I would make exactly the same point to Paula Radcliffe. I completely agree, it is about the whole package. It is not just about the ceremonies, it is about the sport. It is about how competently we put on the biggest sporting event on the planet. It is about the Cultural Olympiad, the torch relay, the whole thing together. I think we have taken a totally consistent approach. I would say to Paula Radcliffe, for example, that Hugh Robertson in this spending round fought very hard to protect the funding for elite athletes, and that was one of the very few areas of funding that did not get cut at all because we thought, two years before an Olympics, the last thing we wanted was to demotivate our finest athletes by cutting the funding going into their training programmes. That was a difficult decision.

We have taken a very ambitious approach to the Cultural Olympiad, which we think will be the biggest cultural festival that we have ever had in this country. All these things are made much more difficult in the context of the austerity that we are facing and the incredibly difficult choices that we have to make as a country, and sometimes the judgement you have to make is-and it was a judgement that I made but fully supported by the Prime Minister-do you make an exception to the general rule that you are having to scrimp and save for every penny in difficult times because you have a one-off event, the likes of which you are never to going to see again, or do you risk making a decision that you could be criticised for generations to come when people say, "We had our moment on the international stage. Did we really make the most of it?" That is what we are determined to do.

Q371 Mr Sutcliffe: Will we get a breakdown after the event of the costs of the opening and closing ceremonies?

Jeremy Hunt: Absolutely.

Q372 Chair: This Committee, when we previously examined the funding package, once you add together the programme contingency and the individual project contingencies, came up with an estimate that something around 40% of the budget was actually contingency, yet we are now at a point where, if the worst case of the NAO came about, you are going to exceed the budget. Would you not regard it as something of a failure that a contingency that large is all going to be spent?

Hugh Robertson: Absolutely I wouldn’t, Mr Chairman. Your analysis, if I might say so, overlooks the crucial fact that under the original budget both the village and the broadcast media centre were due to be financed privately because of the economic downturn. That was not possible, so they have been financed from within the budget and that is what has largely affected the figures that you have quoted.

Q373 Dr Coffey: Given the Government’s role as guarantor for any LOCOG expenditure that goes beyond the current forecast, how concerned are you by Paul Deighton’s comments that the LOCOG budget is very finely balanced?

Jeremy Hunt: LOCOG has always budgeted to be in balance. They are not seeking to make a huge profit from the Games, but equally they are seeking not to make a loss. I think Paul rightly has a very, very strict attitude towards cost control and I think that they have done a pretty good job of that. Overall, when you are looking at their financial performance, you have to look at their performance not just in controlling costs but also in raising revenue. They have raised 92% of their £2.16 billion budget, they are on track to get the £527 million they need from ticket sales, and they managed to raise two-thirds of the sponsorship money before the financial crisis broke. I think they did a very good job on that side.

On the costs side, where we have increased their budget is where we have had Government guarantees that we have made over security of the Paralympics or where we have changed the scope, as in the opening ceremony that we have just been talking about, but I think the real messages, from what Paul was saying, is that one can never be complacent and delivering this project in budget is incredibly important in the current climate.

Q374 Dr Coffey: You have already responded positively to requests for more money for the opening ceremonies. How will the Department respond to further requests?

Jeremy Hunt: Bear in mind the only thing that hits the headlines are the requests that we have responded to positively. There are many other times when we do not respond to requests positively. I think it is impossible to predict the answer to that question without knowing what the reason is for the call for extra funds, but what my Permanent Secretary and Hugh have been absolutely determined to do right from the start is to make sure that there is an atmosphere of strict cost control where it is not possible to think that, if you need more money, if you have made a mistake with your numbers, you can just go to Ministers and ask for another cheque. When you call LOCOG in front of this Committee, they will confirm that, when they have come for requests for extra funds, such as the additional money that has been put into the security budget, which we may talk about later, there has been a very, very long process indeed before there has been any willingness to cough up any more taxpayers’ money.

Q375 Dr Coffey: Just out of interest, where is the additional funding being sourced from, if it is required?

Jeremy Hunt: The only place that we source funding from is the contingency budget.

Dr Coffey: So it is not a case of you going off to Treasury and saying, "We need more"?

Jeremy Hunt: No.

Hugh Robertson: It comes from the contingency. There is £500 million there. That is the first port of call.

Q376 Chair: Can we just turn to legacy, which is something that we have spent a great deal of time on in this Committee? First, I want to discuss the actual hard links, if you like, of the facilities. The two facilities that have caused most problems are the media centre and the stadium, and here we are and both are still unresolved. Are you confident that you will be able to resolve them before the Games?

Hugh Robertson: Yes. I will take a leap forward. I would almost say, Mr Chairman, to turn that inside out. Bear in mind that on Friday we celebrate six months to go and we already have six out of the eight legacy venues nailed down. That is something that no other Olympic city has ever managed in the Olympic Games before. Yes, it would clearly be nice if there were eight out of eight, but six out of eight is an extraordinary achievement and one we should be very proud of.

Chair: That is a glass half full approach, which I commend.

Jeremy Hunt: Three quarters full.

Q377 Chair: I am not sure in terms of the overall cost, but we can dispute that. The stadium is obviously the thing that is attracting a lot of attention. We understand now that it is intended that the stadium is going to remain in public ownership-

Hugh Robertson: Correct, yes.

Mr Whittingdale: The cost of conversion of the stadium is likely to be met from public funds and it is estimated at £95 million. Where is that coming from?

Hugh Robertson: Having questioned your question last time, I am afraid I am going to do the same thing. It is very, very difficult to put a figure on the conversion costs of the stadium until you know what it is going to be used for. First we need to select the end legacy operator and then, as part of that, we will look at what it is going to cost. The public money that might be available for such a conversion at the moment is money already inside the ODA budget, the public sector funding package for conversion that would have happened had we taken it down to its 25,000-seater base case post the Games, and then any money that the OPLC, or the new Mayoral Development Corporation, when it is created, might wish to put into it to ensure an end legacy user. There have been a variety of figures put in the press but it is very hard to nail that down until we know exactly what the end use is going to be.

Q378 Chair: Are you still confident that there will be a decent return to the national lottery in due course from land sales?

Hugh Robertson: Yes, and I say this having spent seven years, before I came into Parliament, working in the property department at Schroders, and values of the very large property portfolio we held on behalf of institutional pension funds went up and down and up and down over that seven-year period. If you looked at land values in and around Stratford in the 2007 to 2009 period, they were at a certain level. If you look at the basic land value now, it is at a different level. If you look at the land value at any time between 2013 and 2020, it is going to be a number of different levels within that. That was why, when answering the earlier question, I said it is dependent on land values, but on a prudent and reasonable reading, yes, we are confident that that £675 million will be repaid.

Q379 Damian Collins: I have just one brief question on that. I know the intention is that the Olympic stadium will be leased to providers, but have you given any consideration to, if there were a future offer to buy the stadium, whether there should be something built into that agreement that might give the Exchequer some further recompense in the future? I know there has been some criticism-for example, of the City of Manchester stadium-that substantial profits were made by the initial owners of the club and the stadium when it was sold on to its current owners, and maybe some of that money should come back to the Treasury.

Hugh Robertson: Absolutely, point well made. We have absolutely looked at the sensible lessons that have been learned out of Manchester, which, to be fair, was regarded as a great success. Many people look at the Manchester stadium, the way it was designed and hollowed down afterwards and then handed on to Manchester City, and look at what happened to Manchester City afterwards. Clearly, money from elsewhere has played a part in that, but it is a pretty good argument for how to get it right, and I say that with a mad keen Liverpool fan sitting right next to me. Absolutely the lessons of that have been learned. We will certainly build all that into the negotiations. Absolutely if somebody should come along, or if a football club was one of the legacy users and there should be a change of ownership in the future and they should want to acquire the stadium, that will definitely be built into the process. It is not our intention that it should remain in public ownership indefinitely.

Q380 Steve Rotheram: In 2010, the Sports Minister described the £135 million Places People Play programme as the cornerstone of the Olympic legacy. Why do you think this programme has failed to deliver the numbers and the increasing numbers of adults taking up sport so far, and do you believe it will meet its 1 million target by 2013?

Hugh Robertson: Because it has not yet completed. The money has not yet been allocated.

Steve Rotheram: Do you believe it will still meet its target by 2013?

Hugh Robertson: Will it, of itself, deliver the old target? We were never in any way wedded to 1 million. Do I think there is a facilities improvement programme that targets small community clubs which had, for reasons we all understand, missed out on the previous old sport plans because sport governing bodies very sensibly targeted key target clubs? This was to reach those small community clubs that cannot afford a new roof, a new boiler or new showers. Every single person sitting around this table has such football clubs, cricket clubs and rugby clubs in their constituency that are struggling to get £25,000 for a new roof. Is it a key part of the London 2012 legacy that we should reach down to that level and try to help those people improve the experience of sport for people who play there and get new members on the back of it? Absolutely it is. Will that play into the active people numbers in due course? Yes, it will. Is it doing so now? No, it isn’t, because those alterations have not yet been made.

Q381 Steve Rotheram: Has the target been abandoned?

Hugh Robertson: The 1 million target has been abandoned, yes.

Jeremy Hunt: I wonder if I can just put those comments in a broader context. The 1 million target was a target by the last Government. A fair assessment of the last Government’s approach to this was that they put a lot of effort into programmes that would boost sports participation but the indicators never really changed direction and, since 2005, in terms of youth participation, the figures have gone down by 2%. Obviously the bulk of that period was under the last Government.

We are absolutely committed to the promise made by Seb Coe in 2005 that we would use hosting the Games to get a lasting increase in sports participation. Part of that is the Places People Play scheme, which we can tell the Committee today that, as a result of the changes that this Government made to the lottery and the increasing lottery ticket sales, the amount of money going into grass roots sport over the next five years will be £500 million more than was predicted at the time of the election in 2010. That will be a huge increase in funding going to boost community sports facilities and also to support our top athletes as well.

But on top of that there are two other elements that we hope will make a real difference. First of all is the Olympic-style school sports competition and School Games, which I am delighted has cross-party support. We have now signed up more than half the schools in England to that. The whole point of that competition is that it will be something that does not just happen in 2012 but it happens in 2013, 2014, 2015 and for many years to come.

One small example of why that programme will be an incredibly important programme is, for many of those schools, they will be doing Paralympic sport for the first time, which will make a massive difference to disabled children in those school. Then a final element is the Youth Sports Strategy that Hugh and I announced the week before last, and in that we are seeking to address this perennial problem that a third of 15-year-olds who actively play sport stop playing sport after they pass their 16th birthday because they leave school. Around 6,500 satellite sports clubs will be set up in secondary schools around the country by the FA, the RFU, Football League, cricket and tennis to try to get links between schools and community sports clubs. If you take all those together, I think we have a very good chance of reversing the change in youth participation, which is partly caused by societal factors-people spending a lot more time watching TV and screens in general-and delivering on the promise that Seb Coe made in 2005.

Q382 Steve Rotheram: I think everybody would welcome the announcement from the Secretary of State of additional funding for those schools and community groups, but we were talking specifically about this initiative and the £135 million. What analysis has been done on the spend to date and how effective that has been with its limited impact, and how much is left?

Hugh Robertson: The simple answer to that is, as part of the application process, anybody applying-and just checking the figures, there have 633 applications for the small grant bit of it. That historically compares very well with programmes that Sport England have run, so it tells you that this is hitting the mark.

As part of the application process, people have to make an estimate of the increase in participation that will flow from new showers, new boilers, new roofs, new changing rooms or whatever it is going to be. When Sport England go back to them, that is then tested and all the people who are playing would then be, we would hope, picked up in the Active People survey.

Q383 Steve Rotheram: Am I wrong to think that it is just more than 100,000 people to date who have participated?

Hugh Robertson: As a result of Places People Play, yes, I would think that is an incorrect figure because I don’t see at this stage how you could possibly-I don’t know where you got that figure from, so I am slightly pitching into the dark, but given that this is a grant programme that started last year-they had gone out to the market, they had invited the applications, they had taken them back in, they had assessed them, they are giving out the cheques at the moment-indeed, there will probably be some people around this table-one of the things that we were very keen to do was to get local MPs involved in giving these sort of grants. I know that process is ongoing at the moment, so I don’t yet know how you could have come to that figure.

Steve Rotheram: It was in December Sport England confirmed that that was the figure to date.

Hugh Robertson: Is that their target-

Dr Coffey: That is from their up-to-date survey.

Hugh Robertson: So that have earmarked that particularly for the iconic strain of Places People Play, or have they said that is an aspiration for the increase out of the whole scheme?

Steve Rotheram: No, they said that 108,000 additional adults had taken up some sport.

Hugh Robertson: Yes, but that may be as part of the general Active People data, not particularly tied to Places People Play.

Q384 Steve Rotheram: What is the Government doing to address the effectiveness of that particular Places People Play project?

Hugh Robertson: The three things I spoke about beforehand. As part of the case they have to put in to get funding, they have to show how that is going to increase participation. Sport England, when they have made the grant and then do their post-grant checks, will assess whether that is the case. All the people that we hope will take up sport as a result of that will then get fed into the Active People survey.

Q385 Steve Rotheram: Given that was Sport England’s own figures, are you confident that they can deliver that part of the Olympic legacy?

Hugh Robertson: Yes. I am absolutely confident that the Active People figures are independent. The worry about them is that they are so independent and catholic with a small "c" and it is such a high bar that they are measured against-three separate incidences of sport a week-that there is quite a lot of activity going on that is not picked up by that measurement target. I am absolutely convinced that the measurement system has integrity, yes, and it is entirely independent and all those sorts of things. The big question is whether it is picking up everything that is happening.

Q386 Steve Rotheram: Despite the measure itself, there is £135 million allocated to spend on this. Surely you need some comfort that you are going to get value for money on that, so if it is not 1 million, what is the new target?

Hugh Robertson: You absolutely do need some comfort on it and it is a perfectly reasonable point to make, but it is perfectly reasonable for that comfort to come from within the overall measurement target that Sport England uses to increase participation in sport. There is a counter danger, which is that, if you over-assess and all the rest of it, it will cost a whole lot more to do. These are small £50,000 grants that go to boilers and roofs and showers, and all your sports clubs will very quickly start complaining about the vast increase in bureaucracy that is required to access what is, after all, quite a small grant, so it is a question of balance between the two.

Jeremy Hunt: Could I just add a small point to what Mr Rotheram said? We did think about whether we were getting into a game of "your target is better than my target" when we looked at the 1 million target that clearly was not going to be delivered when we came to office, and I think it got to just over 100,000. We decided that a better objective was to say that we wanted to increase the number of people who did sport, the number of young people who developed sport as a habit for life, and we have a fairly clear definition of sport as a habit for life for those people who actively play sport at the age of 16, 18 and 24. We thought that if people played sport at those three moments in their life, there is a good chance they will develop sport as a habit for life.

In terms of accountability, at the moment it is about 51% of 24-year-olds who actively play sport, and we would be looking for an increase in that number, but we decided not to pick another target. Obviously, if it is not a substantive increase, we would be very disappointed, but the point I want to make is we are measuring very carefully. The problem with the 1 million target is that it did have slightly the feel of a random target, a nice number but a random target, and we did not want to just take that with another randomly chosen number, so we decided this was a better way of measuring overall success.

Jonathan Stephens: If I may, just to clarify, the 110,000 figure is the Sport England figure for the increase in adult participation between 2008-09, when the original baseline was set, and 2010-11, so it covers entirely a period before Places People Play.

Q387 Damian Collins: I suppose I should state for the record that Sport England has made grants to the sports centre in Folkestone and in Hythe, and the refurbished sports centre opens in next month. So, if anybody wants to come and see how the money has been spent, you are more than welcome to come and have a look. My first question is, was a flat target of 1 million people participating in sport the wrong target to start off with, or should it have been a more focused target looking at areas where the Government has a more strategic interest in getting more people involved in sport?

Jeremy Hunt: I think we all learn from when these things happen, and I think there was a randomness about the number chosen and you also sometimes have great reverse incentives when you have a big number like that. When we relooked at the issue, we decided that a better way to target public money and to target the efforts of all the people involved in what we all consider to be a very important project, which is getting more people to play sport, is to focus on young people and focus on getting them to have sport as a habit for life. That is why we have changed the approach. We have not instituted a new target, but we think people will be able to measure very clearly whether there is an increase in young people who have sport as a habit for life. We have said what we consider the definition of that to be, and it is with that in mind that we have designed these three programmes, not just the expansion of funding for community sport facilities but also the work we are doing in schools and also to link schools to community sport facilities, which we hope will lead to some really good improvements.

Q388 Damian Collins: Has removing that target given you more flexibility over the type of schemes you could support? For example, I understand that DCMS did not give financial support directly to Kick, the premier league football programme, because it was not a programme designed to increase participation but instead to deal with issues related to crime and antisocial behaviour in communities.

Jeremy Hunt: I think the Home Office is the primary funder of that programme. But again, what we have not done with this new youth sports strategy is required all the money in whole sports plans to be devoted to the new strategy because we recognise that there are very good programmes, whether it is bowls or swimming or programmes for the over 60s, which are excellent programmes, and we do not want people to stop supporting those programmes but we do want the focus of efforts to be on getting more young people having sport as a habit for life.

Q389 Damian Collins: Do you think there needs to be greater co-ordination within Government on different programmes for sport? For different reasons, sporting programmes are supported by the Home Office, the Ministry of Justice, your Department, the Department for Health, the Department for Communities and Local Government and the Department for Education. Is there enough co-ordination between all those Departments? Should there even be-and I do not have a view of whom it should be-a lead Minister that oversees all those programmes?

Jeremy Hunt: There can always be better co-ordination, better "joined-up Government" as someone once said, but we are working very hard. I know Hugh works very hard on a cross-departmental basis.

I will give one example where I think we have made some progress. The Department of Health has agreed that increasing sports participation should be a public health objective for the new devolved responsibilities of local authorities who are going to be implementing the public health agenda, and I think that is a positive step forward.

Q390 Damian Collins: I just wanted to ask a question briefly on a different legacy area, on the business legacy. UKFD, I think, has taken the lead in creating the business embassy that will be running during the period of the Olympic Games. Is that something your department has been involved with as part of your efforts leading on the Olympics themselves?

Jeremy Hunt: Yes. In fact, a really good example of cross-Government co-ordination that has never happened before but I hope will now become a permanent feature following 2012 has been that the British Council, UKTI and Visit Britain have come together to do a single campaign to promote what the UK has to offer, whether to a tourist, a student or an inward investor, under one campaign, which is called The Great Campaign. You have probably seen the posters around the place. That has, I think, worked extremely well and there has been a lot of focus on that. There has been a lot of effort, particularly in the last three to four months, on boosting the business and tourism legacy from the Games. We have a plan to get an extra 4.5 million tourists to the UK. If we get this right, this summer will confirm London’s position as the cultural and sporting capital of Europe as well as the business capital of Europe, and that is a very, very big prize to go for.

Q391 Damian Collins: Are there any results to date for The Great Campaign? Is it a success or-

Jeremy Hunt: It only started this month. I appreciate the new trend in Government with the NAO examining the Work Programme when it has only just started, and we read all about it this morning. There is this new trend to examine programmes when they have only just started. We don’t have any results yet, but we have publicly said we have some very clear objectives whereby people will be able to see whether we have been successful.

Hugh Robertson: That is absolutely the case. There are already results. You can already clearly see the extent to which the London 2012 project has changed the way that the international sports world approaches. We would not have won the World Athletics Championships had we not been bidding for it against the background of London 2012, because international sports bodies now believe that we deliver what we promise. That has not always been the case, and that brings in its wake a £100 million boost to the London economy.

Q392 Damian Collins: Finally, the inward investment into the UK from overseas might be a measure that we might look at, and that is something that regions of the country have a strategic interest in as well, particularly authorities like mine in Kent where there is an enterprise zone for investment. Are there opportunities, or could there be opportunities, for regions where there are enterprise zones to be part of the work of the business embassy and have a chance through the Olympic Games to demonstrate what they have to offer to overseas investors?

Jeremy Hunt: Absolutely, and I have been going the length and breadth of the country in the last three months. I have been to every region bar the North East, which I am going to on Thursday, and we are absolutely determined to make sure that everywhere embraces the opportunities of 2012.

I have to say that there is a lot of enthusiasm for doing this. A year ago, there was a degree of cynicism about this being a moment for London and the South East. I think that really has changed. If you go to places like Yorkshire, there is incredible excitement about the opportunities that we are going to have, and it is not something the Government can deliver on our own, but I think the fact that we have launched this campaign has given people encouragement that this is something we really have to go for.

Q393 Mr Sanders: The last Government produced a document, "Legacy Promises", which outlined the goals of the legacy project. One of the promises was to make the Olympic Park a blueprint for sustainable living, with 80% of the park’s energy coming from non-renewable sources. Is that still a goal?

Jonathan Stephens: I am sorry, I don’t know on that particular promise, but what I do know is that the Commission for Sustainable London, the independent expert body that reviews progress against the sustainability goals, has published recent reports showing that almost all, if not all, of the goals originally set for the development of the park have been met.

Mr Sanders: Is it possible to let us have something in writing on that? It was a specific target and, if it is being met, that is fantastic.

Jonathan Stephens: Sure.

Q394 Philip Davies: I want to come on to security, but just before I do, Hugh, on sporting legacy, an idea that you floated, I think, about three years ago, which I thought was a great idea at the time and I have championed ever since-I fear to little avail-was that, when sports were being broadcast at the Olympic Games, we had a little strip at the bottom of the programme to say, "Judo is on at the moment. To find out where your nearest judo club is, please contact this number or go on this website," or whatever it might be, because you have a short window of opportunity to get people into these things, which I thought was a fantastic idea. I just wonder if you could tell us if you have made any headway with the broadcasters on this.

Hugh Robertson: I am championing it still, is the short answer, and I am seeing the BBC next month, and item 1 on the agenda is what they were going to do. To be fair to the BBC, they have been hit by a number of legacy programmes and, of course, they have their own Big Splash programme to try to get kids to go to swimming. I absolutely think that, whether it is by the red button or whether it is something that happens underneath, something that signposted people from the action they see in front of them to the nearest possible place so they could give it a go might well-if I say it would transform it, it is probably over-egging it, isn’t it? But it could make a considerable contribution to this. All I can do this morning is give you my word that I will continue to push this as hard as possible.

Q395 Philip Davies: Good luck, because I think it is a great idea. On security, initially we were told that we needed 10,000 people for the venue security. We appear to be now-correct me if I am wrong-around 23,700.

Hugh Robertson: Correct, yes.

Philip Davies: Can you explain why the first estimate was so shocking?

Hugh Robertson: Yes, because it was done on the basis of figures that were lifted from the Manchester Commonwealth Games and from previous Olympics where it was possible to make a realistic estimate. That turned out to be less than the numbers required in the post-7/7, post-operational planning environment.

Q396 Philip Davies: It seems to me that the security is potentially the biggest threat to the Olympics Games and also the biggest threat to the budgets of the Olympic Games. How confident are you that it is not going to increase again from 23,700?

Hugh Robertson: The experience of 10 years in the Army tells you can never be utterly and absolutely confident about security costs because it is a moving piece. I often say this to people. If you ever want a chilling reminder of what we are dealing with here, just remember what Gerry Adams always used to say when I was a young soldier in Londonderry in the late 1980s, that the British Army has to be lucky every time. We only have to be lucky once. You are dealing with some very high-tech threats here.

That said, having been through this process, I always thought this would be the sort of last big financial pillar to get in place. I am absolutely as confident as I possibly can be at this stage, having burrowed down into this, person by person, venue by venue, gate by gate, that 23,700 is absolutely the maximum demand on peak days. That is not a constant figure running through the process. That is the maximum demand on peak days. We now have a much better method, a much less risky method of covering that, with a contribution from the military, a contribution from the private security industry, contribution from volunteers, a contribution from Bridging the Gap. You are not looking for them all from one source, which would increase the risk of doing that. That has presented a balanced security plan and a viable budget. So, the answer to your question is yes, I am confident as we can be.

Q397 Philip Davies: Can you just clarify, out of those, exactly how many of the private security guards will be needed?

Hugh Robertson: I don’t know if we have the actual figures. We are getting 7,500 from the military and the remainder will come from a division of the other three.

Q398 Philip Davies: Are they confident that G4S will be able to recruit-

Hugh Robertson: Yes. It is much, much better to do it this way than to ask under the previous plan, where the private security industry was going to make up the whole of the shortfall. That clearly introduces an extra level of risk that is not there if you use the military to make up some of that shortfall.

Q399 Philip Davies: Given that we have volunteers and we have private security guards, and we have the Army, what plans have been put in place to make sure that they are all effectively co-ordinated?

Hugh Robertson: As we sit here having these hearings, the private security guards are being recruited by the contractor G4S. They sit alongside LOCOG in the Organising Committee headquarters. Alongside them are those in the Army who are responsible for doing it. Alongside them are the police. The thing is entirely co-ordinated now to prevent precisely the problems that you are suggesting.

Q400 Philip Davies: The final thing I want to mention on security is e-Borders, because the e-Borders programme, if it is done properly, like it is in Australia, is a fantastic method of making sure that only legitimate people come into the country and that the people who are on a terrorist watch list, for example, do not get into the country. It prevents them from boarding the plane in the first place. It does not just deal with the problem when they get here, it prevents people from getting on the plane and getting here in the first place. That project, which should have been in place years ago, still is not in place, and I just wondered what you were doing to agitate the Home Office to get an effective e-Borders programme in place in time for the Olympics.

Hugh Robertson: The Secretary of State has been dealing directly with the Home Office about that, so I will hand that over to the Secretary of State.

Jeremy Hunt: The Home Office is doing everything it can to make sure that we have secure borders in obviously a very critical time, and I am having regular discussions with the Home Secretary about a whole range of things that make it possible to do that, but the security and the integrity of our borders is an absolutely necessary underpinning of everything that we do.

Q401 Philip Davies: In those discussions, have any discussions taken place of the e-Borders programme, or have you had any assurances from the Home Office about where we are up to with that?

Jeremy Hunt: It is part of what we discussed, but the whole issue of the security of the borders is more than that, such as the management of the queues at immigration, and by thinking it through sufficiently in advance we are determined to minimise any potential risks to national security, which is our number one priority.

Q402 Philip Davies: Would you not accept it would be bizarre, given how effectively, for example, Australia uses the e-Borders programme, not to have it in place in time for the Olympic Games? We have known this has been coming for years. It seems to me that it would be absolutely ludicrous if it did not come into place until after the Olympic Games, given the fact that we have all accepted that security is one of the biggest threats to the Games.

Jeremy Hunt: The extent to which it will be in place is, I am afraid, something you will have to ask the Home Secretary, but I know that she is fully engaged with issues around Olympic security. In fact, I think she is giving a speech on Olympic security tomorrow. I know that it is an absolute priority for her to make sure that we have efficient processing of people through the borders, but also that they maintain safe and secure borders as well.

Philip Davies: Maybe you could ask her to add a chapter on e-Borders to her speech tomorrow.

Jeremy Hunt: Or indeed maybe you could.

Q403 Steve Rotheram: I think everybody would absolutely agree that security has to be the number one priority, but also you want people who go to the Games to enjoy it and to have a wonderful experience as well. I am just wondering, for those volunteers-the point that I perhaps wanted to pick up on before when you said that London would be a cultural capital, I will dispute that one, because you know that Liverpool is the European cultural capital. But we got lots and lots of volunteers, as you will be aware, and we put on specific training, and that included the taxi drivers as well, so that when people came into the city it was all about making that experience the most enjoyable that those people could possibly have. Is there something similar going on with training volunteers now?

Jeremy Hunt: There is a huge amount of work going on, right down to training Tube drivers to make sure that we make Tube passengers feel particularly welcome in this special period for London, so we absolutely are doing that.

The other message that we absolutely want to get across is that this is not a time to stay away from London, this is a time to come to London. This is going to be one of the most exciting years in London’s history and you will kick yourself if you were not here. It will take a bit longer to get around-of course there are going to be more people on the tubes, trains and buses-but it is going to be a fantastic summer with a huge amount happening, and we want to do everything we can to make people feel welcome and give people the confidence that, if they do come, they will have an enjoyable experience.

Q404 Damian Collins: I want to ask about the Olympic Route Network. What sort of detailed consultations have the Government had with people that use the Olympic lanes at the moment as part of their daily habit of getting in and out of the city and around it?

Jonathan Stephens: There has been an extremely detailed process of consultation led by Transport for London, who is responsible for the operation of the transport system generally but in particular the Olympic Route Network during the Olympics. All the plans are open and available on their website. In addition, TfL have been through and are going through a process of extensive engagement with business of all sizes, large business, SMEs, and they are beginning their process of public engagement and public awareness-raising next week in preparation for the public’s role in helping to manage demand during the Games.

Q405 Damian Collins: What level of contingency is there in the plans? For example, one of the areas that are contentious for my constituents in Kent and people in southeast London is the northbound approach to the Blackwall Tunnel, which is already a traffic and accident hotspot area. If there are accidents in the Olympic lanes, are there contingency plans for other routes that might be used or will people just have to cope?

Jonathan Stephens: Of course TfL have contingency plans to keep the traffic moving at normal times and, of course, they have two objectives here. One is to obviously facilitate the essential traffic that is essential to the Games, but the other very important objective is to make sure that business as usual for as much as the rest of London goes on as usual. They estimate that something like 70% of the usual traffic from London will not be affected by the Games. 30%, they think, will be affected, and some of that very significantly, possibly severely, which is why they are trying to raise awareness so that people can plan alternatives and plan around that.

One of the things they put out to the public are the hotspots, as it were, the particular points of focus and congestion, be it on the road network or the Tube network or whatever, again to begin to raise awareness and business and among individuals as to the particular areas to avoid and the particular days and times to avoid, because this will be a constantly changing picture. As the Secretary of State said, it is not a message about, "Don’t come into London; it will all be congested", it is very much a picture of, "Think about where you are travelling, think about when you are travelling, look at the information available and see how you can adapt or change your journeys if you need to".

Q406 Damian Collins: Has TfL raised any concerns with you about this? If you look at some of the Olympic lanes, they also sit very neatly on some of the worst traffic hotspots in the city, such as Hammersmith Flyover, Hanger Lane, Blackwall Tunnel. There are big, strategic issues about traffic flows going through there normally, but when you are reserving lanes of traffic for Olympic-only traffic, it is just going to make that a lot worse.

Jonathan Stephens: I should be clear that the Olympic Route Network is just over 100 miles or so of roads, most of which will not have reserved lanes on it. Only about a third of it has reserved lanes, so the rest of the Olympic Route Network is all about speeding traffic up on that network so that TfL can achieve the reliability that is a key part of the Games promise. It is things like removing unnecessary right-hand turns, speeding up the phasing of traffic lights, taking out unnecessary parking or pedestrian crossings.

Damian Collins: We could keep that. That could be part of the Olympic legacy.

Jonathan Stephens: When I was present at the Public Accounts Committee, one of your colleagues who drove in from Thurrock asked how much extra time would be added, and the Commissioner for Transport for London said, "If you are travelling on a Games network, you might find your journey is faster". By comparison, of course, if you are crossing an Olympic Route Network, you may find it slower.

There will be nowhere where a Games-only lane is the whole of the Olympic Route Network. The Games-only lanes only exist where there are two lanes on the road, so there will always be the opportunity for ordinary traffic to go alongside the Games-only lanes, which only take up about a third of the overall network.

Q407 Damian Collins: Everyone will have their own areas in mind, but my concern is for something like the Blackwall Tunnel. If one of the three approach lanes is reserved for Olympic traffic only, that is already very, very badly congested and I think what is demonstrated at the moment is, if there was an accident or an emergency on one of these routes, it causes chaos over a very large area of the city because the infrastructure isn’t good enough to cope with it. I am able to appreciate it is not going to be business as usual while the Games are on, but I suppose there are still concerns about the level of contingency that exists within the plan as it stands.

Jonathan Stephens: Keeping essential routes open, obviously one cannot prevent accidents or breakdowns happening, but getting routes reopened and flowing smoothly again as quickly as possible is one of TfL’s main priorities. You mentioned earlier Hammersmith Flyover, and TfL have been closely in touch with us to keep us up to date on their plans for that, and the Mayor and TfL have announced their plans to make sure that the flyover is open again to traffic on a normal basis before the Games.

Q408 Damian Collins: I have a couple more questions and then I think my colleague wants to come on this topic as well. There has been some debate about the rights emergency vehicles have to use the Olympic Route Network. Will emergency vehicles only be able to use Olympic venue lanes if they are on emergency callouts, or will they be able to use them generally to get around the city?

Jonathan Stephens: I think I had better write to you on that. I know that it will be available to emergency vehicles, but I am not sure exactly the latest, so let us write to you.

Q409 Damian Collins: I know there has been concern about emergency service vehicles that may not be on emergency callouts but nevertheless want to get around the city efficiently, and whether they can use those lanes or not.

Just finally, there has been some debate about whether Olympic sponsors should have access to some of the Olympic Route Network as well. I believe even the current Secretary of Defence raised this when he was Chancellor Secretary. Is that simply something that the Government has no control over and is decided by the IOC as part of their agreement with the host city, or is that something the Government has discretion over?

Jonathan Stephens: It is part of the host city contract and it is part of what sponsors buy, as it were, when they contribute the very significant sums they are contributing to the LOCOG budget. At the same time, it is also worth stressing that sponsors by and large are also key suppliers to the Games-like Atos is providing a lot of the IT infrastructure; Visa is providing the payments infrastructure-so they have key workers who are also an essential part of making the Olympics work. Those key workers will have access to the ORN but they will generally be, if they are using it, in coaches, and we reckon that on a daily basis only about 4,000 workers associated with the sponsors will be using the Games network, which is only about 10% of the total usage we anticipate on the network.

Q410 Mrs Mensch: What is the state of the Government’s discussions with London taxi drivers and the organisations that represent them? I have received many representations from taxi drivers who, as you know, wish to be allowed to use the reserve lanes and are not going to be allowed to use the reserve lanes, who are saying that during the Games traffic will be so unmanageable that they are going to go on holiday en masse and, therefore, that section of London that uses taxis will be crammed on to general London transportation, thus exacerbating the transportation problems that we can anticipate during the Games. What is the state of the discussions with taxi drivers, and do you regard this as a credible threat that London will lose its taxi service during the Olympics because they are not allowed to use the dedicated routes?

Jonathan Stephens: No is the short answer to that. The discussions are led by TfL, and on the points of detail about their discussions you would have to talk to TfL, but what we hear from them is confidence that taxi drivers will play a key and close to normal part of their role in getting people around London.

Mrs Mensch: You have had no threats from those organisations that represent taxi drivers that they are going to down tools during the Olympics if they are not allowed to use the lanes?

Jonathan Stephens: They did not say anything about various representations and threats. Of course, everyone is interested in assessing the impact on this, but this is also a good business opportunity for them as well. TfL is confident that they will play their normal and important role in getting people around London.

Q411 Steve Rotheram: You are absolutely right to get people in and out of stadia as quickly as possible, but with increased traffic volumes and increased speeds come dangers. I have read somewhere, and I can’t dig it out or I would quote it to you, but is it true there has been some modelling done and that there are estimates that there will be increased pedestrian accidents and fatalities along the Olympic route?

Jonathan Stephens: I have not see any such estimates. I am not aware of any.

Hugh Robertson: Along the Olympic Route Network?

Steve Rotheram: The network, sorry.

Hugh Robertson: Not pedestrian places like the park, because we have done some extensive modelling on pedestrian flows and indeed we authorised some extra expenditure precisely to take out such a pinch point. I just wonder whether what you picked up was a reflection of that but, if it is on the Olympic Route Network, that is not what you were after.

Steve Rotheram: Olympic Route Network, sorry, just to clarify. If that was to be the case-and if I can dig it up, I will share that with you-what would you be doing to try to negate as near as possible those sorts of issues?

Jonathan Stephens: TfL are responsible for the safety of all the road users, pedestrians, cyclists and drivers, and take that part of their responsibility very seriously, so we would expect them to look at all the possible measures to reduce risk of accidents.

Jeremy Hunt: We will look into it.

Q412 Chair: Could I quickly just turn to public transport? There are obviously going to be huge extra pressures on public transport in London. We were told in a letter from John Armitt immediately before Christmas that it is intended that working with businesses should achieve an anticipated reduction of 20% in the total number of journeys achieved as a result of the changed travel patterns. Are you confident that that figure can be achieved?

Jeremy Hunt: We are confident, but I think the important point to make about that message-it you look at other Olympic host cities, Vancouver needed to get a 30% reduction in traffic and they managed to achieve a 35% reduction. The key message we want to get across is, "Don’t stay away from London. Come to London".

Where it comes to specific pinch points, we are working with specific businesses, particularly in the Canary Wharf area, where we think that there may be some particular pressures. The Jubilee Line, London Bridge Station, the Central Line, Bond Street and Bank Station are going to be particularly busy. It will still be possible to get through them. It may take a little bit longer. It may be quicker to avoid interchanges at those stations over the summer, but those are the kind of changes in travel patterns that are completely normal. We are working with particular businesses in particular locations on a targeted basis, but what we want to avoid is a generalised message, because I think that would suggest that we wanted people not to come to London in a period where, frankly, they will want to be here, and to go out in the evening after work in the most exciting city in the world over those six weeks will be a wonderful thing for many London workers to do.

Q413 Chair: A 20% reduction is a huge number, and for those people you are essentially saying, "Stay away", aren’t you?

Jeremy Hunt: Yes, but only on a targeted basis. This isn’t every business in London, this is businesses in particular locations and that is over the summer holiday period as well. Jonathan, do you want to come in?

Jonathan Stephens: I was just going to add that it is not just about simply avoiding journeys. That may be a part of it, but it is also about, "Can you travel at a different time? Can you change your route slightly and just walk the last bit of your route to avoid a particular hotspot? Use the bus rather than the tube if the tube is particularly congested on a particular day."

Again, sometimes it may be about encouraging people to stay in London for longer. TfL have had very good discussions with Canary Wharf, where there is a large number of important businesses, where large numbers of employees are based, and they are thinking very actively about how to create lots of opportunities for staff to stay on after the working day with TV screens, entertainment locally to participate in and watch the Games, and, as a result, stagger their journeys home to help demand management. It is very much about amending your journey.

The civil service is playing its part. Virtually all Government Departments have signed up to an objective to reduce their travel patterns during the Games. This is being led by the Department for Transport, which trialled this with their own staff last year and altered 69% of their staff journeys in a two-week period. I think it is capable of being done.

Q414 Chair: Have you studied what happened on the first day of the new Millennium in terms of the travel arrangements for visiting the Millennium Dome for the celebrations there?

Jeremy Hunt: It is engraved on my brain, Mr Chairman.

Chair: I thought it might be. I think there might be some lessons to be learnt from that.

Jeremy Hunt: Indeed.

Q415 Steve Rotheram: We were very fortunate we had a tour of the Olympic Park last week, which was very exciting. This question was raised with John Armitt, who I think you know well, and he gave a robust defence of the plans for the stadium wrap. As Chair, Secretary of State, of the Olympic Board, do you think it is appropriate for London 2012 to be so closely associated with a company like Dow Chemicals?

Jeremy Hunt: Obviously it is a decision for LOCOG, but it is a decision that, as a result of the controversy that we had last autumn, I looked into very carefully. After looking at it very carefully, I decided that I wholeheartedly supported the decisions that LOCOG had taken.

Dow is an IOC top sponsor. The ethical practices of our sponsors are very important matters, but it is also something that is looked into exhaustively by the IOC before they make someone a top sponsor. The fact that, as you will know, they did not own Union Carbide at the time of the Bhopal disaster in 1985 nor at the time of a final settlement with the Indian Government in 1989-that has been upheld three times in the Indian Supreme Court-makes me confident that it was a very reasonable decision.

In terms of the sustainability considerations, they passed with flying colours as being much the best solution. I just have a wider concern that, at a time when corporate practices are very much under the spotlight for all sorts of reasons that are not related to the Olympics, we have a third of the cost of staging the Games being borne by corporate sponsors, and those are companies that are doing the right thing. They are supporting sporting events, they are reducing the cost to taxpayers and they are doing something that is of extraordinary benefit to the country, and I would not want to send a signal out to corporate sponsors that we do not value what they do.

Q416 Steve Rotheram: I am sure we do value it. Anyone who has corporate social responsibility also is to be applauded, but you may not think that there is a case to answer, and others have put that forward, but how about the potential reputational damage to the Games?

Jeremy Hunt: We are a free country, and I think it is a very important part of our Olympics that we tell the world that we are a country that allows protests and that allows a democratic debate about all the decisions taken with respect to hosting the Olympics. I defend to the hilt the right of anyone to challenge decisions that have been made by the Government or by LOCOG or anyone associated with the Olympic project, but I have to say, in this particular case, after looking at the issues in enormous detail-the Bhopal tragedy was an appalling tragedy and there is absolutely no question that there was an appalling human cost-I do not believe that Dow were responsible and I think we should support them as a company that wants to do the right thing by supporting a project that will be of huge benefit to the country.

Q417 Steve Rotheram: Secretary of State, is this a case of you just belligerently ploughing on regardless, or have you done any analysis of the damage that this could do to the Games?

Jeremy Hunt: Of course, if people wish to protest-that attracts publicity-that is something may be with us for a while in the run-up to the Games, but I think it is also important in these situations to be clear about your principles. The IOC and LOCOG and the Government have all looked very carefully at that decision and we think that ethically it was the right decision to take. We welcome sponsorship from ethically and morally responsible companies. It would be the wrong thing to make a hasty decision on the basis that I have outlined and on the basis of pretty exhaustive examination of the decisions that were made by LOCOG and which we fully support.

Q418 Mr Sutcliffe: We move now to corporate hospitality and issues around that and the Government’s role in all this. Can we first of all confirm that LOCOG will recover the costs of the VIP centre from the IOC and the sponsors?

Jonathan Stephens: Yes, that is entirely met from private funds from LOCOG’s budget. There is no public funding going into that at all.

Q419 Mr Sutcliffe: Who from Government will have access to the VIP lounges?

Jonathan Stephens: We haven’t taken final decisions on this, but we are very clear that participation by Government Ministers or officials will only be where there is a strict working justification for it, and in particular where there is a clear need either to represent the UK or to advance the UK’s interest, particularly in respect to business, or to represent and celebrate UK sporting success.

Q420 Mr Sutcliffe: Can we move on now to the thorny issue of Games tickets and the issues around there? The Government has bought a number of Games tickets for business leaders and dignitaries. Can you give us description of who that might be?

Jonathan Stephens: The principles here we are seeking to apply are, first, to maximise the benefit to the UK from hosting the Games, but secondly and very importantly to make sure that the maximum number of tickets are available to the public for their use and access. Thirdly, we want to make sure that we are completely transparent in our use of tickets. Applying those principles, all top sponsors were entitled to 13,500 ticket allocations. Right from the start, the Government decided not to take up its full allocation, so we purchased about 8,800 at a cost of just under £750,000. Roughly 3,000 of those we set aside to make available for people who have worked consistently on the Games to make them a success over a significant period of time to purchase at cost value-not free, but to purchase at cost value.

We originally made about 3,000 tickets available. We have only allocated 2,300 of those. Another 2,000 or so we purchased on behalf of host local authorities outside of London, the venues such as Weymouth or football venues outside of London, for them to host dignitaries and visiting guests. The number available to the Government to host guests is around 3,300. We have not yet taken final decisions on how to use those. We expect most of them will be associated very closely with the various business promotion efforts, the business conference, the exporters’ conference that will be associated around the Games and, of course, as we firm up our plans and review them with the other departments closely involved, such as the Foreign Office, as and when we find that we have tickets that we do not need we will return them to make them available to the public.

Q421 Mr Sutcliffe: Earlier, you talked about buying tickets for the staff for the opening and closing ceremonies. Will that be on a similar sort of basis in terms of making sure that those people who have worked on the project get the opportunity to go to the opening and closing ceremonies?

Jonathan Stephens: Yes. I should be clear that the tickets for staff do not include any tickets for opening and closing ceremonies. Indeed, the value of all such tickets is between £40 and £90, and staff are purchasing those at face value.

Q422 Mr Sutcliffe: I do not know if this is an oddity or not, but you can explain why there seems to be a strong interest in beach volleyball among Ministers and civil servants? The Government have bought 410 beach volleyball tickets, costing £26,000, as against only 256 athletics tickets. I think the Chairman has a few tickets as well.

Jonathan Stephens: I thought that was an oddity, myself. The explanation is an interesting one. When we were purchasing tickets for staff to purchase, we thought they are mostly going to be able to go at the weekend or on Friday, and when you look at what is available at those sorts of price bands on those days, most of it turns out to be volleyball. As ever on these occasions, the explanation is coincidence rather than conspiracy.

Chair: I think we have exhausted all our questions, so I thank the three of you very much.

Prepared 27th January 2012