CHAPTER 7: THE ECONOMIC, SOCIAL and cultural
351. The Government's December 2010 Legacy Action
Plan outlined four areas of focus for delivering the post-Games
legacy. These included:
· Exploiting to the full the opportunities
for economic growth offered by hosting the Games.
· Promoting community engagement and achieving
participation across all groups in society through the Games.
352. The plan went on to set out a number of
areas of activity that would be pursued in support of these aims.
The possible benefits for British business were emphasised: the
experience of delivering on time and on budget would be used to
promote British businesses to countries hosting future major events,
and the Games would allow an opportunity to leverage additional
foreign direct investment into the UK. Plans to showcase the sustainability
standards achieved in building and running the Games, and the
efficiency benefits that can be gained through such an approach,
were also highlighted.
353. Initiatives to promote community engagement
centred on volunteering; the 2010 plan stated that: "After
the Games we want to enable a proportion of the up to 70,000 Games
Makers, who will act as volunteers around the venues, to use their
skills and expertise to benefit their communities".
It went on to explain that "the emphasis on all areas of
the UK means that legacy is a project that all societies can take
The business legacy
THE SUPPLIER RECOGNITION SCHEME
354. Reaching back before the Sydney 2000 Games,
successive Governments have worked to ensure that UK companies
are well placed to compete for contracts to deliver construction
and event management services to Games organisers. The reputational
benefits of working to win contracts for a successful Games are
355. There can be little doubt that the design
and build of the 2012 Olympic venues, coupled with delivery of
the Games themselves, presented significant opportunities for
UK businesses. We received evidence that the ODA sub-contracted
out £5.6billion worth of business for the Games, through
1,433 major Tier-1 level contracts. These contracts were then
divided up into over 43,000 separate Tier-2 sub contracts that
were opened up to private sector competition.
356. Many of the businesses which supplied services
to the ODA, and to LOCOG, would hope to use the experience gained
in providing for the Games to secure further, similar work. The
Government stated, in December 2010, that "UK Trade and Investment
are working with many of these companies to turn the expertise
they have acquired from working on the London 2012 Games into
357. In the lead-up to, and during, the London
2012 Games, domestic marketing rights for the Olympic words and
symbols rested with the organising committee, LOCOG. Successful
delivery of the Games by LOCOG was dependent upon their ability
to use these rights to raise significant amounts of sponsorship
income. At the end of December 2012 these rights reverted back
to the BOA, who are the usual custodians. The BOA is reliant,
to a significant extent, on using these rights to generate ongoing
sponsorship income to support the sending and assembling of future
teams for the Games.
358. In light of these restrictions, many UK
companies that provided services to the Games signed 'No Marketing
Rights Protocol' agreements, which stipulated that they would
be unable to advertise their involvement as suppliers. These provisions
are made to protect the interests of the main IOC Olympic sponsors,
as well as the sponsors who were attracted by LOCOG. This measure,
in effect, prevented British companies from freely using their
experience of supplying to the Olympics to secure new work.
359. In response to concerns on this matter DCMS,
with the authority and support of the BOA, introduced the Supplier
Recognition Scheme (SRS) in January 2013. This allows companies
which supplied to the Olympics to apply for recognition and, upon
satisfying certain criteria, to promote their involvement in a
series of approved ways which had been prohibited under the protocol.
The UK is the first country to develop such a scheme after hosting
the Games; the Secretary of State told us that, so far, 750 companies
have been awarded licences under it.
360. There are, however, issues with the SRS.
Many business categories have been excluded in order to protect
the main IOC Olympic sponsors.
We received evidence arguing that these categories of exemption
were too broad, and often covered areas of industry in which Olympic
sponsors were not represented.
Applications to the scheme also require time, resources and administrative
capacity that small and micro businesses often do not have.
361. The UK is the first country to create
a scheme to recognise Olympic suppliers post-Games, and this is
to be welcomed. We believe, however, that further improvements
to the Supplier Recognition Scheme are possible, and recommend
that the Government work with the BOA, and with suppliers, to
narrow the range of exclusions from the scheme. (Recommendation
362. A number of business organisations, including
London First, the London Chamber of Commerce and Industry and
the Federation of Small Businesses worked together ahead of the
Games to develop 'CompeteFor'. This website, and the activity
which supported it, allowed smaller companies to bid for second
tier Games contracts.
363. The London Chamber of Commerce and Industry
(LCCI) told us that they were "confident that CompeteFor
provided unprecedented opportunities for small firms to access
contracts for a major international event".
More than 172,000 businesses are registered on the site and over
13,000 contract opportunities have been made available. The LCCI
estimated the total value of contracts awarded to be in excess
of £2.5billion, with 75% going to SMEs. Impacts were not
limited to London; Essex County Council told us that over 200
CompeteFor contracts were awarded to Essex-based companies, with
an estimated value of £55million.
364. The FSB explained why CompeteFor worked
"It opened up the supply chain because it
is very hard in public procurement. You know who gets the tier
1 bid but then it becomes a black hole. By forcing the people
who won (tier 1) Olympic contracts to put the supply chain through
CompeteFor it opened up lots of opportunities
tier 2, 3, 4 right the way down to tier 5 of people to get into
that supply chain. That had never been done before. It is a unique
way of doing public procurement by forcing the supply chain to
365. We consider CompeteFor to be a successful
innovation. We welcome steps taken by the GLA to sustain the use
of this portal post-Games, with expansion into the supply chains
for Crossrail, TfL and the work currently taking place on the
366. We were told that the Government is currently
reviewing its own Contracts Finder procurement service, the contractual
arrangements for which are coming to an end. Business representatives
were concerned that this review would lead to the establishment
and development of new procurement systems. There were also concerns
that, already, a multitude of public sector procurement systems
exist, the complexity of which inhibits the ability of SMEs to
access the market. The FSB feared that the outcome of the current
review might further exacerbate this problem.
367. We believe that the CompeteFor portal
allowed SMEs a better level of access to the Games supply chain
than might otherwise have been the case. We are pleased to see
that the GLA has continued using this service post-Games. We believe
that there is a strong case for rolling out CompeteFor still further.
368. We recommend that the Government work
with major public sector procurers to make CompeteFor permanently
available to SMEs across a wider range of public sector procurement
programmes. The Government should refrain from introducing new
procurement systems into areas of activity where CompeteFor would
be suitable for use. (Recommendation 32)
Benefits across the UK
369. The Government has set a target of securing
at least £13 billion of economic benefits from London 2012
by the time of the Rio 2016 games. £11 billion of this is
projected to come from trade and investment, with a further £2
billion from increased tourism.
370. In July this year the Government stated
that £2.5 billion of additional foreign direct inward investment
had been secured since the Games, bringing 31,000 new jobs.
We were provided with evidence, from the Cabinet Office, that
gave further description to this headline figure, describing it
as a "£2.46 billion investment estimated as influenced
by the Olympics".
A regional breakdown, correct to the end of March 2013, was also
Investment into nations and regions of
the UK Title
Additional jobs by nation and regions
resulting from the £2.5bn in foreign direct investment into
the UK as a result of the Games
371. It is to be expected that, given the Games
were principally hosted in south-east England, the balance of
benefits might accrue in this region. It is important also to
note that spending and investment in the south-east of England
can support jobs elsewhere.
Notwithstanding that, however, the regional disparities contained
within the table above give cause for concern. The £2.5 billion
of FDI has delivered 14,928 additional jobs to London, but only
51 to the East Midlands, and 7 to the North East of England. £716
million of investment has been secured for south-west England,
but only £21.54 million for Wales.
372. We note that economic benefits which
might have arisen from the Games are disproportionately weighted
towards southern England. The scale of difference goes beyond
that which might reasonably be expected to occur as a result of
the Games taking place in and around London.
373. We urge the Government and UKTI to assess
the reasons for this disparity and, in light of this assessment,
to revise their plans for promoting post-Games investments in
regions outside southern England, whilst recognising the importance
of London to the UK economy as a whole. (Recommendation 33)
The tourism legacy
374. The Government have set a target of using
London 2012 to secure £2 billion of additional economic benefits
from tourism by the time of the Rio 2016 games. We were told that
an extra 4.7 million overseas visitors were expected to come to
the UK between 2011 and 2015.
Efforts to promote this increased tourism are principally being
taken forward through the GREAT campaign, Visit Britain and Visit
London. Visit Britain are managing a £100 million campaign
to promote UK tourism following the Games; this runs until 2015.
375. We were told that, post-Games, the UK had
seen improvements on a range of indicators which are used to measure
the image of international tourism destinations. Nations Brand
Index survey research, commissioned by Visit Britain, showed that
our overall tourism 'brand' had improved, as had our scores for
welcome, culture and natural beauty. Further research on Britain's
reputation overseas, by Ipsos MORI, found that more than 1 in
3 people said that the Games have made them more likely to visit
376. Initial tourism figures released since the
Games are largely positive. Britain played host to 31.1 million
overseas visitors in 2012, a 1% increase on 2011.
The amount spent by these visitors increased by 4%. London accounted
for almost half of all overseas tourist visits to the UK. In 2012
there were 15.5 million visits to London (up 1% on 2011) and 15.6
million visits to the rest of the UK (up 0.7% on 2011).
377. Increases in spend and visits have been
sustained into 2013. The first five months of 2013 saw a 10% increase
in visitor spending on the same period last year; visits were
up by 2%. The
latest International Passenger Survey statistics show that London
has felt a particular benefit, with 4.2% more overseas visitors
in the first quarter of 2013, and an 11.5% increase in expenditure.
378. London has accounted for around half of
overseas visits to the UK for a number of years. Patricia Yates,
Director of Strategy and Communications, Visit Britain set out
the measures being taken to utilise the Games to promote tourism
"We worked phenomenally hard during the
Games to make sure that the media who came to London were taken
around the rest of the country. We escorted NBC, which was the
rights-holding broadcaster in America, around the country. They
did the Today programme from Wales and Scotland, and they
had regular slots showing the rest of the country. When we tracked
the brand and how perceptions internationally had changed, we
found that 75% of people we asked internationally said that the
coverage they had seen of the Olympics made them want to explore
more than London
As to the benefit, if it is a visitor
to London or a visitor to Paris, I would rather have the visitor
379. Whilst we share this last sentiment, we
are concerned that, once again, the balance of benefits arising
from hosting the Games appears to be weighted in favour of London.
We believe that more work is needed to utilise the Games to promote
visits, and spending, outside London.
380. Initial results suggest that levels of
overseas tourism to the UK are being sustained and improved since
the Games; this is to be welcomed. Tourism in London has seen
a particular benefit, in terms of both the numbers of visits and
levels of spending, since the Games. We welcome this positive
development. We note, however, that London accounts for almost
half of all tourist visits to the UK.
381. We are concerned that more needs to be
done to ensure that regions outside London enjoy a tourism legacy
from the Games. We recommend that the Government and Visit Britain
conduct an analysis of how effectively their current major campaigns
are promoting the rest of the UK, and, where required, bring forward
changes to ensure that regions outside London can share more fully
in the tourism legacy. (Recommendation 34)
382. As mentioned in the previous discussion
of housing, the approach taken to sustainability at London 2012
has been widely praised. Sustainable design and construction techniques
were employed in the building of the Park and sustainability was
also incorporated into the event management approaches used for
the Games themselves.
383. LOCOG embedded sustainability within their
Procurement Governance Model, requiring suppliers to satisfy certain
sustainability criteria. The former Head of Sustainability at
LOCOG told us that: "Significantly, on both the construction
and event staging sides, London 2012 was able to demonstrate that
sustainability paid its way
The learning here is that UK
companies, small and large, can do sustainability and, when done
properly, this does not increase costs".
384. London 2012 also inspired the creation of
a fully certifiable international event management standard, known
as ISO 20121. This standard provides a means through which organisations
in the events sector can address sustainability matters in an
efficient and managed way. Rio 2016 has committed to using this
standard and all candidate cities for the 2020 Games also committed
to using it. We were told that the development of this standard
has demonstrated UK global thought leadership in the sustainability
385. The expertise that British construction
and event management businesses gained through London 2012 should
give them a competitive advantage when seeking to win contracts
for future major events. The Government stated, in their 2010
Legacy Action Plan, that they would be "showcasing the broader
sustainability standards reached in the building and running of
the Games and the positive economic and financial benefits derived
from taking a sustainable approach".
386. The evidence received suggested that UKTI
and others were not always taking the steps necessary to promote
this UK area of expertise. David Stubbs told us: "My concern
is that this success is not being promoted and utilised to support
UK business, the sport culture and event sectors
ingredients are leadership and advocacy
In a nutshell this
is a classic case of something of value being developed in the
UK but exploited overseas".
387. Sustainable Events Ltd told us that the
UK event industry delivers £58.4 billion to the UK's GDP.
They went on to state that in Sweden, Thailand, Singapore and
Australia governments were spending money on building knowledge
and brand around the sustainable events market, concluding that:
"In the next few years these destinations will take on the
leadership role which the UK currently has".
388. London 2012 was rightly praised for the
sustainable design and construction measures which were used in
the development and building of the Park by the Olympic Delivery
Authority. The events themselves also set new international standards
for sustainability, which future hosts of major events are committed
389. The experience of developing and working
to meet these standards should give UK businesses a competitive
advantage when bidding for future contracts. We are not convinced,
however, that this niche area of UK expertise is being effectively
390. We recommend that the Government and
UKTI develop an appropriate strategy to promote the sustainability
expertise of the UK event industry. (Recommendation 35)
The volunteering legacy
391. The 70,000 London 2012 volunteersknown
as Games Makersmade a major contribution to the success
of the Olympic and Paralympic Games. Their role in delivering
the Games has been rightly and widely praised.
392. The recruitment and training exercises that
LOCOG carried out in appointing the volunteers were praised in
the evidence that we received. Lord Coe told us that over 300,000
people applied to become Games Makers. The process through which
LOCOG arrived at the final number of 70,000 required major commitment,
including 100,000 interviews.
Mike Locke of NCVO told us that: "The main lesson, in terms
of the Games Makers, is to look at investment in and leadership
of the volunteering programme".
He felt that LOCOG had recruited high calibre volunteers, and
that the value placed on the role by all parts of LOCOG, from
the leadership down, had had a significant impact upon their success.
393. Mr Locke said that the Games had helped
to improve public perceptions of volunteering, and that this might
have a positive impact on the willingness of individuals to come
forward as volunteers:
"The Games focused people on volunteering
through the media coverage of all that enthusiasm
that the public consciousness of volunteering has grown and enlarged,
and that ought to have a beneficial effect on the way people think".
We recommend that the methods used to recruit
and train volunteers for London 2012 should be applied more widely;
the Games provided an impressive example of what can be done to
inspire volunteers. The lessons learned from this process should
be built upon to support future events. (Recommendation
394. We considered the challenges involved in
sustaining interest in volunteering from the pool of 300,000 who
initially applied for Games Maker roles. Management of the LOCOG
consumer database has been taken over by Sport England. Since
September 2012, Games Makers and other potential volunteers on
the database have received information about volunteering opportunities
available through the Sport England Sport Makers programme. In
total, over 78,700 people have registered on the Sport Maker website,
and over 53,500 have registered for a workshop.
395. Not all Games Maker applicants, however,
will be interested solely in volunteering opportunities connected
with sport. Lord Coe told us that the motivation for volunteering
at a major event such as the Olympic and Paralympic Games did
not necessarily extend to wishing to become involved with a sports
club on a regular basis.
396. The Join In programme is the official 'legacy'
volunteering programme from London 2012, and was launched in May
2012. It received £1.5million from the Big Lottery Fund to
encourage 2012 volunteers into longer-term volunteering with local
sports clubs. NCVO told us that Join In "was created a bit
late in the day, but then has done a splendid job within its own
terms". Richard Sumray told us that: "The Join In programme
is of value but it is not comprehensive, its focus being on sport".
397. The sense that efforts to sustain the interest
of Games Makers in volunteering had come 'a bit late in the day'
was common to much of the evidence that we heard. We were told
that: "There was a real opportunity to create a comprehensive
and inclusive programme building on the great success of the Games
Makers, London Ambassadors, local authority volunteers and others,
but that opportunity has been lost".
398. We share the view that the opportunity
to create a comprehensive programme, building upon the success
of the Games Makers initiative, has been missed. Planning for
the volunteering legacy should have started much earlier; organisations
that would be charged with carrying this forward should have been
established well in advance of the Games. The work that the Join
In programme is carrying out is commendable, but began too late
to have maximum impact.
399. We examined the role that data protection
issues might have played in limiting access to the contact details
of Games Maker applicants post-Games. Despite hearing concerns
regarding this matter,
we were assured by the Information Commissioners Office that the
Data Protection Act had not placed any restriction on the ability
of LOCOG, Sport England, Join In or others to access relevant
information. We were satisfied by the Information Commissioner's
assurance on this point, and note that his explanation tallied
with what we were told separately by Sport England.
The cultural legacy
400. The Legacy Trust UK was established in 2007,
with a £29 million Big Lottery Fund investment and a further
£11 million from the Arts Council and the Department for
Culture, Media and Sport. The Trust sought to create a lasting
cultural and sporting legacy from the 2012 Games, and was the
primary funder of the 2012 Cultural Olympiad.
401. The Cultural Olympiad was a four-year programme
of activity from 2008 to 2012, culminating in the London 2012
Festival from 21st June to 9th September. Many aspects of the
programme were positively received.
402. We were told that the official evaluation
of the Cultural Olympiad estimated that it reached a combined
audience of 43.4 million people (participants, volunteers and
audiences), and a wider audience of 204.4 million people through
broadcasts and online.
The Government told us that a "conservative estimate"
would value the PR generated at £44 million.
403. Whilst the Opening Ceremony was incredibly
popular, and the programme of events that comprised the Cultural
Olympiad enjoyed some level of recognition, we are unclear as
to what the distinct cultural legacy of the Games is. Aside
from the Government figures, we received very little evidence
on this matter, despite raising it in our initial call for evidence.
In over 500 pages of written evidence, the term 'cultural legacy'
only appeared twice. We asked the Secretary of State how the cultural
component of London 2012 was being built upon and sustained:
"The Cultural Olympiad really put us up
the rankings in terms of soft power, put us up the rankings of
welcome that people felt towards London and the way they understood
London better, and we are taking forward the GREAT campaign that
was launched really around the Olympics to show Britain abroad
in a very rich and culturally filled way
That is very much
linking back into what we learned out of the Olympics themselves,
and indeed there are very tangible things we did around the Olympics
that we are taking abroad as well. The inflatable Stonehenge is
one of them, which is on the world tour, and is a fantastic way
of bringing Britain to life overseas. That is something that was
specifically designed around the Olympics and Paralympics itself".
404. Dorset County Council told us that the 'Cultural
Olympiad by the Sea' programme generated 52 temporary jobs, and
increased GVA in Dorset by around £2.5 million. We were told
that this programme was "high quality" but also a "one
Essex County Council told us that, over the four years of the
Cultural Olympiad, £10.7 million was invested into 101 different
projects in the East of England, reaching 2.5 million people.
405. It is clear, therefore, that the Cultural
Olympiad, through a series of one-off events, helped the Games
to reach out beyond London, whilst also creating some temporary
employment and generating one-off local economic benefits. We
have received insufficient evidence, however, to be convinced
of any longer-term impacts.
406. We ask the Government, in their response
to this report, to set out what the long-term, distinct, legacy
benefits of the Cultural Olympiad will be, and to explain how
these will be measured and monitored over time. Whilst some of
the events which comprised the Cultural Olympiad itself were undoubtedly
well received, we have seen no evidence to suggest that there
has been any coordinated, properly resourced attempt by Government
to use this potential to deliver a distinct cultural legacy from
the Games. (Recommendation 37)
The international legacy
407. London 2012 was the first Olympic and Paralympic
Games to have an international sporting legacy programme. International
Inspiration, established in 2009, trained teachers, sports coaches
and young people across the world to deliver sports programmes
in their own communities. The programme was delivered through
a partnership between UK Sport, British Council and UNICEF.
408. The limited evidence that we received on
International Inspiration was largely positive. We were told that
the programme was delivered in 20 countries, and reached over
15 million participants, with over 230,000 teachers and coaches
trained. A survey in sample countries
found that 85% of practitioners who had been trained by the programme
were still involved in providing coaching one year after their
training had concluded.
409. Concerns had been raised about the sustainability
of the programme post-Games; we were pleased to note that, through
a merger with the International Development through Sport charity,
this work will continue for the foreseeable future.
410. Ahead of the Games, the FCO developed a
programme of activities to seek to promote the Olympic Truce.
We received limited evidence on the success or legacy of these
activities. The evidence that we did receive commended the Government
for seeking to promote the Truce, but questioned the effectiveness
of the activities delivered.
167 DCMS, Plans for the Legacy from the 2012 Olympic
and Paralympic Games, December 2010. Back
Professor Mike Raco. Back
DCMS, Plans for the Legacy from the 2012 Olympic and Paralympic
Games, December 2010. Back
Q 483 Back
Usually known as the IOC 'TOP' sponsors: TOP is an acronym for
'The Olympic Programme'. Back
Essex County Council. Back
Q 433 Back
Q 434 Back
The Government and Mayor of London, Inspired by 2012: The Legacy
from the 2012 Olympic and Paralympic Games, July 2013. Back
Emma Boggis. Back
eg. Manufacture of Tube carriages in Derbyshire. Back
The Government and the Mayor of London. Back
Cited in written evidence from the Government and the Mayor of
Visit Britain. Back
The Government and the Mayor of London. Back
Visit Britain. Back
The Government and the Mayor of London. Back
Q 207 Back
David Stubbs. Back
British Standards Institution. Back
DCMS Legacy Action Plan, December 2010. Back
David Stubbs. Back
Sustainable Events Ltd. Back
Q 70 Back
Q 442 Back
Q 444 Back
Sport England. Back
Q 70 Back
Richard Sumray. Back
QQ 445-447. Back
Visit Britain. Back
The Government and the Mayor of London. Back
Q 491 Back
Weymouth and Portland Borough Councils. Back
Mozambique, Nigeria and Jordan. Back
Youth Charter. Back
International Inspiration. Back
United Nations Association Westminster Branch. Back