Osborne cuts budget for London 2012 by £27m
Updated on 24 May 2010
Chancellor George Osborne has delivered a £27m budget cut to London 2012 budget, which critics say could lower the quality of the Olympic Park.
Spelling out plans for £6.24bn in spending cuts, Osborne revealed plans to claw back £88m from the Department for Culture, Media and Sport.
A third of the savings, totalling £27m, will be siphoned from the Olympic Delivery Authority (ODA) budget - which is responsible for building the Olympic Park and planning its post-Games use.
The London Assembly's budget chairman John Biggs said the cut leaves less wriggle-room in the Olympic budget and may lower the quality of the project.
"£27m is a small amount in the overall budget (of £9bn), but it is a significant amount to come from this year's budget, which is around £1bn," he said.
"90 per cent of it will already be spoken for. The cut will materially effect this year's budget."
While the ODA has not specified where the cuts will come, Mr Biggs said it may lead to less "gold plate" on the venue and lower the quality of the finish.
The ODA is the publicly funded body responsible for building all the permanent Olympic sports facilities in venues - such as Eton Dorney and Weymouth and Portland.
One of its key projects is the Olympic Park, where the main 80,000-seat stadium and most of the sporting action will take place.
Minister for Sport and the Olympics Hugh Robertson said: "The government remains 100 per cent committed to delivering London 2012 on time and to budget.
"However, given the economic position, no part of government can be immune. We have, therefore, agreed with the ODA that £27 million of savings can be delivered without compromising the project."
Earlier this year, the Olympic Park was awarded the "Greatest Contribution to London" at this year’s ICE London Civil Engineering Awards.
London Mayor Boris Johnson said at the time the work was helping to "secure a truly lasting legacy for the capital", transforming the skyline of east London in one of the "biggest ever single regeneration project seen in Europe".
The ODA is set to revitalise more than 3 kilometres of rivers and canals in the Olympic Park, alongside a "backbone" of 30 new bridges and underpasses.
It is the biggest construction project under the ODA's remit – and aside from the main stadium the vast area will encompass an aquatic centre with space for 17,500 people, a velodrome to seat 6,000 and a temporary basketball arena for 12,000 spectators. There will be further space for 100,000 ticket-payers to wander about.
The ODA is also tasked with the job of converting the Olympic Park for long term use post-Games.
Arenas that are due to be relocated after the Games include water polo, hockey, basketball, Paralympics' tennis and archery, the Greenwich Arena and the indoor shooting hall.
Osborne offered no further detail on where the cuts would come from within in the ODA's budget - indeed the slash to the Olympic budget warranted only an asterisked aside within the six-page review.
London 2012 has a £9.3bn budget of public sector funding, which comes from a variety of sources including central Government, London authorities and the National Lottery.
However, a spokesman for the Department for Culture, Media and Sport (DCMS), said the ODA is confident it can deliver the savings.
"£27m is just less than 2 per cent of the ODA's overall budget for 2010-11," the spokesman said. "It has already delivered some £600m of savings in the past five years."
The exact details of the savings are due to be outlined by the DCMS in July's economic report.
ODA chairman John Armitt said: "I am confident that the ODA will be able to save £27m from our budget this year. This saving will be found by continuing to make efficiencies in the way the project is delivered as we have already done in the past."
