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A LONDON bid for 2012 Olympics could cost the taxpayer £2.5 billion.

Tessa Jowell, Secretary of State for Culture, Media and Sport, will reveal the figure this afternoon in the House of Commons when it debates whether the Government should back a London bid.

The figure is twice as much as the subsidy estimated by consultants Arup, who last year produced a report assessing the costs and benefits of a London bid at the behest of the British Olympic Association, the Government and the Greater London Authority.

Ms Jowell told The Telegraph: “We have to be clear what the costs are and what costs the Government may have to bear, because I am absolutely determined that we are not going to go through a repeat of Wembley, or Picketts Lock or the Commonwealth Games when we can pre-empt the experience of Sydney and Athens.

The cost of the Games in Athens has doubled and the cost of the Sydney Games went up by 50 per cent. That is why we’re so determined to establish what the subsidy would be and that the expenditure we make is realistic.”

The figures have been produced by civil servants reassessing Arup’s figures. Jowell said that Arup accepts their estimates were wrong in certain respects: they based their Games costs on Sydney, when the cost of living in Australia is 80 per cent of what it is in this country. They also underestimated the cost of transport by £200 million, as well as security and land acquisition costs.

Jowell said: “We have been very open about this and kept the stakeholders informed and Arup now accepts that they underestimated some of these figures.”

Cost is one of four factors that will decide whether the Government back the London bid. The others are legacy, what the Games will leave behind; deliverability, can London do it; and winnability, can London win if it makes the bid.

Jowell revealed that “there are three reports on winnability. One prepared by the British Olympic Association, one prepared by UK Sport and a report which is departmental.”

It is this report that is rather downbeat and suggests that London may not be able to come out ahead of New York, the only declared bidder, and Madrid and Paris, who are possible bidders.

Jowell said: “Assessing winnability is not like the other three criteria. We do need to know whether we start from a position of strength. You must understand the impact of the 2006 World Cup, many people here bear the scars of that bid. We invested a great deal in that bid but it’s clear that right from the beginning we didn’t stand a chance.”

Craig Reedie, chairman of the BOA, has estimated that he would like London to be sure of at least 30 of the 128 votes in the IOC before the bid started and it is understood that the BOA assessment supports that view. However, the assessment made by Jowell’s department is more pessimistic and she said: “We have spoken to a wide range of people and sometimes people are franker when they talk to you face-to-face, than in written reports.”

When it was suggested that there was a strong view within sporting circles that she had failed sport by not arguing for the Olympics, Jowell robustly denied it. “I disagree. I have made it clear that there’s a strong sporting case for our bidding for, and doing everything we can to win the Olympics for 2012. But I am a member of the Government and as a member of that Government we have to ensure that this is a decision taken by the whole Government.

“The decisions about the benefit of sport is self-evident, we all know that sport is going to benefit from the Olympics. But if we’re going to invest at the level that Olympics would require, something like underwriting £2.5 billion of Government and public money, there has to be gain and benefits beyond just hosting the greatest sporting event in the world.

“It has to be justified by regeneration, to be justified by the number of houses and new jobs — what we call the economic benefit — the uplift in tourism and all the other benefits that the Games could bring.”

Jowell gave no clue as to what she was thinking on this question but crucial as the Commons debate is, her visit to Lausanne on Friday, when she will have tea with Jacques Rogge, president of the IOC, will also be crucial. The two were supposed to have dinner during the Commonwealth Games in Manchester and Jowell will now use the visit to assess London’s chances of winning 2012.

She said: “I know he will say London will be a strong candidate. I expect him to say that. He wants as many cities as possible bidding. But I have to make an assessment about what our chances are and, as the Prime Minister said, ‘a decision on the bid will depend on what our assessment of a likely success is’.”

Far from being defensive about lack of clear-sighted direction, Jowell argues that the way the Government have conducted the Olympic debate shows their openness. “The process by which Government have conducted this decision is as open as possible. The debate at the House of Commons is instigated by the Government. We asked for Parliamentary time so that all sides of the House would have an opportunity to express their views.”

You would expect Jowell to say that, but the real test of openness will come when we see how the Government weigh up the views expressed in the House.

© Mihir Bose

      

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