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At your Leisure - 1 May 2006
London Calling
Introduction
In his March 2006 Budget, the Chancellor of the Exchequer Gordon Brown announced plans to give £200m in funding to Olympic sports. He also intends to raise a further £100m through private sector sponsorship of individual athletes. Combined with the £300m in lottery cash received at present by elite sports, this makes a £600m fund which aims to see Britain enter around 750 athletes in the London 2012 Olympic and Paralympic Games. The target is for Britain to finish in 4th place in the medals table, up from 10th place at the last Olympics in Athens in 2004.
But is getting the Olympics just about the medals table? Surely there's more to it than that? Let's look into what the Olympics is all about and how the UK plans to meet London's commitments as host city in 2012.
Olympics Old and New
The ancient Olympics, so-called because they were hosted in Olympia in Greece, were more than a festival of sport: they were a cultural occasion, bringing together writers, poets and sculptors as well as athletes. The modern Olympic movement was founded by Baron Pierre de Coubertin, who outlined the Olympic spirit in his Charter, stressing that:
Olympism is a philosophy of life, exalting and combining in a balanced whole the qualities of body, will and mind... Blending sport with culture and education, Olympism seeks to create a way of life based on the joy found in effort, the educational value of good example and respect for universal fundamental ethical principles.
It is perhaps this emphasis on creating a way of life that was behind the success of the London bid. London was announced as the host city by Jacques Rogge, head of the International Olympic Committee (IOC) in Singapore on 6th July 2005. The London bid, which was fronted by former Olympian Lord Coe (Sebastian Coe, double Gold and Silver Medal winner at successive Olympics in the 1980s), stood out from other bidding cities (Paris, New York, Moscow and Madrid) in some key ways.
Perhaps the greatest contrast saw the London team invite 30 local schoolchildren to join the official delegation in Singapore. Other cities tend to pack their delegations with business people and politicians, but London did things differently. They took the opportunity to show how their bid focused strongly on the legacy which will be left for future generations after the 2012 Olympic and Paralympic Games.
Key Aspects of the London Bid
The presence of Olympic gold medal winner Sebastian Coe on London's Olympic bid committee certainly helped their cause. Copyright: Getty Images, from Education Image Gallery.
- Regeneration
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East London has largely missed out on the regeneration projects that have affected much of the capital in the last 25 years. The large investments needed to host the Olympic and Paralympic Games will create wealth and employment within this part of London. The Lea Valley, home to the main Olympic Park, is one of the capital's underdeveloped areas. This will be transformed by hosting the Games.
- Transport
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Many parts of the physical infrastructure needed to host the Games were already underway, or at least planned before the announcement of London's successful bid. The Channel Tunnel Rail Link, speeding up train travel from the Continent to London, will be fully operational in Spring 2007. The site of the Olympic Park in Stratford will be served by ten railway lines by 2012. Transport for London will introduce a 12-carriage Olympic Javelin train service linking the Olympic Park with Kings Cross/St Pancras in a seven-minute journey. Improvements will also take place on Docklands Light Railway and the Jubilee tube line.
- Venues
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Athletes will be able to 'compete, not commute' due to the compact nature of the main Olympic site. The Olympic Park will house the Olympic Village with accommodation for every competitor and official, athletics stadium, velodrome, aquatics centre and hockey centre, as well as multi-sport arenas. Elsewhere, existing or planned venues will be used, such as the new Wembley Stadium, London parks, Lord's Cricket Ground and other well-known landmarks in the capital city and beyond.
- Legacy
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What the Games will leave behind for current and future generations to enjoy is a crucial part of London's success. Highlights of London's bid in this respect included: conversion of many stadia into smaller usable venues post-Games, relocation of removable stadia to other parts of the country, and the use of the Olympic Park to create Europe's biggest new public park for over a century.
So the London bid won by differentiating itself from other bidding cities and offering a genuine sporting opportunity to young people, as well as providing a lasting legacy for sport in the UK. But having won the right to host the Games, how do you go about planning for an event that will take place (at the time) seven years in the future?
Organising and Planning
Responsibility for planning a successful 2012 London Olympic and Paralympic Games falls to four organisations working together.
- The Olympic Delivery Authority (ODA) is a Government body headed at present by the Culture Secretary, Tessa Jowell. The ODA's main task is to build the facilities for the Games
- The London Organising Committee for the Olympic Games (LOCOG) headed by Lord Coe is responsible for putting on 'the show', such as the opening and closing ceremonies
- The British Olympic Association (BOA) whose Chairman is currently ex-Sports Minister, Lord Moynihan, has to focus on making sure UK athletes are ready and prepared for competition in time for the Games
- The Mayor of London, currently Ken Livingstone, will take responsibility for the facilities created for the Games once they are over. The Mayor will oversee the legacy of 2012 for regenerating under-developed areas of London
Getting these bodies and the individuals who run them to work closely must be a challenge, not least because they are nearly all elected officers who may well not be in their posts by the time the Games come to London. Nonetheless, they meet monthly and monitor progress towards achieving agreed targets. In April 2006, the International Olympic Committee's (IOC) Coordination Commission made a visit to London to check on the work carried out already. They reported that they were pleased with how plans are progressing.
Winning the Olympics: A Bitter Legacy?
This image shows construction work underway on London's Olympic Park - but what debts will be incurred from all this work? Copyright: Getty Images, from Education Image Gallery.
Critics of cities' ambitions to host the Olympic and Paralympic Games say that, because governments are required by the IOC to guarantee the financial health of the event, countries and cities are left with large debts for many years to come. A recent article for Forbes magazine, citing research carried out by Oxford Analytica, said that it is wrong to assume that the spending boost to the economy and extra tourism generated as a result of a successful bid, will ever materialise.
Examples abound of host city debts and financial struggles after winning the right to host the Games: the Montreal Games of 1976 famously was reckoned to nearly bankrupt the city; the Athens Olympics of 2004 propelled the Greek economy into large budget deficits.
Oxford Analytica's research indicated that the main problems are due to:
- Limited legacy value of capital investment in venues and infrastructure because Olympic-style venues are too large for everyday use, and their maintenance costs are too high.
- Visitors to the Games tend to be from the host country itself, so spending by visitors to the Olympics would have happened anyway, only in other places.
- Staging the Games does not appear to add to the stock of world-class sportsmen and sportswomen in the host country.
On these three points, observers may note that London 2012's bid provides for the continued use of Olympic facilities, but on a reduced capacity basis. Some might say that a bigger problem with London's bid is that the additional stimulus to the regional economy is not needed. There is a danger of over-heating in the south-east economy and the boost to the construction, engineering and tourism sectors would be better focused on less affluent areas of the UK.
Supporters of London's successful bid are more likely to be angered by the final finding of Oxford Analytica's research. The UK, they might say, are investing in a programme of sports development that is unrivalled in this country's history.
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The BOA's Performance Aims
Quite simply, the £100 million per year investment in the run-up to the 2012 Games will help pay for the best coaches in the world to be hired. This will boost the development of teams in a wide range of Olympic sports. Taking part in more Olympic events than ever before means more competitors attending the Games: the BOA estimates that the number of competitors in the British team in London will increase by over 270 compared to the team in Athens, to more than 700 athletes.
The funds are being spent at a rapid pace, with top class coaches being appointed as a priority. The BOA argues that coaches are the centres of excellence in sports such as women's water polo where:
- The UK has never previously entered a team at the Olympics.
- Only eight countries enter a team.
- Britain stands a good chance, therefore, of (as they say) 'medalling'.
Overall, the BOA is targeting every Olympic and Paralympic sport, but most money is being spent on sports where Britain has a strong chance of winning. Building strong development squads of competitors is also important, as is a sport's commitment to talent identification in our schools.
Some of the winners of the allocation system are highlighted below:
Olympic Winners? Increases in funding by selected sports
| Sport | Increase in funds (%) | Total funding (£m) |
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| Athletics | 7 | 20 |
| Rowing | 8 | 20 |
| Cycling | 22 | 17 |
| Sailing | 9 | 17 |
| Swimming | 306 | 16 |
| Canoeing | 23 | 10 |
Source: Data confirmed by Lord Moynihan on BBC Radio 5 Live, 18th April 2006
It's also interesting to note sports where public funding has never been received before. The following sports are being funded in order to provide a catalyst to make them more attractive and accessible for young people:
- Volleyball
- Handball
- Water polo
- Basketball
All the millions of pounds being invested in sport have one purpose: to get Olympic success moving! Copyright: Einar Hansen, from stock.xchng.
Conclusion
So the race has begun to produce an Olympic and Paralympic Games in 2012 that rivals the best ever held. A great deal of money has and will continue to be spent on the hosting of the Games. They will involve a major regeneration project, massive rail and road construction, and some significant building projects. At the same time, perhaps the biggest ever sports development programme is underway in Britain, bringing in the best coaches in the world and setting up a squad development and talent identification programme.
The 2012 Olympic and Paralympic Games in London will be judged according to many different criteria: sporting performance, financial prudence, security and safety. In the end, though, it is the social, cultural and economic legacy that the Games leaves behind that may be most important.
Activities
Task 1: A Question of Sporting Venues
Task 2: The 2012 Budget
The budget for the 2012 Olympic and Paralympic Games is detailed in this PDF file (see page 15 of the document). Please be aware that this is a large file [1.64MB] (http://www.london2012.com/NR/rdonlyres/2428F9A3-87A2-4BA4-91F6-F9E2CF60E1A7/0/Theme_6_finance.pdf)
You will see that this is the budget for the LOCOG operation. How much are the following parts of the Games expected to cost? (Note that the figures given are expressed in thousands of US Dollars).
- Opening ceremony
- Closing ceremony
- Paralympics
Notice that the LOCOG budget is not being used to finance any capital spending (spending on infrastructure projects like roads, railways and buildings). The capital investment overview is given on page 17 of the financial document mentioned earlier:
- What is the largest cost item of capital investment?
- What are the dangers in using bank lending to part-finance the Games?
Sources of Further Information
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