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Jowell says Olympic cost up £900m Cost of 2012 Olympics 'up £900m'
(20 minutes later)
The expected cost of the 2012 London Olympic park has risen 40% since the games were won in July 2005, Culture Secretary Tessa Jowell has told MPs.The expected cost of the 2012 London Olympic park has risen 40% since the games were won in July 2005, Culture Secretary Tessa Jowell has told MPs.
The extra £900m cost was likely to be met by London council tax payers and lottery funds, Ms Jowell suggested.The extra £900m cost was likely to be met by London council tax payers and lottery funds, Ms Jowell suggested.
The new £3.3bn estimate is still far below the £8bn critics say the Olympics will cost if things like regeneration linked to the games are included.The new £3.3bn estimate is still far below the £8bn critics say the Olympics will cost if things like regeneration linked to the games are included.
The Tories said the budget had gone "disastrously wrong".The Tories said the budget had gone "disastrously wrong".
Ms Jowell told the Commons culture, media and sport committee the £3.3bn did not include the cost of regenerating the area or the cost of the local organisation committee.Ms Jowell told the Commons culture, media and sport committee the £3.3bn did not include the cost of regenerating the area or the cost of the local organisation committee.
She blamed the rise in cost on a doubling in the price of steel and revising transport costs to take into account inflation in the years to 2012. She blamed the rise in cost partly on a doubling in the price of steel and revising transport costs to take into account inflation in the years to 2012.
Ms Jowell, who said the games would leave a legacy "for ever" in East London, told MPs an unexpected VAT bill for building costs was unlikely to add to the overall cost to taxpayers of the games. But it also included an extra £400m to pay "delivery partner" CLM to make sure the games came in on budget.
Ms Jowell, who said the games would leave a legacy "for ever" in east London, told MPs an unexpected VAT bill for building costs was unlikely to add to the overall cost to taxpayers of the games.
'Construction plans''Construction plans'
Asked who would meet the extra £900m cost, Ms Jowell said discussions were on-going, but the earlier "memorandum of understanding" had been for overspends to be met by a mix of London council tax payers, and lottery games.Asked who would meet the extra £900m cost, Ms Jowell said discussions were on-going, but the earlier "memorandum of understanding" had been for overspends to be met by a mix of London council tax payers, and lottery games.
The original budget includes a contribution of £625m from London council tax payers - which works out at £20 a year for 25 years - and £1.5bn from Lottery games.The original budget includes a contribution of £625m from London council tax payers - which works out at £20 a year for 25 years - and £1.5bn from Lottery games.
Ms Jowell suggested that one other option being discussed was getting the Treasury to waive its 12p take from Lottery tickets sold.Ms Jowell suggested that one other option being discussed was getting the Treasury to waive its 12p take from Lottery tickets sold.
She said that whatever funding arrangement was agreed it had to be "fair, sustainable and proportionate".She said that whatever funding arrangement was agreed it had to be "fair, sustainable and proportionate".
HAVE YOUR SAY You could have guaranteed that the costs would go massively over budget. Just look at Wembley John, UK Send us your commentsHAVE YOUR SAY You could have guaranteed that the costs would go massively over budget. Just look at Wembley John, UK Send us your comments
Ahead of the committee hearing shadow sport and Olympic minister Hugh Robertson said: "I do not want to hear any more spin from the government about the Olympics.Ahead of the committee hearing shadow sport and Olympic minister Hugh Robertson said: "I do not want to hear any more spin from the government about the Olympics.
"What I want now is transparency and accountability over the true cost and an explanation of why the original budget has gone so disastrously wrong."What I want now is transparency and accountability over the true cost and an explanation of why the original budget has gone so disastrously wrong.
"It looks like monumental government incompetence.""It looks like monumental government incompetence."
The Liberal Democrats say the government should pay for the extra cost.The Liberal Democrats say the government should pay for the extra cost.
The ODA and the government are reviewing the original budget for the games and are expected to announce a revised financial plan next February.The ODA and the government are reviewing the original budget for the games and are expected to announce a revised financial plan next February.