As part of the Government’s measures for reducing the national deficit, there have been a few successful savings which have been made, but have not reduced the project’s programme delivery.
The Olympic Delivery Authority’s (ODA) lifetime budget has been reduced by £27m. This has been achieved through efficiency savings and procurement gains and now the overall public sector funding package for the Games now stands at £9.298bn.
Minister for Sport and the Olympics, Hugh Robertson said, “As we approach two years to go until the games and with over two-thirds of the construction phase complete, we are in an excellent position.
“The ODA have done an excellent job thus far, delivering a complex project on time and within budget despite the credit crunch. Today’s report shows they have delivered £27m of savings as part of the government’s measures for reducing the deficit while keeping the whole Olympic programme intact.”
He added, “It also shows that the Anticipated Final Cost remains stable despite the impact of the forthcoming VAT and tax increases. Given we are halfway through the most complex year in construction terms this shows just how well this project is being run.”
Figures from the London 2012 Olympic and Paralympic Games Quarterly Economic Report show a like for like decrease of £51m in the Anticipated Final Cost (AFC) of the part of the Games being delivered by the ODA – from £7.267bn in May 2010 to £7.216bn in June.
Over £100m of savings have been achieved in the last quarter, of which £27m has been returned to the Government as part of the wider efficiency savings announced in May. These £27m were made through efficient delivery and procurement gains and comprise, and include £13m from construction site security, £11m from the IBC/MPC and £3m from smaller changes to the Basketball Arena and Velodrome.
In total around £700m in savings have been achieved by the ODA since the November 2007 baseline budget was agreed. The majority of these savings have been used to control the budget by offsetting cost increases in other areas of the programme and helping to fund the impacts of the credit crunch, thereby reducing calls on the contingency.