The increasing frenzy around the 2012 Olympics ?masks a hidden bailout and a dubious social legacy, says Anna Minton.
Landmark events always reflect the social and economic realities of the time which in this case is the tax-payer funded bailout of an economic model in crisis. In 2008, as the government prepared its bailout of the banks, another less well-advertised bailout was also underway, this time to save the Olympic project with public funding increasing by a massive £5.9 billion.
The initial proposal for the Olympic park and village, stated that it would fall to the private sector to borrow the majority of the finance – with the government, Lottery funding and London itself making up the rest. However, an investigation by the House of Commons Public Accounts Committee reveals that less than two per cent of the Olympic budget has ended up coming from the private sector.
The budget is now around the £10 billion mark, a figure which does not include the escalating costs of the security operation. Commentators claim the final budget could top £20 billion. So what are we getting for our money?
The real importance of London 2012, as the organisers continually remind us, is not about sport but about ‘the legacy’ – the wholesale redevelopment of a large swathe of East London.
The chair of the Olympic Park Legacy Company, and former banker, Baroness Ford, often mentions how the Great Exhibition of 1851 and the Festival of Britain, are the inspiration for London 2012. The Great Exhibition left Britain with a legacy of museums and public spaces including the Victoria and Albert Museum, the Natural History Museum and the Science Museum. The Festival of Britain in 1951 left as its legacy the Royal Festival Hall, one of finest public buildings in the country.
The legacy of London 2012 includes the Westfield Stratford City, the open air shopping mall through which visitors to the Games must pass and the Queen Elizabeth Olympic Park – the first new park to be built in Britain since Victorian times. But despite its royal moniker, and a campaign for Royal Park status supported by local people and Newham Council, the Olympic Park will not be a Royal Park. Instead, it will be a private park, comprising a series of private developments overseen by a new quango, the Olympic Mayoral Development Corporation, which mirrors the London Docklands Development Corporation set up by the Thatcher government in the 1980s.
Sites within the park, from the Olympic village to the Olympic venues, will all be run by private companies and sold off piecemeal to the highest bidder – although the debacle over the sell-off of the Olympic stadium revealed how easily these deals can collapse.
Meanwhile a £1bn bid by the Wellcome Trust to buy the Olympic Park and village and create a ‘Silicon Valley for Europe’, in conjunction with two universities, and providing a museum, social housing and 7000 jobs, was turned down by the Olympic Park Legacy Company. Apparently, it didn’t offer ‘value for money’ to the taxpayer. The Olympic village has now been sold to a consortium led by the Qatari royal family.
Another much-touted aspect of the legacy is the provision of affordable housing. The masterplan for the park promises up to 11 000 new homes. Currently, we know that the Olympic village will definitely provide 3000 homes from 2013, half of which will be ‘affordable’. As always, the definition of ‘affordable housing’ is slippery especially since changes brought in by the Coalition mean that housing associations can charge up to 80 per cent of market rates for social housing – prices far out of reach for the majority in the Olympic boroughs, which include some of the poorest parts of the country.
Local people are increasingly being edged out of the picture In 2004, Lord Coe, chair of the Olympic bidding committee, former Mayor Ken Livingstone and John Biggs, then deputy chair of the London Development Agency, signed an ‘Ethical Olympics Pledge’ in return for local support, giving guarantees on housing, jobs and training, promising that 30 per cent of construction jobs would be set aside for local people. But after London won the bid, the Olympic Delivery Authority refused to honour the agreement, on the basis that the ODA was not in existence when the agreement was signed.
The true legacy of the Olympics is this litany of collapsed deals and broken promises by a confusing array of quangos and companies. An Olympics in tune with the public spirited legacy claimed could only have gone ahead if the concept of the ‘public good’ retained some meaning in today’s political discourse. Instead this term was quietly removed from legislation in 2004 reflecting the extent to which the market has squeezed the notion of the ‘public good’ out of politics. Given the context, the Olympics have never stood a chance of fulfilling a public spirited legacy in tune with 1851 or 1951.
Anna Minton is the author of ‘Ground Control: ?Fear and Happiness in the 21st Century City’.
Occupy London!
I’m afraid this is more sloppy journalism by an Author with a book to sell. Large parts of this Article were cut and pasted from a previous equally poor article she wrote in the Guardian.
While the Olympics will cost a lot of money, I would suggest that the Author conserves her energy to campaign for an end to war a much more costly exercise. Even if there was no Olympics I think the money was and will be well spent.
Just look at this video as to what this part of London will look like in 10 years time and try telling me it’s not worth it.
As for the Wellcome trust deal, the trust grossly undervalued the Olympic park. Their audacious bid for the WHOLE park would have been a complete rip-off and would have derailed all the carefully planned legacy process. Everything has been going very well. The tax payer will get alot more money back than that once this project is successfully completed
In a few years there will be 11,000 new homes in the area. The Quango that the author talks about , the Mayoral Development Corporation, is a fantastic idea streamlining the planning process of an area wider than that of the Olympic park and ensuring that the area does not become an island of prosperity but an integrated part of the surrounding areas. It will take planning power away from the four boroughs and ensure an integrated approach
Why is the author so down on this project? I think it is a fantastic example of Britain at it’s best and should be applauded for how well it has been managed.
The article states that “Sites within the park, from the Olympic village to the Olympic venues, will all be run by private companies and sold off piecemeal to the highest bidder”
This is just plain wrong, the venues are being leased by the Mayoral Development Corporation which is a Public, not Private body. The Park will remain in Public hands. The Welcome Trust deal would have made the park private, luckily it remains Public.
Get the facts right or please don’t write any more articles promoting your book which I will now definitely NOT read