Oral Answers to Questions
Debate between John Whittingdale and Hugh Robertson(11 years, 10 months ago)
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Hugh Robertson
I entirely acknowledge the concerns that the right hon. Gentleman puts so well. A response to the Committee’s report is due shortly—clearly, once we have that, I will be in a position to say more—but I acknowledge his concerns and the need for proper evidence to underpin our response.
Mr John Whittingdale (Maldon) (Con)
I share some of the concerns expressed by the right hon. Member for Tottenham (Mr Lammy), and I urge those who have heard reports about what the Select Committee said to look at the report itself. The report did not say that there should be widespread liberalisation; it said that in specific areas local authorities that had concerns about the number of betting shops could consider whether they might be met by some flexibility in the numbers. I specifically agree with the right hon. Gentleman on the desperate need for more empirical evidence and research in this area. That must be addressed as a priority before we start taking decisions.
Olympics and Paralympics (Funding)
Debate between John Whittingdale and Hugh Robertson(12 years, 8 months ago)
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Mr Whittingdale
My understanding was that 23,000 was the figure for the number of security personnel, of whom a substantial proportion will be from the armed forces, but the Minister may be able to explain.
The Minister for Sport and the Olympics (Hugh Robertson)
I shall clear that one up straight away: 23,700 is the total man-guarding number. That comes from four sources: one is an additional commitment from the military here—from our own armed forces—of about 7,500; there is a contribution from the private sector, from G4S; there is a contribution from volunteers; and, finally, there is a contribution from a scheme called Bridging the Gap. That solution—let me give the right hon. Member for Leicester East (Keith Vaz) complete assurance on this issue—was felt to be much less risky than looking for the entire balance from the private sector, and that was one of the key drivers behind the announcement that we made in December.
Mr Whittingdale
I am most grateful to my hon. Friend for putting the precise position on the record. However, I am sure that we will come on to debate security at great length, and I want to say a little more about the cost of the games and how it is to be met, which is the area that we focused on to begin with.
The candidature file that was submitted to the IOC originally stated that the cost of staging the games would be £1.5 billion, and once inflation was taken into account that figure increased to an estimated £2 billion. That has largely remained unchanged. The current budget for staging the games is £2.16 billion, 36% of which will come from the IOC, 18% from sponsorship, 20% from ticket sales and 12% from official suppliers. The budget has just about been raised in its entirety, and there is left within it a contingency of £93 million, with risks identified of £88 million. The headroom left in the budget is pretty small; indeed, it was described by the chief executive of LOCOG as being very “finely balanced”. Nevertheless, the Government have so far indicated that they hope that the cost will come in within that figure—understandably, since they will have to fill the gap should it overshoot.
Mr Whittingdale
I recall having that debate with the right hon. Lady in the Select Committee at the time.
The other element that increased the budget dramatically was the inclusion of the programme contingency. The Select Committee spent some time examining that, because we discovered that the £2.7 billion programme contingency came on top of the contingencies that were built into each of the individual projects. That resulted in an overall contingency within the £9.3 billion budget of £3.5 billion. We observed that that was extraordinarily large. As it happens, it will almost all be spent.
To some extent, the right hon. Member for Dulwich and West Norwood was correct in setting, right at the start, the budget with a substantial contingency, which we all hoped would not be spent, rather than having to come back and increase the budget each time. There is no doubt that there would have been far more adverse publicity if the budget had gone up every single year. The then Government decided—I do not criticise them for this—to set a substantial budget with a large contingency right at the beginning, with the expectation, I imagine, that there was no possibility that it could be overrun. As it is, it will be pretty close, but I hope that the budget will be met.
Hugh Robertson
My hon. Friend is absolutely right. Although it is not for me to defend the previous Government, it is worth balancing what he says by saying that the money that was expected to come from the private sector for the athletes’ village and the broadcast and media centre was not forthcoming because of the financial situation. Despite the fact that everything he says is correct, it should be balanced by the fact that the Government are already in receipt of money for the sale of the athletes’ village and will, I hope, in due course be in receipt of money for the broadcast and media centre.
Mr Whittingdale
My hon. Friend anticipates me. I was going to say that the clear reason why the contingency has been spent to a far greater extent than we had originally hoped was that the private sector contribution to the athletes’ village and the media centre simply failed to materialise and had to be met from the public purse. Recouping some of that money through future sales is still an issue of some interest to us, and I hope that the Minister might be in a position to say more about it.
There was always a degree of controversy about the extent to which the financing of the facilities would have to be met out of national lottery funding, and the impact that that would have on the lottery’s ability to fund projects in the rest of the country. We were always very clear that if the lottery was to meet a substantial part of the bill for hosting the Olympics, it would inevitably be less able to fund a lot of worthwhile projects elsewhere, and that some causes would therefore not get the funding that they otherwise deserved. For that reason, we expressed the hope that should the contingency not be fully spent, it could be given back to the national lottery. As it transpires, that will not be possible.
I still very much hope that even though the National Audit Office has expressed concern, the funding package will prove just about sufficient to meet all the costs. I am sure the Minister will want to say a few words about that if he is fortunate enough to catch your eye, Mr Speaker. I believe it is fair to say that it will be very tight. The NAO’s last estimate identified a residual risk of something between £127 million and £999 million, with the most likely risk being £318 million, to be met out of the remaining contingency of £354 million. That would leave 0.39% of the budget unspent, so I am afraid the national lottery will not get much from that source.
The Committee identified that future receipts from land sales could be used to compensate the national lottery, and the Government included such a provision in the funding agreement. That is still intended, I hope, to raise £675 million. Perfectly understandably, the Minister is reluctant to give a firm guarantee about that, given the uncertainty about the price of land, but I hope he shares my hope that that can be achieved.
Mr Whittingdale
One reason is that financing and staging the games, which was not a cost to the public purse, required the attraction of sponsors, in which we have been very successful. However, that required that the corporate sponsors derived some benefit, and that was always going to include tickets.
Hugh Robertson
Of the tickets available, 75% across the piece were available to the general public. That is a far higher percentage than has ever been available at any other games. Of the remaining 25%, 8% are available to sponsors, in their many different forms—corporate and government. In return, the private sector has provided more than £700 million of private sponsorship. That is a pretty fair deal.
Mr Whittingdale
I am grateful to the Minister for supplying the figures that I did not have but which strongly demonstrate why this was necessary. I say to my hon. Friend the Member for Gainsborough that the 20,000 people who applied in the first and second rounds of ticket sales but failed to get any will be given priority over the remaining 1 million tickets about to go on sale. If he happens to be one of those who has been unsuccessful, he stands a good chance should he apply again.