Olympics to cost UK £9bn

The cost of hosting the 2012 Olympics could be set as high as £9bn (€13.4bn), according to a report.

The BBC has alleged that the Treasury and the Department for Culture, Media and Sport are considering the figure – almost four times the initial £2.35bn (€3.5bn) estimate used in London’s bid.

Last November, Culture Secretary Tessa Jowell admitted in parliament the costs were set to rise to £3.3bn (€4.9bn), but it is now reported that construction alone will equal that figure.

In addition, it is alleged that a £2bn (€3bn) construction contingency fund will be set aside, with regeneration costs (£1.8bn/€2.7bn), VAT (£1bn/€1.5bn) and security (£900m/€1.34m) taking the final outlay even higher.

The shadow culture secretary, Hugo Swire MP, told the BBC: “There is no doubt that there will be real worries across the country about the huge increase in costs.

“It is time we got a proper explanation from (chancellor) Gordon Brown on what has gone on and assurances as to what the government is doing to control the ever-increasing budget.”