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Last Updated: Thursday, 15 March 2007, 23:13 GMT
Q&A: Olympics budget increase
The government has announced it is increasing the Olympics budget to 9.35bn, four times the estimate two years ago.

Why has the budget for the Olympics risen so dramatically?

The government says it did not have access to the sites earmarked for Olympic building when it originally estimated the budget.

After more detailed analysis of the sites for each of the Olympic venues the government says it has now been able to come up with more realistic costs.

It has particularly been able to work out more accurate figures for the clean-up of the sites to make sure they meet health and safety standards.

Why is the contingency fund such a large figure?

The overall sum includes a 2.7bn contingency fund which ministers do not expect to spend unless there are unforeseen circumstances.

Analysts say the government has set the highest figure it possibly can.

It is keen to ensure the budget figure does not keep rising and so has started with a high contingency fund from the outset to prevent a series of embarrassing hikes, says BBC Sports News correspondent James Pearce.

Ministers will be mindful of other Olympics where the cost ballooned, he adds.

Athens is thought to have cost 7bn in 2002 and Beijing next year is expected to cost anything between 10bn and 20bn.

Will contractors be able to hold the government to ransom close to the Games by saying they need money from the contingency fund to complete on time?

The government says the contingency fund will be locked away and will "not be easy" to access.

Tessa Jowell said part of the government's protection against being held to ransom was the speed with which they were working.

She said they were well ahead of time, suggesting building work would be completed well before the start of the Games.

Will increasing Lottery funding to 2.2bn penalise the clubs and small organisations that were supposed to benefit from the Olympics?

The government concedes sport will "take a small hit" as a result of the increase in Lottery funding.

But it says the money being taken is relatively small "in the overall scheme of things".

Tessa Jowell said the Lottery would be repaid after the Games with money raised from the sale of Olympic sites.

Sports groups have raised concerns that small clubs could suffer if they do not have access to cash that would otherwise have been available.

They raised fears that youngsters inspired to take up sport as a result of the Olympics may not have clubs to join.


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