Games gold rush 'may harm locals'

Sale of the Olympic Park land will push up housing prices, the report says

East London's poorest people and communities are at risk of being "trampled in the Olympic gold rush", a study by a think-tank has warned.

The report by the New Economics Foundation said the Games' legacy may not benefit locals as only 11% of all contracts had gone to local businesses.

It also said that local people could be priced out of the housing market.

London Development Agency (LDA) said the report "simply ignores" opportunities provided to the area.

The independent think-tank's report, Fool's Gold, said the Games would bring tourists, boost transport and infrastructure in the Lower Lea Valley but these may not be sustainable.

It said the "trickle down" effect may not happen as contracts were going to large companies and developers.

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It highlighted that of the 500 contracts awarded, worth about £1bn, only 11% went to companies based in host boroughs. The contracts were so big that local businesses could not match bids by big corporations.

Plans to sell land after the event meant it will go to the highest bidder and the regeneration could "price out" local people from the housing market, it said.

Josh Ryan-Collins, co-author of the report, said: "Promises and undertakings were made in the bid on behalf of the city and the nation, these must be achieved if we are all to keep faith with the assurances made to the world on our behalf."

The report suggested some measures to the Olympic authorities.

• Consider community benefit when awarding contracts
• Breakdown contracts to allow local businesses to bid
• Give local community groups a place in the Olympic and regeneration planning board
• Form an asset-holding body to ensure assets are owned by the local community

But the LDA said: "It simply ignores the facts to claim that not enough is being done.

"The benefits include new skills for local people, construction jobs, thousands of new homes, the largest new urban park in Europe in 150 years and world-class sports facilities."

Adam Hart, executive director of Hackney Co-operative Developments, said: "There is a need for much more investment... and for many more bold and creative initiatives that really involve local community groups.

"It would be entirely wrong to overlook or to be complacent on this issue or, let alone, to dismiss such concerns as just attempts to undermine the London Olympics."