Olympic Games at risk of exceeding budget, says watchdog

The National Audit Office (NAO) said a doubling in the estimated security costs meant the budget was now so “finely balanced” there was a “real risk” that additional taxpayer funding would be needed.

Ministers insist more than £500m remains in unallocated funds for dealing with any further contingencies.

However the report is likely to alarm the Treasury at a time when public spending is being pared to the bone as the Government grapples with the massive deficit.

The NAO also highlighted delays in finalising the transport plan for the Olympics and warned that without effective operational planning there could be “abiding damage” to the reputation of the Games.

Overall, the NAO said that the Olympic Delivery Authority (ODA) remained on course to complete its work on the Olympic Park on time and on budget.

However, on current projections, almost all the £9.298bn public sector funding package is likely to be required, with little margin for any further unforeseen costs emerging in the final eight months.

In the last 12 months alone, the estimated cost to the taxpayer of providing security at the venue has risen by £271m to £553m following a review of the guards needed.

The London Organising Committee had originally let the tender to G4S on the basis that around 10,000 would be required. However, following detailed planning the figure was revised to 23,700.

Sports Minister Hugh Robertson insisted the budget remained under control.

He said: “Consistent careful management of the finances has enabled us to fund additional costs such as venue security from within the public sector funding package”.

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