The Austerity Games

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When Seb Coe invited the International Olympic Committee to select London as hosts of the 2012 Games he justified the bid in simple terms. If London won, he promised, more people would take part in sport than could be achieved by any of London's rivals: "Choose London today and you send a clear message to the youth of the world: the Olympic Games are for you". If London won more would be done for less money than could be achieved anywhere else.

Since London's victory there have been some attempts to keep an eye on whether these two promises have been met. The London Organising Committee (LOCOG) publishes annual accounts, and there has been some scrutiny through the Commons Public Accounts Committee (PAC).

It now seems clear that there will be no increase in sporting participation as a result of the Games. In 2008 the last government set Sport England a target to increase adult participation in sport by a million by March 2013.

Civil servants from the Department for Media, Culture and Sport told the PAC in March that they believe sporting rates have increased by around 100,000 over the last four years (the number of adults taking part in sport has increased by around 1 percent).

LOCOG's publicity says as little as possible about adult involvement in sport, although there are frequent references to the number of schools which have been sent Olympics merchandise (a cynic would suggest that this has also been a cheap way of disposing of tens of thousands of items marketing the main Olympic sponsors).

As for cost, the London Olympic bid was for £2 billion, of which, it was said, the majority would be raised from the private sector. In fact only some £700 million or so has been raised from the private sector.

The total cost to the public, has risen from £1 billion (in the original bid) to £11 billion according to latest reports.

The PAC is critical of a number of decisions LOCOG has taken, including decisions about security. The Olympics organisers' security forces will include Typhoon jets and two amphibious assault warships, one of which (HM Ocean, which houses 800 marines) is to be stationed on the Thames for the duration of the Games. These are the most grandiose of "conventional" weapons. What are they intended to protect us against - a surprise attack by Argentinean hockey players?

Between 2005 and 2011, the organisers budgeted for 10,000 security guards costing £282 million. In late 2011 a decision was taken to increase the total number of security personnel (including soldiers) to 23,500 costing £553 million. LOCOG chose to give the contract for 6,000 additional security guards to G4S, a business which has a track record of granting well-remunerated non-executive directorships to former members of both Tory and New Labour cabinets.

"There is no evidence", the PAC writes, that "the government has secured any price advantage" from renegotiating this contract.

In other words, although you might have thought that buying services on this massive scale would lead to a price reduction, the government and LOCOG appear to have accepted the first offer that G4S put to them. Don't assume that the workers will benefit from LOCOG's largesse. In a letter sent by Seb Coe to the Commons Culture, Media and Sport Committee in January 2012, LOCOG spelled out how G4S's contract will work.

Big salaries for some
Nine hundred and four managers are going to be employed at G4S's Olympic Project Management Office on generous salaries. As for the 16,000 or so security guards to be provided by G4S, they will be paid just £10 per hour. And G4S are "incentivised" (in their contract with LOCOG) to "identify saving opportunities in labour costs". So if agencies can be found who will pay their workers less than £10 per hour, G4S will keep the difference.

Seb Coe is being paid £350,000 per year of public money for the Games (which are also netting him personally around £150,000 per year in image rights, plus lucrative contracts with Nike and other private sponsors). Meanwhile LOCOG chief executive Paul Deighton is being paid £800,000 per year, and altogether 16 executive directors of LOCOG are being paid in excess of £150,000 per year.

Just as there are two British economies, so it is at the Olympics: the rich are in permanent boom while the majority of workers find themselves in deep recession.