Olympic debt and land deal gives momentum to legacy

July 8, 2010


The government has signed off a multi-million pound debt and land deal with the Mayor of London, which could have endangered parts of the 2012 Olympic legacy and threatened to turn it into an unseemly Conservative spat.

Margaret Ford, chairman of the Olympic Park Legacy Company (OPLC) responsible for managing the Olympic Park post-Games, had used every possible opportunity to flag up the debt issue ever since the Conservative-led coalition government said it was to review the previous Labour government’s deal.

The Treasury had agreed in March to pay 438 million pounds after much to-ing and fro-ing between central government and Boris Johnson’s office.

But the coalition, which has made reining in  a record peacetime budget deficit its top priority, said it would look at the deal. It has also told Olympic organisers responsible for the Olympic build to find 27 million pounds of savings.

Ford told the House of Lords last month it was crucial the Treasury honoured the deal to transfer the LDA’s land and debt to central government, otherwise companies could be put off investing in the Olympic Park.

The OPLC would need to go forward as the freehold owner of the site, without being saddled with the multi-pound debt, she said.

It is hoped high-quality family housing and businesses will be attracted to the site in Stratford, east London.

Ford was not the only one becoming impatient. Conservative mayor Johnson accused the government of jeopardising the project by its dithering, reports said.

The IOC’s Denis Oswald expressed concern about some legacy elements that needed to be clarifed at the end of a three-day visit.

He did not specify what they were, but the legacy of the main stadium, which has yet to attract an anchor tenant is likely to have been among them.

But Chancellor George Osborne wrote to Johnson this week agreeing the matter was a pressing one.

“I share your concern that we need show the world that we can achieve a lasting Olympic and Paralympics legacy for the country and for local communities, and that this is affordable and offers good value for money for taxpayers,” he said.

“Therefore, I can confirm that I will be writing to Eric Pickles to confirm that the previous administration’s deal to transfer part of the Olympic Park to the Olympic Park Legacy Company still remains in place.”

The government will pay 138 million pounds for the current value of the Stratford land while relieving City Hall of their 300 million pounds liability, media reports said.

The OPLC said this “allows us to carry on building the momentum we have been driving over the past year.”

Oswald also told reporters that Osborne and Prime Minister David Cameron had both reassured him during talks that the 27 million pounds of savings would not affect the core of the Games.

Picture Credit: This computer-generated image released by The Olympic Delivery Authority in London shows the design for the Olympic Stadium, the flagship venue for the 2012 Olympic and Paralympic Games, in this November 7, 2007 file photo. REUTERS/Olympic Delivery Authority/Handout/Files

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