London Games Budget Takes A Hit; Economy Could Impact VANOC

London officials admitted that the 2012 Olympics budget is $775M (all figures U.S.) "short of private sector money because of the credit crunch,” according to Ashling O’Connor of the LONDON TIMES. London Olympics Minister Tessa Jowell: “We have lost half a billion pounds of private investment. But that does not mean it won’t come back. We have to be optimistic about the coming years and that there will be deals to be done. We will go back to the banks when borrowing terms are more favourable.” O'Connor notes the admission 'means that the Games organisers have already gone through half of the [$1.5B] contingency fund intended for emergencies, with four years still to go.” However, the “exact state of the Olympic finances will not be clear until the first set of quarterly accounts for the project is published in January.” Besides the $465M "hole in the [athletes’] village budget," a further $310M of private sector money that was earmarked for the $620M media center “has disappeared." And the consortium involved is "struggling to raise its share of the money” (LONDON TIMES, 10/24).

WINTER GAMES: VANOC 2010 officials Thursday indicated that the “worldwide economic storm could impact plans” for the 2010 Games. VANOC Chair Jack Poole: “The challenge to us now is to wring out every non-essential component on the cost side of the budget and make sure we’re doing only what we need to do to put on outstanding Games and (that we have) no unnecessary frills.” VANOC CEO John Furlong said that he “has had no indication sponsors aren’t going to fulfill their commitments to provide hundreds of millions of dollars in critical revenue to stage the Games.” Furlong: “There hasn’t been a payment missed and we’re up to date with every partner and sponsor.” Poole added, “We have no reason to think anything will be delayed but you can’t ignore the circumstances we find ourselves in.” Meanwhile, VANOC Exec VP/Revenue, Marketing & Communications Dave Cobb said that ticket sales, which began October 3, are “moving along ahead of schedule and that organizers still expect to sell out all 1.6 million tickets” (TORONTO STAR, 10/24).