The Government’s spending watchdog confirmed that the work of the London Organising Committee for the Olympic Games (LOCOG) and the Olympic Delivery Authority (ODA) remains on time and within the £9.3 billion budget.

But with a special session of parliament’s sports committee due next week, the NAO again raised concerns about value-for-money from Games facilities and 2012’s sporting legacy, calling for more clarity and co-ordination among the various Olympic stakeholders.

"With just under two-and-a-half years to go, there are plenty more hurdles which the delivery team are yet to jump,” Edward Leigh, chairman of the Committee of Public Accounts, said.

"But with less contingency funding available, the room for manoeuvre has been reduced."

One concern is that homes in the £1 billion Olympic Village may not realise the same values that had originally been projected when London’s Games plan was outlined more than six years ago, when property prices in the capital were at all-time highs.

Although London’s property market has undergone something of a recovery in the past four months after the credit crunch, analysts remain gloomy about the state of the economy in 2013-2014.

Another worry for the NAO is the ultimate commercial viability of the International Broadcast Centre (IBC) and Main Press Centre (MPC), which is hoped will form a massive media village in Hackney after the Games.

"From the outset it has been difficult to reconcile Games-time requirements for the Media Centre with a viable use after the Games," the report warns.

The IBC and MPC were to have been built by commercial developers, but when a deal could not be reached against a worsening economic background, the construction bills were met with £334 million of public money from the contingency budget.

According to the NAO, the IBC/MPC’s location away from the main public transport hub at Stratford could hamper future endeavours to persuade businesses to move into the facility.

The NAO report underlined the importance of securing long-term use of all Olympic venues, a recommendation which is certain to heap further pressure on Olympic Minister Tessa Jowell and Baroness Ford, the chair of the Olympic Legacy Park Comapny (OLPC), in their discussions with West Ham over whether the football club will become the anchor tenant for the £530 million Olympic Stadium.

"Successful delivery of the Games, including the intended legacy benefits, requires the Olympic Executive and the delivery bodies to develop an effective and fully integrated programme," the NAO office’s latest report says.

"Further progress is required before we can be confident that planning and delivery, including for legacy, have been gripped. In particular there is a need for clarity and agreement on scope, costs, budgets and responsibilities."

Last month the Government Olympic Executive said that £160 million of previously unallocated contingency funding may be needed to pay for maintaining and operating the Olympic Park between the venues being finished and then being handed over to Baroness Ford’s Legacy Company.

But the NAO report calculates that the management of the Olympic Park from the time construction is completed, through the staging of the Olympic and Paralympics, could cost up to £276 million.

This does not include the estimated £100 million cost of converting the stadium for football use after the Olympics - an amount which could be saved from the Games budget if a football anchor tenant can be persuaded to use the stadium which senior figures, including London 2012 Sebastian Coe Coe and Minister for Sport Gerry Sutcliffe, regard as a promise that cannot be broken.

The OLPC is hoping to firm up the stadium’s post-Games future by the autumn.


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