Yes, the Olympics are expensive – but they can also be an investment

A sign protesting Switzerland’s bid for the 2026 Winter Olympics. Image: Getty.

Poor Olympic Games, poor IOC.

Rich in cash, of course – wallowing in it, some might say – but poor, it seems, in esteem. Calgary is the latest city to suffer the indignity of a proposed Olympic bid being scuppered by a public referendum. And how we – or at least those of us who don’t work in Olympic sport – love it when the Olympics and the IOC get a bloody nose.

“Nobody can afford to host the Olympics but at the IOC the largesse never stops”, read a gleeful headline from the Guardian, actually published a couple of weeks before the vote, nicely summed up the prevailing (western) attitude to the Olympics, for those without any skin in the game(s).

Written by someone, calling himself an ‘unlucky sucker’, who claims to love the Olympics, it continues: “Potential host cities are dwindling to an embarrassing low and yet the International Olympic Committee seems to still be living in the era when money is no object”. With friends like that… 

Partly, as we all know, the IOC doesn’t help itself. Covering the Olympic movement, you can’t help but come close to gagging on the sickly-sweet diet of first-class air travel, luxury limos, opulent hotel suites and exclusive dinners that constitutes life inside the bubble of IOC membership.

Indeed, the Guardian article didn’t fail to recycle the (probably fallacious) story that the IOC’s ‘rider’ for hosting the 2022 winter Olympics in Oslo (which subsequently dropped out of the race) was 7,000 pages long and stipulated that IOC members get a cocktail reception with the Norwegian royal family, exclusive use of special road lanes and priority treatment at airports and hotels, “but stopped just short of Van Halen’s famous request for a bowl of M&Ms with all the brown ones picked out.”

I have interviewed a series of IOC members and those close to the IOC in recent months and years and can’t help feeling that they, or many of them, still don’t get it. Often, they seem genuinely hurt and baffled when asked what the IOC can do to reverse the received wisdom (recycled again and again by the world’s media) that its members are out of touch and over-entitled and that the games are elitist and just, somehow, neither of, nor for, the people.

This is despite the fact that a millionaire Olympian is, on the whole, an oxymoron, while a millionaire in football, the ‘people’s’ game, is just the football billionaire’s poor relation (yes, I know football is in the Olympics, but it’s telling that it’s an under-23 tournament and the stars don’t take part – they know they can earn much, much more with their clubs).

For, like it or not, the reason that cities keep dropping out of Olympic bid races is money. Just consider the Calgary bid campaign, which seemed absolutely incapable of derailing the runaway juggernaut of public debate from the preordained tramlines of ‘think-how-many-schools-and-hospitals you-could-get-for that-amount-of-money’ that the ‘NOlympics’ lobby had laid down for it.

Yet show me, if you can, all the schools and hospitals that the nine cities and states that have rejected the Olympics in referenda in the last five years have built with the money they saved. You can’t? Thought not.

The point about the Olympic Games, if they’re done well, is that they’re not a cost; they’re an investment. Just take a look at the post-industrial wasteland that was the east end of London before the 2012 games, and then look at it now. The UK government knew this (or at least it was eventually brought round to believing it), which was why it went ahead with the games without feeling the need to call a referendum.


It’s true that costs multiplied over the course of the bid process, and that the eventual all-in cost of approximately £9bn ($11.6bn) was several times the amount originally forecast. But that’s not £9bn to host an Olympic Games, it’s £9bn to regenerate a massive area of one of the world’s great cities – transport, infrastructure, housing, sports facilities for all and, yes, even a school.

And, hey, you know what? The costs of major infrastructure projects nearly always do overrun. A recent report found that cost and revenue overruns of Olympic Games between 2000 and 2018 are broadly comparable to those of other similar large-scale projects.

The study, by academics at Germany’s Johannes Gutenberg University and France’s Paris Panthéon Sorbonne, found that: “The core Olympic capital investments considered in this study show cost overruns, but they are similar to the cost overruns of other (non-sporting) mega projects.”

Moreover, the study also found that “All Games underestimated their revenues and had revenue overruns,” and that “the costs of organising the Olympic Games (OCOG budget) are usually covered by revenues, which are almost entirely private resources plus the International Olympic Committee’s contribution.”

Calgary’s budget for hosting the winter Olympic Games, including delivery and games operations, all venues, housing, legacy endowment and contingency funds, was a relatively modest C$5.1bn ($3.9 bn) in C$2018. That’s still a lot of money, some might say, but a lot of money compared to what? Canada’s federal budget for 2018-19 is C$338.5bn – and remember that’s for just one year. The costs of hosting the games would have been spread over seven years.

Back in the UK, it’s now six years since those £9bn games, and the government’s current pet project is ‘HS2’, a high-speed rail line linking London, Birmingham, the East Midlands, Leeds and Manchester. Scheduled to open in phases between 2026 and 2033, high-speed trains will travel at up to 400 kilometres an hour on 330 miles of track.

Sounds expensive? It is. The budget is now £56bn – more than six times the cost of the Olympics, and an increase of 71 per cent on the initial projection in 2010 of £32.7bn.

I live in the UK. Did anyone ask me whether I wanted this rail line? Nope. Did anyone give me a choice between this and £56bn worth of schools and hospitals? Don’t make me laugh. The government did what it was elected to do and made that difficult spending choice for me. If I don’t like it, I can see what can be done about it at the next election.

So why is it different for Olympic Games?

This article originally appeared on Sportcal.

 
 
 
 

The Fire Brigades Union’s statement on Theresa May’s resignation is completely damning

Grenfell Tower. Image: Getty.

Just after 10 this morning, Theresa May announced that she would resign as Britain’s prime minister on 7 June. A mere half an hour later, a statement from Royal Institute of British Architects president Ben Derbyshire arrived in my inbox with a ping:

“The news that Theresa May will step down as Prime Minister leaves the country in limbo while the clock ticks down to the latest deadline of 31 October. While much is uncertain, one thing remains clear – a no deal is no option for architecture or the wider construction sector. Whoever becomes the next Prime Minister must focus on taking the country forward with policies beyond Brexit that tackle the major challenges facing the country such as the housing crisis and climate change emergency.”

I was a bit baffled by this – why would the architecture profession try to get its thoughts into a political story? But then Merlin Fulcher of Architects Journal put me right:

Well you know construction is a larger contributor to GDP than financial services, and most of the work UK architects do is for export, and at least half of the largest practice (Foster + Partners) are EU, so there's a lot at stake

— Merlin Fulcher (@merlinfulcher) May 24, 2019

So, the thoughts of the RIBA president are an entirely legitimate thing to send to any construction sector-adjacent journalists who might be writing about today’s big news, and frankly I felt a little silly.

Someone else who should be feeling more than a little silly, though, is Theresa May herself. When listing her government’s achievements, such as they were, she included, setting up “the independent public inquiry into the tragedy at Grenfell Tower” – a fire in a West London public housing block in June 2017 – “to search for the truth, so nothing like it can ever happen again, and so the people who lost their lives that night are never forgotten”.

Matt Wrack, general secretary of the Fire Brigades Union, is having precisely none of this. Here’s his statement:

“Many of the underlying issues at Grenfell were due to unsafe conditions that had been allowed to fester under Tory governments and a council for which Theresa May bears ultimate responsibility. The inquiry she launched has kicked scrutiny of corporate and government interests into the long-grass, denying families and survivors justice, while allowing business as usual to continue for the wealthy. For the outgoing Prime Minister to suggest that her awful response to Grenfell is a proud part of her legacy is, frankly, disgraceful.”

A total of 72 people died in the Grenfell fire. At time of writing, nobody has been prosecuted.

Jonn Elledge is editor of CityMetric and the assistant editor of the New Statesman. He is on Twitter as @jonnelledge and on Facebook as JonnElledgeWrites.

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