Commonwealth Games costs rise to £454m
Commonwealth Games organisers have confirmed that the cost of staging the 2014 event in Glasgow has risen by £81 million to £454 million.
The Scottish Government, Glasgow City Council and the Games Organising Committee have been forced to plug a funding gap caused by an increase in broadcasting and staffing costs.
Initial costs were put at £373 million and the latest announcement follows a budget review by the Organising Committee.
The figure now stands at £454 million, with £59 million being met by the Scottish Government, £9 million from Glasgow City Council and £13 million from the Organising Committee.
Games chairman Lord Smith said: “This organising committee is committed to running a tight ship.
“We understand fully our responsibilities to the taxpayer, as well as the athletes, spectators and other stakeholders in the Games.
“None of the Games` partners want a position to emerge where the Games` budget keeps creeping up over the period between now and 2014, so we have approached this exercise with a desire to be as realistic as possible.
“We are all united in the belief that these Games can be the catalyst for significant change, and that they will generate enormous sporting, social and economic benefits for the whole of Scotland.
“We are confident that the budget announced today will enable all those potential benefits to be realised.”
Two years have passed since Glasgow beat the Nigerian capital Abuja to host the major sporting event.
The Games will be held over 11 days with an opening ceremony on July 23 2014.
Thousands of athletes and officials will stay in an athletes’ village in the east end of the city which will also welcome a new national indoor sports arena and velodrome.
An extra £41 million will go on the “core budget” for the Games, a rise from £333 million to £374 million.
Lord Smith said the cost of delivering the broadcast signal had increased “dramatically” due to advances in technology, including the introduction of high definition, and the failure to sell the domestic rights to the BBC.
Lord Smith said: “Previous Games have been able to offset the host broadcast costs against the sale proceeds for the domestic rights. At this stage the organising committee has been unable to engage the BBC on this basis and with the current categorisation of the Commonwealth Games as a B-list event, is unlikely to be able to secure another domestic broadcaster.
“In effect, the Commonwealth Games is viewed as a ‘BBC event’.”
Organisers said an extra 100 staff will be needed to host the Games, bringing the total to 950 – 1,000 and putting an extra strain on costs.
Since the bid was finalised there is now a legal requirement for companies to pay compulsory pension contributions to all staff.
An extra £20 million will go towards the contingency fund – a rise from £40 million to £60 million which covers risks associated with hosting the Games, such as the conversion of Hampden into an athletes’ track, which will involve raising the ground’s base level by a metre-and-a-half.
Thirdly, an additional £20 million has been set aside by the Scottish Government as a special reserve to ensure there will be no future budget increases.
First Minister Alex Salmond, who attended the announcement, said: “The budget increases are going to be challenging but they are necessary.
“It means we can guarantee the successful delivery of the Games.”
Glasgow City Council leader Steven Purcell said: “I’m disappointed that we found ourselves in this position.
“I’m certain that this is necessary if we are to stage a Games that will leave a lasting legacy.”
Category: Event Management, Sporting Events
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