Olympic stadiums swallow 2012 budget

The Department for Culture, Media and Sport said the overspend, which was revealed in a government report, would be offset by savings on infrastructure projects and clean-up work.

Last month ministers gave the Olympic Delivery Authority another £231 million of contingency funds to plug a gap in financing for the Olympic Village.

The village will house athletes during the games, and later be converted to 3,000 homes, including 30 per cent affordable housing. It has struggled to secure the necessary private finance, following the crises in financial and property markets.

The project has now received a total of £326 million in public contingency funding.

The ODA is continuing to negotiate with Lend Lease, its preferred private investor in the village, in an effort to close a restructured financing deal.

Preparing the Olympic site for construction is now expected to cost £47 million less than expected, and the Olympic structures and bridges project is expected to save £98 million, according to the Government Olympic Executive’s annual report.

Olympics Minister Tessa Jowell said: ‘While cost forecasts have risen on some venues, these increases have been offset by savings in infrastructure around the venues and work to clean up the park.

‘We are now halfway through the project with three quarters of the contingency left available, and we are confident that we can deliver on time and within budget.’

London mayor Boris Johnson and the DCMS have agreed to establish a company dedicated to delivering a lasting ‘legacy’ from the 2012 games.

Mr Johnson said the decision ‘will bring together crucial private sector expertise and ideas, in partnership with the extensive knowledge of those already working on legacy planning in my office, in the government and in the Olympic boroughs’.