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North/south divide - South gets Olympic contracts

In 2005, when London won the 2012 Olympics, Seb Coe of Locog Ltd wrote "The London 2012 Games will provide a unique opportunity for businesses of all shapes and sizes across the UK, providing essential goods and services for this historic event." Unsurprisingly, as with most Olympic promises, the reality has turned out to be somewhat different.

The Financial Times has found that companies based in London have won more than £2.7bn of contracts awarded to create venues and infrastructure, over half the total £5.1bn so far spent by the Olympic Delivery Authority – with south-east companies gaining contracts worth £805m and those in eastern England £719m. Companies in north-east and south-west England have clinched £9m each, while businesses in Scotland, Wales and Northern Ireland combined have netted £43m.

Stephen Alam­britis of the Federation of Small Businesses expressed astonishment: "These are astounding figures. They show there’s still a north-south divide which is being exacerbated by the ODA’s in­ability to play the game and give other parts of the country a fair crack of the whip."

The ODA claimed contracts had filtered down to companies outside London through sub-contracts: "Direct ODA contracts are the tip of the iceberg and there are hundreds of sub-contracts going to businesses through the UK-wide supply chains." However, it could not provide any evidence to support this claim on grounds of confidentiality.

The Olympic version of trickle down theory.


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