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Olympics will ruin London

We should seriously be thinking about giving the 2012 Olympic games back, before it is too late. It's all very well to say that it will be all right on the night, but that's now looking increasingly unlikely. Tessa Jowell's performance in the Commons on Monday confirmed that there already exists a state of mild chaos.

It is almost unbelievable that the VAT liability for the games was not clarified before the costs were drawn up. The background is rather murky, but it seems that someone at the Treasury gave someone else an assurance that VAT would not be levied on the construction and other costs of staging the games. It now appears that the Treasury, perhaps even the chancellor himself, is saying that VAT will have to be paid after all because - here it comes again, the usual excuse when no one knows what's really going on - European Union rules insist on it.

It has been estimated that this may add £1bn to the costs- or possibly only £250m, depending on whom you ask to pluck a figure out of the air. But no one seems to know how much the total bill is to be. It is a major issue that "we are working through" said Jowell; "Work is still continuing to finalise the budget," a spokesman for her department explained. What we know for certain is that the cost estimates are already a lot more than the figures that were bandied about only last year. And that they will be a lot, lot higher as we approach 2012. We can safely assume - following many precedents, of which I need name only two, the Scottish parliament and Wembley stadium - that costs will rise quickly, inexorably, and by a large multiplicand of the original estimate.

To pay for this folly, London will be nearly bankrupted, the national lottery will have to be robbed (thus taking funds away from many good causes), and taxes will have to be raised (or services diminished).

From: The Olympics will ruin London, Marcel Berlins, The Guardian, 8 11 06

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