Exactly a year ago we all woke up, knowing that London 2012 had been a great success and whilst there were things we could be cynical and critical about, that the end result was a great one. There were bound to be a few loose ends and tidying up was going to take a bit of time, but what a great experience all of us had during the games themselves.
One of the loose ends was the repayment of a debt that the Government had incurred about 5 years before the games to help pay for some of the venues. The story is a bit complex and if you want to read the full account, the best place to go is this website. However the important detail is that Tessa Jowell borrowed £425M from the Big Lottery fund set aside for good causes with a promise that when the venues were sold (which was to have been resolved before the Olympics began) the money would be repaid to the Big Lottery and the good causes which had been waiting for 5 years could use the funds to help communities up and down the country in a myriad of ways. The money was borrowed without any opportunity for the good causes to object, or to negotiate the terms of any repayment, but there were plenty of objections from the Conservative Party politicians including a younger David Cameron who knew that an election was in the offing and who hoped that he could get the top job, the ideal time to speak up about things that might become his responsibility!
As we celebrated the end to the Olympics, David Cameron who was by then the Prime Minister now had all the power he needed to ensure that the coalition stuck to the promises made by the previous government. However there was a snag. The venues were not all sold and indeed even today many of them have not been sold. They have been leased instead due to the market conditions and with the consent of the Government and Mayor of London. The venues include the jewel in the crown of the main Olympic stadium which has been leased to Karren Brady‘s West Ham football club.
This should not be a problem as the Government like many before it have plenty of experience of taking capital receipts and converting them to revenue funding and vice versa. All that is needed is for the Treasury to take funds from their reserves to repay the good causes and then as the receipts roll in, the reserves will be recreated. Alternatively the Treasury could do a deal with the Lottery and agree to repay the £425M over a 3-5 year period using the early payments of the leases to repay the debtors first. One sticking point with my optimistic ideas could be the state of the nations reserves, but this is not a problem as we have recently been told that over £500M has just been paid into the reserves following the finalising the accounts for the games. In other words the Government has accepted money into its resources from the same source that should be repaying the Big Lottery debt.
In reality as we all remember back to what we were doing this time last year, it is a sad indictment on this Government that they are still waiting to repay a single penny piece to the Big Lottery fund from the £425M, even though they have made much of the commitment they have to local communities and the importance of repaying debts. I have written about this before and I am afraid I may well write about this again. In the meantime this morning could be a great time to remind your MP that he or she is part of a Parliament that should be holding the Government to account for this failure to do the right thing by 1000’s of good causes.