Will the Games be worth it for London?

We’re fast approaching the end of the countdown to the launch of the 2012 Olympics in London, and the national debate continues, will the Olympics bring the Big Smoke tears or an explosion of wealth and fortune or will we meet the same fate as many past Olympic celebrations such as Los Angeles, Greece and Sydney, still paying off debts for the games over twenty years later?

Since the budget was set for Olympic village, it has doubled, soared, rocketed and doubled  again and again since the original budget of £2.7 billion was set, and has now risen to £24bn and is expected to continue to rise as fears over security, access for the disabled and other unexpected problems have to be accounted for. Whilst venue itself is funded by private sponsorship, some of which comes directly from the Olympic fund, through ticket sales and the sale of merchandise, as well as banks such as Lloyds TSB or international corporations such as McDonalds, Coca Cola and Adidas whilst groups such as the National Lottery have made a contribution of more than £2.2bn. However the extra infrastructure needed to make the games easily accessible and the security and policing costs of the event are estimated to cost the UK taxpayer an extra £20 household tax per year.

It is then important to consider the effect of the games on local housing costs. This year London tenants are being scammed across the city by greedy landlords hoping for a quick cash fix from the 17 day sports event. Many contracts for tenants have given them specific moving out dates for this time period to make way for tourists who are willing to pay up to eighteen times as much the usual cost for a regular tenant in order to see the games. This has led to many London tenants fearing homelessness during the Games or being forced to move out of the City whilst tourists run the city. Could it be that the Olympics are forcing Londoners out of their homes, rather than making it a more exciting and desirable place to live?

It is not all doom and gloom however, according to the European Tour Operators Association, the Games are expected to bring an estimated 350,000 foreign visitors per day, each spending thousands of pounds not just on the tickets, but also on accommodation, eating out and transported. Yet in previous years Olympic cities have been sorely disappointed by tourism generated income. In 2000, Sydney was hoping for 132,000 foreign visitors and only received 97,000 for the entire Olympic period, and Athens was equally disappointed four years later when only 14,000 visitors came during the Games of an estimated 105,000 per night. Yet despite these lows, Sydney did see a gentle boost in the four years following the Olympics, reporting an extra £2 bn increase in tourism generated revenue.

In essence, it is important to remember that although the Olympics may create a bigger cost than revenue, it is about bringing the world together through the celebration of good sportsmanship and uniting different cultures, after all, who throws a party to make a profit?

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