London Olympics: Were they a financial success?

Alex Miller investigates whether the financials of the London Olympics will add up as well as the sporting success enjoyed over the summer.

Many financial analysts remain convinced that Britain’s recession-hit economy will not prove to have enjoyed the success at the Olympics that the victorious Team GB did - because it has failed to receive any major financial boost from the games.

It is actually too early to tell whether the 2012 London Olympics itself will make a profit or loss - the official figures are yet to be released - but what is debatable is after fully accounting for all of the costs related to hosting the games, whether an Olympics ever truly makes a profit.

However just this week business groups gave a cautious welcome to the news that the UK economy emerged from recession in the three months from July to September helped on, some say, by the Olympics. Growth was better than expected with the economy growing by 1%, according to official GDP figures.

Continued...

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JAADAMS's picture

Update to my moan under ' Olympics - heaven or hell'...

JAADAMS | | Permalink

I wrote a 'long moan about the Olympics' way back in July (see under the Philip Fisher column - The Olympics - heaven or hell?)

 http://www.accountingweb.co.uk/blog-post/olympics-heaven-or-hell 

It was most definately not a good thing for Weymouth as you will see from my comments. Not least the cancelled events and holidays of usual visitors.

Update since then... there was supposed to be so many people visiting Weymouth for the Olympics that all roads from about Stonehedge down (A303) had big electronic notices (rented... by the way!) warning of  queues so that frightened people into keeping away. They spent a lot of money renting a field from a farmer, putting down matting and wanting to charge £8 per day for a Park and Ride. Not a sole used the place.. so in the end they made it free ... and still no one used it!

It would have cost even more without the volunteers - one of my local Business club's members and her husband volunteered. It cost them a lot personally not least in travel to London (4 times) etc but they purposely saved their holiday to use. She gave us a talk on the experience last week and said she would do it all over again just to say she had been a part.

I was amazed at the 'freebies' she brought along to show us - so many that she had to bring in a suitcase! Cap, diaries, notebooks, jacket, pin badges, souvenier books etc (but I suspect Coca Cola as official sponsor paid for those)

HOWEVER>>> one thought is going round Weymouth now it is all over...that many people saw the town on the TV and it is hoped that they would be sufficiently interested in visiting next summer. The council will be trying to take advantage by advertising and putting on displays around the Olympic venue theme.

So possibly the 'benefits' or otherwise cannot be measured until this time next year...I'll let you know!!

 

 

 

It's Showtime!

vstrad | | Permalink

"Many hotels were forced to cut their prices and many restaurants, theatres, attractions and entertainment venues saw a significant reduction in their business levels."

When this was reported early in the Games, Andrew Lloyd-Webber's Really Useful Theatre Group responded that it was doing better than usual business at it's West End theatres. It has also been reported that, although there were fewer tourists in London than usual, they were spending more per head than usual.

Future benefits

philh74a | | Permalink

Sometimes experiences are worth more than money - the whole experience was one the country will never forget, it was magical and I'm proud of our country and what we achieved. I'm sure tourism and business will benefit from our country being showcased so well for many years to come. 

At least my taxes were used on something special, worthwhile and of benefit to me for once.

 

 

keithas's picture

The biggest con!    1 thanks

keithas | | Permalink

I was working in Stratford prior to the Olympics.

We had been sent plans of the development that was going to take place before the site was taken over by the Olympics. The old industrial estates had already been demolished and they were soon going to start work on an enormous multi-billion pound project of offices, shops etc.

The new railway terminal which has since been built, named "Stratford International", gives a big clue as to why this was going to be an important development, guaranteed to be successful.  The subsequent decision not to run Eurostar trains to Stratford was almost certainly taken because of the Games and the plan to review this decision after the Games underlines this.

After the Olympics were awarded to London we were constantly fed the line that these were bringing development to the area that otherwise would not happen. This story was so ubiquitous that I frequently had to pinch myself to stop myself believing that this was the truth: "I did see the plans; it wasn't a dream!"

Far from bringing prosperity to the East End of London, the Olympic Games has set back any meaningful, sustainable economic growth of this area by decades, if not forever. Any supposed gains for the construction industry would have happened anyway and the opportunity to take full advantage of the planned rail link to Europe has been lost - maybe permanently.

This has to be the biggest lost opportunity I've seen in my lifetime and the biggest insult to the general public is that this truth has not, to my knowledge, been revealed to them and has, instead, been smothered by the fantasy that the Olympics was a huge benefit bestowed on London's East End.