MPs fear builders to exploit Olympics

MPs fear builders have got the Olympic Delivery Authority (ODA) "over a barrel" and might exploit the Games for extra cash.

Scottish MP Ian Davidson raised the concern during evidence that formed the basis of a damning report by the Committee of Public Accounts on the massive rise in the Olympic budget.

The Committee said the original budget of £4bn was “entirely unrealistic” and had increased by to an “astonishing” £9.3bn within two years of winning the Games.

In evidence Mr Davidson said: “One of the things that does worry us a bit is that builders, whilst not quite as voracious as farmers, are nonetheless somewhat keen to exploit the situation where perhaps the client is over a barrel.”

Mr Davidson said he was concerned at the lack of competition for major contracts, including the Olympic Stadium and Aquatic Centre which both only had one bidder each.

ODA chief executive David Higgins said an insistence on transparency that was drilled down to the trades gave hope for increased competition.

He said: “It is a concern. It is one of the major risks, inflation, but also market appetite, so as much as possible we try and make the Olympics an attractive site to work on.”

The committee recommended the ODA have rights of access to contractors’ books to check costs and financial viability, and should establish incentives for meeting deadlines.

It also said the ODA should impose early warnings and contingency plans to identify and resolve problems with contractors and, if necessary, replace them.

Construction Confederation spokesman Kurt Calder said the claims were “unfair” and there was no evidence contractors had the ODA “over the barrel”.

He said: “It is quite early to start the blame game, isn’t it?

“It is quite unfair. The industry hasn’t created the situation and I don’t think there is any evidence that situation would exist or has even happened.”