Olympic Village gets £95m contingency fund bailout

The chancellor has authorised a £95m contingency payment to keep construction of the Olympic Village going.

The bailout is the first time the government has had to raid the 2012 contingency fund and comes following the collapse of private finance deals for the £1bn project, according to the Daily Telegraph.

Village developer Lend Lease had struggled to raise its share of the cost, forcing the Olympic Delivery Authority to fund early works itself until a funding package could be arranged.

Negotiations over the funding are continuing and could result in the project being nationalised.

As reported in Contract Journal, firms are also being quizzed about cheaper ways to build the village, in the hopes the budget can be slashed in half.

CJ understands that Olympic bosses want to save money by drafting in firms to build residential blocks on fixed-price contracts.