Commonwealth Games' costs 'out of control'

The cost of the 2014 Commonwealth Games is “out of control” because inflation and pensions were excluded from its budget, the Tories have claimed.

Holyrood's public audit committee heard that the Glasgow event's supposed £374 million price tag is likely to be exceeded.

Inflation costs, which are unknown, and £2.5 million of pension payments for the Games’ 900 workers are likely to require the use of an £80 million contingency fund.

But Liz Hunter, the Scottish Executive director of equalities, social inclusion and sport, told the committee the true cost will not be known for another three years.

She admitted the budget will almost certainly rise, but claimed it is unlikely to exceed the total amount of money available, including the contingency, of £454 million.

“Even with inflation the £374 million will be more than enough right up to the very end of the process. By that point it will be clear how much of the contingency will be required,” she told MSPs.

But Derek Brownlee, Scottish Tory finance spokesman, said the Games were “just another example of a project that is out of control”.

James Kelly, Labour MSP for Glasgow Rutherglen, added that it is “staggering” that inflation costs were not factored into the budget.

Ian Reid, finance manager for the organisers, said pension costs needed to be met because of a recent change in the law. Previously there had been no mandatory requirement to do so.

Hugh Henry a Labour MSP and committee convener, requested a copy of the rules for pension payouts because of a “growing concern over public sector pensions”.

The committee also heard that television rights to broadcast the Games have been sold to Australia. Negotiations are ongoing with the BBC, according to John Scott, chief executive of Glasgow 2014 Ltd.

He also admitted ticket sales were “revised down” in the budget. George Black, Glasgow City Council chief executive, told the committee he could not provide costs for the athletes’ village but hoped to do so soon.