13 February 2004
The closure of Wembley stadium in October 2000 seriously weakened the project to build a new national stadium, reducing the value of the assets acquired and cutting off a revenue source that could have helped refinance the project, MPs said this week.
A Commons' Public Accounts Committee report published on February 10 concluded that Sport England should not have committed £120m of lottery money to the national stadium project without a guarantee from the Football Association that it would provide funding itself or underwrite the grant.
The decision to hand over the money left Sport England in a vulnerable position that was further weakened by the premature decision to close the old stadium.
PAC chair Edward Leigh said: 'I expect [the Department for Culture, Media and Sport] and Sport England to keep a close watch on the project, act quickly if there are difficulties, and treat any proposal to reduce further the public benefits of the project as if they were being asked for hard cash.'
The MPs warned departments to apply lessons learned from the Wembley debacle to other large publicly funded ventures, including the London bid for the 2012 Olympics.
The new Wembley stadium, due for completion in 2006, is expected to cost £757m, of which £161m is being contributed by the public sector. Any further cost increases are being borne by the Football Association.
But the PAC said that, as the FA is poised to receive all profits from the new stadium, the DCMS and the Treasury should develop guidelines to allow the public sector to share in the benefits generated by projects that have received taxpayers' money.
There was also a question mark over whether the athletics facilities being built into the stadium would ever be used.
The committee concluded that the 'dubious' decision to include athletics provision was probably made so the FA could keep an extra £20m it would otherwise have had to repay.
PFfeb2004
