Olympic Cost Debate Renewed

(ATR) The IOC is reacting to a new study on Olympic costs a week before the research from the University of Oxford is actually published.

"Regression to the Tail: Why the Olympics Blow Up" is to be published in the Sept. 15 issue of the journal Environment and Planning A: Economy and Space. It’s written by economic geographer Bent Flyvbjerg, the third in a series of reports on Olympic costs that began with London 2012 and continued with Rio 2016.

Flyvbjerg says the Tokyo Olympics will be the most costly in the annals of the Games, rising from a forecast of just over $7 billion during the bid seven years ago to $15.8 billion today. The report says London, with $14.9 billion in spending, had been the most expensive.

In comments from the IOC to Around the Rings, the IOC says the study is flawed as it does not include any input from the IOC, lumps Games costs with capital projects and disregards measures now in place to rein in spending.

"It seems a very strange procedure that an academic study about the Olympic Games and the IOC’s role is promoted ten days ahead of the publication without giving the IOC the chance to see the paper. The researchers have not requested any kind of data from the IOC over the past few years.

"Having said this, what we can see from the media reports so far is that the study takes a fundamentally flawed approach, mixing two different budgets: the budget for the organization of the Games, and the infrastructure budgets of the city, region and country," says the IOC statement.

Flyvbjerg says the figures in the study are conservative and do not include projects such as road construction or a new airport. In an AP story about the study, Flyvberg acknowledges it’s difficult to get accurate data about Olympic related spending .

"Our estimates are conservative because there are lots of costs that are hidden that we can't get into. And there are lots of costs we decided not to include because it’s too complex. We include the things we can get the most reliable numbers for and we do it in the same way for each city that we study."

"Unfortunately, Olympics officials and hosts often misinform about the costs and cost overruns of the Games.We therefore cannot count on organizers, the IOC, and governments to provide us with reliable information about the real costs, cost overruns, and cost risks of the Olympic Games."

The IOC says the Oxford study disregards the long term value of infrastructure improvements by aggregating those costs with those for the Olympics.

"This gives the completely wrong impression that these infrastructure budgets serve only the four weeks of Olympic Games competitionand must be "written off" immediately afterwards. This is simply not true.

"It also seems like the legacy of the Olympic Games is completely left out of the picture. In addition, the study ignores the fact that the new procedures implemented by the IOC after the reforms of Olympic Agenda 2020 now encourage future hosts to develop Olympic Games projects that best fit their own social, economic and environmental vision," says the IOC.

The IOC says a study from the University of Mainz and the Sorbonne University in Paris indicate that for the past 20 years, Olympic Games have paid for themselves.

"They found that ALL Games editions investigated since 2000 have either broken even or turned a profit. This was also thanks to the very significant financial contribution by the IOC," says the IOC statement.

"They (IOC) obviously don't like our results, but it’s very difficult to counter a piece of rigorous research like this," Flyvbjerg is quoted by AP. He says the new measures to cut costs of the Olympics "are too little, too late".

While Flyvbjerg is critical of Olympic finance and management, he says he is a fan of the Olympics and willing to share his insights.

"It's not that the IOC hasn’t been willing to talk, or I am not willing to talk, We certainly are. We have communicated in writing to keep the IOC informed. But yes, we would like to sit down with Thomas Bach," Flyvbjerg says.

Written by Ed Hula.