2010 Olympics to Cut Costs Due to Economic Crisis
2010 Olympic officials seek ways to cut costs
Friday, October 24, 2008
The Canadian Press/CBCNews.ca
Three days of meetings between Vancouver and international Olympic officials ended Thursday with the message that the countdown to the Games needs to include a cut-down on spending.
With a global economy in tatters, organizers need to reduce any dependency on finding new revenue and look for cost savings, the International Olympic Committee and Vancouver organizers said at the close of the IOC's latest visit to review plans for the 2010 Olympics.
"The message was look at every activity, every single thing you're doing, and ask yourself the tough question," said John Furlong, the chief executive officer of the 2010 Olympic committee.
"Do you need to do it? Do you need to do it as much? Do you do it for less? Do you need to do it at all … and make the decisions that are necessary to give you the advantages that you need at the time like the one we're in now," he said.
The current budget for running the Games is $1.6 billion, not including the $580-million budget for venue construction. That money comes from a pool of sponsorship dollars, ticketing revenue, fees, licensing, and government funds.
The venue budget has risen steadily since construction began but with most of the venues now complete, it is not expected to require additional funds.
Spending on the Games themselves is about to increase, with organizers going on a billion-dollar spending spree to outfit the Olympics.
Despite Olympic sponsors such as General Motors facing their own economic challenges and Olympic fans likely tightening purse strings themselves, organizers said they remain confident neither will desert the Games.
"We have great partners and sponsors and there hasn't been a payment missed," Furlong said.
Ticket sales are also ahead of where organizers thought they would be at this point, he said. Some sales statistics are expected to be released next week.
IOC offers money saving tips
The IOC is helping Vancouver try to find places to save money, said René Fasel, the chairman of the committee's co-ordination commission for the Vancouver Games.
"There are the must-dos and the nice-to-haves," said Fasel, in French. "We have arrived at a point where we need to diminish our dependence on looking for money in a difficult market," he said.
The IOC has not signed on the final two top sponsors for the Olympics — deals that give companies exclusive rights to the Olympic brand worldwide — but Vancouver has already surpassed the amount of money expected from domestic sponsorship, even if dollars committed haven't translated totally into dollars paid, organizers said.
There have been no final decisions on what changes will be made to achieve cost savings, said Gilbert Felli, executive director of the Olympic Games for the IOC. One of the items under consideration is transportation.
"If it runs every 10 minutes it will be more expensive than if it runs every 20 minutes," Felli said in French.
The transportation plan for the Games won't be finalized until later next year.
Felli and Fasel said they are not concerned the federal government still has not released the security budget for the Olympics, adding they haven't seen the budget themselves.
Fasel, who is based in Switzerland, said they remain impressed with the venues and facilities being built to house and train athletes.
© The Canadian Press, 2008