Government must reveal full Olympic price tag and account for rapidly rising costs
VICTORIA — Recent headlines from VANOC about rising construction costs and uncertainty around the total price tag shows that the BC Liberals do not have a realistic grasp on the financial impacts of the 2010 Games and the government should reveal how cost overruns will be managed to protect BC taxpayers, NDP Olympics Critic Harry Bains said today.
"In 2002, the Premier told British Columbians that costs for the 2010 Olympic Winter Games would be completely contained within the existing budget and plan," said Bains. "However, we learned this week from VANOC that cost overruns are already exceeding expectations because of construction costs."
Representatives from VANOC have confirmed that construction costs for venues are escalating at 40 to 50 per cent. As a result, VANOC has approached the provincial and federal government seeking an undisclosed amount of extra funding.
"The Premier needs to reveal how much VANOC is looking for and let taxpayers know what the impact is going to be," said Bains. "The original budgets and plans were developed using 2002 dollars, but now VANOC is uncertain the funding available will withstand inflation and cost increases. This uncertainty is why the NDP first called for the Auditor General to have financial oversight several years ago. However, the BC Liberals refused to have the independent officer serve as the watchdog and now there are several unanswered questions."
The Premier and the Minister of Economic Development have said that any overruns will be managed by a $139 million contingency fund. However, some estimates already peg cost overruns at $70 million and it is only 2005. If the 40 to 50 per cent escalation continues, the overrun could actually exceed $300 million when inflation is included. There is a real possibility that the contingency fund will run out and BC taxpayers will be on the hook.
"The province is on the hook plain and simple," said Bains. "There is no guarantee the federal government will cover cost overruns because it is BC that has underwritten the 2010 Games. Any and all financial risks and exposure rest with the province. That's why the Premier must reveal how much VANOC is looking for so taxpayers have all the information they should have had three years ago."The Olympics are an important piece of BC's short and long-term future," said Bains. "We need to make sure they are a success, but we also need to make sure taxpayers are protected and kept informed. To date, the Premier has failed to do either."