The Games Begin

Vancouver gets the Olympics; the rest of us get their rising cost


 

Being the opposition critic for the Vancouver 2010 Olympics hasn’t been the easiest of jobs for Harry Bains, a New Democrat MLA and former labour leader. Bains is regarded by the governing Liberals as, quite literally, a spoilsport for cocking a skeptical eye at the Games’ finances. Criticize the Olympics? You might as well trash the very spirit of British Columbia, and Santa Claus, puppies, and all things sweet and good. The opposition only “pretend” to support the Games, says B.C.’s finance minister, Colin Hansen. “In fact, they’re using so much misinformation and spreading so much fear among British Columbians that they are, in fact, doing the exact opposite.”

But the Liberal strategy of branding its critics as Olympic bashers is fraying badly. The recession and the epic cost overrun of the Vancouver Olympic athletes village—$125 million and counting—is raising public alarm. Vancouver’s problems are so acute that the B.C. legislature convened a rare emergency session last Saturday. After 20 rancorous hours of debate the government and opposition granted Vancouver unlimited borrowing authority to finish construction of the condominium project on False Creek that will serve as the Olympic athletes’ village. Mayor Gregor Robertson said the city may borrow as much as $800 million to finish the project and buy out the current lender, Fortress Investment Group, a troubled U.S. hedge fund. Fortress advanced the city $315 million of a promised $750 million—at 11 per cent interest—before suspending further financing last September. The Fortress debt alone costs the city $87,000 a day in interest.

Vancouver’s plight, while significant, may be the least of taxpayers’ problems. The true cost of the Games—including such crucial items as security, as well as fast-tracked highway, rapid transit and infrastructure projects—defies calculation. The provincial government insists its Olympic budget remains at $600 million. Meanwhile, it has spread other Olympic-related spending across departments in such a Byzantine fashion that even the provincial auditor general can’t find the true cost. An auditor general’s report in 2006 concluded “the current estimated minimum cost of the Games is $2.5 billion, of which $1.5 billion is attributed to the province.”

Since then, the government and the auditor’s department have been locked in a dispute over whether all or part of such projects as the $775-million upgrade of the Sea-to-Sky highway to Whistler should be included as Games ex­­penses. No, says the government, which even insists its $41-million-a-year Olympic Secretariat, established to manage Games finances, isn’t an Olympic expense. Auditor General John Doyle said if the risks aren’t disclosed, he can’t issue an updated audit. “Should these risks come to pass,” he warned in a letter in December, “the cost of staging the Games could escalate considerably.”

With a provincial election set for May 12, the New Democrats sense Liberal management of the Games may be the edge they need to deny Premier Gordon Campbell a third term, and a chance to play host in February 2010. “It’s precisely that lack of scrutiny that’s at the root of spiralling Olympic costs and plummeting confidence in the Liberal government’s truthfulness about those costs,” Opposition leader Carole James told the legislature Saturday.

Bains keeps a list of Olympic costs, adding to it as he finds new information. It includes such things as the $20-million cost for a road into the Nordic Centre at the Callaghan Valley, sponsorships of $15 million each by such public entities as B.C. Hydro, the provincial lottery and insurance corporations and the Royal Canadian Mint, the $900-million expansion of the Vancouver Convention Centre, and security. “I’m sitting at a $4.5-billion cost to the taxpayers so far,” Bains says.

Hansen calls such estimates “exaggerations.” But he concedes the province is at odds with Ottawa over security costs, once optimistically estimated at $175 million. For that number to hold true, Osama and Obama would have to link arms and sing Kumbaya. Former federal public safety minister Stockwell Day has put the costs at a more realistic $400 million to $1 billion. In fact, no Games since Salt Lake City in 2002 have had security costs under $1 billion. Hansen claims B.C.’s portion is just $87.5 million, a share of venue and athlete protection. The rest, including air, border and marine security, he sees as federal responsibilities. (The feds’ total contribution to the Games is about $665 million.) Both Campbell and Prime Minister Stephen Harper say there will be no additional funds, a difficult pledge to keep, as generations of Olympic hosts have learned.

Expect a face-saving compromise on security costs buried in the recessionary federal and provincial budgets, due within weeks. Cheaping out on security simply isn’t an option. When you invite the world, the guests must be kept safe. The taxpayer, however, is collateral damage.


 

The Games Begin

  1. The taxpayer, however, is collateral damage.

    The taxpayer always is…

  2. VANOC just banned Right to Play from the Olympic site including the Village for the feeble reason that it has separate sponsors. We pay for the party, but they control the guest list, and they actually banish the one organization of Olympians that actually measures up to Olympic ideals.

    A bunch of pretend capitalists who shouldn’t be trusted with Monopoly money let alone blank cheques from the government.

  3. I cannot believe there is not more outrage and more posts on here about this fiasco. A previous item on here about this mess drew only one comment, from Me! How many times must the taxpayer be hosed to stage these circuses? They NEVER come in on budget and NEVER provide the dubious, unmeasurable benifits claimed. That is, accept for business cronies and friends of government who dine at the public trough for years to come. It just gets worse. Vancouver was borrowing from a hedge fund at 11% interest? WTF? Why didn’t they just go to a bank? That is insane. Well at least I know how hedge funds work now. Find some hayseed government, preferable in Canada and charge them higher interest rates than Tony Saprano. Halifax avoided a similar fate(Commonwealth Games) but only because a private citizan with access to the internet blew the whistle and the mayor backed out. Otherwise our foray which was origionally to cost 500 million was going to be 2+billion. Some people (especially the business crowd/corprate socialists) are still sour about not going ahead with it. Also, the Can. military says they will have to divert some of the new helicopters it is just getting from Afganistan to Vancouver to babysit this mess. These helicopters were supposed to be keeping our troops off the roads. I guess they can just keep getting blown up IED’s. How nice. 175 million for security? Did anyone ever believe that? I hear the London summer olympics are approching 15 billion. Guess we can count ourselves lucky we didn’t win that “prize”.

  4. I have had it with the Olympics and hope that Canada never attempts to get them again. I was in Calgary in 1988 and remember a great Olympics experience. Although there were problems, it just didn’t seem to have the issues and controversy that the 2010 Olympics are having. Maybe the games have gotten too big and logistically it is becoming nearly impossible to stage a two week event with all that is required. When you include the security that is now mandatory, it is hard to see the benefits of hosting the games. With the latest IOC decision to severe ties with Right to Play, along with the problems with getting tickets, the athletes village, the cost overruns, the Hockey Canada logo, and the banning of women in ski jumping, has caused me to reach the breaking point and I am no longer excited about the games. I hope that once the games are here, all of this will be forgotten and the country will come together and be proud to host the world. But I think before we decide to host them again, we should really consider whether it is worth it.

    • Me too, I have had it with the olympics and almost all professional sport. The greed and incompetence is incomprehensible.