Londoners paying for most of the new West Ham stadium

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It has now been decided that West Ham Football Club are the new tenants for the Olympic Stadium. They have agreed to a 99-year lease with the LLDC (London Legacy Development Corporation), and are planning to move in to the stadium for the 2016-17 season.

The conversion of the stadium will cost £150m of which West Ham will pay £15m, the local council £40m and £80m will be 18.75% is private sources and 81.25% public money. UK government has also set aside £25m of funds if needed for the work on the stadium. Other then that the club is going to pay £2m per year as rent and share the revenue from catering on the match days and any naming rights deal.

Even though different events are going to take place in the stadium, other than football games, West Ham Football Club are getting the stadium for a ridiculously small amount of money, while Londoners have to pay for most of the conversion.

Are there not better things to spend millions of pounds on than on a private football stadium? When the government are making cuts in welfare and cap the housing allowance to £400 now in April, forcing 761 families just in Camden Council to move, is it really necessary to put public money in to an investment like this?

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West Ham Stadium Deal Collapse to Cost Taxpayers Millions


Tax-payers will now find themselves paying a multi-million pound bill, as West Ham’s plans to buy the Olympic Stadium in Stratford have fallen through.

West Ham were in line to purchase the stadium after the 2012 Games, with the support of a £40 million fund from Newham Council. However, rival bidders Tottenham Hotspur argued that the fund was an ‘unfair advantage’ and claimed that West Ham were receiving ‘illegal state aid’, sparking a legal battle between the two teams.  Challenges from Leyton Orient football club and an anonymous complaint to the European Commission also created a great deal of uncertainty around the deal. As a result Newham Council has now said they no longer want to proceed.

‘…the Olympic Park Legacy Company (OPLC) received a letter from Newham Council yesterday saying because of the uncertainty that they no longer wanted to proceed’

The stadium is now to be state-owned instead and will be rented out to football clubs, rather that sold. Boris Johnson and ministers are claiming that this is the best solution, with the greatest long-term results for taxpayers:

”…We’ve come up with a very good solution to keep it in public hands and rent it to football clubs… that will be a very good deal”

Yet, taxpayers will now have to meet the contribution that would have be made by West Ham and Newham Council towards the conversion of the stadium, resulting in a multi-million pound bill. They may also find themselves paying for any annual losses that the stadium makes – a fate that has been met at previous Olympic sites.

Some experts say it will turn out to be the most expensive venue of its kind in the world- more debt Legacy.

The Olympic Park Legacy Company will now have to begin looking for a new tenant to rent the stadium. It has been confirmed that West Ham will be bidding again, but it is yet to be made clear whether renting the stadium will turn out to be a better deal for the East London football team.

 

 

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Spurs and Leyton Orient to launch review over Olympic Stadium


Tottenham Hotspur and Leyton Orient are applying to the high court for a review of the OPLC’s (Olympic Park Legacy Company) decision to award West Ham United the chance to move into the Olympic stadium after the 2012 Olympic games.  One of the reasons for OPLC’s decison to pick West Ham was that they had said in their bid for the stadium, that they would keep the athletics track, whilst Spurs had argued the only viable option was to rebuild the entire stadium as a dedicated football ground.

Leyton Orient’s chairman said. ‘We will shortly apply to the High Court for judicial review and take action against the Premier League for ignoring their own rules.’

A big concern for Leyton Orient is that because of the size of the stadium, West Ham plans to offer discounted tickets. The worry is that this could significantly effect Orients ability to generate ticket revenue since the clubs current home is the Matchroom Stadium just over 2 miles from Stratford. The club’s fan groups have launched an online petition urging the Government to revoke the decision. Orient have also accused Newham council of granting “unlawful state aid” to West Ham in offering them a £40m to finance their move into the Olympic stadium after the games.

What are they doing lending £40m to a football club? They are not allowed to be involved in commercial deals. This is state subsidy of a commercial operation, which falls foul of European competition laws.‘ Barry Hearn (Orients chairman) said. ‘We are asking them to withdraw it. It is state aid and they don’t have the authority to make this kind of commercial investment under their charter.’

This another incident linked to the Olympics where there is no accountability.  It seems that although the decision to award West Ham the loan is technically illegal, it is allowed to happen because of its connection to the Olympic games. Should allowances such as this be made just because of its links to a major event ? It seems unlikely that West Ham will be able to pay back such a huge loan given football isn’t renowned for financial sustainability and it will be the Newham taxpayers who will be liable for the debt in the event of default.

In January, BBC London found a number of potential ‘abuses’  during the process leading up to the loan. These included:

  • Crucial documents explaining the bid in detail being withheld from councillors until shortly before the vote
  • No explanation as to whether the council would be liable for the debt if relegation-threatened West Ham defaulted
  • A ‘significant number’ of councillors holding reservations – but refusing to speak openly because they are allegedly “afraid” of missing out on lucrative positions
  • Mayor of Newham Sir Robin Wales declaring dozens of gifts from West Ham, with critics saying his impartiality has been compromised

For more information click BBC News

Spurs also intend to take the OPLC to court over a number of concerns they have about the process which led to the decision to give West Ham the £537 million stadium. They released a statement saying that,

‘Our lawyers have written to the OPLC, the Mayor of London, the Minister of Sport and the Secretary of State for Local Government and a separate letter to the London Borough of Newham raising a number of concerns with the processes which led to the award.’

‘The letters also requested – in the interests of transparency – for the provision of certain information concerning the processes, which the Club considers that it is entitled to. Tottenham Hotspur will determine its next step as and when it receives a response to these letters.’

Tottenham also plan to challenge the £40m loan which West Ham will be given at preferential rates that was not been offered to any other bidders for the stadium believed that this will form a key argument  for Spurs’ claims against the decision.

Tottenham said that they have now ‘sought permission from the High Court to bring a claim against the London Borough of Newham (“Newham”) for judicial review of Newham’s process in providing a loan for the conversion of the Olympic Stadium after the 2012 Games.’

A spokesperson from the OPLC stated that, ‘We have been consistent, fair, objective and entirely equal in our dealings with the bidders from start to finish. We are confident that if these judicial review proceedings are pursued, our approach will be entirely vindicated by the courts.’

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Olympic promises- fingers crossed

Tottenham Hotspur's new stadium

In their bid for the games London Olympic officials promised to keep an athletics track in the stadium.

Now, during a meeting in Acapulco, British Olympic Association chief executive Andy Hunt only “hoped” the Olympic stadium would retain a running track after the games- neatly side stepping the issue of empty promises by saying the decision was down to the mysterious “Olympic Park Legacy Company”.

Two Premier League football clubs, West Ham and Spurs, have made bids to move into the Olympic Stadium after 2012, but only West Ham’s bid includes keeping the running track.

Hunt made clear his determination to honour that promise telling AP . “Of course, we would love to see the provision of a truly world class athletics track….I think we’d all be disappointed if that didn’t happen.”

Fighting talk, might as well rip up the Spurs offer then.

If the London Olympic organisers keep none of their promises to Londoners  (on jobs, on housing, on costs)  will it be an Olympic record? Or does it happen where ever the five rings descend?

One way East Londoners could economically benefit from the games would be to put money with the bookies that the stadium will be home to Tottenham in 2013. I wonder what odds they are giving.

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