Khan seeking to recoup 'staggering' stadium losses

  • by Staff Writer
  • Friday, 1st December 2017

The Olympic Stadium is set to lose in the region of ?20million per year, according to a damning new report.

And Current London Mayor Sadiq Khan has announced that he will be taking control of the stadium after calling the administrative errors that led to the vast losses as "staggering".

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"I ordered the review into the finances of the London Stadium to understand how key decisions were made about its transformation and why costs were allowed to spiral out of control," he said.

"What has been presented is simply staggering. Not for the first time, it reveals a bungled decision-making process that has the previous mayor's fingerprints all over it.

"I am determined to put the London Stadium towards a stronger financial footing and secure its long-term future, but I'm under no illusion that this is going to take time and some real commitment from all partners to make this work."

Khan's predecessor, Boris Johnson - who signed the deal to allow West Ham to rent the arena for ?2.5million per year - was also panned by Newham mayor Robin Wales.

However Wales admitted that the Borough were unlikely to see any return on the ?40million loan they used to invest in the conversion of the stadium into one fit to host football.

"Those contracts have now been found to be onerous and, if the stadium is to return to profitability, they must be revisited by the new mayor of London and his team," said Wales.

"We remain committed to working with Sadiq Khan to ensure the stadium is a success in Newham."

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The 160-page independent review, conducted by accountants Moore Stephens accused Johnson & Co of hugely underestimating the running costs involved once West Ham moved into the stadium.

For example, the ?10million annual costs of moving the temporary lower tier stands at the beginning and end of every football season were budgeted at just ?300,000 - meaning this represents the greatest deficit relating to the stadium - almost half of its annual losses.

The report identified five key issues that led to the current huge losses - those being the stadium's original 'non football' design, the planning for post-games use, the bid process plus the transformation and operation of the stadium.

Khan later insisted that he would be seeking to renegotiate new terms with West Ham United for the club's tenancy of the arena - although that would almost certainly incur yet more costs, with West Ham ready to fight any such plans.

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