Newspaper reports reveal rising costs and suggest lottery will fund shortfall

Public support for the 2012 Olympics in London is dwindling because of rising costs according to Sunday’s Observer newspaper.

The paper said that members of the London Assembly now estimated that the original £2.4bn for the Olympics was likely to rise more than threefold to £8bn, because of rising regeneration and security, and an unexpected £250m VAT bill.

Meanwhile a Daily Telegraph report on Saturday said that more cash set aside for National Lottery ‘good causes’ is to be raided to fund the 2012 Olympics.

According to the paper the Lottery has already had to put £1.5bn towards the games and that now the cost is expected to double to almost £5bn, Lottery funds would have to pick up most of the tab.

A deal struck between the mayor of London, Ken Livingstone and Tessa Jowell, the Culture Secretary any overspend will have to be paid for by the Lottery or London council taxpayers.

But Livingstone has said he will veto any suggestion that the bill should be footed by taxpayers who are already paying £625m towards the event.

As the costs of the Olympics are reportedly escalating, a final budget is not expected until the new year following crisis talks between the Treasury, Department of Culture, Media and Sport and the Olympic Delivery Authority.