35 Sports The RGS Gazette Issue 12 July 2024 Did the London 2012 Olympics Boost Britain’s Economy? The Olympics is a time when countries get together to display their sporting excellence to the world, and the London 2012 Olympic games were no exception to this. Furthermore, London 2012 was extra special, as it was the first of the Olympic games where females were competing in every sport. 32 world records and many more Olympic records were set, with the most memorable being Usain Bolt’s 100m in 9.63s and Jamaica setting 36.84s in the men’s 4 x 100m. However, I will be exploring the impact of the Olympics from a more financial perspective and exploring the pecuniary benefits and drawbacks to the country’s economy. When the UK first adopted the role of hosting the Summer Olympics in 2012, they set aside a budget of £2.4 billion for the event. However, when the time came to evaluate the final cost of hosting the Olympics, the resultant expenditure was over triple the budget, coming in at £8.7 billion. There was one main reason for this drastic increase: after it was announced that London would be hosting the 2012 Olympics in 2005, there were terrorist attacks the following day. These suicide bombers killed 56 people, and injured a further 700. In order to prevent attacks like this, they decided to increase the amount spent on security, increasing the security budget from £282 million to £553 million. These costs that have been altered due to overlooked situational circumstances, like terrorist threats, have meant that the original budget cost has ballooned. Only £2.1 billion of the money used to create the London 2012 event was from the private sector, leaving a burden of £6.6 billion to the UK government. After counting all revenue as a result of the event, it totalled to £5.2 billion, leaving a £3.5 billion deficit. However, although it may seem it, the money spent by the government is not free. The consequences of using so much money from the public sector meant that most of the burden from creating the 2012 Olympics was slapped onto the taxpayers. This added to the already large budget deficit, affecting the country in the long term. This will lead to the budget deficit being passed through generations of workers with high tax brackets, as well as reductions in the public services provided by the government. The rest of the money that had been provided from the private sector had come from the national lottery, resulting in at least some of the financial burden being sawn off, but not much. Although large amounts of money were spent, this large increase in spending on the London area led to large improvements in the city’s infrastructure, with large amounts of it going to the transport sector. The total amount of money allocated to upgrading capacity and reliability across the cities entire system climbed to £6.5 billion, resulting in large benefits to nearly all of the city’s public transport networks. An example of this infrastructure upgrade can be observed in Stratford, as a new tube station was built in the area, on account of the Olympic games, heavily increasing the connectivity of this location with the rest of London. This has led to Stratford becoming one of the most wellconnected places in London, coming second to only King’s Cross. This increase in interconnectivity within the city of London means that commuters can easily move into and within the city, allowing for easier commutes for the labour force from the countryside. Furthermore, the increased infrastructural investments led to the regeneration of East London, as the area needed redevelopment. The investments made by the government led to significant positive changes in the housing of the area, as well as the parks and business spaces. The Olympic village that was placed there has now been turned into residential housing, contributing to the longterm urban development of the area. All in all, I believe that in some aspects, hosting the 2012 Olympics in London did act as an economic catalyst for Britain, however, the major burdens that came as a result of it have to be recognised. An example of this includes the major deficit and burden put onto the taxpayers, yet, the resultant effects of the infrastructure development could be said to outweigh this. Max ModrayLane (Year 12) explores the impacts of the London Olympics on the country's economy Tower Bridge with the Olympic logo (2012)
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