Select Committee on Culture, Media and Sport Appendices to the Minutes of Evidence


Further supplementary Memorandum submitted by Sport England

1.   Sport England has been responsible for assessing the Lottery application for the Lee Valley National Athletics Centre at Picketts Lock. Can we see the exchanges of correspondence between the organisation and DCMS concerning the viability of the project as mentioned in evidence?

2.   The former Secretary of State was consistently confident about the prospects for Picketts Lock and the 2005 WAC as you have quoted in your evidence. To what extent did this reassure you about the Lottery funds you were committing to the development phase of the project?

  The following evidence demonstrates that:

    —  Sport England consistently advised Ministers and officials at the Department for Culture, Media and Sport that there was considerable doubt about the viability of the project being proposed at Picketts Lock from the outset.

    —  Sport England made it very clear to both the Government and the applicants (UKA and LVRPA) that lottery funding for Picketts Lock would have to meet our standard criteria including viability, value for money and sporting legacy. Despite being under considerable pressure to fund for the project, Sport England consistently and objectively applied the same criteria to this application as it does to every other lottery application.

    —  Sport England was constantly reassured by the previous Secretary of State and Minister for Sport that the DCMS were strong supporters of the project and that they would do all they could to address the issues of viability. This of course informed our decision-making process and gave us confidence that it was sensible to proceed with the project. We took a prudent decision to allocate a small amount of feasibility funding to the Lee Valley project to assist in assessing its longer-term viability.

  More specific evidence is set out in the chronology and annexes that follow:

  On 15 and 24 March 2000, the Secretary of State chaired meetings at the DCMS attended by UK Athletics, Sport England and other key parties to consider an alternative London site to Wembley at which international athletics and the World Athletics Championships could be staged. Sport England had facilitated the assessment work of potential sites in London.

  In these meetings, Sport England made it clear that the cost of an athletics stadium of the standard required for hosting the World Athletics Championships was likely to be in excess of £100 million. The Secretary of State had already acknowledged that the maximum support that Sport England could provide for this project was £60 million.

  Our assessment report that was presented to and discussed at the meetings of 15 and 24 March had drawn the following conclusions:

    —  There was a lack of certainty about the project being deliverable at any of the sites (including Picketts Lock), the key issues being budget, quality, programme and planning;

    —  Preliminary cost assessments suggested that the aspirations of UK Athletics were unlikely to be achieved within the projected budget available (£60 million lottery funding)—the costs were assessed as likely to be in excess of £100 million;

    —  There was a substantial funding requirement that needed to be addressed at an early stage;

    —  The economic viability of the project was questionable, given the event profile and other potential uses for the stadium.

  A copy of the paper presented to the meeting chaired by the Secretary of State on 24 March 2000 is included with this submission.

  On 2 October 2000, the Minister for Sport chaired a meeting of the Lee Valley Forum. At this meeting Ian Fytche, Head of Major Projects at Sport England expressed continuing concern about the uncertainty facing the project, namely the capital funding gap, the level of planning permission still required, the revenue deficit, the project delivery vehicle, and transport improvements required.

  On 2 November 2000 Sport England wrote to the Secretary of State raising our concerns at the funding problems facing Picketts Lock. Our reasons were twofold:

    1.  We were shortly expecting to conclude negotiations with WNSL confirming the voluntary return of £20 million in return for dropping their obligation to stage athletics. We wanted to confirm that the Secretary of State wished us to formally preclude the option of athletics at Wembley when we still had to resolve doubts about the funding and planning issues at Picketts Lock. Len Hatton, Chairman of the 2005 WAC organising committee had expressly stated his concern that we should not remove athletics from Wembley until the future of Picketts Lock was clearer.

    2.  We also advised the Secretary of State that the Council was shortly to consider an application for feasibility funding for Picketts Lock (on 6 November 2000). Before agreeing to commit our lottery funds, the Council thought it useful to secure some clarification of the additional funds that might be available for the project from local and/or national Government to address the funding shortfall.

  A copy of this letter is attached.

  On 3 November 2000, the Secretary of State wrote to Trevor Brooking ahead of the Council's consideration on 6 November of the LVRPA application for lottery funding for feasibility studies. He wrote "the Government are firmly committed to the success of the Lee Valley Stadium project . . . At this stage of the project's development, there is, of course, a lot of further work needed, particularly in identifying sources of funding. But I wanted you to know that we, for our part, will do all we can to support the Lee Valley Partnership in identifying funding sources which will help bridge the funding gap." A copy of his letter is attached.

  On 13 November 2000, at a Lee Valley Forum meeting, the Minister for Sport Kate Hoey publicly addressed the project's capital funding gap. She was recorded in the minutes stating that it was "vital the design team were aware the project had a capital deficit and took account of this."

  On 14 December 2000, the Secretary of State wrote to the major partners in the Lee Valley project, including Sport England, stating "I just wanted to confirm that the Government are determined to put in place the best possible facilities for the 2005 World Athletics Championships and that we believe that the Lee Valley stadium offers the best potential to bring this about." A copy of this letter is attached.

  On 12 January 2001, the Secretary of State wrote to Trevor Brooking addressing the Council's concern as to whether it ought to continue funding the Picketts Lock feasibility studies while a review of the Wembley option was being undertaken. The Council was concerned not to spend further lottery funding on Picketts Lock if the review by Sir Rodney Walker was to recommend the return of athletics to Wembley. The Secretary of State wrote that it was in his view "vital that momentum is maintained on the Lee Valley stadium project." A copy of this letter is attached.

  On 16 January 2001 at a Lee Valley Forum meeting, the Chief Executive of the Lee Valley Regional Park Authority informed the Secretary of State that substantial capital and revenue funding gaps still applied to the project.

  On 26 January 2001, the Secretary of State again wrote to Trevor Brooking, "I believe it is now time to shift up a gear both in progressing the project and in ensuring that clear and positive messages are given. Sport England will have a key role and I know you will ensure that your officers who are working on the project give it the priority and energy which will be essential if it is to be delivered on time . . . I should be grateful if you would continue to take a close personal interest in the project and keep us informed of its progress and any issues or opportunities where we might be able to help. Perhaps we can touch on this when we meet to discuss the Sport England Funding Agreement next month." A copy of this letter is attached.

  On 21 March 2001, the Secretary of State told the Select Committee in response to a question from David Faber on the funding of Picketts Lock that "I have assured David Moorcroft, as indeed everyone involved in Picketts Lock, that Government will be doing everything it possibly legitimately can to ensure that this is going to be a success". He also reiterated to the Committee that "I am, as I indicated earlier on, absolutely confident that we will be able to ensure a good, world class athletics facility at Picketts Lock. That remains my belief."

  On 22 March 2001, the Secretary of State issued the following statement to the press regarding the Lee Valley National Athletics Centre designs: "The stadium is the best thing to happen to athletics in the UK for a generation. The National Athletics facility will provide a fitting venue for the 2005 Championships and a wonderful legacy for the sport."

  On 12 April 2001, as evidence submitted by the LVRPA reveals, the DCMS wrote to the LVRPA stating "we are currently considering a number of different options for resolving the capital funding gap and on the question of who ultimately stands behind the construction of the new stadium. There is no specific progress to report at this stage, but Ministers are optimistic that current discussions taking place will bear fruit and that there will be some development to report before the end of this month."

  On 2 May 2001, the Secretary of State made the following statement in a debate in the House of Commons on Wembley Stadium "The 2005 world athletics championships have been bid for and won by London, and we must ensure that we provide a high-quality stadium for that event. I am proud that we will have a purpose-built, dedicated athletics facility for those championships. One of the reasons why we were so successful in winning IAAF approval for the proposal in Paris last year was the fact that that facility would be designed and built specifically for athletics. We want to stick to that."

3.   The costs of the development at Picketts Lock were known to be in the order of £90-£120 million from an early stage. Why was the Lottery application only for £65.3 million? Is it not part of your role to advise applicants on a realistic bid?

  Sport England has always made it clear that the maximum allocation it could make available to the development at Picketts Lock from its Lottery Fund was £60 million (including the £20 million to be returned by the FA from the Wembley project). A further £7 million was subsequently allocated towards the cost of an English Institute of Sport performance centre on the site that would have included indoor facilities for athletics.

  We have also earmarked up to £15 million towards the revenue costs of staging a World Athletics Championships in England.

  The Secretary of State informed the Select Committee on 1 February 2000 that the following lottery funds might be available "what is effectively available for the support of athletics is the £20 million coming back from Wembley through the Football Association; and up to £40 million, which will not now be required, for the creation of the platform and the warm-up facilities at Wembley."

  As you will note from our previous evidence, we consistently advised the Government, UK Athletics and the LVRPA that the project they proposed had an identifiable funding gap. This was discussed in the meetings that took place at the DCMS on 15 and 24 March 2000 when UK Athletics and the Government decided to proceed with selecting a new site for an athletics stadium in London.

  The evidence submitted to the Select Committee by the LVRPA demonstrates that they were fully aware there was a capital shortfall between our funding commitment and the total amount they needed. The LVRPA constantly sought to raise the issue and how it would be addressed with Government.

  On 7 September 2000, Ian Fytche of Sport England wrote to the LVRPA confirming the award of feasibility funding to develop the project and advising the applicant that Sport England's Council was mindful that there was a considerable funding gap. "Please note that this award is part of the overall total budget available for the project (of up to £60 million)".

  The total available for sport from our Lottery Fund for sport has fallen from a high of £300 million to an anticipated £175 million next year. It has always been our intention that 75 per cent of this is made available for community sport initiatives. We are currently over-stretched in funding all the community sports we would like to support. It would just not have been possible for us to commit more than half our fund for one year to supporting the proposals at Picketts Lock given all the competing and worthwhile demands for our funding.

4.   Did Patrick Carter's review of the Lee Valley Stadium tell you anything about Picketts Lock that you did not know already?—  The Government's reply to this Committee's last report on the topic states that "Patrick Carter's conclusions on the risks to the likely delivery of the necessary transport infrastructure improvements in time for the 2005 Championships was one of the principal reasons why the Government and Sport England decided that the project was unsustainable" (p7), Is this a fair statement of Sport England's position?

  As our previous evidence demonstrates, the lottery application submitted in May 2001 for £65.3 million towards a National Athletics Centre at Picketts Lock failed to address many of Sport England's policy and financial directions—including eligibility, viability, sustainability, value for money, and financial need.

  Sport England subsequently agreed with the new Secretary of State that Patrick Carter should be appointed to undertake a review of Picketts Lock to see if these issues and other wider concerns associated with the project could be addressed.

  Patrick Carter's report subsequently endorsed Sport England's strong reservations as to the viability of the project—which included the capital and revenue funding, transport and planning issues covered in our earlier report. Patrick Carter concluded that Picketts Lock could not demonstrate clear value for money when set against the many other demands on the Sport England Lottery Fund.

5.   What formal role do Ministers have in deciding the sustainability of applications for Lottery funds?

  Ministers have no formal role in assessing lottery applications. This is a role undertaken by the Council and Lottery Panel of Sport England.

6.   When will you publish the full Carter report?

  Sport England published the relevant extracts of the Carter report on its Website on the 4 October 2001. This was the same day that Tessa Jowell announced her decision that the Government would not be able to continue offering its support to the Picketts Lock proposals.

  The reason we did not publish the evidence on the alternative options is that it contains commercially sensitive information relating to the potential assessment work we may have to undertake of future lottery applications.

  We understand the Committee has, under terms of confidentiality, a full copy of the Carter report. We will keep under review whether in time it might be appropriate to publish the rest of the report.

7.   Patrick Carter told the Committee on 16 October that in reviewing the Lee Valley Stadium and the 2005 WAC he was "not looking at whether a platform worked at Wembley because the time for that has passed" and "the Wembley option was not there"(Q112). Can you confirm that Mr Carter did not assess Wembley as an alternative view for the 2005 WCA in the course of the Lee Valley Stadium review?

  In his report on Picketts Lock, Patrick Carter reviewed Wembley and other options in London before concluding that he needed to look outside of London as well.

8.   Have you made any kind of allotment of funds for a 2005 WAC in Sheffield—in principle—in outline?

—Has the Government asked you to fund improvements to the Don Valley Stadium in Sheffield? If so, is this appropriate?

  Sport England's Council has continued to allocate a budget for staging a World Athletics Championships in 2005. We cannot and have not guaranteed this funding, as the Committee knows and supports, it is dependent on a lottery application meeting our standard criteria which includes viability, value for money and sporting legacy.

  £15 million has also been set aside for the revenue costs of staging the Championships. Any further costs for staging the games would have to be met by either Sheffield City Council or the Government.

  When the Government became aware that it was unlikely to be able to support Picketts Lock as a viable option, it looked at alternative sites and was advised in this process by Sport England. It was the view of Government and Sport England that Sheffield has many advantages. It already has a good infrastructure and transport links; there are few planning problems and the city has experience in staging major events. As Carter reported it is likely to be much better value to stage the WAC at Sheffield than PL, largely as a result of the project not being a "new build" development.

9.   Given the IAAF's preference for "major world cities", and the UK's track record with these particular games, are you confident that Lottery funds for feasibility work or a bid related to Sheffield would be money well spent?

  As the Committee is aware, it is not within out remit to advise directly on whether we should bid. The actual decision to bid is one for UK Athletics as members of the IAAF. They will of course require the backing of the Government. Sport England's role is potentially to provide lottery funding for the facilities that would be required to stage the games and for the costs of the Championships.

  UK Athletics will decide whether to bid based on their consultations with the Government and Sport England. We will advise on the support that we are able to provide to the provision of facilities for a Championships, and the lasting legacy they will provide. The IAAF meets at the end of November to decide on whether to re-open the bidding, all indications are that it will. If in the coming weeks, UK Athletics does choose to make a bid, we will work with them to advise on how a bid can be taken forward.

  Any lottery funding provided would of course have to meet out standard criteria including viability, value for money and legacy.

10.   Can you remind the Committee how the position was reached that £20 million was to be paid by the Football Association and/or WNSL to Sport England in lieu of provision for athletics at Wembley?

  The £20 million payment was negotiated outside of the Wembley Lottery Funding Agreement, without any Sport England involvement, by the previous Secretary of State and the Football Association.

  The following chronology provides a background to this issue and demonstrates that Sport England has taken every possible step since then to secure the return of this £20 million.

  This has so far not proved possible and we are currently seeking legal advice on the matter.


  Sport England entered into a Lottery Funding Agreement (LFA) with the Football Association (FA) and WNSL on 12 January 1999. This covered our award of £120 million toward the development of an English National Stadium at Wembley.

  The LFA is our legal mechanism for safeguarding grants and ensures appropriate accountability for lottery funds. Failure to comply with its terms and conditions provides Sport England with the right to demand repayment. In this case the LFA (a copy of which has previously been submitted to the Committee) stated that WNSL would design and build a world class national stadium for three sports. The LFA required that WNSL meet the following criteria;

    —  The capability to meet International Amateur Athletic Federation requirements for athletics;

    —  A minimum seating capacity of 80,000 seats for football and rugby league, and 65,000 seats for athletics;

    —  The stadium must be made available for the World Athletics Championships and the Olympics on the terms on which the event is offered.

    —  Design standards and sight lines at least comparable to other major national stadia such as Stadium Australia (Sydney) and the Stade de France.


  In July 1999, WNSL announced their detailed design plans for the new Wembley project. These plans were widely acclaimed and endorsed by all three of the sports who had committed their events to the project—the Football Association, Rugby Football League and UK Athletics—together with other key parties including the then Secretary of State Chris Smith and the British Olympic Association.

  The Select Committee has since then twice heard oral evidence from Rod Sheard, lead architect for WNSL, on the design plans for Wembley which included the platform option for converting the stadium to athletics use. We believe the Committee shares our view that this design did then, and still does, represent the best value approach to building a national stadium that meets high standards for each of athletics, football and rugby.

  We also noted with interest that this design is now likely to be used by some of the cities bidding for the Olympics in 2012 and that the IOC have endorsed the design concept as a welcome development in addressing how major stadia can secure a lasting and viable legacy beyond the staging of an Olympic Games.


  On 22 December 1999, the then Secretary of State for Culture, Media and Sport, Chris Smith, decided that the National Stadium project at Wembley was no longer suitable for athletics, based primarily upon his assessment of a report prepared in just two weeks by the architects Ellerbe Becket.

  This report was subsequently found to be fundamentally flawed in its main recommendations. It is our regret that neither ourselves nor WNSL were given sufficient time to discuss this report with the Secretary of State before he made his formal announcement to Parliament that he was proposing withdrawing athletics from Wembley.

  On 22 December 1999, the Secretary of State announced that he had decided that athletics should not be staged at Wembley, and that, in return for a relaxation of their contractual requirements, he had agreed with the Football Association that a payment of £20 million be made to Sport England.

  It should be noted that despite Sport England being a party to the LFA, the Secretary of State did not involve Sport England in any of his meetings with the Football Association to discuss the £20 million payment. A unilateral and non-binding renegotiation of the LFA had taken place, sealed at a meeting between Ken Bates and Chris Smith in late December 1999.

  On 10 January 2000, 18 days after the Secretary of State had concluded his deal with Ken Bates, the Department for Culture, Media and Sport wrote to Sport England providing formal notification of the agreement. This letter, which we attach with our submission, states "You ask whether we have any information on the outcome of discussions with the Football Association. As you will be aware, the FA has offered to repay some of the grant they have received in return for removing the requirement to stage athletics at the national stadium. Details of the offer are set out in the attached letter from the Secretary of State to Ken Bates. It is of course for you, to flesh out the agreement, and to improve its terms if possible".

  We were subsequently surprised to learn in an evidence session of this Committee that the Secretary of State had initially sought that the repayment be £40 million and that this had been reduced to £20 million as a result of FA "haggling".

  Sport England had not been asked to contribute to or be involved in any of the meetings or discussions which subsequently led to a request that we try and renegotiate an LFA.


  As we have indicated, once the Secretary had met with Ken Bates, he passed over to Sport England the responsibility to secure the actual return of the £20 million. He wrote to Mr Bates on 7 January, confirming that (i) athletics would be removed from the Wembley project; (ii) in return, the FA/WNSL would pay £20 million to Sport England over a five-year period, beginning in December 2000; and (iii) the detailed arrangements would have to be resolved by Sport England and the Football Association.

  This was not a straightforward task. As the Chief Executive of Sport England indicated in oral evidence to the Committee on 27 January 2000, there appeared to be no contractual basis for WNSL having to repay £20 million to Sport England on the basis that the stadium was not suitable for athletics. The Secretary of State had in effect agreed that WNSL would make a voluntary repayment that has no legal basis

  Sport England was extremely concerned about this scenario. Indeed when we had become aware from press reports that a deal of this nature was being considered, we had written to the Permanent Secretary at the DCMS on 13 December 1999 expressing our reservations. The Chief Executive of Sport England wrote "it is not open to ourselves unilaterally to change the scope of the project, and in the context of the current legislative framework. I am concerned about the apparent attempts by HM Government itself". Despite our advice, the Secretary of State went ahead and did just that. A copy of this letter is attached.


  Upon learning of the agreement, Sport England immediately entered into discussions with the FA to secure the return of the money. However we found it hard to clarify their position. To add to our difficulty in securing the return of this voluntary payment was the fact that there then developed a dispute between the FA and the Secretary of State as to the exact nature of the agreement they had come to.

  As the attached letters demonstrate, we wrote to the Football Association on five occasions between January and June 2000 seeking their confirmation that they intended to honour the voluntary repayment they had agreed with the Secretary of State. It subsequently transpired that the reason we could not secure any detailed agreement with them is that they were still negotiating with the Secretary of State as to the exact nature of their agreement.

  It was finally brought to our attention on 2 August 2001 that the Secretary of State had received a further letter from the Chairman of the Football Association on 30 January 2001 setting out the deal the FA believed it had agreed with him. This was a different interpretation to that of the Secretary of State in his letter of 7 January 2000 involving the relaxation of commercial rights. The confusion was added to when the Secretary of State wrote again to the FA on 9 February 2000 appearing to agree with the FA's interpretation of the agreement, rather than his earlier views. Copies of this correspondence are enclosed.

  Again, Sport England had not been privy to any of these letters or discussions as they took place but had been expected to conclude the legal documentation.

  On 30 June 2000, Sport England again wrote to the Football Association seeking to clarify the exact agreement that the two parties had come to. We have attached a copy of this letter.

  We again wrote on similar terms to the DCMS on 4 September setting out the problem that we had in interpreting the exact nature of the agreement between Mr Bates and the Secretary of State. To try and move things forward, we set out three different options for consideration. This letter is attached with our evidence.

  The issue was only finally resolved on 13 September 2000 when a meeting took place at DCMS at which all parties were for the first time present, ourselves, the Football Association and DCMS. The next day we wrote to the Football Association setting out the terms of the agreement that all parties were now content with. This letter is attached.

  On 29 September 2000, the FA/WNSL submitted an application to Sport England to amend the terms of the initial Lottery Funding Agreement. The key amendments to the LFA were to be:

    —  the obligation on the new Wembley stadium to retain the design capability for athletics would be removed.

    —  £20 million would be paid to Sport England, by WNSL, over five years, in line with the following timetable: December 2000, £3 million; December 2001, £3 million; December 2002, £3 million; December 2003, £5 million; and December 2004, £6 million;

  At its November and December 2000 Council meetings, Sport England considered the FA/WNSL application requesting an amendment to the LFA that would see the removal of athletics from Wembley.

  Before so doing, the Council had to consult with all the interested parties to the project to confirm that they were happy to see athletics removed, this included UK Athletics, the BOA, the WAC organising committee and the DCMS. This consultation process took a few weeks. As our previous evidence demonstrates, there was not unanimous agreement to this in the first place. Once we had confirmed that all parties agreed to the changes proposed by WNSL, we were able to proceed.

  The Council agreed the WNSL application on 4 December 2000. In doing so, they concluded that the main issues behind the application were not technical or financial as:

    (i)  there had been no discernible breach of the Lottery Funding Agreement's technical requirements; and

    (ii)  there was no technical or pre-existing legal basis for a payment of £20 million to Sport England.

  Sport England wrote to WNSL/FA on 8 December 2000 confirming that the Council had accepted the application to amend the LFA, and stating that it hoped this could soon be put into legal documentary form. We have attached a copy of this letter.

  Just as this agreement was ready to be signed, the FA announced that the syndication of the loan for Wembley had failed. Subsequently a new Chairman, Sir Rodney Walker, was appointed at WNSL. He immediately introduced a review of the project to consider whether Wembley could in fact satisfactorily accommodate athletics. WNSL did not want to sign an agreement to remove athletics while they were assessing its feasibility. This meant that Sport England still had no legal mechanism to expedite the return of the £20 million, as WNSL was not prepared to sign the amendment to the LFA agreed by the Council and WNSL on 4 December 2000.

  Sir Rodney announced the results of his review on 18 January 2001. These were that while it was feasible to host athletics at Wembley, he could not guarantee that the stadium and its ancillary facilities would be ready in time to stage the 2005 WAC Championships.

  He did not announce when WNSL intended to repay the £20 million it had agreed with the Secretary of State or when it would put a signature to the request it had made to amend its LFA.

  Sport England wrote to the Chairman of WNSL three times in January seeking progress on this issue without receiving any satisfactory conclusion. Copies of these letters are attached.

  Sport England then wrote to Adam Crozier on the 26 February 2001 to seek clarification on how the FA/WNSL was to proceed in meeting the amendment to the LFA and repaying £20 million. Adam Crozier wrote back on the 2 March saying "we are all aware that there is no obligation on the FA to repay this, though it currently remains in the FA plan. This will be discussed by the FA board in due course."

  We continued to seek reassurance from the FA and WNSL in February and March. Indeed we were heartened that both the Chairman of WNSL and the Chairman of the Football Association stated to this Committee in March 2001 that they recognised their "moral" obligation to repay this £20 million, even if there were no legal obligation. This was a view also reiterated and supported by the Secretary of State, Chris Smith.

  As the Committee will be aware, in April 2001 the FA announced that it did not feel it could continue with its plans to finance the project in its existing form. As a result the Government announced that Patrick Carter would be appointed to review the Wembley project.


  The willingness of the FA/WNSL to pay £20 million to Sport England had been made clear during the negotiations over the amendment of their Lottery Funding Agreement with Sport England. Once the Carter review was announced we were keen to ensure that the review did not in any way infringe on our ability to protect lottery funds, both the full grant of £120 million and the proposed repayment of £20 million.

  We have attached with this submission copies of letters we sent to the DCMS on 11 May 2001 and 15 June 2001 in which we made it clear we wanted the Department to ensure that in conducting the Carter review they did not undertake any action that might undermine our ability to protect the grant. We also wanted to remind them of the commitment that the £20 million would be repaid and that they should not come to a conclusion that would lessen the likelihood of the Football Association still making this payment.

  Since the appointment of Patrick Carter and then Tessa Jowell as the new Secretary of State, we have reminded both of them in writing and in conversation of the expectation of the Council and Panel that the commitment to repay the £20 million will be met. Attached with this submission is a copy of the letter that was sent to the new Secretary of State on 30 August 2001. The Committee will note that in that letter we write "it is likely that the review will re-confirm that project as the national stadium for association football and rugby league. It is important, therefore, that the agreement reached by the Government and FA in December 1999 is retained, and that £20 million is repaid to Sport England."

11.   Can you clarify whether the £20 million payment from the Football Association and/or WNSL to Sport England is predicated upon (a) the removal of the obligation to host athletics events at Wembley (at cost); (b) the removal of the potential to host athletics at a Wembley National Stadium; or (c) some other formula?

  The current terms of the proposed amendment to the LFA that will lead to the return of the £20 million to Sport England are set out in Sport England's letter to WNSL of 8 December 2000.

  This states that WNSL, on the basis of repaying the £20 million, would no longer have to:

    (a)  hold athletics events at the stadium on a "cost only" basis

    (b)  retain the design capability of the stadium to accommodate athletics.

12.   What does the Lottery Funding Agreement (LFA) say about the provision of athletics at Wembley—does it refer to the 2005 championships specifically?

  The LFA does not refer specifically to the World Athletics in 2005. Instead it states that WNSL must make the stadium available, in athletics mode (to IAAF standards), on a "cost only" basis to any World Athletics Championships or Olympic Games that the UK might stage.

  The advantage of this is that it was hoped we might stage the World Athletic Championships perhaps three times in a fifty-year lifetime of the stadium.

13.   Given the delay in the project is there not now the potential for Sport England to declare the Lottery Funding Agreement unfulfilled and require WNSL to reapply (perhaps for only £100 million) if a national stadium is given the go ahead at Wembley in due course?

  As Sport England stated in oral evidence on 23 October 2001, if the project fails to go ahead, Sport England will take legal action to recover our grant. At present our Council has considered it reasonable to await the outcome of the Government review led by Carter into the project before making any final decision.

14.   Have Ministers always drawn the correct line between involvement and interference in the history of the National Stadium and the 2005 WCA?

  Sport England welcomes Government involvement in major sporting projects, in fact it is essential to their success. A major event requires a joined-up and pro-active approach across Government.

  We have been grateful for the very positive support the Government has given to the Commonwealth Games. Sport England believes that in Manchester we have secured the right balance in securing new facilities for the Games and providing a lasting legacy for the communities in which they are based.

  It is essential to solve major infrastructure projects and clearly government has a role to play in this. We would advise that we do not think it is appropriate that the Government, against advice from Sport England or any other relevant body, to interfere in a Lottery Funding Agreement agreed between two other parties.

  We welcome the review announced by Tessa Jowell into major events that will be led by the Performance and Innovation Unit. We hope that the review will take on the previous recommendations this Committee has made on this issue, in particular its recommendation in April 2001 that:

    "the Major Events Steering Group of UK Sport and the Government and Agencies Committee within Government be abolished and that they both be replaced by a single decision-making body within Government chaired by the Minister for Events and with a membership including the Ministers responsible for sport in the United Kingdom Government and in the devolved administrations".

  We would also urge that the Government recognises that if it wishes to support major sporting events in future, it cannot expect the Sport England Lottery Fund to take on the sole burden of funder. In light of falling lottery ticket sales and increasing demands for Lottery Funds from the grass roots, this really is imperative.

1 November 2001

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