Select Committee on Culture, Media and Sport Fifth Report



III BACKGROUND

The scale and importance of the Games

  1.  As reported by the previous Committee, the Manchester Games will be the biggest Commonwealth Games ever, with approximately 5,000 athletes and team officials from 72 competing nations across 17 sports.[10] The Games will run over ten days from 25 July to 4 August 2002. Running from 11 March to 10 August 2002, the Spirit of Friendship Festival (a multi-cultural festival running nationwide but focussed in the North West) is described as a "catalyst and banner for the celebration of the modern Commonwealth".[11] Its themes are sport, education, culture, the arts, the community and the Golden Jubilee, and, by linking this festival with the Games, the organisers are aiming for greater awareness of the Commonwealth and greater inclusion of the whole North West community in the Games.[12]
  2. The previous Committee's comments on the need for Manchester to set "a new benchmark" in staging major international events have gained greater significance following the failure of the UK to host the 2005 World Athletics Championships.[13] We reported on this latter debacle in November 2001.[14] We are certain that this country's international reputation as a host for the most important sporting events rests upon the success of the Manchester Commonwealth Games.
  3. Changes since the previous Committee's Report

    Management

      9. The previous Committee had welcomed the appointment of a new Chairman and Chief Executive to M2002.[15] However, the report of the Review undertaken by Patrick Carter for the Government, in Spring 2001, recommended a significant number of changes to strengthen management, improve oversight of the Games' finances and support the overall performance of M2002.[16] These changes in management were to support the creation of a robust financial framework within which organisational planning could be delivered.[17] There could be no doubt that this strengthening of financial and organisational management was necessary, as the initial budget for the Games was a significant under-estimate.

  4. The joint memorandum to the Committee outlined the additions to the management structure:

  • Two new senior director level posts were created in July 2001, the Chief Operating Officer, an appointment described as "crucial", and a Creative Director.[18]

  • A separate M2002 Finance Committee was established "to improve financial oversight, scrutiny and accountability within M2002."[19]

  • A Funders Panel was created to review regularly the overall funding position, including releases from the contingency fund.

  • A master-programming group was established within M2002 to "drive through progress against plans and improve co-ordination across functional areas".[20]

  • A Greater Manchester Commonwealth Games Co-ordinating Committee was created comprising senior representatives of DCMS, MCC, Sport England, M2002, Greater Manchester Police (GMP), Greater Manchester Passenger Transport Executive (GMPTE) and the NHS. This Committee meets on a monthly basis to co-ordinate the necessary preparations across Greater Manchester and the North West.[21]

  • Task groups, with a focus on specific issues, have been established to report back to the Co-ordinating Committee and workshops have been held to give detailed consideration to key strategic issues.[22]

  • Critical "success factors" are being defined, for development over the coming months, to provide a framework for monitoring the outcomes of the Games.[23]

  • M2002, together with the GMP, has developed a security framework across all venues, including Site Vulnerability Surveys. This review resulted in a stepping up of security at a number of venues, including the creation of a secure "island" site at SportCity (the main stadium complex).[24]

  • The Chief Constable of Greater Manchester Police has overall responsibility for ensuring that security arrangements at Games time are robust, and the Home Office have agreed to give GMP 3 million towards additional costs. This allocation will be reviewed nearer Games time.[25]

  1. The joint memorandum asserts that the three public funders, the Government, Sport England and Manchester City Council, now have active involvement with the key funding decisions, and determination of key strategic delivery issues, made by these new management groups and committees.[26] PricewaterhouseCoopers (PWC) have been engaged by DCMS and Sport England to provide an assessment of M2002's progress against the programme and on the management of the budget. The Office of Government Commerce (OGC) was working alongside PWC on the Games' degree of readiness in April 2002. The joint memorandum states that the new framework of management and review procedures has produced a stable budget "underpinned by a differentiated set of service standards based on a realistic approach to quality".[27] We are encouraged by the developments in the organisational structure of M2002, and the continued engagement of the public funding partners in the key strategic and financial decisions. We recommend that the relatively late creation of the crucial Chief Operations Officer post be considered amongst the lessons to be learned from the Games and included in the Legacy document to be prepared by M2002.
  2. Funding and budget

      12. The total operating budget for the Games is now just under 130 million, with funding provided by Manchester City Council, Sport England and the Department for Culture, Media and Sport.[28] Public funding for the capital investment in venues amounted to 135.5 million from Sport England and 40.75 million from Manchester City Council.[29] In July 2001, following the review conducted by Patrick Carter, the Secretary of State for Culture, Media and Sport announced an extra funding package of 105 million.[30] This was in addition to the existing 10.5 million allocated by the Government to the Opening and Closing Ceremonies and an equivalent sum from MCC for staff costs.[31]

     

     

      Funding for Manchester Commonwealth Games 2002

     

     

    As at May 20021

    Original Targets

    Contingency Fund2

    Income

    Sponsorship and television rights

    55 million3

     

     

    Ticket sales

    5 million

    Merchandising and Licensing

    2 million

    Public support

    DCMS - July 2001 grant

    25 million

    5 million

    DCMS - original grant

     10.5 million4

    MCC - July 2001 grant

    35 million

    10 million

    MCC - original investment

    about 51 million5

    Sport England - July 2001 grant

    20 million

    10 million

    Sport England - original grant for capital expenditure6

    135 million

    Totals

    276.5 million

    62 million

    25 million7

    1 The figures relating to progess on income from sponsorship, TV rights, ticket sales, merchandising and licensing are commercially confidential

    2 Only to be deployed with the unanimous consent of DCMS, MCC and Sport England for emergencies — i.e. not a management contingency

    3 HC (2000-01) 286, p. 176

    4 DCMS's contribution to the costs of the Opening and Closing Ceremonies, HC (2000-01) 286, paragraph 93

    5 Of which approx. 41 million was MCC's capital contribution towards the facilities, and approx. 10 million was MCC's budgeted cost of support of human resources, HC (2000-01) 286, pp. 176-177

    6 The total cost of the facilities was estimated in March 2001 as approx. 190 million (HC (2000-2001) 286 pp. 175-176)

    7 Of which an undisclosed amount has been spent as a result of the collapse, in Autumn 2001, of Atlantic Telecom, a principal sponsor of the Games and provider of telecommunications infrastructure and services.

     

     

  3. The July 2001 package consisted of 30 million from the Government (including 5 million of contingency fund), 45 million from Manchester City Council (of which 10 million was for contingencies) and 30 million from Sport England (of which another 10 million was for contingencies).[32]
  4. The total contingency fund of 25 million is only to be used with the unanimous consent of all three funders, for the purpose of emergencies rather than as a management contingency.[33] Whilst, so far, the only release from the fund has been to deal with the failure of Atlantic Telecom, a principal sponsor of the Games and the telecommunications infrastructure and service provider for the Games, it seems likely, following the need for greater security for the Games village and venues after September 11th, that other funding will be released for previously unplanned security measures.[34] We expect a clear statement to be made by M2002 breaking down any spending from the July 2001 contingency fund after the Games have concluded.
  5. Departmental responsibility

      15. In July 1999, responding to the recommendations of the previous Committee, the Rt. Hon. Ian McCartney MP, the then Minister of State at the Cabinet Office, was given special responsibility by the Prime Minister for co-ordinating the Government's interests in the 2002 Commonwealth Games.[35] A new Cabinet Sub-Committee was established to support the Minister in his role. The Home Secretary was appointed Chairman of the Sub-Committee to link the preparations for the Games with the wider plans for the Golden Jubilee.

  6. Since the changes to departmental functions following the General Election in June 2001, the responsibilities for both the Golden Jubilee and the Commonwealth Games, together with the officials providing ministerial support, have passed to the Secretary of State for Culture, Media and Sport.[36]

 


10   HC (2000-01), HC 286, para 84 Back

11   Ev 4 Back

12   Ev 4 Back

13   HC (2000-01) 286, para 83, and First Report from the Culture, Media and Sport Committee, Unpicking the Lock: The World Athletics Championships in the UK, Session 2001-02, HC 264, paragraph 68 Back

14   HC (2001-02) 264, para 68 Back

15   HC (2000-2001) 286, para 88 Back

16   Not printed Back

17   Ev 1 Back

18   Ev 1 Back

19   Ev 1 Back

20   Ev 1 Back

21   Ev 1 Back

22   Ev 1 Back

23   Ev 2 Back

24   Ev 4 Back

25   Ev 3 Back

26   Ev 1 Back

27   Ev 2 Back

28   Ev 7 Back

29   DCMS, PN 198/2001, 2 July 2001, and HC (2000-01) 286, p. 176 Back

30   DCMS, PN 198/2001, 2 July 2001 Back

31   HC (2000-01) 286, pp. 176-177 Back

32   DCMS, PN 198/2001, 2 July 2001 Back

33   Ev 5 Back

34   Ev 5 Back

35   HC (1998-99) 124, paras 68-83, and HC (2000-2001) 286, paras 104-108 Back

36   DCMS PN 170/01, 11 June 2001 Back

 
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Prepared 23 May 2002