Olympics costs have not trebled!!

Classic case of the media's inability to understand numbers this morning, especially when it gets in the way of a good story. There are screaming headlines everywhere that the costs of the 2012 Olympics has more than trebled from the £2.4 billion quoted in the bid, to £9.3bn. That simply isn't true.

As Evan Davis (the BBC's economics pixie) details here it would be fairer to say that the original budget has more than doubled from £3.4bn to £7.5bn, and a fair chunk of that increase is provision for contingencies. The official bid figure did not include the £1bn that was announced at the time would be spent on post games regeneration and the £9.3bn includes costs like VAT (which overall isn't a cost to the taxpayer so should really be discounted) and security that were not budgeted for in 2005.

Now there are questions to be asked about why security wasn't budgeted for separately originally. Its not as if July 7th, the official excuse, actually really changed anything. And we should be asking where the £9bn is going to come from. But lets not get carried away with the idea that the costs are out of control, because they are not, yet.