Sadiq Khan to set out ‘forward path’ for London Stadium finances next month

by Dave Hill

Sadiq Khan hopes to set out plans for the future of the loss-making London Stadium and the mayoral body responsible for the 2012 Olympic Park by the end of next month, according to one of his closest advisers.

Appearing before the London Assembly’s budget monitoring sub-committee, the Mayor’s chief of staff, David Bellamy, said “my hope is that by the end of November we would be in a position to be saying ‘here are some key decisions from the mayor about the direction we’re going to take and what the forward path is'”.

The stadium is a rebuilt version of the 2012 Olympic Stadium, converted and now operated by E20 Stadium LLP, a joint venture formed by the Mayor’s London Legacy Development Corporation (LLDC) and Newham Legacy Investments, a company set up and wholly owned by Newham Council.

The sub-committee, which looks in detail at how the £17bn annual budget the Mayor oversees is made use of, has described the financial situation of the LLDC, which is responsible for the development of the Olympic Park and its environs, as representing a risk to the Mayor’s budgets, having used up the last of its reserves and requiring £29m from the Mayor over the current financial year.

The stadium itself is losing money, following conversion costs put at £272m in 2015 subsequently rising by a further £51m. West Ham United are its principal tenant, paying a basic rent of £2.5m a year under a deal finalised in April 2016. However, a £40m loan Newham Council provided towards the conversion costs through Newham Legacy Investments has been characterised in the Council’s accounts as “impaired” by the poor financial performance of the stadium, meaning in simple terms that it has yet to begin to pay off.

In November 2016, Mayor Khan ordered an independent review of the stadium’s costs, but this has yet to be delivered by accountants Moore Stephens, who had originally intended to complete their work by the end of June, the sub-committee heard. Bellamy said he would be seeing representatives of the company today (Friday) to express the Mayor’s displeasure at the delay, which was explained to the sub-committee by the GLA’s Martin Clarke as being largely due to the need to speak to a number of individuals and to locate documents going back several years.

Outgoing LLDC chief executive David Goldstone told the sub-committee that a number of studies were going on into how to make the stadium viable, including getting the retractable seats and other aspects of conversion for different sorts of event to work more efficiently and managing the flow of spectators arriving at Stratford station better and more cheaply. He said he was “very confident” that these and other measures would bring down costs and lessen the current projected losses considerably. E20 Stadium received £4.9m from the Mayor’s budget last year.

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