IOC defends London 2012 spending amid recession

By Martyn Herman

LONDON (Reuters) - Britain is justified in spending 9.3 billion pounds ($13.54 billion) on the London 2012 Olympics despite the worst recession since World War Two, the International Olympic Committee (IOC) said on Thursday.

A three-day inspection of London's preparations by the IOC's Coordination Commission ended with another glowing report, although Wednesday's gloomy UK budget cast something of a shadow over the visit.

Denis Oswald, the head of the Coordination Commission said the grim economic forecasts should not obscure the benefits the 2012 Games would bring.

"In every city where you organise the Games, it's a unique opportunity to improve the infrastructure in one way or another," Oswald told reporters.

"If you look at most previous cities like Athens, they have a new airport, they have a new train line, they have a new metro line, they have a new tramway, they have a new motorway... all this was done on the occasion of the Games.

"These were investments which were needed by the city in order to be a modern city and I think it's a very similar situation with the east end part of London which needed improvement. The Games are just the best opportunity to do it."

While construction of the main venues, the Olympic Village and the International Broadcast and Media Centre is ahead of or on schedule, the Olympic Delivery Authority (ODA) is already dipping deeply into the 2.7 billion pounds contingency fund contained in the overall budget as private funding dries up.

The costs of the Olympic Stadium have doubled since London's bid was announced while the Government recently bailed out the Village project with a 95 million pounds cash injection.