Finally. More than eight months after the IOC’s decision to postpone the Tokyo 2020 Olympics for a full year, Japanese taxpayers know how much they need to pay to cover the extra cost of the postponement. As expected, it turns out to be quite high : 200 billion yen, or a bit more than 1.9 billion dollars, or 1.6 billion euros, at the current price.
The figure is not yet official. It is disclosed by two Japanese media, Kyodo News agency and the Yomiuri Shimbun daily. Both cite anonymous sources who are familiar with the matter.
Precision : the amount revealed does not include the cost of health measures considered by the Japanese to fight against health risks at the Olympic and Paralympic Games. They will be the subject of a separate estimate, still impossible to establish without knowing what situation the country will be in next summer, and above all what the gauge will be for the number of spectators at the competition venues.
The amount disclosed by the Japanese media concerns only the expenses related to the postponement of one year, namely the salaries of the staff of the organizing committee for a further twelve months, the rental and maintenance of the sites until 2021, including the athletes village, the studies carried out by the Tokyo team for the organisation of the Games a year later, in a context of health crisis …
Nearly two billion dollars, then. Copious. But the bill does not surprise anyone. Shortly after the announcement of the postponement, initial estimates were “several billion dollars”. They were right.
As a reminder, the Japanese had announced a budget of 7.3 billion dollars when the 2020 Olympics were awarded, during the IOC session in Buenos Aires in September 2013. Since then, the cost of the event has been on a roller coaster, climbing to 30 billion before the organizing committee is forced to review its venues map, under pressure from the authorities of the city and the country.
At the last score, before the decision to postpone, the budget for the Games had been “stabilised” at $12.6 billion. But an audit conducted by a state audit office concluded last year that it would actually be more than double that amount.
Question : who will pay ? Before the postponement, the answer was known. The sum of 5.7 billion dollars was provided by private funds : the contribution of the IOC, marketing, ticketing and merchandising. The rest, about $7 billion, came out of the taxpayer’s pocket, via subsidies from the governments of Tokyo (5.7 billion) and Japan (1.4).
Since the postponement, the IOC has already warned that it will not increase its direct contribution. For their part, the organizers have embarked on a vast plan to simplify the Games and reduce expenses. This result is not insignificant, as it would scratch around $288 million. But it now looks almost paltry considering the final score of $2 billion for the event’s one-year lag.
At this point in history, no accounting skills are needed to conclude that the bulk of the deferral bill will be paid by the taxpayer. It is indeed difficult to imagine the organizers finding the money elsewhere, especially as the negotiations undertaken with the national sponsors for an extension of their contribution would be delicate, even tense in some cases.
The organizing committee, the metropolitan government and the government of Japan are expected to announce the official additional cost of the postponement before the end of the year. And, above all, the way in which everyone will have to contribute…