London Olympic Games and Paralympic Games Bill

My Lords, I thank the Minister for his introduction. I, too, wish to associate myself and the Liberal Democrat Benches with the tributes to and comments on Tony Banks—Lord Stratford—from the Minister and the noble Lord, Lord Glentoran. All sides of the House and the general public are much poorer for his sad, sudden death. He was a true Londoner and a great supporter of sport in this country; our debate is a fitting time to mention him with enormous affection. We have truly all been waiting with some anticipation for this Bill, not only today but on a previous day. It is a pity—although I dare say he may not have had the patience to wait—that the noble Lord, Lord Coe, is not in the Chamber to receive personal congratulations. Gaining the Olympics for London was a massive achievement; the Prime Minister, the Secretary of State, and all those involved deserve great credit for having secured them. I saw a rerun of the announcement in Singapore not long ago, at the CBI dinner, and again at the ““Sports Personality of the Year”” awards on the BBC. It is very watchable, isn’t it? I could keep rerunning that tape for quite some time. On the Liberal Democrat Benches, and in my party generally, we strongly support the Olympics as a huge potential boost for London’s economy and infrastructure—and a positive impact on sports generally in the UK. However, we also want to ensure that expenditure incurred on the Olympics will give us the promised payback in terms of regeneration, tourism and economic legacy. It is also crucial for the overall success of the Games that they are delivered on budget, and we want to ensure that that benefit for London is not outweighed by detriment for the rest of the country. The recently reported PwC study was positive about the potential for London and the rest of the country, but only if the Government make the right interventions. A number of provisions in the Bill give rise to issues around general arrangements being made for the Olympics. First, there is the council tax bill for Londoners. Although the Government state, in the bid documentation, that they are the ultimate guarantor of the cost of the Games, it is far from clear how that operates. Indeed, it appears that Londoners are the real guarantors since, despite the best efforts of my honourable friend Don Foster and the Conservative Front Bench in the other place, there is no cap on council tax for Londoners in the Bill. That is no theoretical issue; the Observer reported on 20 November that the projected costs have surged because original projections allowed for inflation at 3 per cent, yet inflation in the construction sector is now over 7 per cent per annum. It appears that KPMG has been appointed to re-appraise the costs. Can the Minister comment on that? What is its remit and when is it expected to report? The Mayor himself seems to have started with an original calculation for the Olympics precept of £20 per head, per year, for 10 to 12 years—the walnut whip, as he described it. The expected bill seems in fact to be over £40 per year for a great many households above band D—and that is on current costs alone. The Observer article quotes an additional possible cost of an extra £1,000 per household over the period. Is that scaremongering, or a reasonable supposition? Can the Minister comment on the true figure? We have seen the concern of the Secretary of State over the increased estimated cost for the London aquatic centre, so this cannot just be an illusion; it is a real issue. It is not right that Londoners should have to foot all the additional costs. Will the Government undertake to limit the liability of the London council tax payer? Secondly, there is the issue of lottery funding. As part of the funding package, Camelot has been asked by the DCMS to raise some £750 million from games through the national lottery to support the Olympics between now and 2012, with a further £410 million to come from existing good causes from January 2009 and £340 million from sports lottery distributors for elite sport and associated sports infrastructure investment. The ““go for gold”” scratchcard has already raised several million pounds, but I am concerned about a major diversion of money from other causes. The Big Lottery Fund, which distributes lottery money, has predicted that grants may be reduced by some £68 million over the next four years, as lottery players switch to the games that support the Olympics. An impact assessment, which was published some two years ago, suggested that the cannibalisation rate from existing good causes could be some 59 per cent—that is, £445 million—over the period to 2012, which equates to some £64 million per annum, which is a fairly similar figure. The Government expect that non-Olympic good causes will receive up to 10 per cent less in lottery income over the period from 2005 to 2013. Action should therefore be taken to limit the impact of the Olympic lottery. Camelot has called for the introduction of a gross profits tax regime, whereby tax is paid after rather than before prizes have been paid to players, which would allow Camelot to increase prize payouts on selected lottery products, thereby stimulating sales growth. A PricewaterhouseCoopers report estimated that the annual opportunity cost of delaying a migration from lottery duty to a GPT regime equates to lost revenues of some £50 million to good causes, and £15 million to the Exchequer. Clearly, GPT would help Camelot to maximise revenues, both for the Olympics and other good causes. The Treasury acknowledges that the economic case for change has been made; the deregulated gambling and gaming sectors have already made that transition. Yet in the pre-Budget announcement before Christmas, the Government set their face against any change. Therefore, what are the Government doing to ensure that the impact of the Olympic lottery is minimised? Why are they not implementing a GPT regime? We then come to the whole issue of advertising. The rights of official sponsors of the Olympics must be clearly given due protection, and the Olympics brand should, of course, be fully protected from unauthorised exploitation—and, indeed, we are obliged to do that by the host city contract with the IOC. However, the Bill, and in particularly Schedule 4, contains some disproportionately restrictive clauses, as the noble Lord, Lord Glentoran, pointed out, which are beyond what is laid down in the IOC technical manual or the host city contract. I have compared the legislation used for the Sydney Olympics and, by comparison, the London Olympic association right runs far too wide. The Sydney legislation ties the list of words to the use of the word Olympic, or similar; in addition, it is clear that there must be commercial use that is designed to give a misleading impression of sponsorship. As presently drafted, the legitimate tourist trade—hotels, travel agents and so on—will be penalised for trying to encourage guests to come to London during the Olympics, when we should be seeking, on the contrary, to encourage their involvement and support. I am particularly alarmed by the automatic presumption of guilt which is contained in the Bill; there is no justification in this instance for reversing the normal presumption of innocence used in our courts, and that is not contained in the Sydney legislation. The IOC did not require of the UK Government a reverse burden of proof to be included in the implementing legislation; that is unnecessary gold-plating, and it is not enough simply to say that the presumption is relatively light—it is not. However, I welcome LOCOG’s recent assurance that it will produce guidelines for advertisers about what in practice could lead to prosecution for breach of the right. But many questions need answering on that front: who will be consulted in drafting such guidelines, and what arrangements will there be for copy clearance? There are other problems with Schedule 4. There is the whole issue of the exemption for publishers and broadcasters contained in paragraph 8(a), when the use of an association is,"““a necessary incident of publishing or broadcasting a report of a sporting or other event forming part of the London Olympics””." ““Necessary”” suggests a high test for editors to comply with. How would this be enforced by LOCOG? Surely it is not for LOCOG to interfere with editorial freedom of expression by policing what falls to be considered a ““necessary”” incident or not. I believe this should be replaced by a more editorial-friendly test, such as the one tabled by my honourable friend, Don Foster, in the other place, that the London Olympics association right is not infringed by the use of a representation in any editorial usage, and so on. This would also ensure that websites were covered. Then there is the issue, referred to by the noble Lord, Lord Glentoran, of when the association right is due to come into effect. The Sydney legislation provided for this to come into effect four years before the Olympics. This Bill introduces restrictions immediately on the passage of the Bill—that is, six and a half years beforehand. Advertisements take a number of months in the planning and execution, during which time significant amounts of money are spent. The immediate introduction of the London Olympics association right could mean that an advertiser would be guilty of an offence. The Government have admitted that it is unlikely that there will be many infringing advertisements in the period after Royal Assent so far ahead of the Games, yet they say that LOCOG, unlike any previous organising committee, needs to protect its right during this period. In fact, legislation already exists to enable LOCOG to prevent false association with the Games, including the Olympic Symbol etc. (Protection) Act, copyright and trademark law, the law of passing off, and the misleading advertisements regulations. Other organising bodies, for the Turin, Beijing and Vancouver Games, have met or exceeded their marketing revenue budgets without introducing similar legislation, and the IOC has reported that it has already signed up six out of a potential 10 multinational sponsors for the Games. So why should there be a problem in getting sponsors? The Government have said that a light-touch approach will be taken, but advertisers are already receiving threatening letters. Clearly the Government should delay implementation of Schedule 4 until 1 January 2008. Then there is the issue of the Secretary of State’s power to change the words, which are the subject of a London Olympic association right. At the very least we will seek changes in Committee that will make statutory the Government’s assurances that they will consult the advertising industry before making changes. It is not good enough simply to rely on the fact that the changes are required to be made by affirmative order. Furthermore, what assurance can the Minister give that any changes would not be applied retrospectively? Campaigns already in production, or that have been approved by the BACC, should not have to be altered. The new rules should of course only apply to new campaigns not yet in production. It is crucial that, in achieving delivery, there are good communications between the various bodies set up or involved in delivery of the Games, and proper lines of accountability. In Committee, we will be probing why certain bodies are not represented on the Olympics board or will not be included in the list of consultees for the Olympic transport plan, and so on—for example, the members of the London co-ordination working group. There are a number of issues there that I will not go into in great detail. My noble friend Lord Addington will be dealing with many of the disability issues that arise in the Bill and the arrangements for them. I shall talk briefly about the tourism potential of the 2012 Olympics. It is enormous. The benefits are estimated at some £2 billion to the UK visitor economy. Some 500,000 additional visitors are expected in 2012, and an increase in the number of international business events is also anticipated. We hope that the Games will prove a long-term boost to tourism. The London Olympics represent the opportunity of a generation for the tourism industry. The hopeful benefits are by no means a given, however. What are the Government doing to ensure that the required leadership resources and pre-planning are in place to create the Olympics legacy for tourism? I would like to hear from the Minister that there will be sufficient funding for this task. We appear to have no commitment from the Government to invest more in tourism in the run-up to the Games. My noble friend Lady Hamwee will be raising a number of transport concerns, and I leave these in her far more expert hands. Finally, there is of course the question of support for British athletes. Mr Caborn and the Secretary of State say that everything will be alright on the night, but that is not the message coming through from the British sporting community. What assurances can the Minister give about the funding of athletes? I confirm that we on these Benches are extremely enthusiastic about the Olympics. We want to see this Bill go through quickly and I hope that the Government will make the few changes that are necessary to make it fully satisfactory. I look forward to hearing the Minister’s winding-up speech.