The Olympic Stadium Coalition believe the arguments for West Ham to pay its fair share of share of costs at the Olympic stadium become more overwhelming with every new report and discussion on the stadium and its mounting financial problems.
Redevelopment of the stadium was paid for by the taxpayer after the Olympics and the bulk of the costs are today borne by the taxpayer through the London Legacy Development Corporation (LLDC).
According to The Times, yesterday (21 March), David Edmonds, the former chairman of the LLDC, admitted to a Greater London Assembly committee meeting that the LLDC had given in to West Ham in negotiating the agreement for the club to use the stadium. The LLDC was negotiating only with them and made “compromises”. Those compromises meant a deal signed off by the then Mayor Boris Johnson in which the taxpayer is paying to support West Ham at the stadium.
A £140 million loss for the LDDC over the next ten years is predicted. West Ham pays just £2.5 million a year to use the stadium.
Rather than facing up to paying its fair share of costs, West Ham have launched legal action over who should pick up the bill for beer and TV; providing draught beer, Sky TV on all TVs in the stadium (the LLDC receives advertising revenue from some of the televisions) and hospitality staff in the corporate boxes. These are all things that other football clubs routinely pay for themselves.
By launching legal action, the owners of West Ham are adding to costs for the taxpayer. West Ham is already taking the LLDC to court over the number of seats at the stadium and, according to the Daily Telegraph legal costs for both sides in that case has hit £2m and could end up being triple that, once it reaches the High Court in November.
West Ham want to increase seating from 57,000 (itself an increase on the initial agreement) to 66,000. This would be worth millions to them in increased income and they are claiming loss of income if they cannot use them. The LLDC argues that the taxpayer – who paid for the transformation of the stadium so that it can be used by a profitable Premier League club – is entitled to a share of that money.
The coalition – made up of 14 football supporters trusts and groups – believes the mistakes made by the LLDC and the then Mayor in agreeing the terms of the deal with West Ham are clear; it is time for West Ham to demonstrate good corporate London citizenship, drop all legal action and demonstrate goodwill in resolving the financial issues of the stadium.
The Moore Stephens Inquiry into the issues around West Ham’s use of the Olympic Stadium reported in December 2017.
The inquiry itself came about in part because of the pressure exerted over the issue by this campaign.
Below, we have provided a wrap-up of the issues, distilling the major points about the background to the report, what caused it to come about, and some of its findings, in the context of this campaign.
Enquiries can be made to the Olympic Stadium Coalition via the contact us page
- The Olympic Stadium Coalition (OSC) is a group of 14 supporters’ trusts and supporters organisations, which exists to pursue a fairer deal for the taxpayer in respect of the Olympic Stadium and use of it by West Ham United.
- One of our first acts was to launch a petition seeking a full Public Inquiry into the issue, though sought at the minimum an inquiry by a competent public authority. When London Mayor Sadiq Khan announced the Moore Stephens Inquiry, we welcomed it as a response to our demands. We were invited to provide evidence.
- We felt that our concerns had been fully considered and professionally scrutinised
The Inquiry has been published and we believe it provides a compelling case for a re-balancing of the finances of the Stadium so that West Ham, a rich Premier League club, pay more, and the taxpayer pays less.
- The LLDC defended the cost of readying the Stadium for West Ham’s use (£323m) on the grounds that operating profits would return that outlay to the taxpayer
- The Inquiry exposes the delusion of this argument. In fact in the first 10 years of operation, losses of £140m are now forecast
- The main reasons for this loss are the eye-watering cost of the so-called ‘removable seating’, and the failure to obtain revenue from a stadium naming rights sponsor.
- The Inquiry backs up the OSC’s long standing complaint that the ‘Concession Agreement’ relieves West Ham of the overhead costs which all other clubs have to bear. The rental West Ham pays does not even cover those costs, let alone deliver revenue that repays the cost of the stadium
- The Inquiry estimates that, just to break even, West Ham should be paying a rent of £11.5m per annum
- The first bid for the stadium, involving a joint venture between West Ham and the London Borough of Newham was aborted due to legal challenges and the fear of a State Aid investigation. In that plan, West Ham were happy to retain a permanent athletics track, and a fabric roof on the stadium which left the first five rows uncovered
- It was only in the second, successful bid that West Ham insisted on retractable seating to bring fans closer to the pitch and a full extended roof to cover all the fans.
- Up until now West Ham have adopted an aggressive strategy of seeking to enforce every unclear aspect of the Concession Agreement in its favour. It is taking the LLDC to court in autumn 2018, claiming that the stadium capacity should be expanded to 66,000, with all costs falling on the LLDC and hence the taxpayer. The OSC has itself so far found nothing in the Concession Agreement that leads a reasonable person to support West Ham’s viewpoint
The OSC believes that with all these facts now out in the open, West Ham United should consider its reputation as a football club, and its position as a good corporate citizen of London. It should recognise that the cost of meeting requirements which West Ham itself previously did not consider to be essential, have ballooned way beyond expectations at the time of the signing of the agreement. These costs threaten the financial viability of the entire project. West Ham should now offer increased payments in the form of usage fees which fully reflect costs. We hope that politicians and those close to West Ham can mediate if necessary to persuade the Club of the wisdom of making such an offer.
You can download the report in full via this link (pdf document)
BBC Sport Editor Dan Roan has just posted the news that Newham are pulling out of the co-ownership of the Olympic Stadium (below.)
After several years of hard work by the OS Campaign, we have achieved disclosure of information we were told could not be published, and achieved an inquiry appointed by the Mayor of London, Sadiq Khan, that we were told would never happen, and which has reported this morning, detailing the ‘mismanagement of London [Olympic] Stadium finances by the previous Mayor’ (Boris Johnson): https://www.london.gov.uk/about-us/mayor-london/our-publications/independent-review-olympic-stadium
Huge credit must go to the 14 organisations that have made up this campaign, and continued to work on it whilst the story disappeared from the headlines.
This doesn’t mark the end of the campaign, but it does finally place in the public domain, the recognition of one of our central arguments.
After several months of patient waiting, the Olympic Stadium Coalition has finally been asked to give evidence to the independent inquiry established by Sadiq Khan, which is being undertaken by ‘Global risk investigations and dispute advisory’ specialists, Moore Stephens
Richard Hunt from the Charlton Athletic Supporters Trust, will be representing the campaign, and speaking to them at a mutually agreed date very soon.
More as we have it.
If you’re interested in our campaign, you might want to watch the London edition of the BBC’s Inside Out programme tonight, as ‘Mark Jordan investigates why the West Ham stadium deal continues to be a burden on taxpayers.’
You can watch it via the regional options on Virgin and Sky, or via iPlayer: http://www.bbc.co.uk/programmes/b08bn38x
Olympic Stadium Coalition
Press release: 15/12/2016
For immediate release
OS Coalition meeting at City Hall
As part of its continued campaign on the costs of the Olympic (‘London’) Stadium, the Olympic Stadium Coalition has met with Liberal Democrat, Caroline Pidgeon MBE AM, to discuss London Mayor Sadiq Khan’s promise of an investigation into the finances of the cost of the development.
They issued the following statement
‘As a campaign we have put a great deal of work into uncovering the facts of the case, and ensuring that it’s in the hands of the people with the power to effect change and influence. We’ve worked hard to ensure support from across the political spectrum, and we’re immensely grateful to Caroline Pidgeon, Conservative AM Andrew Boff, and former Labour AM Murad Qureshi, who have put a considerable amount of work into this issue for some time.
‘We hope to meet with Sadiq Khan, and we will be writing to him to disclose the significant information we’ve gathered about the operational costs of the stadium and its cost to the UK taxpayer. Ultimately, we’re seeking to ensure that it does the least damage possible to Premier League and EFL clubs not just in London, but across the country.’
Olympic Stadium Coalition
Press release: 02/11/2016
For immediate release
Statement in response to announcement of Mayoral enquiry into spiralling stadium costs
The Olympic Stadium Coalition has welcomed the news of the London Mayor’s Sadiq Khan’s investigation into the finances of the Olympic (‘London’) Stadium with the following statement:
‘This is a breakthrough in our long campaign to highlight the intolerable burden on taxpayers of the rebuilding of the Olympic Stadium to the specification of a well off Premier League football club.
‘We have never objected to the idea of West Ham playing at the stadium; the question is simply one of how much the club should pay, and how much the taxpayer should be expected to fund.
‘Our attempts to seek transparency have been blocked at every turn by the London Legacy Development Corporation and Newham Council. It took two years for us to obtain release of the full rental contract under Freedom of Information law. We believe that all taxpayers deserve to be made fully aware of just how much we are all paying, and how much West Ham United are paying towards both capital and operating costs.
Only this week, we have learnt that the naming rights deal for the stadium has fallen through. As a result we believe this means the stadium will operate at a loss for the foreseeable future, especially if the police seek to recharge the costs of their increased presence at the stadium due to crowd control issues. The entire deal, and not just the rebuild costs, should be examined in detail, by the Mayor and the taxpayer.”
We hope to be able to meet the Mayor to present him with the significant information that we have gathered about the operational costs of the stadium.
‘Supporters trusts from across the country and across the divisions formed the Olympic Stadium Coalition, and have worked continuously to uncover the details of the deal. The Mayor’s investigation is good news, a good starting point, but it is only a start.’