Unexpected seating cost was key factor in London Stadium sharp cost rise - LLDC
The unforeseen expense of retro-fitting retractable seating at the London Stadium was the major factor behind a £51million rise in conversion costs, according to London Legacy Development Corporation chief executive David Goldstone.
London Mayor Sadiq Khan last month ordered an investigation into the climb to £323million in tax-payers' money being used to make the stadium a fully functional multi-purpose venue following the Olympics.
West Ham, who have a 99-year lease on the 60,000-seat stadium, made a one-off contribution of £15million to the costs and pay £2.5million a year in rent. The total bill for the stadium, which also has seen a new roof installed, is now some £752million.
The London Stadium is also set to host the both the World ParaAthletics and IAAF World Championships from July 2017, which will be proceeded by concerts at the Queen Elizabeth Olympic Park venue including from Depeche Mode, Guns N' Roses, Robbie Williams and Erasure.
LLDC chief Goldstone was questioned by the London Assembly budget monitoring sub-committee on Wednesday afternoon. The LLDC was set up prior to the London 2012 Olympics to ensure the site would be suitably developed.
For the first time, full details were given on the additional costs, which had originally been leaked to the media before the mayor's statement of being "deeply concerned about the finances of the Olympic Stadium".
Goldstone said: " If we go through the difference of the £272million and the £ 323million referred to, and the £51million increase, a chunk of it was to do with the very unfortunate failure of the seating contractor who had been appointed to introduce the seating system.
"That happened just before the Rugby World Cup last summer, so an inopportune moment, and effectively in the efforts of installing the new seating system the contractor failed and were unable to meet the requirements of the contract.
"We were left with a partially-installed system with a Rugby World Cup imminent and very large crowds and very high profile, so (we) had to step in and make it ready for that event.
"It had been a joint venture. One part of the main designer and installer of the seating systems went bust, the other inherited it, but wasn't a suitable long-term contractor, so for 2016 they took it forward, but we had to effectively settle out with them.
"It was only really for this summer's season we were able to do the first moves with the fully-installed system and understand what that would involve.
"Issues we have had, starting with the collapse of the appointed contractor in mid-2015, have caused about £21million of that increase."
Goldstone added another £14milion of the extra costs were part of a joint venture with Newham Council that involved aspects such as enhancements to enable bigger concert crowds and of the lighting system as well as improving the "robustness of the pitch" and installing a large screen which could provide potential advertising revenue.
There was also a contingency of £12million which "had to be used for things which happened, but risks that had been anticipated", with another £4million covering insurances and the LLDC's own management costs.
Despite all of the controversy over increased expenditure and the mayor's review, L LDC chief Goldstone maintained the Stratford regeneration project as a whole would prove a success in the long term, with the "transformation" of the stadium now complete.
"The £323million, that is the final number. The work is finished," Goldstone said.
"The challenge we have got now is making the ongoing business work in the way we have referred to, the issues with the seating and making sure the operation is working as smoothly as possible, but yes, the transformation is complete so that is the final figure."
Goldstone had earlier highlighted that t he London Stadium "is proving itself a really successful venue for major events and last year we had more than a million spectators in".
He added: "Over half a million people have attended (West Ham games) this season, which shows how much it will be a contributor to the legacy more broadly in the park."