Richard North, 13/09/2004  

How sad. It seems but yesterday that the Olympic Games finished with great fanfare and Athens seemed the centre of the universe. And now? Well, dear me, it seems that somebody is going to have to pay for it. And the somebody is going to be the people of Greece. (Or perhaps the people of the other EU member states as Greece is a recipient of plentiful funds.)

Prime Minister Costas Karamanlis has announced that the expected €7 billion ($8 billion or £4.8 billion) price tag will mean that the Greek deficit will be around 5.3 per cent in 2004. That, I need not remind our readers, is almost twice as much as that allowed even by the somewhat losened Growth and Stability Pact.

According to Mr Karamanlis, it is all his socialist predecessor’s fault. Constantine Simis’s government apparently had an interesting idea of budgeting.

A large part of Olympic, social and other spending was not written up in the budget. The real deficit was not recorded. … Social policy was done on borrowed cash, military spending was not recorded on the budget, debts were created in secret.
An odd way of running a country but there you are. The socialist government had predicted before the elections a deficit of 1.2 per cent and a total debt of under 100 per cent of GDP. The real figures, Mr Karamanlis thinks at the moment, say that the total cumulative debt is 112 per cent of GDP or €184 billion (c£126 billion) or €50,000 (c£34,000) for each Greek household. How jolly.

More than anything else the price of the Olympic Games was kept quiet. The Athens games were the most expensive of the modern period, what with ever rising costs of running them, stupendously high security costs and the expense of finishing all the construction hastily at the last minute. One wonders whether the present estimates are accurate.

Mr Karamanlis has ways of dealing with the problem. There will be privatisation, new investment and pro-competitive laws. But there will be no shock therapy. Will the new laws take as long as the construction of the stadium?

In the meantime Londoners might like to take up the cry of UKIP in the London Assembly and support the Paris bid for the 2012 games.

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