The Organizing Committee for the Paris Olympic and Paralympic Games (COJO) on Monday adopted a budget up 10%, or 400 million euros (574 million Canadian dollars) to 4.38 billion euros (6, C$29 billion), notably due to inflation and underestimated costs. What expenses are rising? Revenues increasing? Where are the savings made? Here are the key figures.
Evolution. Between 2018 and 2022, the OCOG’s budget has increased by €600 million (CA$862 million). It went from 3.8 billion euros (5.5 billion $CA) in 2018 to 3.9 billion (5.6 billion $CA) in 2020, then to 3.98 billion (5.7 billion $CA) ) at the end of 2021 and now at 4.38 billion (CA$6.3 billion) During the bid, the OCOG’s budget was estimated at 3.3 billion euros (CA$4.7 billion), or one billion less than now.
Impact of inflation. Inflation increased the budget by 195 million (CA$280 million), i.e. almost half of the total increase, with 120 million euros (CA$172.4 million) for this year and 75 million euros (CA$107.7 million) planned for 2023 and 2024.
The share of the State and local authorities. The OCOG’s budget is based on three sources of private income: ticketing, sponsors and a contribution from the International Olympic Committee (IOC). The State and communities have so far contributed 100 million euros ($143.6 million CA) for the organization of the Paralympic Games alone.
As part of this budget revision, they add 111 million euros (CA$159.4 million), including 70 million euros (CA$100.5 million) from the state.
In addition, 71 million new euros are earmarked for the Paralympic Games: the State puts 44.5 million (CA$64 million), the Metropolis of Greater Paris 15 million (CA$21.5 million), the City of Paris 5.6 million (CA$8 million) and Île-de-France 5.6 million (CA$8 million), the OCOG said in a statement on Monday.
While the president of the IDF region, Valérie Pécresse, is in the midst of a tussle with the State over transport, the region informed Agence France-Presse that it “conditions its participation in the implementation of the commitment made by Édouard Philippe in January 2020 to grant permanent resources to Île-de-France Mobilités for the operation of the Grand Paris Express lines”.
The State is also investing 25.5 million euros (CA$36.6 million) for sports equipment, anti-doping equipment, or even the Olympic routes, and the metropolis 15 million (CA$21.5 million) for “amenities that will remain after the Games”.
The public share of the OCOG budget thus increases from 3 to 4%.
Sponsors. Finding partners is the sinews of war. The OCOG says it is “ahead” of its goal of raising 80% of the sum of 1.1 billion (C$1.6 billion) by the end of 2022. It thus judges that it can increase its revenue target sponsorship of 127 million euros (182 million $CA), which increases to 1.24 billion euros (1.78 billion $CA). The LVMH group has been expected for months to join the ranks of the first five major sponsors of the OCOG (Orange, EDF, BPCE, Sanofi, Carrefour). Even the state got involved to try to convince new partners.
Rising expenses. Expenses related to the quarantine of sites and infrastructures are up by 165 million euros (237 million $CA). They reached 756.8 million (CA$1.7 billion) in 2021. As well as “Games services” (catering, security, cleaning, transport, etc.) with 113 million (CA$162 million) compared to 1.003 billion in 2021 (CA$1.43 billion). With the unprecedented opening ceremony on the Seine, the ceremony budget increases by 30 million ($43 million CA).
Savings. They were made with the help of the IOC, who agreed to cut back on specifications with high standards. They affect all sectors, from catering to a later takeover of training sites. Likewise, the Olympic Village will open four days later than planned. To absorb the increase in expenses, the OCOG also dipped into its contingency reserve.
Surpluses. More tickets, sold at higher prices for the most popular sessions, now 1.4 billion euros (2.01 billion $CA) in box office revenue. The OCOG also received an additional 33 million (CA$47.4 million) from the IOC, including from a new sponsor.
Total bill. In total, the bill for the Olympics is 8.7 billion euros ($12.5 billion CA). Solideo (an Olympic delivery company) has a budget of 4.3 billion euros (CA$6.2 billion), of which 1.87 billion (CA$2.7 billion) is public money. Also affected by inflation in building and public works, it entered 150 million (CA$215 million) in its budget for this purpose, two-thirds of which was borne by the State, and one-third by local authorities. Solideo, chaired by Anne Hidalgo and directed by Nicolas Ferrand, will hold a board meeting at the end of the week.