LDA will shelve climate work after ‘losing’ £161m from Olympics budget
Boris Johnson today denied key climate change schemes were at risk after his regeneration body acquired a massive hole in its budget after getting its Olympics sums wrong.
A London Assembly report claimed that £4.5 million was being cut from climate change initiatives as the London Development Agency shelved or axed £45 million of schemes to balance its books. The LDA has "lost" £161 million after failing to keep track of around £1 billion of land purchases for the Olympic Park.
Today the agency claimed that its spending on climate change had gone up rather than down, but the Assembly said its report was based on the LDA's own figures and stood by its findings.
The LDA refused to name any of the projects being cut. An Assembly source said: "It is difficult to see how else these figures could be interpreted."
But a spokesman for Mr Johnson said there was "no question whatsoever" of the LDA's financial problems resulting in less money for flagship projects, such as fitting public buildings with energy saving devices and encouraging decentralised energy supplies.
The spokesman said: "Making London's homes more energy efficient, promoting decentralised energy and helping the capital's businesses cut their emissions are [the Mayor's] top priorities.
"The LDA is addressing the shortfall through a range of measures including cutting some projects that are poor value for money and delaying the start of others. None of these measures affects climate change projects."
Today's report, from the Assembly's budget committee, noted that the LDA, which has a £469 million annual budget and oversaw the £1 billion Olympic land purchase in Stratford, has been riven with problems since its formation nine years ago and has "bleak" financial prospects.
The report says that the black hole has "not only damaged the agency's reputation but has significantly reduced its resources". The agency will have a fifth less to spend on all its schemes next year —- and 40 per cent less by the time the Olympics start in 2012.
John Biggs, Labour chairman of the Assembly budget committee, said its confidence in the LDA's ability to produce and monitor budgets accurately has been "dented".
He said: "The LDA must now demonstrate that lessons have been learned, controls improved and sufficient testing on budget areas carried out to ensure budgets going forward can be relied upon."
An LDA spokesman said: "The Olympic budget problems are part of historic management failures that were inherited by the LDA's new leadership, who are continuing to address this legacy and are ensuring that the organisation is fit for purpose."
