Olympic bid cities should boost bargaining position to avoid future risk

Cities bidding to host future Olympic Games should sharpen their negotiating skills to help avoid financial ruin - according to a University of Birmingham report. 

Events like next month’s Games in Rio de Janeiro, and the Football World Cup, have become major liabilities for the host nation, in a phenomenon experts have dubbed ‘mega-event syndrome’. 

Dr Martin Müller, a senior research fellow at the University of Birmingham’s School of Geography, Earth and Environmental Sciences, has identified seven symptoms that afflict the planning and hosting of such events. 

In his policy brief ‘Why So Much Goes Wrong in Mega-Event Planning and What to Do About It’, he urges future host cities to take steps to reduce the likelihood of the event spiralling out of control.  

Dr Müller said: “Rio has gone massively over-budget, the Brazilian public is bearing almost all the risk and urban planning has been changed to fit the event, rather than the other way round. In the run-up to the Olympic Games, the city has been in a perpetual state of emergency. 

“However, cities bidding for future Olympics have the power to avoid the same thing happening to them. Without their bids future events won’t happen and they should bargain with event-governing bodies, as well as taking a number of further key actions.” 

Dr Müller says addressing ‘mega-event syndrome’ requires a radical change in the way cities plan such events. The policy briefing advises potential host nations to: 

• Avoid tying mega-events to large-scale urban development
• Bargain with event governing bodies
• Cap and earmark public expenditure
• Seek public participation from the start
• Enrol independent experts 

The report sets out seven common, but dangerous, symptoms of ‘mega-event syndrome’ – a concept developed by Dr Müller – that afflict host nations and cities: 

1. Overpromising benefits: leading to misallocation of resources and loss of trust with citizens.
2. Underestimating costs: actual costs always exceed the original budget. 
3. Event takeover: event priorities become planning priorities - creating infrastructure that does not serve people’s long-term needs.
4. Public risk taking: using public funds for limited or no public benefit.
5. Rule of exception: suspending regular rule of law can result in displacement of people, tax exemptions and reduced public oversight in planning the event.
6. Elite capture: billed as events for the whole population, but mostly benefiting small elite.
7. Event fix: seemingly quick fixes for major planning challenges. Cities spend money and time on hosting large events rather than tackling more fundamental problems.

Dr Müller added: “A window for reform is now open, with the International Olympic Committee (IOC) facing difficulties convincing cities of the benefits of the Olympic Games. The recent shake-up of football’s world governing body FIFA also gives cities new opportunities. 

“We now need to move on this chance – not just in the interest of bid cities, but to secure a sustainable future for the sports events many of us love so much.” 

• The University of Birmingham is ranked amongst the world’s top 100 institutions, its work brings people from across the world to Birmingham, including researchers and teachers and more than 5,000 international students from over 150 countries. 

• More information can be found in Dr Martin Müller’s policy brief (PDF - 2Mb) .

For more information or interviews, please contact Tony Moran, International Communications Manager, University of Birmingham on +44 (0) 121 414 8254 or  +44 (0)782 783 2312. For out-of-hours media enquiries, please call: +44 (0) 7789 921 165.