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Closed-door panel meeting underscores IOC's concern over cost of 2020 Games

A four-party working group tasked with reviewing the budget for the 2020 Tokyo Olympics held its first meeting on Nov. 1 amid strong concerns from the International Olympic Committee (IOC) over ballooning costs.

The working-level talks between the IOC, the Tokyo Metropolitan Government, the Tokyo Organising Committee of the Olympic and Paralympic Games and the Japanese government apparently focused on transportation and security. The meeting was held behind closed doors, with no explanation or news conference afterward.

According to sources familiar with the talks, IOC officials are reviewing the basis of cost estimates produced by the organizing committee. The IOC has reportedly expressed strong concern over an estimate made by a research team from the metropolitan government's administrative reform headquarters that showed the cost of hosting the games would top 3 trillion yen. The organization is nervous about figures capturing news headlines while talks are still in progress.

Since there has been a growing trend among cities across the world to distance themselves from hosting the quadrennial event due to fears of being saddled with an enormous financial burden, the IOC's objective in its involvement in the four-party panel is slashing the costs of the Tokyo Games.

Japan's central government is in concert with the IOC in holding down costs. Olympic minister Tamayo Marukawa told a news conference on Nov. 1 that the central government plans to take part in the discussions while presenting a full picture of the situation.

The research team from Tokyo's administrative reform headquarters has proposed eight points for operation of the 2020 Games, including the establishment of a joint chief financial officer (CFO) system wherein the organizing committee and the metropolitan government collectively manage the budget for the games.

While the costs of the Olympics and Paralympics will be shared by the metropolitan government, the organizing committee and the central government, Tokyo is as a rule to cover the loss should the games end in the red. The three bodies currently each manage their own budgets, but the research team pointed out the need to monitor the risks of Tokyo covering the losses if the games end in a deficit. The team also suggested that the CFOs should check all budgetary items, including spending on the games by other prefectures if deemed necessary.

Other proposals from the reform headquarters include reforming "the coordination council" consisting of the representatives of related parties; early disclosure of budget information; specifying portions of spending by the central government, Tokyo and each prefecture hosting events; a review of roles taken by the metropolitan government and organizing committee; disclosure of Tokyo's contract with the IOC; consideration of a plan for "soft legacies" that do not involve a venue; and the establishment of a foundation to maintain "legacy" facilities after the 2020 Games are over.

Keio University professor Shinichi Ueyama, who serves as a special adviser to the administrative reform headquarters, points out that there are differences between the logic driving the Tokyo Metropolitan Government, which has to answer to taxpayers, and that adopted by the IOC, a private, independent organization. He calls for flexible management and suggests that information related to the games should be disclosed as a general rule.

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