The Mainichi Shimbun answers some common questions readers may have about expenses related to the Tokyo Olympics and Paralympics.
Question: Is it true that expenses for the Tokyo Olympics and Paralympics will be reduced?
Answer: The Tokyo Games have been postponed to next summer due to the spread of the coronavirus. The Tokyo Organising Committee of the Olympic and Paralympic Games reached an agreement with the International Olympic Committee in June to simplify the arrangement of the Tokyo Olympic and Paralympic, in order to minimize an increase in costs arising from contract extensions and personnel expenses following the postponement. The organizing committee announced its current plans to cut down on the budget by around 30 billion yen (roughly $284.1 million) following a close examination of 52 items.
Q: What costs were reduced?
A: The main cost reductions comprise a 15-billion-yen (roughly $142.1 million) decrease in expenses for temporary facilities inside venues, a 3-billion-yen (about $28.4 million) cut by optimizing the number of required staff for the organizing committee, and a 30 to 40% reduction (a 1-billion-yen, or roughly $9.5 million decrease) in expenses for decorations used in venues and the athletes' village. Although the cost reduction scheme was publicized as making no exceptions, the organizing committee was not able to achieve cutting down on costs surrounding centerpieces, such as shortening the time of the opening and closing ceremonies, and compressing the schedule of the torch relay, due to opposition from related parties. There were many contracts and arrangements that had been concluded on the assumption that the games would be held this year, and a radical cut was apparently difficult to attain.
Q: It's difficult to imagine how much 30 billion yen actually is. Does this cutback have a large effect?
A: The 30 billion yen accounts for about 2% of the expenses related to the Tokyo Games, estimated at 1.35 trillion yen (about $12.8 billion) as of last December. Meanwhile, an increase in additional expenses following the postponement is thought to total some 300 billion yen (roughly $2.8 billion), while expenses for coronavirus countermeasures will also be added. It is likely that the total cost will greatly surpass the original 1.35 trillion yen. Furthermore, expenses for maintenance of roads as a countermeasure against heat and other preparations fall under a separate category of related expenses. The Board of Audit of Japan, which is seeking to grasp the full picture of costs, including the related expenses, claimed that the total cost to hold the Olympics prior to its postponement exceeded 3 trillion yen (about $28.4 billion).
Q: Who pays for the amount that increased due to the Tokyo Games' postponement?
A: A large majority of the organizing committee's earnings are payments made by sponsors, but a significant rise in revenue cannot be expected due to a decline in companies' financial conditions amid the pandemic. While discussions on parties responsible for shouldering the costs will be held moving forward, it is likely that public funds from the Tokyo Metropolitan Government and the Japanese government will be used to cover the costs.
(Japanese original by Yuta Kobayashi, Sports News Department)