FINANCIAL INCENTIVES ARE WITHDRAWN

London's bid for the 2012 Olympic Games suffered a major blow when it was forced to withdraw a £15 million package of financial 'incentives' which the International Olympic Committee claimed came dangerously close to bribery. Mounting controversy surrounding the offer to give free flights to athletes and pay countries £30,000 to train in Britain before the event has led the bid chairman, Sebastian Coe, to announce it would be abandoned. The embarrassing climbdown came as the president of the IOC, Jacques Rogge, warned all five cities bidding for the Games that such packages risked reviving the spectre of corruption that plunged the organisation into turmoil over the 2002 Winter Games in Salt Lake City and ended with the expulsion of 10 committee members.

Rogge made clear his displeasure by stressing he did not want the IOC to go back to the 'bad old days' and asking the committee's ethics commission, which monitors rival cities' conduct, to investigate London's offers. The sports minister, Richard Caborn, a key backer for the bid, acknowledged that London had blundered. "People in the bid genuinely thought that they were working within the rules, but clearly mistakes have been made and Jacques Rogge's intervention has been enough for them to reconsider, which they have done. They have done the right thing." Rogge demanded that London, Paris, New York, Madrid and Moscow should not become embroiled in a 'bidding war' and told them to remember that the IOC was still recovering from 'a period of excesses, of red carpet treatment' and 'a corruption scandal in Salt Lake City'.

The London offers included a free full-fare return economy class air fare for all 10,500 athletes, free rail tickets in the UK and phone calls worth up to £60. Crucially, each country's national Olympic committee was offered £30,000 to site its pre-Games training camp in Britain. The spokesman for the London 2012 bid, Mike Lee, insisted the U-turn was not a serious setback. "We think this is a sensible decision. We don't think it will damage the bid at all. We understand President Rogge's desire to avoid a bidding war and that's why we have acted. Many people in the Olympic movement will appreciate that once the IOC president had spoken about the campaign of the candidate cities, it made sense to fully reflect on his remarks. That's exactly what we have done," added Lee.

London withdrew its offers rather than confront the ethics commission over every detail of its promises. It hopes this will minimise the IOC's annoyance. Privately bid leaders hoped they would boost the capital's chances of triumphing when the IOC's 117 members choose the 2012 host city in Singapore. But senior personnel from rival bids, and IOC members from those countries, quickly began questioning the offers. Gunilla Lindberg, a Swedish IOC member who is thought likely to vote for London, said the incentives 'have not helped' its chances. Rivals said the offers were 'sweeteners'. One adviser to Paris, the favourite, said London's tactics 'came close to being immoral'. (Source: Observer )