ALLOCATING TICKETS

The Costs and Benefits of Means of Allocating Tickets for the 2012



The Costs and Benefits of Means of Allocating Tickets for the 2012

Introduction

This discussion will assess the relative costs and benefits of using each of ticketing methods as a means of allocating tickets for the 2012 Olympics. focus on the impact of each of these different schemes on economic efficiency. The ticketing methods that this discussion will cover are lottery, first-come-first-served, an administrative process and the price mechanism.

However the proposal for an 'Olympic FriendShip' that was to be launched at the Beijing Games in 2008 and sail around the world before arriving in London in 2012 was cancelled. This 'journey of discovery' project was queried by the ODA due to the cost and associated risks, including negative PR. This is an early example of the Olympic bid promises and visions being downgraded as budget and operational realities take over.

Costs and benefit assessment

Lottery

The issues of capital and running cost overruns are the main concern in this development phase, as well as planning for exceptional security and terrorism risks. Like the Millennium Dome, the Olympics are also reliant upon National Lottery ticket sales - £2.175 billion, up from £1.5 billion in the original budget, via a special Olympic lottery, and £300 million in ticket revenue (9.6 million tickets will be for available), with 75 per cent of all Olympic Game tickets costing £48, but 25 per cent priced above this level (Alden, 2006, 22). The diversion of National Lottery funds to the Olympics is controversial in terms of the negative impact on existing 'good causes' that were the established beneficiaries of the UK state lottery (i.e. the arts, heritage, sports, community/charity and education science & technology), but also predictable as a 'soft' source of off-balance sheet funding for the government (technically not 'public' funding or spending).

The Lottery had been established by the previous Conservative government in 1995 to provide funding for good causes which were 'additional' to government's own spending on public services and provision (Evans, 1996, 12). It was not designed to meet either a shortfall in public sector spending projects or programmes, or be directed by government, but to respond to applicants based on need (Sloman and Wride, 2009, 25). Lottery funded projects are also required to meet a (public) accessibility test. It is doubtful however if either additionality or public benefit tests will be adhered to in the Lottery contributions to the Olympic development costs, or whether any of the contribution will be repaid from subsequent post-event asset sales, given the Millennium 'experience' and recession. The British public, of course, has choice whether to buy lottery tickets or to attend the Olympics. By contrast, London rate payers have no choice.

First-come, first-served

First-come, first-served (FCFS) - sometimes first-in, first-served and first-come, first choice - is a service policy whereby the requests of customers or clients are attended to in the order that they arrived, without other biases or preferences. The policy can be employed when processing sales orders, in determining ...