The true cost of Olympic success

Britain outdid itself at the Olympics in Brazil thanks to the generous funding on offer. But was it really worth it, asks James Ferguson.


Jason Kenny and Laura Trott scooped up the golds for Britain

The satirical poet Juvenal decried Julius Caesar for distracting the populace from political involvement by appealing to their baser, immediate concerns: cheap food and state-sponsored entertainment ("bread and circuses"). The UK government already pays out nearly £200bn a year in pensions for the "grey vote" and in-work benefits to "hard-working families". That's the bread.The Olympics typifies the "circuses".

Team GB won 65 medals in London in 2012 and the funding was increased further for 2016. The results speak for themselves. Team GB came second in the world in the Rio medal table, taking 9% of the medals despite only having 0.8% of the world's population. We won 67 medals, one for each million people in the UK. The US came top with 121 medals, roughly one for each 3 million people. China was third with a medal for each 20 million or so of its population. Undoubtedly our athletes did an amazing job, but why did quite so many of them do quite such an amazing job?

When I was a child, the Olympics was entirely amateur, except for the Soviet Bloc countries whose state-sponsorship of athletes and their coaches led them to dominate gymnastics, weightlifting, wrestling, track and field, and many other sports. These were effectively professionals and as such had an unfair advantage over part-time athletes from other countries who also had to hold down a job in the real world.

Subscribe to MoneyWeek

Subscribe to MoneyWeek today and get your first six magazine issues absolutely FREE

Get 6 issues free

Sign up to Money Morning

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Don't miss the latest investment and personal finances news, market analysis, plus money-saving tips with our free twice-daily newsletter

Sign up

Britain took 366 athletes to Rio (a third of whom made the podium) as well as more than 100 staff members from the English Institute of Sport alone (the EIS is part of UK Sport, a state-funded agency). Those staff put in an average of 40-45 hours a week each over the last four years, according to EIS's national director, Nigel Walker. In other words, both training staff and athletes have worked full time to achieve their success. That's great, but it did give them a distinct advantage over athletes from other countries who could only train before and after work. More to the point, how did Team GB afford it?

Well, a cynic might say we didn't so much win 67 medals as buy them with taxpayers' money. Developed countries with similar populations to ours and strong support networks, such as Germany and France, both won 42 medals; cash-strapped Italy only won 28. So let's say that our taxpayers' money accounts for 39 of the medals won.

What did these medals cost us? The athletes onlyget £15,000 a year unless they're serious medal contenders, in which case their pay rises to £21,500; proven medal winners are on £28,000. The four-year support payments from UK taxpayers totalled £543m, which, divided by the 1,300 athletes who receive funding support, works out at £104,400 a year, each.

On top of paying athletes a living wage, we also provide their equipment, facilities, training, diet, transport and a host of other costs and sponsorships. If we assume we won 39 medals more than Italy because we spent up to £543m more, then each medal cost the taxpayer £14m. If we'd otherwise have won 42, like Germany or France, then each medal cost us more like £22m; the true figure probably lies somewhere between the two.

And what do we get for employing all these hard-working but wholly unproductive UK ambassadors? Sport participation rates have hardly risen at all since London 2012, so it's not that we are sportier or healthier than our peers only that we're better at tilting the odds in our favour by pushing our athletes for gold. Like some latter-day Eastern bloc country, and as part of a state-sponsored "bread and circuses" opiate, our self-congratulatory Olympic success makes perfect, if rather depressing, sense.

The price of gold


Team GB received £274,465,541 in funding ahead of this summer's Olympic Games in Rio de Janeiro, according to Sport UK. That works out at an average £868,562 per athlete, with a greater portion of the pot going to sports most likely to yield medals. Britain's proud rowing tradition earned it the most cash at £32.6m, and five medals.

Yet, gymnastics bagged more than twice the number of medals for half the money. Max Whitlock, a 23-year-old pommel-horse specialist, bagged two golds the first Briton to win an Olympics gymnastics title, notes The Economist. "Well-targeted investment, it seems, pays off."

James Ferguson qualified with an MA (Hons) in economics from Edinburgh University in 1985. For the last 21 years he has had a high-powered career in institutional stock broking, specialising in equities, working for Nomura, Robert Fleming, SBC Warburg, Dresdner Kleinwort Wasserstein and Mitsubishi Securities.