Dennis Hone is the first to admit he’s never tackled anything on such a, well, Olympic scale. But then again, who has? As the chief executive of the Olympic Delivery Authority (ODA), Hone must deliver one of the biggest construction projects in Europe on a highly contaminated site with a deadline that, for obvious reasons, allows for no slippage.
“This is the pinnacle,” he says, with some slightly nervous lip-licking. “As soon as we won the bid it was the project I wanted to work on. But when I came to the project I thought: ‘This is a high-risk project – if we’re not on budget in two years we’ll all be fired.’ And that was a fair assumption – it happened in both Australia and Athens.”
So who could blame Hone for being a tad dry of mouth? As we sit chatting in a café, we glance across the canal every now and then at the “as near as dammit finished” Olympic Park. The sheer scale of it would scare most people: this giant construction site spreads some 600 acres across a forgotten corner of east London. The dimensions are stunning. The press centre is the size of six football pitches, and required the use of the UK’s biggest forklift during the erection of its steel frame. The velodrome’s cable-net roof is made from 56,500 feet of cables – almost twice the height of Mount Everest. But Hone says the trick is all in the preparation – and that started with getting on the right side of the locals. That said, he bridles when I suggest a PR push must have been needed. “PR often gets confused with spin,” he insists, “and spin doesn’t win people’s hearts.”
The trick, says Hone, is community engagement. “People fear change and the disruption that comes with it,” he says. “They fear that the new people coming into the area will change its character. So working with local communities was imperative,” he adds, emphasising that money – not just warm words – is needed. “The ODA put a huge amount into working with local people,” says Hone. “We set up the Olympic Park Engagement Network so we could work with local community groups. We also set up a construction hotline, so anyone could ring up and complain about what’s happening or ask about any aspect of the site and we’d take the time – and spend the money – answering those questions.”
But fundamentally, the ODA knew it had a finite amount of time to spend on squaring the locals: this is a project with a deadline written in stone.
“Yes, people talk about the huge pressure the immovable deadline brings – and they’re right, it did.” Hone adds that the lesson the ODA learnt from other projects was to get moving super-fast at the start knowing that, if you delay, the finances are liable to suffer later.
“We had to move very quickly because we were determined not to have to do reworks at the end of the project,” says Hone. “We put a lot of effort in at the beginning to make sure we weren’t half-baked, so we didn’t have to change anything later on.”
Hone says he quickly realised that if he delivered the park and the venues a year ahead, he’d remove “all that mad panic at the end”, which is when, he says, “cost goes out the window and it’s just a scramble to get it finished”. And by achieving that he says he’s removed the threat of contractors holding Hone and his team to ransom at the end of the process.
“We could have been penny-wise and pound-foolish at the start, but we decided to stick to our schedule above all and save money in the long run,” says Hone. “And that’s how it turned out. Most of the money we saved wasn’t because we scrimped on the build. We are sticking to our guns and, most importantly, we don’t need to use a contingency plan, because all the awful things that could’ve happened haven’t. And that’s where the savings are.”
Which is why, of the total funds available to him – £8.1 billion, from taxpayers, the lottery and Greater London Authority funds – he’s bringing the project in at £7.2 billion. That saving of £900 million is pretty impressive.
And it’s that underspend that provides Hone’s central defence of the very lucrative packages he and his colleagues at the ODA were handed last year. His former boss, David Higgins, was on a package worth £544,000 a year. And Hone himself? A mere £400,000. He laboriously lists all the politicians his salary was rubber-stamped by – “right up to the top”. It’s clearly a subject that irritates this naturally jovial character. “If we hadn’t achieved our targets, I’d have been sacked, I can assure you,” he says. “Yes, these are large salaries. But if you want to get the right guys, it’s no good telling them they have to earn less than the Prime Minister.” (I didn’t – but plenty of other journalists have.) Hone waxes on, struggling “not to say something trite”, but I feel he clearly wants to say something along the lines of “if you pay peanuts, you get monkeys”.
“Most of the people who come here have worked on major projects before,” he says. “They’re not virgins working on the park… they’ve worked on the Channel Tunnel Rail Link, they’ve worked on Terminal 5 at Heathrow, the Australian Olympics, you name it.”
“Robust and sensible”
It’s true that if they do deliver this project ahead of time, under budget, to critical acclaim and with a clean health and safety bill, they’re clearly no monkeys.
But Hone admits that one of the reasons they’re coming in under budget is the global recession – also one of their largest headaches.
“One of the biggest problems we faced was getting the village off the ground financially,” he says. “We wanted to bring it forward as a predominantly private sector development. And then we hit the global financial crisis in 2008 and suddenly had an issue of how to fund it at all.”
Over the course of this project they’ve undertaken £6 billion of procurement, with a construction market that has gone from boom to bust. When the Olympic project began, building costs were spiralling. As the sector overheated, only one consortium put in a “robust and sensible bid”, says Hone, for the main 80,000-seater stadium infrastructure in Stratford (the bidder was Sir Robert McAlpine, with designs from Populous, which had just finished Arsenal ’s Emirates Stadium).
But then, as the market cooled, more companies decided to take the plunge, partly driven through economic realities, but also, Hone says, because the sector started to realise the Olympics project was going to be a success, and was therefore something with which they would want to be associated.
“And we got an influx from there on in,” he says. “And we got more efficiencies down the supply chain, as people wanted to come in – and work was scarce.” While he, not surprisingly, doesn’t want to “give all the credit to the financial crisis because it presented problems too”, he does acknowledge it helped. Quite a lot.
But not everything has gone to plan. The stadium was meant to be sold – almost certainly to West Ham United. But that deal has now collapsed, running the risk of turning the Olympics’ crowning glory into a white elephant.
“It’s a bit of a setback,” admits Hone. “But if you had a dash to get people in, it wouldn’t be helpful. The stadium will be in use for 60 to 100 years, so a couple of months delay doesn’t make a great deal of difference.
“We put a lot of effort into making sure the stadium was versatile and they could get tenants in. I recognise that trying to negotiate with a likely tenant five years before the Games is hard. What private company would sign up to something they couldn’t take occupation of for six years?”
But Hone insists he’d still like to see West Ham take up residency – even if only on a rental agreement. And that’s despite being a season-ticket holder at Tottenham Hotspur Football Club, who challenged West Ham’s bid to move into the Olympic Stadium. But this Spurs fan has his eyes on another stadium entirely. “I would love to see Tottenham rebuild their ground at White Hart Lane,” he adds. Perhaps that’ll be his next project, when he finds himself out of a job next year?
Key dates in Dennis Hone’s career
Financial controller, London Docklands Development Corporation
Deputy chief executive and director of finance, Commission for the New Towns
Chief operating officer, English Partnerships
Director of finance, Olympic Delivery Authority (ODA)
Chief executive, ODA
About the author
Born Daisy Sampson in London in 1972, Daisy edited politics journal the House Magazine from 1995 to 1997 before becoming press secretary to the then-Liberal Democrat leader, Charles Kennedy, in 1999, following a two-year spell as a freelance journalist. She moved to Channel 4 in 2001 before co-presenting The Daily Politics and Yesterday in Parliament on the BBC.
In 2005, she was poached by ITN as chief political correspondent before becoming its economics editor in 2008. In the summer of 2011, she took on a new role as special correspondent for ITV News at Ten – and joined Professional Manager as headline interviewer.