We regard this premature grant by Sport England—in advance of certainty on planning permission and other elements of the Wembley proposal—as a cavalier and egregious use of public funds (paragraph 11).

  Events have confirmed the previous Committee's commendations of the proposed athletics platform for a new national stadium at Wembley which the previous Secretary of State so abruptly rejected (paragraph 21).

  We conclude that the initial decision to remove athletics from Wembley was beyond the proper responsibilities of the then Secretary of State and was taken in a hurry on flimsy and subjective grounds (paragraph 23).

  The national stadium concept was developed precisely to solve the problem that an athletics-only stadium for the largest of events would be economically unsustainable. To abandon that solution precipitately and propose in its place an athletics-only stadium was therefore perverse. To abandon athletics at Wembley on the grounds of its possible unsuitability for an embryonic Olympic bid, and substitute efforts to build an athletics-only stadium which was, by design, not suitable as a main Olympic venue, can only be described as bizarre (paragraph 24).

  Given the position taken by the previous Committee on Picketts Lock, the present Committee agrees with the decision of the new Secretary of State not to proceed with the project (paragraph 46).

  We fail to see any justification for the shift in the Government's position on Picketts Lock, from confidence to alarm, between March and June 2000. The grounds for the Secretary of State's decision to abandon the project were all identified as serious challenges from the very start of the assessment process and were fully set out in the previous Committee's Report. Much effort was put into dealing with them by the Lee Valley project team. These difficulties were also the subject of consistent requests for clarity and action from Government from Lee Valley, Sport England and others until the project was dropped (paragraph 52).

  As far as we can see the shift in policy—on Picketts Lock—arose when a Secretary of State who was inexplicably wedded to the project was replaced by one who was not (paragraph 53).

  We believe that Sheffield has the potential to host an excellent championships based on the evidence from the City Council itself which sets out its track record. We trust that the IAAF will view the Government's offer seriously, taking into account the increased certainty and value for money inherent in the city's existing facilities (paragraph 54).

  We conclude that, in switching from Picketts Lock to Sheffield as the venue for the 2005 championships, the Government has traded one risk for another. With Picketts Lock the perceived risk was of an expensive and possibly problematic event. With Sheffield as the venue the risk is more straightforward—that IAAF policy on what it defines as world class cities could lose UK the championships (paragraph 59).

  We support the decision to offer the IAAF a venue for the 2005 Championships. However, in the light of our evidence, we would regard it as seriously unwise for any further expenditure from central funds to be made in advance of a careful and realistic assessment of Sheffield's chances of success in an open competition for the event (paragraph 60).

  We expect the Government, in its response to this Report, to set out in full its conclusions in respect of—proposals for a football and athletics stadium from the Genesis Consortium—a late arrival to the Wembley party (paragraph 66).

  We recommend that, if Sheffield is rejected by the IAAF and the UK loses the 2005 championships, then the Government should consider seriously whether there is a last opportunity to return to the original strategy of a national stadium at Wembley for football, rugby and major athletics events. Without this it seems clear that there will be no venue for athletics in London capable of staging the World Championships, or the Olympics, and therefore little prospect of attracting these events to the capital for the foreseeable future. We recognise that this would be a bold and controversial step involving significant consultation and negotiation with all relevant bodies which might well cut across the maturing work of Patrick Carter on behalf of Government. Nevertheless, we believe that the original Wembley concept was, and remains, a highly commendable plan; knocked off course by hasty decisions arising from a lack of co-ordination between long term Olympic ambitions and more immediate priorities (paragraph 67).

  We recommend that the Government, in replying to this Report, set out in full the direct, indirect and associated expenditures of public money arising out of the cancellation of Picketts Lock, including such items as the legacy investments referred to by UK Athletics and the compensation sought by Lee Valley and Enfield Council (paragraph 73).

  It now emerges that Sport England did not know of any reference to the relaxation of commercial constraints—in discussions between the Government and the FA—until copied in on correspondence by WNSL six months later in August 2000 (paragraph 80).

  Should the Wembley project go ahead with the potential to host athletics, there is at present no legal mechanism to implement Sport England's claim on the £20 million. What does exist is the 'big stick'—the clawback of the total grant (£120 million) if the project does not proceed or proceeds without fulfilling the conditions of the original Lottery Funding Agreement (paragraph 84).

  It is quite deplorable that the FA has shown no intention of returning public money to which it has no right. The FA has at least a moral obligation to return £20 million to Sport England (paragraph 85).

  We believe that the agreement struck between the former Secretary of State and the Football Association for the payment of an arbitrary £20 million to Sport England—which after nearly two years has yet to result in a signed legal document, let alone a single penny being paid over—represents a scandalously inept treatment of public money (paragraph 92).

  The Government had no business effectively to rewrite the terms of a Lottery Funding Agreement to which it was not a party. Equally Sport England had no business allowing this to happen and deserves censure for being so slack and negligent. We require that, in its reply to this Report, the Government makes clear the nature of its response to the demarche sent to the Permanent Secretary of the DCMS by the Chief Executive of Sport England on 13 December 1999 (paragraph 93).

  For some time it has been open to Sport England independently, on grounds of the delay to the project, to foreclose upon the Lottery Funding Agreement with Wembley National Stadium Limited and demand the return of the £120 million grant in full. Leaving aside the question of whether a subsequent application for a grant of £100 million could, or should, be entertained, we believe that the moment for Sport England to deploy that threat has long since passed (paragraph 94).

  In our view, a rushed and flawed decision to remove athletics from the Wembley project led to a rushed and superficial agreement purporting to be a partial refund of Wembley's Lottery grant—something specifically ruled out by the Funding Agreement. Presentation of this deal as a 'heads of agreement' to be fleshed out subsequently by WNSL and Sport England is a thin veil for a political stroke which failed to take account of legal and financial realities (paragraph 95).

  We conclude that these matters merit the attention of the Comptroller and Auditor General and the Chairman of the Committee of Public Accounts and we urge them to investigate the Wembley Lottery Funding Agreement, the handshake over the £20 million and the circumstances which have allowed the situation to arise and persist unresolved to this day (paragraph 96).

  If the fate of the full £120 million Lottery grant to Wembley National Stadium Limited is not clearly resolved, in favour of the public, by the long-awaited conclusion to the English National Stadium saga we intend to pursue matters with the FA, Sport England and the Secretary of State until a satisfactory outcome is reached (paragraph 97).

  We believe that the Government must decide, and state clearly, whether or not it wishes the UK to be a host for the larger sporting events: to secure home advantage for UK athletes; as a facet of its wider sports policy, including the encouragement of grassroots participation; and as an element of the way the UK is perceived internationally (paragraph 100).

  Mr Carter told us that the UK should "establish a major events group ... which establishes a process to make sure the right questions are asked at the right time, ie, early enough." We think that Mr Carter has the right approach but the wrong solution. We believe that the case for a dedicated Minister for Events, with the responsibilities and resources identified by the previous Committee, has grown yet more compelling. The same approach should be applied to all major events, sporting or otherwise. We recommend that the Prime Minister gives serious consideration to the conclusions of the previous Committee on this subject when he studies the outcome of the review of major events policy to be undertaken by the Performance and Innovation Unit (paragraph 106).