Britain still considering 2012 Olympics bid

Culture, Media and Sport Secretary Tessa Jowell said there is a case for bringing the Games to London but the government is wary of cost overruns in recent Olympics and wanted to ensure it would help regenerate run-down parts of the capital.

"There is a very clear sporting case for the Olympics coming to London but that is not the end of the story and that is why we are looking at the regeneration impact of the Olympics in the east London area," she told BBC Radio.

The International Olympic Committee will choose the venue for the 2012 Olympics in 2005. New York, Moscow, a German city, and a Spanish city -- probably Madrid -- are almost certain to bid. Paris is also expected to make a pitch.

Jowell and her sports minister, Richard Caborn, will give their thoughts to Prime Minister Tony Blair's Cabinet by the end of January, when a decision will be taken.

A report undertaken on behalf of the government, London Mayor Ken Livingstone and national Olympic

But that would be the tip of an iceberg.

"I am right to be cautious," Jowell said. "We estimate that around two billion pounds ($3.2 billion) of public subsidy would be required...if we were to win."

The government would only go ahead if it could nail down the costs, she said. "We are not going to find...a dead anchor around the neck of government because we failed at the outset to make a proper estimate of costs.

"We will go into this, if we do, and we will decide at the end of January with our eyes wide open and understanding exactly what the cost to the public purse will be," Jowell said.

The Observer newspaper reported on Sunday that ministers have privately shelved the idea of bidding.

Blair's office denied the story but the paper quoted an analysis that concluded Paris would be favourite to win because it has a state-of-the-art stadium, good transport links and successfully hosted the 1998 soccer World Cup.