Brazil slashes the budget for Rio Olympic Games by 10%

The economic recession in Brazil, which the government officially recognized in August, is affecting plans for the 2016 Olympic Games.

In order to avoid a deficit, there will be a 10-percent cut to the budget for the Olympic and Paralympic Games to be held in Rio de Janeiro next year.

These cuts, which come just 10 months before the event kicks off, will only affect private companies, most of them sponsors. There is no proposed plan to pull back investment in infrastructure or security.

Organizers have not shared the details of their budget and investments with the administration, citing the private nature of the resources

According to Organizing Committee Executive Director of Communications Mario Andrada, these cuts are also an attempt to prevent protests against waste like the ones that took place during the World Cup last year in several Brazilian cities – especially now, during these lean years.

The Rio Games have the support of most of the population, but a rise in unemployment and inflation, corruption and the devaluation of the real is worrying Brazilians. “People get annoyed with luxury and excess. We have to tighten our belts,” Andrada said.

The organization wants to reduce costs by 10 percent in order to avoid going over the €1.7 billion budget. It will trim superfluous spending like excessive printing of documents, and will also drop the number of volunteers from 70,000 to 60,000, thus saving on the cost of their food, uniforms and transportation.

The organizing team will also reduce the budget for the opening ceremony. Organizers are examining every department to find items where they can make adjustments, and they say they may cut the budget by as much as 30 percent in some areas. “The time for squandering is over. We have to organize an economically sustainable Games and be creative in the way we make these cuts,” Andrade told Reuters.

Balancing the books

The announcement came just as the federal government eliminated an article from a 2009 law that required the administration to cover any deficit that the 2016 Committee’s plan might incur.

A week before, President Dilma Rousseff had announced a raft of measures to cut spending by €6 billion in order to balance the budget. According to the Committee, the timing of this announcement is “a complete coincidence” and it will have no impact on how it organizes the Games. “It will affect nothing because the adjustment is actually aimed at ensuring that we close in the black,” an advisor said.

Brazil’s Court of Auditors and the Attorney’s Office have shown concern over the Committee’s budget and called for greater transparency. Organizers have not shared the details of their budget and investments with the administration, citing the private nature of the resources.

Translation by Dyane Jean François.