The first loser of the 2002 Games

Despite a projected shortfall in revenues and the event's huge popularity, the Commonwealth Games represent another example of UK sport being left in the lurch. Lack of cohesive, centralised effort and, whatever the spin doctors may say, a distinct absence of governmental will when it comes to sport, means that the Games will be the last major sporting event to take place in this country for decades.

Initially, there were great hopes that revenue shortfalls would be met by sponsor and partnership income, but the projected sponsorship revenue of £62m took no account of the impending slump in corporate marketing budgets. The figure was reduced to £51m and depressed further last April to £42m. In the summer, this had fallen to £30m and with just over six months to go, the amount generated to date is estimated at £17.25m.

Meanwhile, costs escalate and although the Commonwealth Games Federation has said that no Games has ever made a profit, Manchester City Council is determined not to create a deficit that will need to be financed from council tax. How it plans to do this is something of a mystery given that it originally budgeted for expenditure of £35m and has ended up footing the bill (so far) to the tune of £80m.

It was believed that the funding crisis had been addressed last summer following a review into the Games' finances by Patrick Carter. A further £105m was committed via Sport England and the city council, while the Government felt that it should pay for more than the opening ceremony, the extent of its commitment at that stage.

At the time, there was still the question of operating expenses; organisers were confident that this could be met by the private sector. Instead, a shortfall of £13m remains.

Unlike the World Cup, where companies-have been queuing up to spend £20-30m to become an 'official FIFA sponsor' (there are currently 15 of them), the Commonwealth Games has had difficulty attracting more than £2m each from its principal sponsors.

Initial calculations were based on attracting between 10-12 companies who would want to officially sponsor the Games. To date seven companies, who have contributed an estimated £15.5m, have been found and a further seven 'official partners' have donated goods and services and a smaller quantity of cash estimated at £1.75m.

The shortfall in operating revenues affects the effective implementation of further, revenue-producing plans. Take merchandising: instead of nationwide flagship stores selling the Games' paraphernalia, last September one shop opened in Manchester's Arndale Centre selling official merchandise. Plans are afoot to open three more stores in Manchester and one at the airport.

The Manchester Games' budgetary arrangements remain something of a moveable feast. This is in stark contrast with the accounts made available by the State of Victoria, where Melbourne will host the 2006 Commonwealth Games; these show that to 30 June 2001, the State has so far incurred (Aus)$22.3m of preliminary expenditure.

However, it would appear that £286m has been allocated to the Commonwealth Games, nearly 60 per cent of which has been injected by Sport England, ie National Lottery, not Government funding. The council tax payers of Manchester inevitably face higher bills for some time.

There will be a Commonwealth Games legacy for Manchester - a short-lived influx of tourists, a regeneration of part of the city and the creation of some permanent jobs. But the ad hoc manner in which the Games has been financed leaves a lot to be desired.

On the world stage, we can soon add the Commonwealth Games to the 2005 World Athletics Championships, the 2006 World Cup bid and Wembley Stadium to the list of the Government's sporting achievements.