Can’t reduce costs by getting mad at them

So there was a small brouhaha about the Pan Am Games yesterday. Kelly Grant:

Toronto won’t pay any more “surprise” costs for the Pan Am Games, Mayor Rob Ford warned after the city’s bill doubled because “we had a gun put to our head.”

Toronto’s contribution to the 2015 sporting extravaganza is now estimated at $96.5-million – up from $49.5-million in February, 2009 – and construction hasn’t even started.

via As Pan Am costs double, Ford says no more surprises – The Globe and Mail.

On the surface, sure, these kinds of cost increases suck. But looking deeper, these growing budget lines are the result of a few perfectly reasonable setbacks (soil contamination, necessary venue upgrades) and one questionable budgeting practice (not accounting for inflation). The latter is a case where management practices could improve. The former, on the other hand, is more a ‘shit happens’ kind of deal.

It’s not a desirable situation but it’s not an uncommon one either. The ‘gun-to-your-head’ scenario occurs frequently when you’re managing something as large and complex as a city. It’s about time for Ford and his supporters to realize — far too late, granted — that you can’t just reduce costs by getting mad at them.

Afterthought: A lot of people — on the left and the right — will say that hosting the Pan Am games is a mistake. That it’s a costly exercise that diverts money from what’s really important. And I can be sympathetic to that, but ultimately I believe these games to be a good thing because the investments we’re getting from the provincial and federal government would never happen otherwise. In addition, the smaller scale of the Pan Ams means that the money spent is more geared toward infrastructure, venues and housing as opposed to the security and glitzy glamour you get with an Olympics.


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