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The 2012 Olympic organisers are to use several hundred million pounds of the £2.7bn contingency fund due to a lack of private money, the BBC reports.

The credit crunch has caused a shortfall in private sector funding.

This use of the contingency will help with the construction of the village and media and broadcast centres.

When the 2012 funding plan was drawn up it was with the expectation there would be ample private money available but the government has now stepped in.

Some of the contingency set aside in the Olympic Budget has already been drawn down.

The Olympic Village, costing around £1bn, was to be funded by bank loans and equity from construction company Lend Lease and a large chunk of the £400m required for the Media and Broadcast Centre was also to be privately funded.

The government argues this is what the contingency is there for and that the Budget is robust. But it was understood the contingency fund was meant to cover cost overruns, essential in a project with a fixed timetable, not lack of private money.

With security plans yet to be finalised, much, if not all of the contingency, may be needed to cover costs.

(Source: BBC Sport)