BHA denies profiteering allegations ahead of London 2012 Olympics

The British Hospitality Association (BHA) has strongly refuted claims hotels in London were profiteering from the London 2012 Olympics.

BHA representatives met with the London Organising Committee (LOCOG) earlier to illustrate the support hotels were giving to the games, following allegations in the Financial Times suggesting prices were being raised.

Speaking on behalf of the UK’s major hotel chains, Ufi Ibrahim, BHA’s chief executive, said that the industry had played – and continues to play – its full part in making the 2012 Olympic Games a success.

“Recent press comment concerning the prices that agents appointed by LOCOG – in particular Thomas Cook – are charging for Olympic ticket and hotel packages has suggested that London hotels are profiteering.

“This is certainly not the case.  London hoteliers have no control over the prices that agents are charging,” she said.

Paul Deighton, chief executive of LOCOG, said that those London hoteliers who had been part of the agreement with LOCOG had fully conformed to its fair pricing agreement, offering room allocation to LOCOG at below market rates for the Olympic Games.

“This was a core factor in the success of the London 2012 bid,” he said.

At the meeting, it was agreed that LOCOG, Thomas Cook and the BHA would meet to discuss the structure and pricing of the Thomas Cook ticket/hotel packages currently on the market so that they were fully understood. 

Ms Ibrahim said that London’s major hospitality companies had signed agreements to provide a total of 56,000 rooms to LOCOG.

“These agreements stipulate that all participating hotels will charge room rates calculated on an agreed formula, which restricts hotel operators from increasing prices beyond CPI increases and ensures fair pricing,” she added.

“That rate broadly represents the average of a hotel’s room rates between 2007 and 2010.

“Without exception, the prices charged by the hotels that are part of the LOCOG agreement are at a rate which is fair and reasonable. There is no question that hotels are profiteering – indeed the opposite. 

“London hotels have agreed to let these rooms at below the current market rate in order to support the Games. 

“Accusations that they are profiteering are totally unfounded.”