Coe, chairman of the organising committee LOCOG, said strict cost management was fundamental to successfully bringing the massive sports event to the UK.

 

He said organisers were working with the Government to make sure issues over budgeting and funding were resolved in 2007.

 

Coe was speaking after fears were raised that the full cost of staging the Games remains unclear and could increase further. Culture Secretary Tessa Jowell admitted the cost of building the Olympic Park has increased by £900 million to £3.3 billion.

 

Government officials were also forced to admit they had not budgeted for VAT to be added on to the construction costs.

 

London Mayor Ken Livingstone has reassured Londoners, who are already footing some of the bill, that they will face no extra costs. The average London household is expected to pay £20 a year for up to 12 years - 38p a week.

 

"Rigorous cost management is a fundamental pillar of this project and we are working with Government to ensure issues of budgets and funding are resolved early in the New Year - and we are confident they will be," Coe said.

 

"We must not lose sight of the wider benefits of this project. It is not simply about cost. It is also about value and ambition.

 

"Our vision for the Games has never just been a summer of great sport in 2012. It has always been much broader than that.

 

"We must not forget the ambition we have to use the Games to help regenerate east London, the opportunity they will present in terms of jobs and skills, and the chance they will give us to promote sport for all, especially among young people."

 

Coe made his pledge in a New Year message released jointly with Sir Roy McNulty, the chairman of the Olympic Delivery Authority.

 

"We are delighted about where we are in the development of the project against our 2-4-1 programme and proud of the work our teams have done to ensure we have met of our 2006 milestones," they said. 

 

"We are in great shape for the New Year."

 

Coe and McNulty outlined other targets for next year.

"In 2007, the project will change gear and begin to come to life for people all over the UK," they said. "Our commercial programme will move up a gear, as we appoint our first domestic partners. 

 

"We will launch the new brand that will tell the world about the kind of Games we will hold in 2012 and we will develop our plans for the Cultural Olympiad and London 2012’s presentation at the Closing Ceremony for the Beijing 2008 Games.

 

"We will also start to clear the Olympic Park site, clean up the land and put in the utilities, and develop more detailed venue designs in partnership with international sports federations, legacy partners and host boroughs. 

"This project is all about good planning.  By planning Games and legacy together now we are making sure that we only build permanent venues if there is a long term legacy use. We can also make the most of the regeneration opportunity winning the Games has given us.