Giving evidence to the Culture, Media and Sport Committee in London she said that officials were working towards an 80 per cent probability that all the contingency fund will not have to be drawn upon.

 

The current budget of £9.325 billion, triple the original, was only set 10 months ago.

 

It includes a programme contingency of £2.747billion.

 

In November, Jonathan Stephens, permanent secretary at the Department for the Culture, Media and Sport told MPs on the Public Accounts Committee (PAC) it was a "safe assumption'' all the contingency would be spent.

 

PAC committee chairman Edward Leigh accused Stephens of either "sheer incompetence'' or "deceit'' in providing the original £2.4billion estimate for the Olympic budget during the bid.

 

And insidethegames revealed yesterday that the Olympic Delivery Authority has already started dipping into the contingency fund.

 

Jowell also told the Committee that it could take up to 10 years after the Olympics for the National Lottery to be repaid from the sale of land being used for the Games.

 

Sales from increased land values at the east London site, estimated at £1.8 billion, are vital to help repay the extra £675 million which will be diverted from the lottery good causes from 2009.

 

This is in addition to the £410million National Lottery funding already promised.

 

Jowell said:  "The decision about when the land is sold will be on the basis of selling the land in the most favourable circumstances.

 

"We would certainly expect that the LDA (London Development Agency) would start selling the land after 2012, but the period of selling the land may be up to 10 years.''

 

The first bill to be settled will be £650 million to the LDA for the money it spent buying the land at the Olympic site.

 

Sale proceeds will then be broken down into two phases, with profits split 75 per cent to 25 per cent initially between the lottery and LDA respectively as the total potential profits are currently unknown.

 

The second phase will see the LDA get a 75 per cent share and the lottery receiving 25 per cent.

 

In the first phase, the lottery gets £506 million and the LDA, which aims to regenerate London's East End, gets £125 million.

 

In the second payout, the lottery gets £169 million and the LDA gets £375 million.

 

Jowell said: "Everybody would want the lottery to get its money back as quickly as possible but these are decisions that have to be taken relative to the land values at the time.

 

"At this stage, what I would not be prepared to do is to predict with any certainty that the land sales will exceed the £1.8 billion we have predicted.''

 

The fixed time schedule of staging the Olympics means that organisers are battling a series of anticipated risks but there are also "unknown risks'' such as inflation and legislation change to potentially cope with, Jowell said.