Russia trims World Cup budget by cutting hotels

Russia’s budget for the 2018 World Cup is being cut by 4 percent by scrapping luxury hotels that might otherwise lie empty after the tournament.

The move would help to reduce the total cost from 664 billion rubles ($12 billion) to 637.6 billion, Sports Minister Vitaly Mutko told Russian news agency Tass on Tuesday.

“We don’t want elite hotels built to FIFA’s highest requirements to end up out of demand after the World Cup,” he said, adding that Russia would be careful to keep to FIFA requirements requiring luxury hotels for teams and officials.

“Bearing in mind the minimum requirements of the organization (FIFA), we have worked with each region on programs for accommodating FIFA groups and we will optimize expenses.”

Mutko said 25 hotels would be cut from the organizers’ program across the 11 host cities.

As these hotels were to have been funded by regional government or by companies, Mutko said the savings will not reduce spending by the federal government on the tournament.

Russian state revenues have come under pressure in recent months from the low price of oil, a key revenue generator for the government.

While the World Cup budget is almost entirely immune from 10 percent across-the-board cuts to federal spending this year, Mutko has previously said there will be a reduction in expenditure on staging costs and ceremonies.