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Reports this weekend claimed that the Treasury had taken control over the procurement of the Olympics construction work. An article in yesterday's Observer said this had led to questions from MPs as to whether chancellor Gordon Brown had met with any of the firms bidding for the programme management role, including well connected US group Bechtel. Liberal Democrat MP Don Foster has already tabled a question to the Commons about the issue.

Foster told the Observer: "There is now clear evidence that the Treasury is going to be involved in the decision over who is main contractor for the 2012 Olympics. In the light of John Prescott's dealing with Philip Anschutz, it is even more vital that the Treasury admits whether it has met with any companies or representatices of those vying to become the 2012 delivery partner."

The concern came as another report in today's Independent claimed the cost of the Olympic stadium would rise from £250m to at least £280m due to higher than expected construction inflation. Contractor Sir Robert McAlpine is favourite to win the job due to its successful completion of Arsenal's new 60,000 seat Emirates stadium.