Birmingham is set to be the first UK city to introduce a hotel tax to help pay for the 2022 Commonwealth Games.

The charges are common in Spain, Italy and other tourist hotspots – but have never previously been tried in Britain.

Birmingham has been confirmed as the 2022 host city.

The Government gave the green light to the tax to secure the Games for Britain.

Under the tax visitors to Birmingham hotels will pay a fee, say £1 per person per night, which will then be collected to help meet the costs.

The hotel tax was crucial in guaranteeing that Birmingham could afford its share of the estimated £750 million cost.

Anita Bhalla, Cllr Ian Ward, Heather Paton, Laura Samuel, Zena Wooldridge and Jake Porter,

Until then Commonwealth Games organisers had been nervous about approving the bid as the previous host, Durban in South Africa, had to be removed over financial concerns.

How do the finances stack up?

The funding is very much under wraps at this stage. The situation has been rapidly changing as negotiations continued between the Birmingham bid, the Government and the Commonwealth Games Federation.

But the Government has pledged full transparency in due course.

What we do know is that the Government is paying 75 per cent of the cost - that is about £560 million which will be invested in Birmingham and the West Midlands.

The rest - about £180 million has to be raised locally.

The City Council's contribution

Many ask how can a cash strapped council, struggling with cuts afford this. Quite simply it can't.

But although the City Council is leading the bid, it is much, much wider than that involving a coalition of organisations and businesses.

The council has consistently said it will not be diverting money from its revenue budget, which funds day-to-day services, on hosting the Games.

An event like the Commonwealth Games is a one-off expense anyway, whereas the costs of services like bin collections, social care and libraries are ongong.

We understand the council is making a contribution from its capital budget for these one off expenses.

In return it will get an upgraded Alexander Stadium and sports centres, transport and thousands of houses - as well as contracts, training and job opportunities for thousands of businesses and residents.

It is a Birmingham bid

It is not just the city council - a consortium is involved in funding and supporting the Games.

These include:

  • the West Midlands Mayor Andy Street, who has been negotiating behind the scenes
  • West Midlands councils, including Sandwell which is building a swimming pool
  • The Local Enterprise Partnership business groups covering the West Midlands
  • The University of Birmingham - which will host squash and hockey
  • The NEC Group - whose arenas and exhibition spaces are crucial venues
  • Aston Villa FC and Warwickshire County Cricket club

The return

The Games is estimated to return £1.1 biillion to the UK economy - with half invested here in the West Midlands.

It will support an average 4,526 jobs until 2022.