A commissioned report by consultants Arup and property surveyors Insignia Richard Ellis is due to be shown to Parliament next week, raising speculation over the ministerial reaction to a possible 2012 Olympic bid.

The 200-page report highlights the principle costs and expected returns from bidding for and hosting the Olympics in London. The identified site, in Stratford, east London, would receive investment that could total £600-£800m as part of a major regeneration programme.

Although the total cost is estimated to be around £1.8bn, the report suggests that revenues, through tourism and job creation, would substantially offset this cost, however, concerns remain that the Government would have to find a significant deficit.

The principle stumbling blocks would appear to be problems concerning infrastructure, with concerns existing over the viability of transport links. Crossrail, the proposed rail link which would be vital to an Olympic bid, is still pending approval from the deputy Prime Minister.

A decision is expected by the end of the year, to meet the IOC's May deadline for bid submission.