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Acting auditor general Arn van Iersel estimates the provincial government's bill for the 2010 Olympics will be $1.5 billion. ((CBC))

The B.C. government's bill for hosting the 2010 Winter Olympics willprobably tally $1.5 billion, far more thanthe budgeted $600 million, the provincial auditor general warns.

Arn van Iersel, who is acting auditor general, released a report on Thursday that cites a long list of potential problems with the province's estimated costs for the Games in Vancouver.

The cabinet minister responsible for the Olympics, Colin Hansen, said as late as Wednesday that he was confident the province could stay within its budget of $600 million in direct costs.

But the auditor general pegs the provincial government's contribution at about $1.5 billion.

Total cost to Canadians: $2.5B

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Economic Development Minister Colin Hansen says a new agreement with VANOC will mean greater accountability. ((CBC))

Van Iersel also notes that nearly $400 million more would come from local governments and another $600 million from Ottawa — bringing the total cost to taxpayers to $2.5 billion.

However, the auditor generalincludes the $600-million cost of upgrading the Sea to Sky Highway from Vancouver to Whistler, something the government says it does not consider an Olympic cost.

He also counts a host of other indirect costs such as security andthe cost of running the Olympic secretariat.

Likely more costs, van Iersel warns

The auditor general makes it clear he thinks there are still more costs that haven't been taken into account.

And he says he does not think the province has given taxpayers all the information they need.

"The funding envelope presented by the province provides only a partial picture of the total Games-related costs for the province and does not reflect its total financial undertaking related to the Games," he says in the report.

He goes on to write: "Of particular concern is that the province has not yet established a definition of what constitutes an Olympic cost."

More accountability promised by minister

Two hours after the release of the report, Economic Development Minister Colin Hansen held a news conference to announce that the government has signed a "performance and accountability agreement" with the Vancouver Olympic Organizing Committee (VANOC).

Hansen saidthat the agreementaddresses management and oversight issues raised in the report.

"The auditor general's report reiterates the importance of strong oversight in the management of the province's interest in the Games, " the minister told reporters.

"And the province agrees with, and is meeting that requirement, and is in fact implementing further actions to provide even more effective management in the interests of British Columbians."

Premier 'misleading' public, NDP says

The provincial NDPcritic for the Olympics, Harry Bains, said the report shows that Premier Gordon Campbell "has been misleading the public over the past two or three years" in terms of the real costs.

Bains also said the VANOC overestimated revenues by $150 million because it didn't anticipate changes in foreign exchange rates, and did nothing to protect itself.

"It brings out [the] incompetency and mismanagement of this government," he said.