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The scheme in Hendon, north-west London, would have been a training facility and a control room during any major incident such as a terrorist attack. It was put on hold after the Met lost about 拢30m in last year鈥檚 collapse of Iceland鈥檚 banking system, and was finally cancelled this week.

The Met said that instead of building a new centre it would upgrade existing facilities. A spokesperson said: 鈥淚t decided to deliver the facility through different means at alternative locations.鈥�

A consultant close to the scheme said: 鈥淲e were told in November that it had been shelved. Now they鈥檝e said it definitely isn鈥檛 happening.鈥�

Another said: 鈥淭he Met told us the scheme equated to their losses in Iceland. It鈥檚 over.鈥�

The project had reached contractor bidding stage when it was shelved. Wates and Mace are understood to have been shortlisted. EC Harris was providing design team services.

The Met told us the scheme equated to their losses in Iceland. It鈥檚 over

Project source

The proposal was originally part of a wider scheme to develop a purpose-built security control centre for the 2012 Games.

A spokesperson for the Met said that a decision had been taken in June 2008 not to build a security centre for the Olympics. Instead, he said the 鈥渙peration will be run from existing command and control facilities鈥�.

However newspaper reports in September said police were still demanding a new command centre for the Olympics.

Last month the government said it had approved a 2012 security strategy and promised to stay within its 拢600m budget, but did not make any details public.