Four years before the millennium Olympic Games are due to start in Sydney, the Australian organising body has been shaken by a political upheaval designed to shift control of the Games from private enterprise to government.

Barely six months after his appointment as president of the Sydney Organising Committee for the Olympic Games, John Iliffe, one of Australia's leading businessmen, has resigned. His replacement at the head of the body charged with staging what is expected to be the biggest Olympics is Michael Knight, Minister for the Olympics in the New South Wales state Labour government.

The two men are worlds apart in their approaches to planning one of the most intricate international events Australia has hosted. Iliffe is chairman of Woolworths, a retailing giant in Australia, and holds senior positions with other companies. Knight is from the Labour Party's right wing.

The sudden unseating of Iliffe appears to have come about after Australian Olympic officials were dismayed by the logistical disasters involving transport, communications, security and training of volunteers at the Olympic Games in Atlanta last month. The Sydney Olympics will be held over a fortnight from September 15th to October 1st in 2000.

The Atlanta Olympics were the first, and possibly the last, Games to be funded and organised entirely by the private sector, with no involvement from city, state or national government. Iliffe is the second president of the Sydney organising committee since its inception three years ago to come from the business world; Australian officials believed earlier that only private enterprise had the expertise to stage a modern Olympic Games.

The fiasco at Atlanta over the poor security, the chaos in transport arrangements for competitors and media representatives and problems with the computerised system of reporting results have forced Australian officials to think again.

Knight's replacement of lliffe reflects a new philosophy that the 2000 Olympics will work only if there is the guiding hand of government at the top. In this, the Australians have been supported by the International Olympic Committee and its president, Juan Antonio Samaranch, who let it be known in Atlanta that the Olympics had become too big and unwieldy to be left to private enterprise.

Samaranch was reported as being unimpressed by lliffe during his brief tenure. Where did you get him from?" he is said to have asked Australian officials in Lausanne in March after lliffe had made a speech lasting nine seconds - his first as Sydney organising committee president.

It is too early to tell what the new approach will mean in practice. The New South Wales government already had a stake in the Olympics by undertaking to build infrastructure such as new sporting venues, roads and a railway line to the main Olympic venue at Homebush Bay. 14 km from the centre of Sydney, and to underwrite the cost of running the Games, if they lose money.

But the business world has reacted with alarm to Knight's takeover, because of what it sees as the deadening impact of too much power in government hands. And, after the sale of television rights, it is business sponsorship that will make or break the Sydney Olympics financially.