Olympic Games: A UK House of Commons watchdog yesterday pledged to keep the economic benefits of staging the London 2012 Olympics under close scrutiny - after an independent report warned that areas outside London could be about £2.8 billion worse off because of the Games.

The PricewaterhouseCoopers report concluded London could benefit by a £5.9 billion rise in gross domestic product from staging the Games, but warned unless action was taken the rest of the UK could suffer a severe economic drain.

John Whittingdale, the chairman of the Culture, Media and Sport select committee, said: "The challenge is to try to ensure the whole of the UK benefits from the Olympics . . . London is going to see a major benefit, there would be great concern if other parts of the UK failed to see any benefit and lost out as a result."