The coalition government is considering shutting down the Department for Culture, Media and Sport (DCMS), according to Labour party deputy leader Harriet Harman.

Writing in the London Evening Standard, Harman said that "there are well-sourced rumours in Westminster" suggesting the government considers the DCMS to be surplus to requirements after the 2012 Games.

Harman's claims come on the same day as an influential conservative think tank said scrapping the DCMS would produce 'huge savings' for the government.

The Institute of Economic Affairs (IEA) claims that closing down the DCMS could save around £1.6bn - if all spending ceased.

The free market group also suggests that the savings would give the government scope to cut taxes elsewhere - such as reducing corporate tax and inheritance tax.