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Deep cuts in funding for top British athletes are likely to be delayed until the London 2012 Olympics are over to avoid damaging the country's hopes of a rich medal haul.
In the longer term leading athletes will increasingly be forced to look to private sponsorship as the British government cuts spending to rein in a record peacetime budget deficit.
Community and grassroots sports could fall victim to earlier cuts, undermining the goal of encouraging millions of Britons to participate in sport.
“Because 2012 is not far away there may be no drastic cuts on elite sports, or the ones that have a chance of success,” said Emmanuel Hembert at management consultants ATKearney.
“It is after that there is potentially a big drop.”
Britain's Conservative-Liberal Democrat coalition plans cuts of at least 25% across most government departments.
It has warned the Olympics will not be exempt and has already imposed cuts of 27 mln pounds on the 9.3 bln pounds ($14.6 bln) Games budget.
Funding for elite sport has been reduced by three percent but deeper cuts two years before the Games could jeopardise a potential top-four place in the medals table.
Details of spending cuts will be announced in October, though the government has already said sports bodies will be merged to save money.
It seems likely the record 550 mln pounds awarded to elite sports in 2006 will be protected because Britain's performance in major championships has improved dramatically thanks to increased government and National Lottery funding.
In the 2000 Sydney Olympics Britain finished 10th in the table after winning 28 medals on the back of 59 mln pounds of funding.
The team then soared to fourth in the table, notching 47 medals, in Beijing two years ago after 235 mln pounds was invested.
FUNDING SQUEEZE
Grassroots sport will have to withstand most of the government cuts, resulting in fewer new leisure centres or renovations.
Local authority funding is also set to be squeezed, and with it, the 1.5 bln pounds councils spend on sport.
Sport England, which works with national governing bodies and other partners to build community sport, has had its government contribution more than trebled to 135 mln pounds since 1997, a sum matched by the lottery.
However such growth is unlikely to last and it has already had to make around four million pounds of cuts this year.
The new government has also put an end to free swimming for under-16s and over-60s as part of a total saving of 40 mln pounds, putting in danger the previous government's target of getting an extra million people involved in sport by 2013.
Elite athletes will eventually be affected by cuts and the individuals set to be worst hit will be those that underperform under UK Sport's “no compromise” policy.
Shooters, fencers and weightlifters are among those who have already had part of their government and lottery funding diverted to sports with a more realistic chance of success, such as swimming, sailing, rowing and cycling.
Sports such as volleyball and handball, with few medal prospects, have struggled to secure funds for 2012.
Britain's women's indoor volleyball team had to embark on a sponsored bike ride to help raise some of the 250,000 pounds they need.
“Cuts are probably inevitable,” said coach Audrey Cooper. “All we can do is perform on the volleyball court and try and raise some money in a different way and not rely on the money coming from the government.”
Hembert said athletes would increasingly have to rely on sponsorship and private funding.
“To attract sponsors you need success and some values that sponsors can relate to,” he said.
There are willing partners. British Gas works with swimming, Sky with cycling, Aviva with athletics and Skandia with sailing.
There are warning signs that it may not be easy though. When UK Sport suffered a 50 million pounds shortfall in 2006 an appeal was made for private funding but only Visa immediately came forward with 10 mln pounds.
