No more National Lottery money will be used to pay for the 2012 Olympics, the government pledged on Tuesday, as it defended the surrender of a further £1.1bn ($2.1bn) of lottery money to the games.

The transfer of the cash, backed on Tuesday night by MPs, will take the total Olympics funding from the lottery to about £2bn.

A Tory vote against the move was avoided only after James Purnell, culture secretary, promised there would be no more such transfers.

The games are set to cost an estimated £9.2bn – about triple the original estimates. The level of lottery funding for the event has prompted concerns of a drain on finances for arts groups.

Most of the cash is planned to be clawed back after the event through land sales worth an estimated £1.8bn – although the London Development Agency would receive at least £650m of this to compensate for acquisition costs. But property agents now estimate that the land could be worth far less if there were a prolonged housing slowdown.

The £1.8bn estimate – seen by the LDA as the upper end of possible figures – was based on an annual 16 per cent per increase in land values over the next two decades. Mark Dorman, director of development consultancy at Savills, called the prediction “total madness”.

“Good causes will be crippled because of hopelessly optimistic projections made by the government as to the value of land proceeds, which good causes are supposed to receive after 2012,” said Jeremy Hunt, shadow culture spokesman.

Ken Livingstone, London mayor, said a figure of £800m would be “the most pessimistic assumption”.