A major business group, BusinessLDN, recommends that the UK Government grant Sadiq Khan new fundraising powers to facilitate the funding of critical London transportation projects, such as the Bakerloo line extension. The report emphasizes that past transport upgrades have demonstrated potential for increasing property values, suggesting that the mayor should be allowed to borrow against these future economic benefits. This approach, known as tax increment financing, could yield over £4.5 billion for projects, supporting London's economic growth and productivity amid public finance challenges.
"The Government needs to consider innovative approaches to get shovels in the ground. Letting local government borrow against the future tax revenues that investment will generate, to fund that investment in transport is critical."
"Transport improvements, like the Elizabeth line, have significantly elevated property values in London, and the resulting economic benefits could help fund new projects through local tax revenues."
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