C&W's response to the Government's TIFs announcement today
9 Dec, 2009, London
Cushman & Wakefield's response to the Government's announcement today on TIFs in the pre-budget report:
Alistair Parker, regeneration & development partner, Cushman & Wakefield: "Today's single sentence in the Chancellor's Pre Budget Report noting that Government would think a bit more about tax increment financing was disappointing in the light of the expectations raised by Minister John Healey's letter back in May inviting all local authorities to put forward possible TiF pilot schemes to unlock stalled regeneration.
"Indeed today's vague announcement might be contrasted with this Government's detailed TiF thinking set out in their Green Paper ' Modernising Local Government Finance' (September 2000) and the subsequent November 2000 PBR which confirmed intention to consult on "tax increment financing, to allow local authorities to retain and invest some of the additional local tax revenue resulting from successful regeneration". After nine years of consideration and consultation, one wonders what aspects of TiF the Treasury has yet to explore.
"What is also particularly disappointing is the Treasury's apparent failure to understand the 'pay as you go' TiF variant which uses private capital to fund infrastructure without any reliance on public revenue guarentees. Even more importantly, it's a variant that doesn't require the new 'primary legislation' that would be needed for TiF formats that would essentially rely on the public purse. Given that TiF rests on the mantra 'no new tax, no lost tax', it seems an immediate and obvious solution in the present fiscal climate to the urgent urban regeneration problem facing our towns and cities. After a decade of thought, isn't time the Government did something that would make the difference on the required scale?"
Link to a C&W report which summaries TIFs, how they would work and how they have worked in the US: HERE or http://bit.ly/4G7E0w