Post on 28-Mar-2015
Barnet Financing Plan: an alternative approach to funding
infrastructure
Hester FairgrievePolicy and Partnership Manager,
London Borough of Barnet
Presentation Contents
The Wider ContextThe Local Context Building the SolutionDelivering the SolutionNext Steps
The Wider Context
UK Policy developments:
Lyons Review Housing Green Paper Sub-National Review of Economic
Development and Regeneration Successful City Suburbs Project
The Local Context 63,000 people and 40,000 new H/hs over 20 yrs 11% increase in local economy Additional population will increase local resident’s
output by £1.25 billion per annum Cricklewood, Brent Cross and West Hendon -
7,500 new homes, new commercial district, 22,000 jobs over next 20 yrs
4 large regen schemes: 3000 homes get replaced by 8000. Largely private sector funded - £1.5bn investment
The Issue
Very little funding available to Barnet for infrastructure investment
Barnet as a strong and attractive place to live and invest could be undermined:
Transport system will be put under strain Healthcare system and schools will not be able to
cope with extra demand Environment will suffer from unsustainable
physical development
Our proposed solution “Barnet Bond”
The Barnet Financing Plan: using a combination of locally generated revenue sources to
raise (and repay) finance directly from either public or
private sources
Key Infrastructure Requirements
Local Revenue Flows
Revenue element Hypothecation approach
1. Stamp duty – Borough wide Based on projected values/completions. 1% band retained
2. Business rates – Borough wide 3p of existing Borough wide take based upon rateable value
3. Business rates – Brent Cross Ring fence 100% of the incremental business rates that could be generated from the major proposed expansion
4. Brent Cross lease renegotiation Ring fencing of increased and lease receipts
5. Brent Cross car parking levy £1 per visit levy on visitors parking at Brent Cross
6. Council tax recovery 1% of Council tax ring fenced
Indicative finance capacity
Revenue element Projected annual income (£m)
Up front finance capacityPrudential Borrowing (£m)
Up front finance capacity Project finance pricing (£m)
1. Stamp duty – Borough wide 5 62 28
2. Business rates – Borough wide
6 72 32
3. Business rates – Brent Cross
9 104 46
4. Brent Cross renegotiation 3 36 16
5. Brent Cross – car parking levy
6 71 32
6. Council tax recovery 2 17 8
31 362 162
Delivery Structure
Infrastructure Plan
Investmentprofile
Funding Profile
Local Growth Fund
Prudential Finance Project Finance
Infrastructure Output
Recycling of Investment
Revenue Flows
London Boroughof Barnet
LGF
Infrastructure Plan
Investmentprofile
Funding Profile
Local Growth Fund
Prudential Finance Project Finance
Infrastructure Output
Recycling of Investment
Revenue Flows
London Boroughof Barnet
LGF
Where next?
Concept launched on 11 Sep 2007Discussions planned with CLG and
Treasury to agree whether to proceed to stage two
Inclusion in LAA
Questions or comments?