There has been much support following Nick Clegg's announcement yesterday, at the Lib Dem conference, that tax increment financing will be brought forward. New borrowing powers will enable local authorities to borrow against expected growth in business rates (NNDR) generated in their area. More details will be provided alongside the spending review but for the HM Treasury announcement, click here.
This is a welcome move. Many local authorities will be keen to have additional powers to bring forward infrastructure which itself will support and generate growth. Some have used existing prudential borrowing powers to good effect and TIF will allow more ambitious provision. No doubt further details will explain how the borrowing local authority is to benefit from the increase in NNDR arising from growth in its area given the way NNDR is currently raised and allocated.
This is one of the measures coming forward as part of the Government's intention to "rebalance the economy in favour of the private sector". But if business rates raised in a given area are going to increase, then this will only happen in any significant way alongside properly and strategically planned growth across the board including in housing numbers. On that score, we await with interest the findings of the select committee on the abolition of RSS and the forthcoming Localism Bill