Projects for economic growth

Jeremy Skinner Senior Manager, Economic and Business Policy,Greater London Authority

Source: FT Intelligence, 2010. Copyright The Financial Times Ltd 2010 (www.fdiintelligence.com)

London was second only to Shanghai in the value of FDI over the second half of

the last decade

0

500

1000

1500

2000

2500

Shanghai London Singapore Dubai Hong Kong Beijing

Nu

mb

er o

f F

DI

pro

ject

s 20

04-2

010

0

10000

20000

30000

40000

50000

60000

70000

Cap

ital

In

vest

men

t 20

04-2

010

(£m

)

Number of Projects 2004-2010 Capital Expenditure 2004-2010 (£m)

Source: FT Intelligence, 2010. Copyright The Financial Times Ltd 2010 (www.fdiintelligence.com)

Transport

Population vs employment density –

peak hour travel demand

Business

Regeneration

Other Infrastructure

Sources of finance• 95% of taxes raised by the national exchequer• Local government resources review• Business rates – based on annual rental values

•Supplementary business rates – tied up in Crossrail•Full devolution•Retention•Bonus•Tax increment financing

• Community Infrastructure Levy – tied up in Crossrail too!

• But no income tax, sales tax, corporation tax, tourism tax, or localisation of stamp duty.

Conclusions• London will grow with the world economy if it

remains open• The distribution of that growth will cause

difficulties• Many projects that will stimulate further

economic growth are funded and in train• But may be concerns about the long-term

pipeline. • Public sector financial reform insufficient for

longer-term planning• A more radical approach will be needed – TIF

opens up the prospect of the public sector as well as the private sector harnessing global growth.

• But insufficient as a policy tool at the moment.

Thank You

Any Questions?

Housing supply

International Migration