The Coalition Government is to give local authorities more freedom to fund construction projects though borrowing, Deputy Prime Minister Nick Clegg has announced.
The powers will allow councils to use Tax Increment Financing (TIF), a method of forwarding funding infrastructure seen as vital to unlocking new development.
This allows local authorities to borrow against the predicted growth in their locally-raised business rates.
The property industry has welcomed the announcement.
British Property Federation chief executive Liz Peace said: “We are delighted that government has taken such a far-sighted step to ensure that new infrastructure - which will be vital to rebuild the UK economy - can be delivered, even at a time when public funding is scarce.
“A huge amount of work and expertise has gone into lobbying for TIFs, over a campaign lasting many years. We look forward to working with government to ensure that the emerging TIF regime is workable and effective.”
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