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LPA calls for change in funding London’s transport infrastructure

News

Dominic Plaskota

24 March 2025

London

The London Property Alliance has called for chancellor Rachel Reeves to adopt new funding models ahead of the Spring Statement on 26 March.

The trade body says a fresh approach is needed to prevent major transport infrastructure projects from stalling, such as the Bakerloo Line extension, the new HS2 terminus at Euston and Crossrail 2.

It pointed to the Elizabeth Line as an example of the potential benefits such projects can bring, with the opening of the line leading to 171 hotel openings, 2,666 new food and beverage outlets and 12 museums.

While it said the recovery in public transport usage was admirable, the LPA said more investment was needed to unlock London’s true potential.

Recent analysis by the LPA, conducted in collaboration with Centre for Cities, found Tube journeys were at 87% at the end of last year, whereas in New York and Hong Kong it was 77% and 87% respectively.

Despite that, Transport for London’s capital programme is significantly smaller than that of its rivals, with the £1.86bn annual commitment between 2022/23-2026/27 working out to just 11% of the resources committed in New York and 44% of those in Paris.

Alexander Jan, chief economic adviser to the London Property Alliance, said: “The opening of the Elizabeth Line brought a huge economic boost but with London’s population set to reach 10m in the coming years – and amid fierce competition for businesses and talent from Paris and New York – we cannot afford to stand still.”

Its recommendations include new development taxes, similar to the Mayoral Community Infrastructure Levy which helped fund the Elizabeth Line, as well as business rates supplements to create additional long-term funding streams.

Alongside that, the LPA suggested using income from fares to secure the debt needed to unlock major projects and introduce mechanisms that could accelerate the release of Community Infrastructure Levy contributions to help fund transport schemes.

Jan added: “Government must be bold in providing a clear timetable for the delivery of projects such as the Bakerloo Line extension, the new terminus at Euston and Crossrail 2. With little fiscal headroom, the chancellor must look at all funding options, including additional levies for those businesses in central London that will benefit from these ambitious projects. Now more than ever, we need a creative and collaborative approach between public and private sectors.”

Send feedback to Dominic Plaskota

The London Property Alliance has called for chancellor Rachel Reeves to adopt new funding models ahead of the Spring Statement on 26 March. The trade body says a fresh approach is needed to prevent major transport infrastructure projects from stalling, such as the Bakerloo Line extension, the new HS2 terminus at Euston and Crossrail 2. It pointed to the Elizabeth Line as an example of the potential benefits such projects can bring, with the opening of the line leading to 171 hotel openings, 2,666 new food and beverage outlets and 12 museums. While it said the recovery in public transport usage was admirable, the LPA said more investment was needed to unlock London’s true potential. Recent analysis by the LPA, conducted in collaboration with Centre for Cities, found Tube journeys were at 87% at the end of last year, whereas in New York and Hong Kong it was 77% and 87% respectively. Despite that, Transport for London’s capital programme is significantly smaller than that of its rivals, with the £1.86bn annual commitment between 2022/23-2026/27 working out to just 11% of the resources committed in New York and 44% of those in Paris. Alexander Jan, chief economic adviser to the London Property Alliance, said: “The opening of the Elizabeth Line brought a huge economic boost but with London’s population set to reach 10m in the coming years – and amid fierce competition for businesses and talent from Paris and New York – we cannot afford to stand still.” Its recommendations include new development taxes, similar to the Mayoral Community Infrastructure Levy which helped fund the Elizabeth Line, as well as business rates supplements to create additional long-term funding streams. Alongside that, the LPA suggested using income from fares to secure the debt needed to unlock major projects and introduce mechanisms that could accelerate the release of Community Infrastructure Levy contributions to help fund transport schemes. Jan added: “Government must be bold in providing a clear timetable for the delivery of projects such as the Bakerloo Line extension, the new terminus at Euston and Crossrail 2. With little fiscal headroom, the chancellor must look at all funding options, including additional levies for those businesses in central London that will benefit from these ambitious projects. Now more than ever, we need a creative and collaborative approach between public and private sectors.”