Financial benefits of Northern Line Extension

Meeting: 
MQT on 2015-03-25
Session date: 
March 25, 2015
Reference: 
2015/1138
Question By: 
Stephen Knight
Organisation: 
Liberal Democrats
Asked Of: 
The Mayor
Category: 

Question

Further to the most recent economic appraisal of the benefits of the Northern Line Extension (NLE) - which found that for every £1 of cost, there will be £8.20 of benefits - how will you ensure that the Greater London Authority and local authorities capture a fair share of the financial benefits generated?

Answer

Answer for Financial benefits of Northern Line Extension

Answer for Financial benefits of Northern Line Extension

Answered By: 
The Mayor

The main aim of the Northern Line extension (NLE) is to allow the development of the Vauxhall Nine Elms Battersea (VNEB) Opportunity Area (OA).  The business case included not only those benefits for transport users but also wider economic benefits. These wider economic benefits include an additional 14,000 jobs, predominantly at Battersea Power Station (BPS), that could not happen without the NLE.

Capturing these wider economic benefits should enable us to fund the entire £1 billion cost of the NLE scheme. The main methods for capturing this value will be developer contributions, raised by the London Boroughs of Wandsworth and Lambeth on the BPS site and across the wider VNEB OA under the S106 and Community Infrastructure Levy and, incremental business rates generated by new, and higher value, commercial development taking place within a new Enterprise Zone in Battersea, which was established by the Government this month.

Should commercial development at Battersea be more valuable than expected, then the business rates received by the Enterprise Zone will increase over time. In addition, there will be additional developer contributions for local infrastructure and affordable housing.