Councillors in the South East of England are developing proposals for new funding approaches to help support the region's infrastructure investment post-Brexit.
In its response to the National Infrastructure Commission’s national infrastructure assessment (NIA), South East England Councils (SEEC) has warned of an ‘infrastructure deficit’ in the region of £14bn over the next 15 years.
The figure came from emergent findings from SEEC's current work with consultants Local Government Futures on innovative local government funding proposals, which the group said it would be pleased to share in full later this year.
In its response to the NIA consultation, SEEC said it ‘would welcome support through the NIA for freedoms/powers for councils to help fund infrastructure’.
It added that the region has the second highest total of business property rateable values in the UK (£8.5bn annually), ‘but councils see little of this to spend in their areas’.
If South East councils has kept 100% of collected business rates, Stamp Duty and Annual Tax on Enveloped Dwellings in 2015-16, they would have generated £3.1bn more income than the amount received in non-ring-fenced grants from central Government, SEEC said.
It argued that the South East is the ‘engine-room’ of the UK economy and that national investment in strategic transport projects is essential to ensure the region ‘will continue to produce financial returns the Government can use to fund growth across the UK’.
SEEC deputy chairman Cllr Roy Perry said: ‘With the right infrastructure investment the South East can drive economic growth and provide funding to reinvest in other areas’ growth too. As we prepare for Brexit we must invest in our successful areas as first class businesses won’t stay put for third class infrastructure.
‘For example, road and rail routes to South East ports and airports are used by companies UK wide but they are congested, overcrowded and inefficient, damaging business profitability and making post-Brexit UK less attractive as an investment option.’
The SEEC said the region contributed £80bn more in taxes than public spending between 2002 and 2012 and that ‘investing in the South East provides proven financial returns nationally, so the need for lower-return regeneration projects in other areas must be balanced with vital investment in high return South East projects’.
It stressed that ‘it is vital that the NIA recognises the role infrastructure plays in opening up and supporting housing and employment developments’, pointing out that the South East had achieved the highest growth in homes in 2014-15 with 28,360 extra homes. But the group warned that ‘without infrastructure up-front for development we cannot be certain of sustaining this level of growth’.