We have just over a year to go before Crossrail 1 starts running services between west and east London, but things are moving very quickly with the planning phases of its sister project, Crossrail 2. This new route has the potential to bring London closer to the commuter belt in Surrey and Hertfordshire and provide much needed capacity relief to London's already over-subscribed transport network.
Closer to home, at least for our businesses operating in Camden, local companies are going to benefit a great deal from the Euston and King's Cross 'superhub' station that has been billed by the Chancellor and the Mayor of London through regeneration in the surrounding area.
Yesterday saw the publication of the Government's National Infrastructure Plan which set out the planning process for Crossrail 2 and pledged £2 million in funding for the development of a business case for the new line. The question that needs to be answered now is: who pays?
There are a number of financing options on the table, most of which were covered in a report prepared for the Government last week by auditors PwC. Our concern is that business tenants in London are going to be hit again by reapplying the 'Business Rate Supplement' (BRS), one of the options set out in the report.
Business rates, like council tax, are collected from owner occupiers. In addition to that, the BRS is currently levied on tenants operating in the capital from properties with a rateable value of more than £55,000.
PwC's suggestion, that BRS payments should be extended from 2030 for another 30 years to fund 15% of Crossrail 2, is problematic. This is mainly because the BRS piggybacks a flawed rates system with an additional 2p levy. This presents a real threat to our creative cluster in Camden and companies renting their premises all over the capital.
Our local tenants - like Elsevier, MTV, Getty Images and Hachè Burgers - all do their bit to fund regeneration in the capital with the contributions they make to our Business Improvement District, something that they took upon themselves to vote for. Using these funds, our 'BID', like many others across the capital, delivers initiatives aimed at making the Camden area a better place to work, shop and visit. Don't hit these firms again because it's the easy answer.
The real threat is that many of the occupying tenants that contribute more in tax and employ more people across the capital could find themselves funding a long-term project that they may not be around to benefit from. Moreover, the route is ultimately going to lead to a rise in property prices for their landlords' because of the better transport links it will deliver.
Encouragingly George Osborne used his Autumn Statement to announce the wider reform of the business rate structure in the UK. This is a welcome development and we are hopeful that the 'big picture' is recognised so that the Crossrail 2 business case is developed with these forthcoming reforms in mind.
Our message to the Government is clear: extending the BRS in its current form will put the future of London BIDs and the success of its high street policy initiatives at risk.
Whether this means offsetting it against BID levies or ensuring that landlords are on a more even footing, the BRS needs to be adapted to ensure that the short-to-medium term occupiers are not the ones that are penalised.