Infrastructure developments have traditionally been largely financed by central government and coordinated by regional development agencies (the GLA Group in London). Now that the London Development Agency (LDA) is winding down and central government funding for regeneration has virtually ceased, London boroughs face increasing difficulty in securing funding to support economic development/regeneration, particularly for larger scale projects.
To generate the level of investment required, it is clear that significant private sector financing is going to play a greater role. This in turn will necessitate the introduction of new powers for boroughs to make maximum use of their income and assets to raise capital investment.
At the same time, boroughs must remain circumspect; decisions need to be taken in the context of the overall state of the economy and the ability to pay/generate sufficient profits from these new sources to pay for the infrastructure. Additionally, even though new potential funding options may become available/more attractive, boroughs will be wary of overextending their commitment and risk; using too many of the new sources of funding might have the effect of putting off development.