Individual London businesses could pay a smaller contribution to the cost of Crossrail if Boris Johnson, the Mayor of London, decides in the next fortnight to reduce the supplementary business rate.
The supplementary business rate will raise £3.5 billion from all businesses in the capital with a rateable value of more than £50,000. However, the rates revaluation of April 2008 has taken many more businesses over the threshold, although the sum to be raised remains the same.
Mr Johnson may decide to reduce the supplementary business rate from 2p in the £1 to 1.7p in the £1, in acknowledgement of the pain many businesses in the capital are feeling.
Baroness Valentine said: “The Government is hammering recessionbattered London businesses with swingeing rates rises, but there’s a chance for Boris to demonstrate he’s more sensitive to their pain by reducing the initial supplementary rate for Crossrail.”
Crossrail is expected to survive a Tory spending review, despite some hesitations from the Conservatives over the cost of the project.
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A review of Crossrail is scheduled for the end of next year to determine whether the project is unstoppable. If the Tories win the forthcoming general election, they would conduct that review.
Terry Morgan, chairman of Crossrail, said this week that the infrastructure would play such a vital role in the nation’s economic recovery that the Conservatives would not axe it. “I find it very reassuring that David Cameron says that, in principle, he supports the project,” Mr Morgan said.
London First has been campaigning for Crossrail since it was formed in 1992. The project finally received government support in 2007 and the necessary legislation was completed in July 2008.
Baroness Valentine said: “Spades are in the ground. This long awaited and much-needed line is finally getting built. Business will contribute roughly a third of the cost, including £3.5 billion through a supplementary business rate.”
The East-West rail link will link Heathrow, the City and Docklands and provide 40 per cent of the extra capacity needed to support London’s predicted population growth of 800,000 and 350,000 jobs by 2017.
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It has been calculated that it will increase UK GDP by up to £31 billion over 60 years and will contribute £12 billion to Treasury tax revenues.
It is also intended to act as a catalyst for regeneration, particularly in the Thames Gateway, where some of the country’s poorest communities are, and there are plans for much more housing.
Work has already begun at Tottenham Court Road and Canary Wharf, where new stations are being constructed. The main construction programme for Crossrail will begin next year.