http://news.independent.co.uk/uk/tra...p?story=484806

A plan to grant Ken Livingstone the power to raise hundreds of millions of
pounds for transport projects through issuing bonds is under consideration
by ministers.
Whitehall officials say private discussions between the Mayor of London and
the Treasury are aimed at striking a "constitutional settlement" between the
Government and the capital to allow the Greater London Authority more leeway
in financing major schemes.

Such a deal could set a precedent for projects elsewhere in Britain and mark
a flexible approach to funding public projects by Gordon Brown, the
Chancellor, whose hardline policies are often blamed for hindering
developments. Mr Livingstone hopes new initiatives such as the East London
extension and the delayed Thameslink 2000 could be funded through bonds.

Some observers believe the £10m Crossrail route, another trans-London rail
link, could be financed, at least partly, through interest-bearing
securities.

It is understood that the mayor could set the price of bonds at a level
which would allow individual voters, as well as investment houses, the
opportunity to invest.

The proposal comes in the wake of Mr Livingstone's readmission to the Labour
Party and some observers believe it may have been part of a unspoken deal.

A senior Treasury official said: "The current constitutional settlement is
an unhappy compromise between central control and local discussion.''

Mr Livingstone can issue a small amount of bonds, but to raise money on a
substantial scale would require primary legislation. It would also need the
agreement of Alistair Darling, the Secretary of State for Transport, and
John Prescott, the Deputy Prime Minister, who is responsible for local
government.

Mr Livingstone, who will stand for re-election as mayor in the summer, has
recently taken a more supportive line towards the Chancellor. Four years ago
he urged the Government to dismiss Mr Brown.

Although an agreement over bonds would show a more liberal approach to
public finance by the Treasury, it would also allow itto blame Mr
Livingstone if projects went awry. It is not clear whether the bonds would
be part of public debt, something the Chancellor will be keen to avoid.

Mr Darling has said he would consider a degree of devolution. He said it
might be possible to give the Scottish and Welsh parliaments, as well as
regional passenger transport authorities, more responsibility.

"Angus Bryant" wrote in message
...
http://news.independent.co.uk/uk/tra...p?story=484806

A plan to grant Ken Livingstone the power to raise hundreds of millions of
pounds for transport projects through issuing bonds is under consideration
by ministers.
Whitehall officials say private discussions between the Mayor of London
and
the Treasury are aimed at striking a "constitutional settlement" between
the
Government and the capital to allow the Greater London Authority more
leeway
in financing major schemes.

Such a deal could set a precedent for projects elsewhere in Britain and
mark
a flexible approach to funding public projects by Gordon Brown, the
Chancellor, whose hardline policies are often blamed for hindering
developments. Mr Livingstone hopes new initiatives such as the East London
extension and the delayed Thameslink 2000 could be funded through bonds.

Local Authority loan stocks are a long-established method of funding
projects. I inherited some LCC and Salford CBC stock back in 1970, and also
a mortgage loan to the local Rural District Council.

Has the law under which these funds were raised been repealed?
--
Terry Harper, Web Co-ordinator, The Omnibus Society
http://www.omnibussoc.org
E-mail:
URL: http://www.terry.harper.btinternet.co.uk/

From: "Angus Bryant"
Date: 26/01/2004 12:31 GMT Standard Time

A plan to grant Ken Livingstone the power to raise hundreds of millions of
pounds for transport projects through issuing bonds is under consideration

As long as it's only "transport projects" we're in the clear. However, knowing
the way our parliamentary democracy works, the legislation will probably allow
him to raise money for anything and everything. Now that's a worry, because
many of us remeber the "loony left" stuff he and his mates got up to with the
GLC in the 1980s (I once received a consultation document from County Hall
concerning the re-siting of a zebra crossing in Holborn which had a section
entitled "Implications for lesbians and gay men" - you'll be pleased to learn
it concluded they used pedestrian crossings in the same way as other members of
the community! - we don't want a return to that kind of nonsense).

"Angus Bryant" wrote in message ...
http://news.independent.co.uk/uk/tra...p?story=484806

A plan to grant Ken Livingstone the power to raise hundreds of millions of
pounds for transport projects through issuing bonds is under consideration
by ministers.
Whitehall officials say private discussions between the Mayor of London and
the Treasury are aimed at striking a "constitutional settlement" between the
Government and the capital to allow the Greater London Authority more leeway
in financing major schemes.

I think it is a good idea (with some reservations) - although the low
value bonds may be a bit of a side-show to make it look more
'democratic'. Most of the money will come from city investors.

Business/City leaders are always saying how important transport is to
the London economy. Yet they are usually reluctant to invest directly
in transport improvements - because the risk is high and the return is
low. At the same time Governments/Mayors etc find it hard to justify,
from taxpayers funds, the huge up-front capital investment needed for
transport projects compared to schools/hospitals/police etc. They are
also (especially after the Jubilee-line fiasco) terrified of cost
overruns.

Bonds offer a middle way - a chance to encourage THE CITY to invest in
the infrastructure of their own city (like they used to in the 19th
century). Investors are attracted because the rate of interest on
bonds is guaranteed (low risk). Government & TfL gain both because
they get the cash up-front and (because of the guaranteed return) can
offer a relatively low rate of interest - cheap borrowing.

Unfortunately, the risk of escalating costs remains largely in the
public-sector, although this may be shared with the construction
companies if the contracts are well negotiated. But - since the bonds
will be issued by TfL not the treasury - the responsibility for
repaying the interest (and eventually the capital) may also be a
business incentive to both TfL managers and local politicians to run
the system more efficiently.

On 26 Jan 2004, Acrosticus wrote:

From: "Angus Bryant"

A plan to grant Ken Livingstone the power to raise hundreds of millions
of pounds for transport projects through issuing bonds is under
consideration

As long as it's only "transport projects" we're in the clear. However,
knowing the way our parliamentary democracy works, the legislation will
probably allow him to raise money for anything and everything.

Moreover, even if it's just transport, there's no way i could buy bonds to
support, say, improvements to the tube without also contributing to bloody
crossrail and other such nonsense. Still, it's better than nothing.

tom

--
Nothing endures but change. -- Heraclitus

"Tom Anderson" wrote in message
...

Moreover, even if it's just transport, there's no way i could buy bonds to
support, say, improvements to the tube without also contributing to bloody
crossrail and other such nonsense. Still, it's better than nothing.


What's your obejction to Crossrail? Apart from anything else, it's
effectively just going to be a big tube line... Sure, it'll go a couple of
stops outside London, but so does the Metropolitan line.

Jonn

Depends what it used for. If they can guarantee it'll only be used for new
construction then fair enough but if most of it will disappear down the black
hole known as "maintenance costs" and "unions pay rises" then it'll become
a farce.

B2003

On Tue, 27 Jan 2004, Jonn Elledge wrote:

"Tom Anderson" wrote in message
...

Moreover, even if it's just transport, there's no way i could buy bonds to
support, say, improvements to the tube without also contributing to bloody
crossrail and other such nonsense. Still, it's better than nothing.

What's your obejction to Crossrail? Apart from anything else, it's
effectively just going to be a big tube line... Sure, it'll go a couple
of stops outside London, but so does the Metropolitan line.

Death also to the Metropolitan Line! And Thameslink, while we're at it!

Okay, so i was feeling somewhat cranky when i made that post. I do,
however, have a vague objection to Crossrail, based on two points:

(1) It makes life easier for commuters. It's not that i have anything in
particular against commuters, but i do have something against commuting,
and making life easier for commuters will make more people commute. The
thing about commuting is that it involves people living a long way from
their place of work - the travel is environmentally damaging and stuff,
probably, and moreover, it leads directly to urban sprawl, which is bad.
What we need is a higher density of living in the city (ie, ways to make
high-density living more enjoyable and practical, which from a transport
perspective means more and better transport within London), rather than to
expand the effective size of the city. At any rate, that's what the
Compact City theory says, and i find it fairly persuasive (but
IANAPlanner); read Rick Rogers's 'Cities For A Small Country' for the
details. Also, i'd just read a column in the Sindie about Crossrail and
its potential impact on the demography of City workers, so i was full of
righteous leftie rage.

(2) I thought it was going to be able to route national services across
London - Harwich to Holyhead, Paris to Edinburgh, that sort of thing. When
i realised it was just a jumped-up commuter line, i was dead put out. Much
less cool.

tom

--
The Impossible is True