Budget 2026: John Healey urged to 'unleash' London by kick-starting new Tube and rail upgrades

Business chiefs are calling on John Healey to hand Lord Sadiq Khan new financial powers to unshackle key transport projects in London.

They also argued that the Mayor of London should be given new powers to borrow against future revenue from transport and other schemes.

Plans to extend the Bakerloo line

TfL

However, he also emphasised: “The plans to rewire the state through greater devolution have great potential.

“They promise an improvement in delivery of public services and crucially give local leaders the ability to drive forward the infrastructure, housing and education that their communities and businesses need.

“Allowing more of the tax revenues raised locally to be retained locally will be key to enabling and incentivising decision-making that drives and unleashes growth.”

Business chiefs want London Mayor Lord Sadiq Khan to be given new financial powers

PA

The business group, which represents more than 170 major employers in the capital, believes that city-regions with a proven track record, such as London and Manchester, should be empowered to borrow against future revenue streams without requiring case-by-case approval from the Treasury.

Such a reform would encourage investment in growth-boosting infrastructure, it argued.

In its Budget submission, BusinessLDN also urged the Chancellor to:

* Boost London’s housing market by cutting stamp duty on new homes by capping it at 1% for all first-time buyers and downsizers

* Encourage the hiring of young people including through an employer National Insurance contributions holiday and increased Employment Allowance for firms that take on unemployed 18-24-year-olds