Levy imposed on developers could fund the 拢200m construction of a Milton Keynes-to-Oxford rail line

Housing developments in the Oxford鈥揗ilton Keynes corridor could be subject to a 鈥渞oof tax鈥� to pay for a rail link between the two cities, according to a government-commissioned study.

Jeremy Edge, head of planning at property consultancy Knight Frank, which wrote the report, outlined the funding package for the proposed Milton Keynes to Oxford rail link at last week鈥檚 Thames Gateway Forum.

He estimated that about 拢65m was required in gap funding to pay for the 拢200m construction cost of the east-west rail line.

He said the study, commissioned by the ODPM and the area鈥檚 local councils and development agencies, had concluded that the funding could be delivered through the uplift in land values resulting from the construction of the line.

Edge said: 鈥淭his can be delivered on the basis that central government in one form or another funds the rail line. It can then be clawed back from developers when they obtain planning permission. There鈥檚 more than sufficient uplift.鈥�

He estimated that the sums could be generated by imposing a levy of between 拢2000 and 拢6500 on all new homes along the route of the proposed rail link, which is one half of a long-planned link between Oxford and Cambridge.

Central government funds the rail line. It can then be clawed back from developers

Jeremy Edge, Knight Frank

Edge added that the levy could also generate sufficient income to subsidise the line鈥檚 running costs in its early years, before the number of passengers increases.

Under growth plans for the area, Milton Keynes is to become the 10th biggest city in the UK within the next three decades. But Edge said although the town鈥檚 north-south transport links are good, the level of growth anticipated threatens to overload the area鈥檚 east-west road network. He added that creating a link across the south Midlands could also relieve pressure on main line routes into London.

Roger Humber, who co-ordinates the Milton Keynes Forward consortium of local landowners and builders, said the rail link was a pipe dream and his members refused to back it. He said:

鈥淭he Strategic Rail Authority, before it was wound up, made it clear that they were never going to fund it.鈥�