City Council leaders in Birmingham, Newcastle, Liverpool and Manchester have called for the Government to allow regeneration schemes to be funded by Councils issuing bonds. The logic being that the infrastructure schemes would increase future tax revenues and so allow the bonds to be repaid.

It all sounds rather complicated although apparently such "tax increment" financing schemes have been tried in the United States. The property industry are keen for more money to be poured on, pointing out that the recession has meant regeneration schemes stalling as the private sector capital available has diminished.

But is the answer really for the state to just borrow more so that the schemes can go ahead anyway? What if the scheme chosen is flawed and does not result in the increased tax revenues projected?