GLASGOW councillors will be asked to approve revised plans to fund work connected with a major city centre retail development by using new powers to borrow against future business rates.

The executive committee of the council will on Thursday consider a plan to use the Tax Increment Finance scheme to fund £80 million work connected with the Buchanan Quarter.

Proposed by Land Securities and Henderson Global Investors, the Buchanan Quarter project involves a major extension to the existing Buchanan Galleries complex.

It also includes the building of new retail space and the development of car parking facilities at Queen Street station nearby.

The council wants to use TIF funding to pay for infrastructure improvements like pedestrian linkages between the new car park at North Hanover Street and the Galleries. It also plans to improve the appearance of public areas in places like Bath Street and George Square.

Introduced by the Scottish Government last year, the TIF scheme allows councils to fund projects that are expected to improve the environment for business by borrowing from a public loan fund.

They will be expected to repay the borrowings by drawing on increases in the receipts from business rates that will be generated by the work concerned.

Administered by the Scottish Futures Trust, the scheme is intended to boost investment at a time when private sector budgets may be under pressure. It is reserved for developments that would not go ahead without TIF funding, under the so-called “but for” test.

Glasgow first mooted using the TIF scheme in connection with a big expansion of the Buchanan Galleries development in January last year. The then leader of Glasgow City Council, Steven Purcell, said use of the “cutting edge” financial model showed the city could be imaginative about bridging the funding gap for key projects.

The council had problems with the first proposal it put to the Scottish Futures Trust after work started on a part of the project in advance of approval of the TIF scheme.

In a paper prepared for councillors ahead of this week’s meeting, Baillie Liz Cameron said this weakened the “but for case” for the overall development. The work concerned is not included in the revised TIF proposal.

Ms Cameron said the revised proposal could help “unlock massive potential” within Glasgow city centre.

The chief executive of Glasgow Chamber of Commerce, Stuart Patrick, said: “We welcome the City Council’s work to secure the first TIF for Glasgow. I also welcome the Council’s approach to it as an innovative funding mechanism to drive private investment and improvement to the public realm, which is desperately needed.”

However some people have expressed concern that further expansion around the Buchanan Galleries scheme could be bad news for other retail areas.