Problems – a summary

London’s economic contribution to its nation is huge, and without it, the UK would be significantly poorer. The capital plays a global role that no other part of the UK can match. However, negative perceptions of London persist, and its arguably oversized national role can bring genuine challenges for the rest of the UK. The previous chapters demonstrate that there are significant grounds for optimism, and that efforts are already being made to improve collaborative working between London and the rest of the country. However, in an increasingly polarised and volatile climate, there is a risk that the capital could  become a victim of its own success if it does not act to strengthen ties with the rest of the UK.

The results of the polling and the interviews conducted for this report differ in several areas, but there are three common complaints. These three distinct but related problems can be summarised as follows:

1. London, Westminster and Whitehall

Whilst relations between London institutions and their equivalents across the UK are in some respects improving, relations with central government appear to be travelling in the opposite direction. There is a widespread perception that central government, overwhelmingly based in Westminster and Whitehall, has a ‘London-centric’ view, leading to national policy that disproportionately benefits the capital. The UK (and particularly England) is an extremely over centralised nation.

Brexit currently dominates national discourse, and there is a sense that the devolution agenda has consequentially slipped down the agenda. The impact of leaving the European Union also seems likely to exacerbate inter-regional tensions: HM Treasury’s own forecasts predict that Brexit will affect London’s economy the least, with the local economies of Leave voting regions expected to be left the worst off. There is a further risk that powers that come back to the UK as a consequence of ‘taking back control’ from Brussels will be hoarded in Westminster and Whitehall.

2. London is too strong

London’s role as a global and national magnet for talent is an asset to the UK. The capital’s dynamic economy and its tendency to attract innovative new ideas from around the world are powerful factors in driving the whole nation forward. Yet efforts to share the benefits across the UK are limited, or underdiscussed. London’s role as an international hub is appreciated, but the spokes that spread benefits across the UK need strengthening.

3. London doesn’t care

Whilst London is far from universally unpopular across the UK, it is seen as an unaffordable and self-interested place, and national pride in the capital is not as high as it should be. Londoners are seen as ‘arrogant’ and ‘insular’, and the capital’s economic contribution to the UK economy is seen as an abstract idea, with little tangible impact in other parts of the country. When asked what London’s government and institutions could do to help other parts of the UK grow, one long serving local government official responded with surprise: ‘Of all the places I’ve worked in the last 35 years, this is not a conversation that I’ve ever had. It’s a conversation that we’ve always had internally, with London as the enemy’.

Proposed solutions

The recommendations seek to address these issues, by suggesting ways in which central government; London’s own government; and London’s business and cultural institutions could work together to enhance the perceptions and realities of how London related to the rest of the UK. In summary, we call for all involved to change the narrative around London and the UK; reduce Whitehall’s dominance by devolving now to towns, cities and regions; launch a campaign to show London cares about the rest of the UK; and strengthen the spokes that spread the benefits of London’s role as global ‘hub’ for business and tourism across the country.

Recommendations for the Mayor of London, Greater London Authority and London’s boroughs

Recommendation 1: ‘London is Yours’

The Mayor of London and mayoral agencies should launch a domestically-targeted ‘London is Open’-style campaign, entitled ‘London is Yours’, to restate London’s commitment to its role as England and the UK’s capital. This should begin with a published ‘mission statement’, explicitly stating that it is in London’s interests for the UK’s other cities and regions to succeed, and that the capital does not seek growth at the expense of any other region. The campaign should also highlight the ways in which the capital’s institutions are already working behind the scenes to strengthen inter-regional ties, and commit to developing and improving these measures.

London needs to be given more control of its own destiny through devolution, to make London a fairer and more prosperous place in itself, alongside generating more wealth for the whole country. But there are understandable concerns about the capital seeking to ‘go it alone’, reducing the amount it redistributes around the country. The Mayor of London must continue to make the national – not just London-specific – case for a more devolved UK.

The Mayor, the GLA and boroughs must work alongside the capital’s businesses and anchor institutions to ensure that London’s cultural offering and business expertise is shared more widely with the rest of the country. London and central government must also work together to explore ways to make London’s culture and tourism offer, and particularly that relating to its ‘national’ institutions, more accessible and advantageous for those visiting from elsewhere in the UK.

Recommendation 2: Mayoral networks

The Mayor of London should play a prominent role in further developing the emerging mayoral network and establish a more formalised UK Alliance of Mayors, to advocate for solutions to shared problems, and further devolution in the UK. There is also potential for this network to be extended beyond the existing ‘M8’, working alongside groups that represent other cities, towns, regions and rural areas across the country. Joint mayoral delegations can and should also play a prominent role in pitching for ‘multi-region’ overseas investment to the UK, demonstrating that the UK’s various cities, towns and regions have complementary, not competing, offers.

Recommendation 3: Make the case for further devolution and comprehensive infrastructure investment

London’s leaders should continue to make the case that neither regional growth nor infrastructure investment across the country need be a ‘zero-sum game’. Growth in London does not need to come at the expense of other parts of the country.

London’s infrastructure needs are huge, and real. The capital is also home to some of the most deprived communities in the country. But it is also in London’s interests, as capital of the UK, that productivity is improved, dependency rates reduced, and inequality addressed across the country. London’s government, businesses and other institutions must continue to publicly state that this is the case.

Recommendations for central government

Recommendation 1: Devolution

The UK must see more power devolved to a local level, with decisions taken as close to those who they affect as possible, in London and across the country. This would not only enable the UK’s distinct localities to better shape policy to suit their own particular needs and specialisms, but will also help to reduce the sense that regions are competing for one ‘pot’ of funding, and lessen the impact of the perception that national government has a ‘London-centric’ mindset.

The results of the EU Referendum demonstrated a spatially divided nation, and the government’s own forecasts predict that Brexit would exacerbate existing regional economic divides. Central government must commit to a major review of where power lies in the UK, and appoint a Cabinet Minister for Devolution to oversee the process.

Recommendation 2: Invest in infrastructure

Infrastructure is key to addressing spatial imbalances, but the regional allocation of national investment has become a contentious topic. Government must act to reset the debate over regional transport funding in the UK. It is widely felt that transport needs outside of the capital come second. Announcements over funding decisions have been handled poorly, and there is now a lack of clarity in the public debate. The government should take up the National Infrastructure Commission’s recommendation to enable ‘city-led plans for transport to connect housing and jobs’ by providing for ‘devolved, long term funding to give certainty to all cities’. ¹⁰⁶

Central government must commit to increasing both its own (public) investment, and better enabling private investment where possible, in both physical and digital infrastructure across the UK. The ‘lock-step’ arrangement for Crossrail 2 and Northern Powerhouse Rail must mean ‘do both’, not ‘do neither’.

Recommendation 3: Better data, better debate

London is the only continuous urban area treated as a region, and millions who regularly commute into the capital, particularly from within the Wider South East, are not included in per capita calculations. Treating London as a region has also fuelled the sense of London’s difference from the rest of the country: the capital is frequently described as ‘the only English region that voted to Remain in the EU’, despite most English cities doing the same. The Office for National Statistics should endeavour to provide more and better city-level data, and consider using the Wider South East region more frequently, to enable better likefor- like comparisons.

There would also be merit in developing a better measure than ‘GVA per capita’ to measure regional economic performance: nations are compared using ‘purchasing power parity’ which allows GDP to be adjusted to reflect different costs of living. Ultimately, like-for-like, Londoners have lower disposable incomes than the rest of the UK after housing costs, and current measures of regional economic activity do not reflect this. The rest of the UK may feel differently about the capital if they were better and more accurately informed about the reality faced by its residents and why London’s government needs more tools to help make it a better place.

Recommendation 4: Civil service secondments

Civil servants in Whitehall should be expected to undertake temporary ‘job swaps’ with local government officials, including London boroughs, to provide greater experience and insight into the challenges and opportunities faced by elected authorities beyond Westminster.

Recommendations for London’s businesses and anchor institutions

Recommendation 1: Cultural connections

London’s appeal to international tourists is impressive, and to be celebrated. London’s cultural offering is world class, and our polling demonstrates that it is the aspect of the capital that those Brits living outside of London who visit the capital regularly associate most strongly with the city. As part of the ‘London is Yours’ campaign, London’s businesses and anchor institutions can play a part in ensuring that this offering is made more readily available to the whole of the UK.

The practice of London’s ‘national’ cultural attractions going ‘on tour’ should be built upon and expanded – and apply to people and performance, as well as artworks and exhibits. London’s business organisations and cultural institutions should promote and sponsor cultural exchange programmes to ensure that young people across the country get to visit and benefit from the capital’s arts and culture offer. For example, London’s national cultural institutions should work with government to find a way to provide bursaries to schools, of the kind made available to visit Parliament, to enable young people to experience London’s world-class cultural offering – and for programmes to enable London assets to come to them. Additionally, government and schools themselves could work together to coordinate a three month nationwide inter-city schools exchange programme, as proposed by Centre for London’s Mario Washington-Ihieme, to help ‘foster a sense of pan-UK identity amongst the younger generation.’ ¹⁰⁷

Recommendation 2: Knowledge sharing

London is a world leading global city. London’s public, private and third sector institutions, following the lead of the Mayor’s Office, Transport for London and London & Partners, as well as the tone set by ‘London is Yours’, must reach out to partner institutions across the country even more than they do so today, to share ideas, experience and knowledge as widely as possible.

Recommendation 3: Strengthen the spokes

Excellent joint initiatives between cities and towns across the UK are emerging, geared towards attracting and spreading the benefits of international tourism beyond London’s boundaries. However, similar coordination and cooperation in the area of foreign direct investment and other private sector activity has generally been less frequent and less successful to date. The City of London’s Regional Engagement Strategy provides a template for inter-regional engagement, but even more should and must be done to broaden and develop engagement between regions, across a broader range of sectors.

Recommendation 4: Regions in the city

London’s governance and business institutions must work together with the Department for International Trade to investigate how to provide spaces in the capital where regional businesses can take advantage of its connections to the rest of the world, and help develop stronger spokes from London’s international hub, drawing investment out across the country.