Friday, May 24, 2013

We need to talk about London

There is currently a move towards fiscal independence and partial devolution that could threaten the functioning of the United Kingdom as a sovereign state as we know it. No, not those troublesome Scots again, but a growing resentment in London that the capital is indeed another country, a thriving city state with its own talismanic government, structural needs, a tax base and different policy agenda.

OK, hold that thought for a moment. At our Downtown conference in July, Northern Revolution, we will be debating the issue of London with an illustrious panel. We will be examining “the London effect” and how it may direct the regional policy revolution we need to unlock the potential of the North.

Sometimes we can run away with ourselves and misunderstand the nature of the challenges the regional cities face. Helpfully, the view of the Core Cities group, of which Manchester, Leeds and Liverpool are a part, is this: “We all need London to continue to succeed, but it is unhelpful and incorrect to see growth elsewhere in the country simply as displacement from the South East. This severely limiting concept stymies the national ability to recover and grow.”

This isn’t just chatter, it was produced as evidence to a commission unleashed by London Mayor Boris Johnson after his re-election last year which has just made a bold case for London to control more of its own taxes than central government. You can link to the full report Raising the Capital, The Report of the London Finance Commission here.

To cut to the chase, here’s the conclusion: “A more devolved system implies both a need to remove government borrowing limits on London government and need to devolve revenue streams in the form of taxation to London government.”

The call for more devolution from London has to be seen as an opportunity for all our cities to develop the right models for new times. At our excellent Leader’s Lunch earlier this month, Sir Richard Leese came as close as he ever has to supporting the idea for a powerful metropolitan mayor for the Greater Manchester city region. However, he made the point that the London mayoral model would be as inadequate for Manchester as the pale small city model that Liverpool and Bristol have adopted.

Indeed, the very smart city deal that Manchester secured is viewed quite enviously by the London commission, who believe using the proceeds of growth in our city region is a good model.

Where I think this is a case of London having its cake and eating it, is how the national structures of the country have inevitably caused the growth of our capital. It is the financial, political, cultural, media and an international transport hub. All our transport runs into London, it is the mother ship, the death star, into which all roads and railways lead. There is no policy plank on which any serious attempt to grow other cities is being pursued with any real vigour. That’s where there is a need for a confident, bold and progressive policy revolution.

I had a peek over the paywall into David Aaronovitch’s excellent column in the Times this week, where he pretty much nailed the politics of today. He said an emerging fault line in British public life was emerging over issues like gay marriage, Europe and ‘political correctness gone mad’. In the shires, the Daily Mail and the narrow UKIP agenda matters, in the cities, it does not.

And the conclusion: “So we may need to secede from the hinterland. And the same is true of our other great cities and university towns which, together, could make an outward-looking, open-minded polity.”

There is a risk that we descend into chippiness, pretty much like the Scots have, where actually our Northern cities find common cause with each other and with London, over many important issues. These include business growth, a flexible approach to core technology skills and an immigration policy that recognizes what growing technology companies need from international labour markets. All important for a strong London indeed, but equally for the strong cities of the North too.

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