Dave Hill: Austerity is not a story of ‘rich London’ versus the North

Dave Hill: Austerity is not a story of ‘rich London’ versus the North

From enervating “giant suction machine” to parasitic “dark star“, London has became an increasingly potent metaphor for geographical inequality in the UK, reviled for its population pulling power, blamed for widening the “north-south divide”, depicted as a greedy monster metropolis getting fat on feeding off everywhere else. Some early media coverage of data compiled by Centre For Cities on the effects of austerity has perpetuated this tale of two nations, focusing attention on the struggles of “the deprived north” while barely mentioning its impacts on the capital.

In fact, London has taken a heavy hammering from cuts to local government funding, especially some of its poorest boroughs. The Centre for Cities figures themselves tell much of that story. The principal contrast made in its analysis is not between the north of Britain and the south as a whole, but between Britain’s cities and the rest of it, with an overall reduction of £386 in spending power for each city resident since the Conservative-Liberal Democrat coalition cuts began compared with one of £172 per person in towns and rural areas.

Yes, it finds that most of those cities hit hardest are in the north of England, and that northern cities in general have had it harder than counterparts in the east, south west and, indeed, the south east. But that excludes the capital. The Centre records that “in terms of absolute cuts, London has been by far the hardest hit”, with £3.9 billion less to spend on services. That’s 30 per cent of all the cuts in Britain imposed on a city that contains 16 per cent of its population. Londoners on average have £585 a year less spent on them than before, which is the fourth biggest cut endured by all 62 British cities after Liverpool, Barnsley and Glasgow. The average national reduction is £287.

Far from “rich London” having it easy, the capital has been a big victim of city austerity and so have millions of its people. London Councils, which represents our 33 local authorities, told the Treasury last autumn that borough finances are “unsustainable” and its chair, Peter John, has pointed out that London’s population has grown by 500,000 since the then chancellor George Osborne – now editor of the London Evening Standard, of course – began swinging the axe. Our own thank tank, Centre for London, has shown that some parts the capital have been wounded particularly badly, with Newham, Hackney, Camden, Westminster and Tower Hamlets seeing reductions of 25 per cent and more in spending power per resident. The capital has the highest poverty rate in the country.

The EU referendum result is legitimately seen as in part a rejection of “rich London”, its character and values. For some, any cohesive and revitalised post-Brexit national future must entail a regional “rebalancing” at London’s expense: infrastructure investment must be switched away from the capital to Liverpool and Leeds, parliament should be moved to Manchester, and so on.

But whatever the merits of such arguments – and some have more than others – any serious policy programme for helping the nation as a whole to grow more equitably and evenly in future will need first to dispense with misleading narratives about the relationship between London’s successes and the problems faced by other UK cities, including squashing any notion that London government and the people it serves have somehow been spared austerity’s harsh punishments. Nothing could be further from the truth.




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