Dave Hill: Labour should talk to London business about growth

Dave Hill: Labour should talk to London business about growth

Don’t be daft. Of course he won’t speak up about taxation measures voters will dislike. While we’re at it, why would Keir Starmer point a finger at Brexit when doing so would bring opponents joy? Why would he tout spending pledges that could be used against him? The Labour leader’s low-risk strategy keeps keeping him on course for a lifetime victory high. Without that victory, nothing better happens. With it, he will be able go for the goal on which all hope for the future depends – economic growth. London is where most of it can come from, and London’s businesses have a few ideas.

The plea to the next government from John Dickie, chief executive of BusinessLDN, which represents many of the capital’s biggest and most important companies and universities, is that it works “in close partnership with the capital and the private sector” to meet the whole of the UK’s needs. That alone would be enormous progress following years of impeding, excluding, interfering, political point-scoring and top-down micromanaging. And the BusinessLDN manifesto suggests a bunch of no or low cost “quick wins” to get things going.

Some of these simply ask for unfinished regulatory business to be completed, so that investing and being in London is more appealing. There’s a particular request to “minimise the impact of post-Brexit red tape” on peoples’ ability to attend business tourism events. London’s universities should be backed as a national asset, including as a draw for international students – a stance with which London’s university sector agrees. Sunday trading restrictions should be removed for the West End and Knightsbridge, and VAT-free shopping restored, a change retailers have repeatedly asked for.

On planning, the manifesto urges a prompt review of Green Belt constraints, a principle Starmer has already signed up to. On housing shortages, a social and an economic problem, it asks for greater certainty about social rent increases and longer-term affordable housing programmes with more flexibility built into them. On transport, it seeks “meaningful devolution of local rail services”. Reportedly, this long-sought change has been ruled out by Labour. Perhaps if and when the party is in government it can be persuaded to think again. The manifesto re-commends the London Local Skills Improvement Plan BusinessLDN helped compile.

To these “quick wins” are added proposals for judicious public investment, often to encourage private sector commitment – the current government’s infrastructure finance review estimates that half the money the UK needs over the next ten years will have to come from private sources. Transport for London and Sadiq Khan have asked over and over for a multi-year capital funding deal so that the full electrification of the bus fleet and a bunch of rail upgrades and extensions can be pressed on with. Just extending the Docklands Light Railway to Thamesmead would pay dividends in jobs and homes.

Underlying many of these proposals is a plea for greater trust in London and London government to run its own affairs better than national government can, and to give that trust in the national interest. The manifesto makes no party endorsement, but begins by observing that the general election coming so soon after that for Mayor of London “presents an opportunity for all levels of government to come together to establish a fresh vision for how the UK works, rather than simply relying on the old, centralised model that is broken – perhaps beyond repair”.

What are the chances? Starmer’s recent summit with England’s Labour Mayors, including London’s, produced excitement. That reported reluctance to put more suburban rail services under TfL control did not.

BusinessLDN asks that London be granted a flexible “trailblazer” devolved funding deal along the lines of those secured by other regions. And it repeats the inescapable truths about the whole nation being dependent on London’s economy – increasingly dependent, even as London has struggled to make the very most of itself of late. London’s “fiscal transfer” to the rest of the country rose to a massive £38 billion last year. Everywhere from to Peterhead to Penzance every tax penny London can export.

What’s to stop a likely Labour government taking swift, prudent steps to liberate more of London’s economic potential? Perhaps conservatively sticking to those broken, old, over-centralised ways of running the UK after all. Perhaps succumbing to a fear that a more autonomous London, growing bigger and stronger still, would present some sort of threat. Both impulses should be resisted, starting from 5 July.

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