Last Friday, Chancellor George Osborne and Mayor of London Boris Johnson launched their long-term economic plan for London. This was largely welcomed by the London business community and London Chamber of Commerce in particular, as many of the economic measures announced are areas that the Chamber has long been uniquely calling for.
London’s long-term economic plan included:
- Measures to address London’s acute housing problem, the number one challenge facing the city, by building over 400,000 new homes – including a London Land Commission to identify and support development of brownfield and public sector land
- £10 billion of new investment in London’s transport over the next Parliament including new tube improvements, better roads, more buses and cycle lanes and identifying the next big infrastructure investment after Crossrail
- New investment in science, finance, technology and culture in London
- Setting the ambition to outpace the growth of New York, adding £6.4bn to the London economy by 2030
- Creating over half a million extra jobs in London by 2020, attracting worldwide investment and continuing to raise standards in schools
- A commitment to give more power to Londoners to control their city’s future, with new powers for the Mayor of London to support economic growth, boost skills in the capital and more control over the planning process
We have long said that housing should be the number one election issues, primarily due to the impact that housing under-supply is having on businesses, so it is excellent news for London businesses that the Chancellor and Mayor are willing to implement a plan to address this issue.
The measures to boost house building, to address the chronic housing shortage in London are particularly welcome, as is the establishment of a London Land Commission to identify brownfield and surplus public sector land. We have called for a register – a ‘Domesday book’ book if you like – of surplus land to harness the space available in the capital, and this is an issue that remains high on the business agenda, and therefore the agenda of the Chamber.
We know that housing shortages can have a huge effect on business, 42% of London businesses have told us they are struggling because of housing costs to recruit and retain skilled workers, so these measures to free up publicly owned land for development will have a tangible economic impact in the capital.
We were also pleased to see the Chancellor confirm new powers for the Mayor over skills provision and economic development. However, this is one area where we would urge him to go further.
If London is to remain the economic powerhouse of the UK economy, the Mayor must have the power over London’s purse strings to secure a sustainable source of funding for the sorts of critical infrastructure investments the Chancellor set out last week.
In the long term, tube upgrades, line extensions and huge projects like Crossrail 2 simply can’t be funded through continual hand outs from HM Treasury. If the Chancellor allowed the Mayor to retain property taxes levied in London, he would have the ongoing source of revenue to strategically plan and finance these projects.
