‘New devolution deal’ needed for London after election

Centre for London say more powers for City Hall are needed to help capital’s economy “fire on all cylinders”, reports Noah Vickers, Local Democracy Reporter

The new home for City Hall at The Crystal in East London
City Hall

The next government must hand down powers to London’s City Hall and borough councils, a think tank has urged, as polling reveals Londoners trust local politicians more than Westminster.

The Centre for London said a “new devolution deal” is needed for the capital to help its economy “fire on all cylinders”.

Polling by Savanta, commissioned by the think tank, reveals that only about one-in-six Londoners (16%) said that of all the levels of government, they trusted national decision-makers most to act in their best interests and those of their community.

By contrast, twice as many said they trusted their local council (31%) most, while one-in-five (21%) said they trusted the Greater London Authority (GLA).

Almost half of Londoners (49%) also told Savanta that they support a greater percentage of their taxes being decided by local and regional government, rather than in Westminster. Only 16% said they would oppose this.

Mayor Sadiq Khan has previously warned that despite the devolution of powers seen under the last Labour government, the UK is still “one of the most centralised countries in the world and London has limited control over the taxes raised in the capital”.

He told the London Assembly last year: “The only funding we have control over is raised through a levy on council tax and a supplementary levy on business rates.

“By contrast, New York has local control over funds from residential and non-residential property taxes, sales and related taxes and revenues from income taxes. It is a similar story for Paris and Tokyo. In the UK, these funds are spent by remote Whitehall departments.”

The mayor also cautioned that this centralisation “leads to London being pitted against other cities in competitive bids for funding pots that waste time and resources”, pointing out that “recent unsuccessful bids for Enterprise Zones cost London government in the region of £50,000”.

In a briefing paper published on Wednesday (3rd), the Centre for London argues that the city specifically needs to see more control over skills, transport and local taxes – including the ability to introduce new revenue-raisers, such as a ‘tourist tax’ like those found in many other European cities.

Centre for London chief executive Antonia Jennings said: “With trust in national government waning, and support for greater devolution increasing, it’s time to re-think London’s devolution deal.

“It is in the whole country’s interest for London to be firing on all cylinders, and in every Londoner’s interest for the city to become less manifestly unequal.

“We know London needs to address its productivity and inequality crises, and fast. A new deal for London has the potential to be the key ingredient for making this happen.”

Emma Levin, associate director at Savanta, said: “In some senses our results are not surprising – it’s long been true that when asked, people say they are more trusting of politics that is ‘closer’ to them, rather than national governments.

“But our findings also suggest a partisan element to this, with Conservative voters more likely to trust the Westminster government they currently control, and Labour voters more likely to trust local and city governments – most of which are Labour-led.”

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