London Councils and Mayor of London urge Chancellor to safeguard the capital's public

London Councils Chairman Councillor Merrick Cockell and the Mayor of London, Ken Livingstone, have written to the Chancellor to urge him to resolve flaws in the way the Office for National Statistics (ONS) calculates population figures.

London's government leaders have warned the Chancellor that it is essential their concerns are addressed before October's Comprehensive Spending Review (CSR) and the first three-year local government finance settlement which will fix council funding until 2010/11.

The latest figures from ONS have reduced the capital's population projection for 2007 by 95,000. If these figures are used to determine funding levels through CSR, there could be dire consequences for the capital's public services.

The sudden reduction flies in the face of all the evidence on the ground, and only came about because ONS decided to change the way it calculates international migration in population statistics. If ONS continues with this changed method, it will result in a 140,000 reduction in London's population projection for 2010 - equivalent to the entire population of Kingston upon Thames going missing.

Population figures are important to local authorities because they are used to determine the amount of funding they receive from government. A failure to measure population properly can result in public services losing out on vital funding.

One of the biggest problems with the methods used by the ONS is a narrow and outdated definition of an international migrant. ONS uses the United Nations definition - first used in 1976 - of someone who leaves their usual country of residence to reside in a new country for at least a year.

However modern migration is far more complex, and a common trend now is for migrants to move into large cities like London for a short period, before moving on to work elsewhere in the capital or the rest of the country. The ONS also does not count people who live in London for part of the week but are resident elsewhere for population purposes - such as second home owners and those with pieds-à-terre in the capital.

Whether they are an international migrant who stays in the capital for a few months only, or someone who formally lives elsewhere but stays in London a few days a week, these people all use a range of public services. But the government will not fund councils for these people because the sources ONS uses fails to count them.

While the government benefits from these short-term migrants through taxes and national insurance contributions, local authorities are footing the bill for providing services without receiving adequate government funding. 

This leaves local authorities in the unenviable position of choosing whether to ration services or pass the costs onto London's council taxpayers.

Councillor Merrick Cockell, Chairman of London Councils, said:

"As a truly global city, London attracts migrants from across the UK and the rest of the world - and this is something to be welcomed. Migration will always be a sensitive issue; to ensure public support, it is vital that the lasting benefits international migration brings far outweigh the increased pressure it places on our public services. But the ONS' failure to properly measure the capital's population means that London's council taxpayers are shouldering all the costs, but receiving little of the benefits.

The government needs to address this problem, or else public support for international migration will evaporate - with serious consequences for community cohesion in London. It is essential that London's public services are properly funded to support new migrants as well as long-standing residents - and we implore the Chancellor to address this problem before both CSR 2007 and the first three-year settlement are announced."

Ken Livingstone, Mayor of London, said:

"London is growing more rapidly than any other West European capital - testifying to its unequalled economic and business success. All forecasting predicts this growth will continue and the new methodology adopted by National Statistics underestimates rather than reflects this growth with potential dire consequences for local authorities charged with delivering services and the Londoners who will need them.

The 2007 Comprehensive Spending Review must ensure that London receives the right level of government investment to ensure its growth is sustainable. This will be hindered without accurate data."