Responding to the launch of the English Devolution white paper, London Councils has welcomed the government’s commitment to devolving more powers and funding to the capital.
With London’s devolution settlement turning a quarter-century old next year, the cross-party group says a new devolution deal is vital for boosting economic growth in the capital and enabling it to compete as a global city.
London Councils believes there is a “golden opportunity” to build on existing collaboration between the boroughs and Mayor of London and to put this on a stable long-term footing, enabling more coordinated decisions and better outcomes for Londoners.
The umbrella body says the lack of formal structures for shared decision-making between the Mayor and boroughs and reliance on voluntary arrangements can represent a significant barrier to effective delivery in the capital. This is in contrast to other parts of the country with Mayoral Combined Authorities, where local authority leaders have a formal say about certain regional funding and powers.
Boroughs welcome confirmation in the white paper that the government will explore how an integrated settlement could be applied to London from 2026-27. This would provide the capital with more funding flexibility and certainty, and put London on a par with existing arrangements for Greater Manchester and the West Midlands.
The white paper confirms the Greater London Authority will need to draw on existing ways of working with London Councils to facilitate collaboration as part of any future integrated settlement. London Councils is committed to working with the government and Mayor to ensure boroughs have a formal role in the decision-making process for an integrated settlement, helping to accelerate delivery and value for money.
Cllr Claire Holland, Chair of London Councils, said:
“The government’s devolution agenda offers a golden opportunity to update London’s devolution settlement and ensure we fulfil our potential as a capital city.
“Boroughs already work closely with the Mayor to tackle the key challenges facing London, but our reliance on voluntary arrangements represents a real risk to long-term stability and delivery. More formal arrangements for shared decision-making between the Mayor and boroughs will enable us to work together more effectively, secure better outcomes for Londoners, and help drive economic growth.
“From boosting housebuilding to helping Londoners into work, boroughs play a critical role in on-the-ground delivery. Ensuring we have a seat at the table is vital for producing the best possible outcomes for the communities we represent. We look forward to contributing to the government’s devolution plans and helping shape this exciting agenda alongside the Mayor.”
London Councils points out that compared to other major global cities, such as New York and Paris, London has relatively few devolved powers. The umbrella body argues that further devolution is crucial for addressing longstanding social and economic challenges, including London’s relatively poor productivity performance [1].
Boroughs’ immediate devolution priorities include:
- Formal structures for shared decision-making with the Mayor of London. This is necessary to ensure joint working is built into the London system, streamlining current ways of working and enabling more efficient and effective delivery for Londoners.
- An integrated funding settlement so that London can make more long-term decisions itself, particularly relating to delivery of more affordable homes and driving growth. In the white paper, the government says it will “explore how an integrated settlement could be applied to London from 2026-27, taking into account its unique circumstances.”
- More options for raising revenue. Devolution of funding levers will help London generate income and sustain hard-pressed local services. Options include: minor reforms to Council Tax (such as an ability to add new bands); establishing a tourism levy; and devolution of taxes such as Vehicle Excise Duty.
- Greater devolution of skills and employment so that boroughs can ensure that residents are equipped for high-quality jobs and employers can access the skilled workforce they need.
- Devolved multi-year funding pot for retrofitting London’s housing. This will enable boroughs to accelerate their work to make London’s homes greener and warmer, plus providing suppliers with the certainty they need to scale up.
Powers to ensure prompter responses to technological innovation. For example, London currently lacks ability to regulate e-bikes and e-scooters in a way that can support sustainable growth of the market while meeting the needs of all Londoners.
ENDS
[1] Research from the Centre for Cities think-tank has shown that over the last 15 years London’s productivity growth has trailed its international competitors and cost the national economy tens of billions of pounds annually.
In its 2023 report Capital losses: The role of London in the UK’s productivity puzzle, Centre for Cities includes a recommendation that central government should devolve further powers to London.
Source: https://www.centreforcities.org/publication/capital-losses-the-role-of-london-in-the-uks-productivity-puzzle/