The mayor of London has announced plans aimed at significantly boosting economic growth in the capital, which are expected to create 150,000 new jobs and improve the financial well-being of London residents.
Sir Sadiq Khan, in collaboration with London Councils—a cross-party assembly of local authority members—is preparing to advocate for increased economic expansion that has declined due to Brexit, the COVID-19 pandemic, and evolving work patterns as part of his initiative for London’s growth.
The strategy will feature the development of industrial centers in outer London, the introduction of rent-controlled housing for essential workers, and enhancements to public transportation, according to the mayor’s statement.
The Conservative members of City Hall have criticized the mayor, claiming he has effectively stifled economic ambition in London and advised taking the proposed figures with skepticism.
The London Growth Plan prioritizes boosting the productivity growth rate to 2% annually by 2035, a significant increase from the current 0.12%, which is anticipated to generate an additional £27 billion in tax revenue for the government.
The mayor’s office remarked that this growth is essential to achieving higher wages, improved living standards, and greater investments in public services.
At an announcement event scheduled at Imperial College, it is expected that the plans will result in a 20% increase in disposable income after housing expenses for the lowest earning 20% of Londoners.
“This growth strategy presents a unique chance to invigorate London’s economy and fully realize its potential for the benefit of all its residents and the nation at large,” stated Sir Sadiq.
The mayor emphasized that leveraging industries such as AI, life sciences, robotics, clean technology, quantum computing, and the creative sector will be vital for reaching these objectives.
Included in the proposals are:
London Councils articulated that the plan “details our aspirations to ignite growth in emerging industries, provide new housing and infrastructure… aiding more individuals in entering the workforce and acquiring the skills necessary for advancement.”
The Federation of Small Businesses (FSB) expressed support for the proposals, remarking on their “ambitious and optimistic” nature, while Business LDN highlighted that the plans “appropriately concentrate on unlocking the city’s full capabilities.”
Conversely, Alessandro Georgiou, the economic spokesperson for the Conservative group at City Hall, has rejected the plans and criticized the mayor’s fiscal strategy.
“It is quite ironic for the mayor to suddenly advocate for growth in London when his party’s budget has already constrained it,” he stated.
“Labour’s national insurance increase is adversely affecting Londoners financially, costing them jobs and hurting businesses throughout our capital.”
City Hall has indicated that it will also push for increased government funding, greater devolved powers, and more autonomy to finance the city’s priorities.
The pro-devolution think tank Centre for London has stated that the plans can only be realized with enhanced financial autonomy and the ability to retain more of the city’s generated revenue.
Antonia Jennings, the chief executive, remarked, “To effectively compete with cities like Paris, New York, Tokyo, and Hong Kong, we need substantial fiscal devolution.”
She pointed out that while New York retains 50% of its city-generated tax revenues, London only keeps 7%.
“Not all economic decisions for local regions are best determined by Whitehall—London’s government must be empowered with the necessary fiscal tools to make similar decisions.”
A spokesperson from the Ministry for Housing, Communities and Local Government affirmed the government’s commitment to fostering growth across the UK, including in London.
“We appreciate the mayor’s initiatives to promote economic development and will continue to collaborate with the Greater London Authority on long-term strategies to enhance prosperity in the capital.”
The spokesperson noted that the English Devolution White Paper aims to eliminate “any unnecessary or outdated regulations” and ensure that any forthcoming legislation supports growth in the capital.
