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Is Politics Too London-Centric

March 10, 2010

With a rich mix of residents, a mass of successful international businesses and a buzzing cultural scene, London is a truly global metropolis in contrast to essentially European capitals such as Rome, Berlin or Madrid. Similarly, in combining the political, cultural and economic hearts of a nation, London stands apart from Washington DC, Delhi and Beijing. Its importance to the British economy is so significant that London can seem like a city state whose social norms and unique dynamism contrast with the Britain beyond the M25. If UK politics is considered too London-centric, perhaps it is merely a reflection of reality.

 With a rich mix of residents, a mass of successful international businesses and a buzzing cultural scene, London is a truly global metropolis in contrast to essentially European capitals such as Rome, Berlin or Madrid. Similarly, in combining the political, cultural and economic hearts of a nation, London stands apart from Washington DC, Delhi and Beijing. Its importance to the British economy is so significant that London can seem like a city state whose social norms and unique dynamism contrast with the Britain beyond the M25. If UK politics is considered too London-centric, perhaps it is merely a reflection of reality.

Even so, we must be careful how we define ‘London-centric’. To have concerns about the concentration of opinion-formers in the capital is one thing. It is another to suggest that London’s residents benefit disproportionately from their city’s success. Aside from the understandable attention it enjoys as our political and financial capital, there is little to suggest that Londoners take more than their fair share of anything other than air time.

 

Over the past decade or so, we have witnessed the devolvement of power to Scotland, Wales, Northern Ireland, and, to a limited extent, London. In some respects, however, it is only London that warrants this extra layer of government. Not only is it by far the largest of Britain’s regions (with three times the population of those in the next rank) but it is also the most diverse in terms of trade, skills and cultures. On both a residential and workplace basis, London generates about 18% of Britain’s tax revenue yet receives only 14% expenditure. As a result, it effectively subsidises the rest of the country to the tune of £14-19 billion each year. In proportional terms, it would be fairer to argue that politics is, in fact, too region-centric.

 

Nevertheless, London’s success is not so great as to find its subsidy to other regions painless. Take business rates, for instance. In the coming financial year, the average business rates bill in Westminster is expected to soar by 38% as a result of the five yearly revaluation of commercial properties. But spread across the nation, the revaluation exercise has been designed to be fiscally neutral. In essence this means that businesses in my patch are being used as a cash cow, effectively paying for generous rate decreases for companies in other areas. With 70% of all business premises in Westminster occupied by firms employing four people or fewer, it will largely be small businesses taking the hit.

 

Many of the social impacts of London’s success are under-catered for by central government as well. The capital has suffered disproportionately from the government’s lack of planning in advance of recent waves of immigration, notably the accession since 2004 of twelve new nations to the European Union. With government grants to councils calculated according to woefully inaccurate population estates, local authorities in areas of great mobility and diversity such as London often find themselves catering for large ‘hidden’ populations alongside registered residents. These extra numbers can place a significant burden on education, policing, housing and health resources. The explosion in London’s birth rate, for instance, has put such a strain on inner city healthcare that a recent Healthcare Commission report found that London hospitals provide the worst maternity care in the country.

 

London’s glittering exterior as a financial success story also glosses over other areas where the capital has been neglected. Few people realise that at an average of 7.5%, London has over the past decade persistently had one of the highest levels of regional unemployment in the UK. With Britain wedded to a model of high housing and employment benefits, those living in the Capital need to earn considerably more than the minimum wage to make it worth their while to work. As a corollary, it has been far easier in recent years to encourage hard working migrants to fill the jobs that Londoners have been unwilling or unable to take up themselves. A large proportion of the indigenous working-age population have been left without the education or skills to fill jobs of any description.

 

We should remember too that London is less a city sprawl, more a series of interlinked towns and villages, each with a unique character. Shabby suburban high streets tell quite a different story to the glitz of the city centre and I suspect residents in many suburbs feel just as disconnected to central London’s own dynamic culture and political character as those living far from the capital. In this sense, while politics may at times seem too Westminster-centric, it is certainly could not be considered too Redbridge-centric or Camden-centric.

 

London’s importance as a national and global hub naturally demands our political attention. But we must be careful not to assume that this attention translates to better standards of living or improved public services for its residents. In many ways, the greatest beneficiaries of the capital’s success are those living in the regions who indirectly enjoy the enormous political, economic and cultural currency that London lends the UK without the associated problems of high living costs and rapid social change. If anyone bemoans London’s position as our national focal point, let them contemplate the UK’s likely place in the world without this most dynamic and vibrant of metropolises.