Strike or no strike, the Mayor of London needs more power

Greater fiscal freedom would allow the mayor to champion properly the interests of hard-pressed commuters and be held accountable for delivery.

This week, hundreds of thousands of Londoners and commuters in the rest of the South East battled strikes and main line signal failures to get to work. With considerable grit and determination many of them succeeded. It’s fair to say that George Osborne’s Christmas gift to restrict regulated fare rises is already no more than a distant memory. But on a day when the mayor could be seen to be standing up for Londoners, it is worth reflecting how limited his powers really are. Take the chancellor’s announcement as an example. TfL bosses were understandably caught off-side by the treasury’s surprise decision to limit fare rises to RPI. This forced the mayor to rework his fares in order to balance the books. The late announcement, combined with the labyrinthine system of revenue settlement, meant that new prices were delayed by weeks.  This gave some season ticket holders a rare windfall but may have cost millions at the farebox.

The stifling complexity and lack of flexibility in the system goes back to regulations put in place at the time of rail privatisation. This included a requirement in law to have a fare structure shackled to many separate train companies taking revenue risk. For certain ticket types, such as the ever-popular London Travelcard, this means that TfL and private rail operators in the south east are financially tied at the ankle – by the Chancellor of the Exchequer no less.

There is nothing wrong in regulating fares where users have limited choice. Many suburban passengers will have welcomed George Osborne’s announcement with open arms and wish that he’d gone further. But surely it would make more sense and be far better if Londoners and their home county neighbours determined how commuter rail services are provided and what they cost to use.

The present system is a reflection of over-centralised control of London’s public services and undoubtedly those of England’s other city regions. As the independent London Finance Commission pointed out last year, the present Mayor for London (and his predecessor Ken Livingstone) has just a fraction of the revenue-raising powers that his opposite numbers in other world cities enjoy. Remarkably, only seven per cent of London’s tax base is determined by the representatives elected to spend it. New York’s figure is about seven times higher than this. Other world cities enjoy much greater fiscal freedom than London, which in turn leads to greater accountability and creates a real incentive for growth and public investment.

The success London has seen in getting London Overground, DLR extensions and Crossrail underway is testament to the effectiveness of city politicians. Across the political spectrum, the mayor and boroughs have demonstrated consistently that they are capable of delivering tangible improvements to our urban infrastructure. A natural next step is handing over greater fiscal power and control for large chunks of the commuter railway. Doing so would boost city government. It would allow the mayor to champion properly the interests of hard-pressed commuters and be held accountable for delivery. Even on a no-strike day.

London mayor Boris Johnson on a visit to Hong Kong in 2013. Photograph: Getty Images.

Alexander Jan is a consultant at Arup.

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An unmatched font of knowledge

Edinburgh’s global reputation as a knowledge economy is rooted in the performance and international outlook of its four universities.

As sociologist-turned US Senator Daniel Patrick Moynihan recognised when asked how to create a world-class city, a strong academic offering is pivotal to any forward-looking, ambitious city. “Build a university,” he said, “and wait 200 years.” He recognised the long-term return such an investment can deliver; how a renowned academic institution can help attract the world. However, in today’s increasingly globalised higher education sector, world-class universities no longer rely on the world coming to come to them – their outlook is increasingly international.

Boasting four world-class universities, Edinburgh not only attracts and retains students from around the world, but also increasingly exports its own distinctively Scottish brand of academic excellence. In fact, 53.9% of the city’s working age population is educated to degree level.

In the most recent QS World University Rankings, the University of Edinburgh was named as the 21st best university in the world, reflecting its reputation for research and teaching. It’s a fact reflected in the latest UK Research Exercise Framework (REF), conducted in 2014, which judged 96% of its academic departments to be producing world-leading research.

Innovation engine

Measured across the UK, annual Gross Value Added (GVA) by University of Edinburgh start-ups contributes more than £164m to the UK economy. In fact, of 262 companies to emerge from the university since the 1960s, 81% remain active today, employing more than 2,700 staff globally. That performance places the University of Edinburgh ahead of institutions such as MIT in terms of the number of start-ups it generates; an innovation hothouse that underlines why one in four graduates remain in Edinburgh and why blue chip brands such as Amazon, IBM and Microsoft all have R&D facilities in the city.

One such spin out making its mark is PureLiFi, founded by Professor Harald Haas to commercialise his groundbreaking research on data transmission using the visible light spectrum. With data transfer speeds 10,000 times faster than radio waves, LiFi not only enables bandwidths of 1 Gigabit/sec but is also far more secure.

Edinburgh’s universities play a pivotal role in the local economy. Through its core operations, knowledge transfer activities and world-class research the University generated £4.9bn in GVA and 44,500 jobs globally, when accounting for international alumni.

With £1.4bn earmarked for estate development over the next 10 years, the University of Edinburgh remains the city’s largest property developer. Its extensive programme of investment includes the soon-to-open Higgs Centre for Innovation. A partnership with the UK Astronomy Technology Centre, the new centre will open next year and will supply business incubation support for potential big data and space technology applications, enabling start-ups to realise the commercial potential of applied research in subjects such as particle physics.

It’s a story of innovation that is mirrored across Edinburgh’s academic landscape. Each university has carved its own areas of academic excellence and research expertise, such as the University of Edinburgh’s renowned School of Informatics, ranked among the world’s elite institutions for Computer Science. 

The future of energy

Research conducted into the economic impact of Heriot-Watt University demonstrated that it generates £278m in annual GVA for the Scottish economy and directly supports more than 6,000 jobs.

Set in 380-acres of picturesque parkland, Heriot-Watt University incorporates the Edinburgh Research Park, the first science park of its kind in the UK and now home to more than 40 companies.

Consistently ranked in the top 25% of UK universities, Heriot-Watt University enjoys an increasingly international reputation underpinned by a strong track record in research. 82% of the institution’s research is considered world-class (REF) – a fact reflected in a record breaking year for the university, attracting £40.6m in research funding in 2015. With an expanding campus in Dubai and last year’s opening of a £35m campus in Malaysia, Heriot-Watt is now among the UK’s top five universities in terms of international presence and numbers of international students.

"In 2015, Heriot-Watt University was ranked 34th overall in the QS ‘Top 50 under 50’ world rankings." 

Its established strengths in industry-related research will be further boosted with the imminent opening of the £20m Lyell Centre. It will become the Scottish headquarters of the British Geological Survey, and research will focus on global issues such as energy supply, environmental impact and climate change. As well as providing laboratory facilities, the new centre will feature a 50,000 litre climate change research aquarium, the UK Natural Environment Research Council Centre for Doctoral Training (CDT) in Oil and Gas, and the Shell Centre for Exploration Geoscience.

International appeal

An increasingly global outlook, supported by a bold international strategy, is helping to drive Edinburgh Napier University’s growth. The university now has more than 4,500 students studying its overseas programmes, through partnerships with institutions in Hong Kong, Singapore, China, Sri Lanka and India.

Edinburgh Napier has been present in Hong Kong for more than 20 years and its impact grows year-on-year. Already the UK’s largest higher education provider in the territory, more than 1,500 students graduated in 2015 alone.

In terms of world-leading research, Edinburgh Napier continues to make its mark, with the REF judging 54% of its research to be either world-class or internationally excellent in 2014. The assessment singled out particular strengths in Earth Systems and Environmental Sciences, where it was rated the top UK modern university for research impact. Taking into account research, knowledge exchange, as well as student and staff spending, Edinburgh Napier University generates in excess of £201.9m GVA and supports 2,897 jobs in the city economy.

On the south-east side of Edinburgh, Queen Margaret University is Scotland’s first university to have an on-campus Business Gateway, highlighting the emphasis placed on business creation and innovation.

QMU moved up 49 places overall in the 2014 REF, taking it to 80th place in The Times’ rankings for research excellence in the UK. The Framework scored 58% of Queen Margaret’s research as either world-leading or internationally excellent, especially in relation to Speech and Language Sciences, where the University is ranked 2nd in the UK.

In terms of its international appeal, one in five of Queen Margaret’s students now comes from outside the EU, and it is also expanding its overseas programme offer, which already sees courses delivered in Greece, India, Nepal, Saudi Arabia and Singapore.

With 820 years of collective academic excellence to export to the world, Edinburgh enjoys a truly privileged position in the evolving story of academic globalisation and the commercialisation of world-class research and innovation. If he were still around today, Senator Moynihan would no doubt agree – a world-class city indeed.

For further information www.investinedinburgh.com