Time to abolish the UK's last "rotten borough" - the City of London Corporation

One year on from the Occupy protest at St Paul's, we're no closer to reforming the dark heart of predatory capitalism.

On the night Occupy LSX marched into the City tweets came into me asking for help as the police kettled activists on the steps of St Paul's. I went down there and did what little I could to prevent people being roughed up. Over the next few days the tents soon appeared and the occupation became a debating forum on the causes and creators of the economic crisis.

As days turned into weeks and the cathedral hierarchy split over whether to evict the camp, the occupiers soon discovered the existence of an organisation the vast majority of the population barely knows exists. The City of London Corporation was flushed out of the shadows in which it normally lurks to show that it was something more than the organiser of a good pageant in the Lord Mayor’s Show.

Naturally members of Occupy turned their inquisitive attention to this seemingly quaint body that was threatening to send in the bailiffs. Just as the direct action by UK Uncut transformed the issue of tax evasion from a dry debate for accountants into a popular cause, Occupy has helped turn the spotlight on the abuse of power that is the City Corporation.

In Michael Chanan’s and Lee Salter’s new film, “Secret City”, Maurice Glasman explains ironically that St Paul’s was the site of our earliest democracy, where the citizens of London in medieval times would hold hustings. In the sixteenth century the city took over from Amsterdam as the centre of international credit and maritime trade. Its coffee houses became banks and governments became dependent upon them for loans, largely to finance wars.

Government's reliance on the city to finance the national debt gave the city such influence that the Corporation was able to avoid the successive reforms that established democratic local government in the rest of the country.

Instead the City Corporation to this day retains the business vote, which overwhelms the votes of residents in the elections for its Common Council. The vast proportion of elections in the City have not been contested. Instead an old boys’ network amongst the companies sorts out which favoured son is to be bestowed the seat.

This usually prevents anyone slipping through the net who shows any spark of independence, although not always. Around a decade ago, Malcolm Matson was elected with 80 per cent of the vote but was known to favour reform. He was hauled before the City’s Court of Aldermen and was blackballed. Local vicar, the William Taylor, was also successful in being elected but as soon as he started asking questions about the Corporation’s unpublished accounts, his bishop received letters with more than a hint of a threat.

Matson and Taylor could not be tolerated because they were asking questions about the massive resources being spent on the secretive role the City Corporation plays as the lobbyist for finance capital. The Corporation has used its influence to dictate successive government’s policies on the regulation of finance and taxation.

This secured the deregulation of the “Big Bang” era of Thatcher and the hands off approach under Blair and Brown. City speculators were allowed to create the bubble that eventually burst to create the current economic crisis. London became a funnel through which trillions poured into tax havens and the concentration on financial speculation rather than investment in our manufacturing base unbalanced our whole economy. Obscene levels of incomes and conspicuous spending in the City have also created a society grotesquely scarred by inequality and a capital city in which immense wealth is located cheek by jowl with stark levels of poverty.

It was Labour Party policy since its foundation to abolish the City Corporation, until Blair arrived and the policy changed to reform. The City cynically interpreted reform as simply giving more businesses the vote.

The abolition of this last “rotten borough” would show that Ed Miliband is serious about tackling predatory capitalism.

John McDonnell is the Labour MP for Hayes and Harlington

"Secret City" previews at the House of Commons on Tuesday 16 October. For details of screenings and to watch a trailer for the film, visit: secretcity-thefilm.com

A statue of a dragon that marks the boundary of the City of London. Photograph: Getty Images
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Is Yvette Cooper surging?

The bookmakers and Westminster are in a flurry. Is Yvette Cooper going to win after all? I'm not convinced. 

Is Yvette Cooper surging? The bookmakers have cut her odds, making her the second favourite after Jeremy Corbyn, and Westminster – and Labour more generally – is abuzz with chatter that it will be her, not Corbyn, who becomes leader on September 12. Are they right? A couple of thoughts:

I wouldn’t trust the bookmakers’ odds as far as I could throw them

When Jeremy Corbyn first entered the race his odds were at 100 to 1. When he secured the endorsement of Unite, Britain’s trade union, his odds were tied with Liz Kendall, who nobody – not even her closest allies – now believes will win the Labour leadership. When I first tipped the Islington North MP for the top job, his odds were still at 3 to 1.

Remember bookmakers aren’t trying to predict the future, they’re trying to turn a profit. (As are experienced betters – when Cooper’s odds were long, it was good sense to chuck some money on there, just to secure a win-win scenario. I wouldn’t be surprised if Burnham’s odds improve a bit as some people hedge for a surprise win for the shadow health secretary, too.)

I still don’t think that there is a plausible path to victory for Yvette Cooper

There is a lively debate playing out – much of it in on The Staggers – about which one of Cooper or Burnham is best-placed to stop Corbyn. Team Cooper say that their data shows that their candidate is the one to stop Corbyn. Team Burnham, unsurprisingly, say the reverse. But Team Kendall, the mayoral campaigns, and the Corbyn team also believe that it is Burnham, not Cooper, who can stop Corbyn.

They think that the shadow health secretary is a “bad bank”: full of second preferences for Corbyn. One senior Blairite, who loathes Burnham with a passion, told me that “only Andy can stop Corbyn, it’s as simple as that”.

I haven’t seen a complete breakdown of every CLP nomination – but I have seen around 40, and they support that argument. Luke Akehurst, a cheerleader for Cooper, published figures that support the “bad bank” theory as well.   Both YouGov polls show a larger pool of Corbyn second preferences among Burnham’s votes than Cooper’s.

But it doesn’t matter, because Andy Burnham can’t make the final round anyway

The “bad bank” row, while souring relations between Burnhamettes and Cooperinos even further, is interesting but academic.  Either Jeremy Corbyn will win outright or he will face Cooper in the final round. If Liz Kendall is eliminated, her second preferences will go to Cooper by an overwhelming margin.

Yes, large numbers of Kendall-supporting MPs are throwing their weight behind Burnham. But Kendall’s supporters are overwhelmingly giving their second preferences to Cooper regardless. My estimate, from both looking at CLP nominations and speaking to party members, is that around 80 to 90 per cent of Kendall’s second preferences will go to Cooper. Burnham’s gaffes – his “when it’s time” remark about Labour having a woman leader, that he appears to have a clapometer instead of a moral compass – have discredited him in him the eyes of many. While Burnham has shrunk, Cooper has grown. And for others, who can’t distinguish between Burnham and Cooper, they’d prefer to have “a crap woman rather than another crap man” in the words of one.

This holds even for Kendall backers who believe that Burnham is a bad bank. A repeated refrain from her supporters is that they simply couldn’t bring themselves to give Burnham their 2nd preference over Cooper. One senior insider, who has been telling his friends that they have to opt for Burnham over Cooper, told me that “faced with my own paper, I can’t vote for that man”.

Interventions from past leaders fall on deaf ears

A lot has happened to change the Labour party in recent years, but one often neglected aspect is this: the Labour right has lost two elections on the bounce. Yes, Ed Miliband may have rejected most of New Labour’s legacy and approach, but he was still a protégé of Gordon Brown and included figures like Rachel Reeves, Ed Balls and Jim Murphy in his shadow cabinet.  Yvette Cooper and Andy Burnham were senior figures during both defeats. And the same MPs who are now warning that Corbyn will doom the Labour Party to defeat were, just months ago, saying that Miliband was destined for Downing Street and only five years ago were saying that Gordon Brown was going to stay there.

Labour members don’t trust the press

A sizeable number of Labour party activists believe that the media is against them and will always have it in for them. They are not listening to articles about Jeremy Corbyn’s past associations or reading analyses of why Labour lost. Those big, gamechanging moments in the last month? Didn’t change anything.

100,000 people didn’t join the Labour party on deadline day to vote against Jeremy Corbyn

On the last day of registration, so many people tried to register to vote in the Labour leadership election that they broke the website. They weren’t doing so on the off-chance that the day after, Yvette Cooper would deliver the speech of her life. Yes, some of those sign-ups were duplicates, and 3,000 of them have been “purged”.  That still leaves an overwhelmingly large number of sign-ups who are going to go for Corbyn.

It doesn’t look as if anyone is turning off Corbyn

Yes, Sky News’ self-selecting poll is not representative of anything other than enthusiasm. But, equally, if Yvette Cooper is really going to beat Jeremy Corbyn, surely, surely, she wouldn’t be in third place behind Liz Kendall according to Sky’s post-debate poll. Surely she wouldn’t have been the winner according to just 6.1 per cent of viewers against Corbyn’s 80.7 per cent. 

Stephen Bush is editor of the Staggers, the New Statesman’s political blog.