No escape from Mammon? The Shard, near London Bridge. Photo: Cityscape Digital
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Leader: The London question

The capital’s economic dominance ensures that investing in it will produce a higher return than in other regions and makes it difficult to justify investing elsewhere. This logic merely tightens London’s stranglehold. 

The referendum on Scottish independence is not a vote about Scotland,” Danny Dorling writes in his essay on page 26. “It is a vote about London.” More than for any other comparable European country, the capital of the United Kingdom – Europe’s only true megacity – dominates national life. With just 13 per cent of the population, London produces 22 per cent of the UK’s wealth; through major projects such as Crossrail, it swallows a disproportionate share of its infrastructure funding. The Institute for Public Policy Research estimates that per-capita transport spending in London is 500 times as much as that in the north-east of England.

London’s economic dominance ensures that investing in the capital will produce a higher return than doing so in other regions. That makes it difficult to justify investing elsewhere. This logic merely tightens London’s stranglehold. Consequently, when the Yes Scotland campaign warns Scots of the dangers of voting No, it makes references to being ruled not by the English but by London. Indeed, in his New Statesman lecture in March, Alex Salmond likened London to a dark star, “inexorably sucking in resources, people and energy”.

On the question of the north-south divide, it is tempting to view the UK as a rich country in which only a few de­industrialised regions have fallen behind. However, it is London and its wealth that are the true outliers. New figures from Inequality Briefing showed that Britain has nine of the ten poorest areas in the whole of northern Europe. In parts of Wales and in Cornwall, the average income is less than £14,000 a year: once living costs are taken into account, this leaves residents poorer than many in the former communist states of eastern Europe.

Inner London, by contrast, is the single richest region in Europe. If our leaders and the deracinated plutocrats who gather in the capital seem unconcerned about the relative poverty of much of Britain, it is because they live within the walls of Versailles.

This is not only iniquitous; it is potentially disastrous for the rest of the country. It puts increasing pressure on housing stock in the south-east of England, driving up prices and leaving many of us ever more addicted to debt. It raises the cost of doing business in London, rendering the capital increasingly uncompetitive, while draining skills and expertise from other regions. It forces people to commute ever longer distances to work and leaves them captives of our train companies. Worst of all, it makes the national economy especially vulnerable to global financial shocks.

The leaders of both major parties are belatedly discussing devolving power from Westminster to the English regions and additional powers to the other nations of the UK. The main cities, meanwhile, are being encouraged to follow London’s example and set up combined authorities: resurrected versions of the old metropolitan counties, back from the dead to plot grand regional infrastructure plans.

However, all these plans are built on the assumption that the Treasury will retain ultimate control of the purse strings. New powers would be exercised only on sufferance from Westminster. It is unclear, too, whether political devolution will be enough to solve the problem of London’s dominance, without incentives to encourage private investors to invest in the regions. That might require some kind of regional banking system such as exists in Germany.

Professor Dorling proposes a different path: a return to the sort of government intervention that has been unfashionable for a generation. He favours more regulation of private rental markets; more publicly funded housebuilding; and changes to land use rules, such as the greenbelt. It would require having a plan for London. “The free market does not co-ordinate spatially and temporally. It reacts rather than instigates,” he writes.

If we are serious about reducing London’s stranglehold over the United Kingdom, trusting to the free market will never be enough. 

This article first appeared in the 27 August 2014 issue of the New Statesman, The new caliphate

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Why isn't Labour putting forward Corbynite candidates?

Despite his successes as a candidate, the organisational victories have gone the way of Corbyn's opponents. 

The contest changes, but the result remains the same: Jeremy Corbyn’s preferred candidate defeated in a parliamentary selection. Afzhal Khan is Labour’s candidate in the Manchester Gorton by-election and the overwhelming favourite to be the seat’s next MP.

Although Khan, an MEP, was one of  the minority of Labour’s European MPs to dissent from a letter from the European parliamentary Labour party calling for Jeremy Corbyn to go in the summer of 2016, he backed Andy Burnham and Tom Watson in 2015, and it is widely believed, fairly or unfairly, that Khan had, as one local activist put it, “the brains to know which way the wind was blowing” rather than being a pukka Corbynite.

For the leader’s office, it was a double defeat;  their preferred candidate, Sam Wheeler, was kept off the longlist, when the party’s Corbynsceptics allied with the party’s BAME leadership to draw up an all ethnic minority shortlist, and Yasmine Dar, their back-up option, was narrowly defeated by Khan among members in Manchester Gorton.

But even when the leadership has got its preferred candidate to the contest, they have been defeated. That even happened in Copeland, where the shortlist was drawn up by Corbynites and designed to advantage Rachel Holliday, the leader’s office preferred candidate.

Why does the Labour left keep losing? Supporters combination of bad luck and bad decisions for the defeat.

In Oldham West, where Michael Meacher, a committed supporter of Jeremy Corbyn’s, was succeeded by Jim McMahon, who voted for Liz Kendall, McMahon was seen to be so far ahead that they had no credible chance of stopping him. Rosena Allin-Khan was a near-perfect candidate to hold the seat of Tooting: a doctor at the local hospital, the seat’s largest employer, with links to both the Polish and Pakistani communities that make up the seat’s biggest minority blocs.  Gillian Troughton, who won the Copeland selection, is a respected local councillor.

But the leadership has also made bad decisions, some claim.  The failure to get a candidate in Manchester Gorton was particularly egregious, as one trade unionist puts it: “We all knew that Gerald was not going to make it [until 2020], they had a local boy with good connections to the trade unions, that contest should have been theirs for the taking”. Instead, they lost control of the selection panel because Jeremy Corbyn missed an NEC meeting – the NEC is hung at present as the Corbynsceptics sacrificed their majority of one to retain the chair – and with it their best chance of taking the seat.

Others close to the leadership point out that for the first year of Corbyn’s leadership, the leader’s office was more preoccupied with the struggle for survival than it was with getting more of its people in. Decisions in by-elections were taken on the hop and often in a way that led to problems later down the line. It made sense to keep Mo Azam, from the party’s left, off the shortlist in Oldham West when Labour MPs were worried for their own seats and about the Ukip effect if Labour selected a minority candidate. But that enraged the party’s minority politicians and led directly to the all-ethnic-minority shortlist in Manchester Gorton.

They also point out that the party's councillor base, from where many candidates are drawn, is still largely Corbynsceptic, though they hope that this will change in the next round of local government selections. (Councillors must go through a reselection process at every election.)

But the biggest shift has very little to do with the Labour leadership. The big victories for the Labour left in internal battles under Ed Miliband were the result of Unite and the GMB working together. Now they are, for various reasons, at odds and the GMB has proven significantly better at working shortlists and campaigning for its members to become MPs.  That helps Corbynsceptics. “The reason why so many of the unions supported Jeremy the first time,” one senior Corbynite argues, “Is they wanted to move the Labour party a little bit to the left. They didn’t want a socialist transformation of the Labour party. And actually if you look at the people getting selected they are not Corbynites, but they are not Blairites either, and that’s what the unions wanted.”

Regardless of why, it means that, two years into Corbyn’s leadership, the Labour left finds itself smaller in parliament than it was at the beginning.  

Stephen Bush is special correspondent at the New Statesman. His daily briefing, Morning Call, provides a quick and essential guide to British politics.