London business groups urge Sunak to give capital its fair share in spending review
A pair of London business advocacy groups have called for the capital to receive significant amounts of funding in Rishi Sunak’s spending review next week amid fears the city could be overlooked.
London First and the London Chamber of Commerce and Industry told City PM that it was vital the capital was not forgotten by the government as it prepares to splash the cash to “level up” economically deprived parts of the UK.
The chancellor will unveil his long-awaited comprehensive spending review next Wednesday, with the Midlands and the North set for large capital investment as a part of the government’s “levelling up” agenda.
Boris Johnson promised £100bn of infrastructure spending across the nation in last year’s manifesto, with major cities north of London in line for a number of projects.
Mayor of London Sadiq Khan asked the government for more than £30bn from the spending review in his formal submission to Sunak, including almost £6bn for Transport for London (TfL).
Any new TfL funding is considered unlikely, with the government and City Hall in the midst of an ongoing row about the future of the transport body’s funding arrangement.
London Chamber of Commerce and Industry chief executive Richard Burge said it was essential for the capital to get its own stimulus package in the spending review.
“The government must provide clear evidence through the spending review that they recognise that London isn’t self-healing and that it is essential to the economic and social health of the entire nation,” he said.
The review was originally going to span the next four to five years, however Sunak was forced to cut the length to just one year due to Covid uncertainty.
This means he will only consider shovel ready infrastructure projects, as well as making decisions on public services spending.
London has several projects that could be considered shovel ready, including the Bakerloo line extension, the Northern line extension and long-awaited signalling upgrades on the Piccadilly line.
Repairs for the closed Hammersmith Bridge have also been mapped out by the local council and TfL, however the government only just formed a task force to consider the project.
Crossrail 2 is also a longer term project that is not expected to be funded in this spending review.
Lobby group London First said it wanted to see from Sunak an extension of business rates relief for new fibre to support rollout targets by 2025, and a re-commitment of funding support for the proposal to introduce a fibre spine in London underground tunnels.
Daniel Mahoney, programme director for economy and infrastructure, said: “We support the government’s intention to level-up all parts of the country, but you don’t level-up the country by doing down London, which is worth 20 per cent of UK GDP on its own.”
A Treasury spokesperson said: “We remain absolutely committed to levelling up the UK and helping every part of the country return to growth, jobs and prosperity.”