Is the Industrial Strategy Relevant to London?

The draft London Plan sets out across almost 550 pages the mayor’s spatial and socio-economic aspirations for London. Alongside the recently drafted Skills for Londoners strategy, and the Economic Development Strategy, these will set the tempo for the Khan mayoralty.

These documents provide an interesting counterpoint to the national Industrial Strategy and has led us to think about how London and the UK’s interests intersect and how national and regional economic strategy can feed from each other?

The draft New London Plan: Towards Good Growth

The mayor’s strategic aspirations build upon ‘A City for All Londoners’, a wide ranging document published soon after his election in 2016. This identifies the big challenges facing London, including the pressure that a fast-growing population exerts on the city. It introduced the principle of good growth i.e. “growth that is socially and economically inclusive and environmentally sustainable”.

The draft London Plan further develops the concept as a fundamental building block around which policies and strategies are shaped. This marks an interesting shift of emphasis from previous London Plans and strategies; rather than simply seeking to maintain and enhance London’s growth trajectory, it asks: what is the purpose of economic growth?

The draft London Plan issues a call to arms to decision markers, businesses, communities and investors across London to consider how their actions are helping to deliver these objectives.

Alignment with the Industrial Strategy

Despite the contrast in focus between productivity nationally and good growth in London, there are clear links between regional and national strategy. The four grand challenges identified within the Industrial Strategy have cross-cutting relevance for the whole of the UK, and London is no exception:

• London can already justifiably claim to be at the heart of the UK’s innovation economy via its focus on the horizon (e.g. advanced urban services being highlighted as a particular area of focus ).
• The plan commits London’s to reinforce its competitive business environment on the global stage, to scale-up innovators and entrepreneurs, and to enhance employment space across the city.
• Further improvements to transport and digital infrastructure are critical to accommodate future growth and better connect people to opportunities.
• Better functioning and more distinctive places was a focus of the previous mayor, and continues to be a priority for Sadiq Khan. The new London Plan places more emphasis on opportunities in Outer London, and his Good Growth Fund will boost investment in town centres and places of work across the city. Above all, London’s housing challenge is central to the Mayor’s narrative, with a range of new policies and initiatives to deliver a wider range of housing across London.
• The good growth focus highlights the mayor’s commitment to London’s people and communities. It acknowledges the threat of living costs and Brexit, while the mayor’s draft Skills for Londoners strategy aims to empower all residents to access opportunities and ensure that London’s future businesses and sectors have access to the skills they need to develop.

Looking Ahead: Can London be left to its own devices?

The fundamental question is whether London needs the industrial strategy or whether it can be left to its own devices?

The last two governments have communicated strong ambition to rebalance the UK economy and the industrial strategy should provide the policy foundation to steer growth outside of the capital. It is however, unclear whether the government thinks it can have its cake and eat it, i.e. enabling London to maintain its performance whilst redirecting investment into the midlands, the north and specifically the combined authorities.

One argument (put forward by the London Finance Commission – https://www.london.gov.uk/what-we-do/business-and-economy/promoting-london/london-finance-commission ) is to offer London greater autonomy to allow the government to concentrate on those areas where the productivity or headroom for growth is greatest. This however, is not a zero-sum game; what is good for London should be good for our other major cities. The devolved powers the city has enjoyed are rightfully also being sought by Manchester, Birmingham, Leeds, Bristol and others.

London is clearly a special case and needs to be supported in its economic aspirations (including further devolution) but it is important however, that we do not lose sight of the relationships between the capital and other cities in the UK, and its potential role in making the UK become more productive and prosperous.

Regeneris is currently working with the GLA to support consultation on the Draft Economic Development Strategy and the Draft Skills Strategy. For more information on this, or any of our other London policy work, please contact  Chris Paddock or Barney Cringle.

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