In the West End we were delighted to hear praise for London and its potential in the leadership campaign. When both candidates said you can’t move up at the expense of London and realized that if London does well, the rest of the UK does well too, we wholeheartedly agreed.
The question, however, is how you translate that sentiment into concrete action – and how you take the actions that will enable a business-led recovery in London and help Britain realize its full potential.
London – especially central London – is unique and impressive in the complexity of its ecosystem and the resulting economic power. Central London occupies 0.01% of the UK’s land area and generates 11% of the UK’s total economic output – or a gross value added of £211 billion. It offers a global magnet for tourism and investment. Our unique ecosystem – combining business with world-class culture, hospitality and visitor attractions – is an integral part of Britain’s soft power.
Troubles in central London continue after the pandemic
We cannot take this ecosystem for granted. The pandemic has revealed significant vulnerabilities and our companies are by no means out of the woods. In the West End we are facing a perfect storm: fewer commuters, fewer visitors, the phasing out of government support, chronic staff shortages that have caused West End hospitality businesses to lose a fifth of their turnover, industrial action that once virtually paralyzed London have more and a business tariff system that does not offer a level playing field.
In recent times, rising energy costs have caused businesses, particularly in the hospitality sector, to seriously question their survival over the next few months. It would be a tragedy – and a waste – if businesses that were supported during the pandemic now failed and people lost their jobs due to a lack of support.
The government cannot do everything, and it certainly cannot turn the clock back to the days before the pandemic. But there are actions it can and should take.
Businesses are crying out for support similar to that during the pandemic, in the form of corporate tax breaks and sales tax cuts, like those promised by the last chancellor just days ago. Active help with managing the energy bill would keep them afloat and keep people busy over the coming months: longer-term measures to increase the energy supply are of little use if they have to close their doors until then.
They want a pragmatic approach to solving the workforce problem – which, given the numbers at stake, may need to include a re-examination of opening up the labor market to foreign workers, where there is a clear and chronic shortage of skilled workers. They want far-reaching reforms in the system of business tariffs so that the high street no longer operates at a competitive disadvantage. Above all, they want to feel that the government is on their side, listening – and behind London.
Stop playing politics with London
It is also time for a fresh start in the relationship between local and national government. The temptation to turn issues like transport and policing into political footballs is understandable. But with Westminster and City Hall in perpetual strife, who will win? Certainly not the people or business of London. And yet: If politicians are willing to work constructively and think long-term, then that will create the jobs, opportunities and growth that the country ultimately needs. To this end, we welcome the recently agreed TfL Funding Agreement and hope it will provide growth and stability.
Nobody doubts London’s ability to bounce back from difficult days; our entrepreneurial spirit and resilience will endure. The question is how fast can we roar back.
The right government support will be transformative, helping London to recover much faster and spurring the economic growth that can get the whole of Britain back on its feet. We do our best to attract people and stay open for business. But we can’t do it alone: we need all sides to work together to make this the best city in the world to visit, live in and thrive in.
Ros Morgan is Managing Director of the Heart of London Business Alliance