Professor Patrick Diamond of Queen Mary University of London has stated that London needs increased powers and funding to invest in areas that drive the UK's international competitiveness. This comes as Prime Minister Andy Burnham has placed devolution and economic growth at the core of his government's agenda.
According to Professor Diamond, London's success is crucial for the rest of the country, as the capital generates more than a fifth of the nation's GDP. Tax revenues collected in London contribute to public services across the UK, and its professional services support growth in major cities.
Professor Diamond also noted that London's growth and productivity have reportedly stagnated over the past 15 years, citing the 2008 financial crisis, global headwinds, and Brexit as contributing factors. He suggests that London needs a robust plan with more devolved powers to stimulate economic growth and productivity improvements.
He proposes that London's government should have similar powers to devolved bodies in Wales and Scotland, including control over major taxes such as stamp duty, property-related capital gains tax, business rates, and council tax. Additionally, London should retain a portion of income tax to finance infrastructure and economic development projects.
Professor Diamond also advocates for London boroughs to have their own budgets and levers to drive local growth, arguing that local councils should be key players in joint decision-making rather than solely delivery arms of the Greater London Authority.