A group of cross-party MPs has urged the Chancellor to use the upcoming Budget to boost economic growth in London.
Describing the capital as a “vital cog in driving the UK’s future prosperity”, the All-Party Parliamentary Group (APPG) for London hopes to see fiscal measures that will help businesses and create new jobs and opportunities.
The group’s shared priorities include:
Safeguarding the future of London’s world-class transport network. Modernising services and investing in infrastructure is crucial for encouraging economic activity within the capital, but also for improving London’s connections to the rest of the UK and helping London compete with other global cities. Projects such as Crossrail 2, the West London Orbital, and the extension of the Bakerloo Line would bring significant benefits.
Reintroducing tax-free shopping for tourists (the VAT Retail Export Scheme) to make London and other UK destinations more attractive to overseas shoppers. Last year a parliamentary report described the government’s decision to remove tax-free shopping in 2021 as “short-sighted and incredibly damaging.”
Maintaining support for Londoners struggling with their energy bills, including the Energy Bill Relief Scheme for businesses. The government currently plans to reduce support for non-domestic organisations from April.
Reforming the Apprenticeship Levy to remove the barriers preventing businesses from creating apprenticeships. Employers across the capital complain of inflexibility in the government-set rules on how the Apprenticeship Levy can be used. A major survey of London businesses last year found 86% of firms in the capital do not employ any apprentices – with worrying implications for London’s future skills capacity and employment opportunities.
Although London makes a major contribution to the UK’s overall economic performance, the APPG argues this cannot be taken for granted.
The cross-party group highlights a recent report from the Centre for Cities think-tank warning London’s rate of productivity growth has plummeted in comparison to international competitors, costing the UK economy tens of billions of pounds a year.
The APPG also points to London’s longstanding economic and social challenges, including the most severe housing and homelessness pressures in the country and among the highest poverty and unemployment rates found in the UK.
The group emphasises that London should be given the powers and resources it needs to tackle these issues, including through further devolution away from central government and towards London’s regional and local government.
Sir Bob Neill MP, Co-Chair of the APPG for London, said:
“The Budget is a chance for the Chancellor to show he recognises London as an invaluable national asset. Rather than try to level London down, the government must do everything it can to get London back in business.
“The capital is a vital cog in driving the UK’s prosperity, but the government cannot afford to take London’s contribution for granted.
“We want London to be the best city in the world to live, to visit, and to run a business. To achieve that, the Budget must bring fresh support for London’s economic recovery and help the capital overcome its immense challenges.”
