Friday, 31 October 2014
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Where is the plan to develop cities that aren't London?

London needs £1.3 trillion over the next 35 years to spend on infrastructure in order to keep up with the expected growth in population. That was the statement delivered by London mayor Boris Johnson this week as he launched a consultation on the city’s new infrastructure plan costed by Arup.

The plan, which is likely to get many engineers excited, included not only the already proposed Crossrail 2 rail link running north to south and a four-runway hub airport in the Thames Estuary, but also a new orbital rail network and an underground ring road.

This was on top of a raft of other transport upgrades including a link between the Channel Tunnel rail line and the planned High Speed 2 network – an omission from current plans that has attracted much criticism – plus new housing, water, energy, broadband and green spaces.

The debate is now open as to whether these are the best ways to improve infrastructure in the capital. But the plan also raises the question of whether the UK should continue to pour so much tax money into London – and even increase it.

Arup’s cost report found that capital expenditure of £1.3 trillion would be needed to fund the plan, with £1 trillion just to enhance existing infrastructure and the largest proportion going on housing, followed by transport. Total costs could be as high as £2 trillion.

Most of these costs will be met by the public sector and Arup found that current funding arrangements will create gaps of £135bn in housing and transport. These will likely be funded through a mix of efficiency savings, higher fares and bills, new revenue streams and extra government funding.

So to complete Boris’s plans, even more taxpayer money will need to be thrown at the capital. And it already receives an awful lot. Estimates vary but public expenditure on infrastructure per person in London is thought to be at least double that of anywhere else in the rest of England.

In fact, total capital spending on regional projects in the capital is greater than that for the entire rest of England apart from the South West, where most spending is going on building the new Hinkley Point nuclear power station.

London, of course, is different from the rest of England and the UK. Its high, dense population means it has different needs and is responsible for a vastly disproportionate amount of GDP. London flag-wavers like to say it’s a global city that’s competing with for international business New York and Tokyo rather than Newcastle and Nottingham.

But it’s no coincidence that the city that receives twice as much public money per head than country’s average is also where most of our most powerful politicians – and the national media – are based.

London’s population may well continue to grow rapidly and will certainly need a large amount of investment to cope with this. But after decades of decline, other cities such as Birmingham and Manchester have also seen population booms in recent years.

There’s an interdependent relationship between infrastructure and its population: as a city grows it needs more transport, housing etc, but these investments will also provoke further growth as more people and businesses are attracted to move in. Similarly, failure to invest will encourage migration away from a city as there will be fewer jobs and facilities to support the population.

What London has realised is that it can exploit its privileged provision to convince central government to give it a grossly disproportional amount of taxpayer money. This seems especially unfair in light of the city’s importance to international businesses that would likely be more willing to stump up private investment to help keep the capital running. But what help’s London’s case is its determination to portray itself as a thriving metropolis with a shining future that deserves world-class infrastructure.

Of course, England’s regional cities may not need big new rail links or great swathes of housing development. They may be better off upgrading existing infrastructure, and plans are afoot to do some of that. But London is much better at visualising what might be possible and, in doing so, raising expectations and building the case for investment.

The capital hasn’t even finished the Crossrail commuter link and already it has drawn up plans for Crossrail 2 – and now comes this proposal for an orbital railway. In the rest of England there hasn’t been a new rail line in over a century. Why did it take George Osborne to put forward the first prominent suggestion for a high-speed trans-Pennine link? And why wasn’t there a more developed plan for him to support? Where are the North’s own champions? Battling the dominance of London-centric media, politics and business, most likely.

Boris’s grand vision for 2050 may never happen. But by setting out such a proposal, London helps pave the way for persuading central government it deserves an even greater share of power and money. The rest of the country needs to start thinking bigger and shouting louder - and the capital’s elite need to start listening.


Readers' comments (29)

  • The problem in this country is that to previous, current & future governments, ministers etc. that unfortunately nothing else exists in this country beyond Watford!
    As an example Birmingham which desperately needs a second runway to the airport has been turned down but London airports get exactly what they want.

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  • To be fair, Birmingham airport has just had a £40m extension and is only operating at 50% of capacity. Heathrow, meanwhile, is at 98%.

  • The total UK national debt in 2012 was roughly £1.3Tn. Boris asking for £1.3Tn for new transport projects in London is ridiculous.

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  • The £1.3 trillion isn't for new transport projects: it's for total capital expenditure (including private sector investment) on all infrastructure. The biggest chunk would go on housing. And £1 trillion of it is to enhance existing schemes.

  • There is no point waiting for London to take care of us. Just stay out of the way.

    We'll manage.

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  • The reality is that Boris, and Ken before him, have ideas and are prepared to stick their neck out and fight for them. Whether they are correct is another matter, but there's little visionary coming out of other regions. In the void politicians try to create things e.g. HS2. Again, it may not be the best thing to do but in the vacuum of ideas at least they are having a go!
    So.. if visionary schemes are wanted elsewhere someone needs to create them, plan them, and fight for them and stop bleating about others who do have ideas getting support.

    (PS 'responsible for a vastly disproportionate amount of GDP' and 'grossly disproportional amount of taxpayer money' is inconsistent. Private investment will simply move to Frankfurt and never be on grubby engineering projects)

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  • London has 12% of UK population, produces 22% of GDP but receives almost half the country's infrastructure spending. Perhaps "vastly" was an exaggeration.

  • One issue is that other cities (esp Birmingham) have been strangled by the green belt and planning laws generally. London, being bigger can support and absorb development without expanding as much, but smaller northern cities probably need to physically expand (and even merge to form conurbations) in order to develop economically. This isn’t just about building houses and offices – but also train lines, roads and (eventually) expanded airports. Great cities have green spaces with in them as much as around them.

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  • Don't be silly Stephen,

    don't you know we outside the M25 exist merely to subsidise London's productivity growth until it decides to declare independence leave, the UK and join the First European Republic circa 2028, leaving the rest of us to rot.

    I believe some Whitehall mandarin read The Hunger Games once and thought it'd be a hoot to propose it as the model for managing investment acorss the UK. Of course his suggestion was submitted as a bit of a laugh but would you know it, it got Downing St. approval and is now the unwritten master plan for the nation.

    Every now and then Boris gets above his station and likes to rub the plebs' noses in it. Its just his way of blowing off steam until Ed Milliband hangs up his primeministerial slippers and the batton is passed back to the Tories to have a go.

    The most amusing part is Ed Balls still thinks he has a chance but unbeknownst to him, the powers behind the scenes have already decided that he and George Osborne are going to suffer serious political fallout following a "factfinding" tour of Thailand and a couple of managed indiscretions. Their wives will forgive them but neither of them will ever make PM.

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  • London is a positive net contributor to the budget. It also is there to compete very much on a global scale. I would see this as an opportunity for the rest of the country to benefit from this. Much of the infrastructure is manufactured in the rest of the UK in sent there. The UK as a whole benefits from this as London draws more money in from the rest of the world and effectively distributes this within the UK. Anything that makes London more competitive and projects that benefit the manufacturers in the UK is only a good thing in my book.

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  • Readers of my other posts may recall a comment about a dear friend [shot down on September 4th 1939 dropping leaflets over Germany] who studied politics during his 6 years as a guest of the Reich, joined the Foreign Office after repatriation and was part of the team to define the Constitution of post-war W Germany. I recall well his description of the fact that that Constitution was designed to ensure that the various provincial cities and 'states/areas' would retain local responsibilities for just about everything including local tax raising AND retention. This was to ensure that the centre NEVER again had absolute power: and that if a mad-man did manage to gain control, his influence would be minimal.

    Unfortunately our present circumstances -all revenue is taken to 'the Capital' and occasionally graciously doled out to deserving supplicants...- but only after London has taken the lions share...is exactly the opposite. Ergo..we in what are still called 'the provinces' get a few crumbs. Central planning always gives regional chaos.

    Best
    Mike B

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  • There is a finite size that a city can grow to; after that it will literally implode on itself. The amount of people that have to have all the facilities at their disposal is not physically possible. No one will be able to travel across the city to where they work; they won't be able to have water & sewerage to their properties as everything will on top of each other!

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  • As a former Londonite, now living in the "sticks" in northern most Cumbria, in a busy but small town, I am shocked at how much Londoners can take for granted that those outside do not get to see. For example broadband and internet access, public transport with good coverage (you only have to try to get to the railway station once without a car to spot that the 9 miles from my town to Carlisle will take longer what with including walking to the bus stop 2 miles away, waiting for the once every 2 hours bus etc, will add another 2 hours min to the journey anywhere else), cultural activities (love Tullie House Museum, but would love there to be more than one small museum and publically funded gallery for 50 miles), and work... Because what business in their right minds will set up in a place that is so difficult to trade from?

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