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Posted: 28.03.24

Race for City Hall: The view from the City

I’ll start with a question; one I’d argue is perhaps not asked enough as we get to closer to London mayoral elections: what does the City of London actually mean to the Mayor of London?

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Well, for one, whether your rosette is blue, red, yellow or Count Binface grey - it’s not votes. At c.8500 residents, the population of those living in City of London equates to just 0.4% of the c.2.1 million who voted in the 2021 mayoral elections. Political allegiances are also rather limited. Following a by-election in autumn of last year there are now six Labour councillors in the City of London Corporation – and even this low number is more than ever before. But this sits out of a total of 125 Common Councillors and Aldermen. And, while some may point out the fact that the de facto leader, Chris Hayward, has previously served as the Conversative Deputy Leader of Hertfordshire and Dorset County Councils, he sits as an independent at Guildhall, as do the majority of his colleagues..

What the Square Mile is for a Mayor of London though, as we know, is one of its key generators of the capital’s wealth. The City of London generates £1.1bn in business rates revenue – more than levies collected across all businesses in Manchester, Birmingham and Leeds combined – from nearly 22,000 businesses. The Square Mile also hosts the second largest number of ‘large businesses’ (those employing more than 250 people) of any region in the country, despite being its smallest by area. It is also one of London’s largest employers and many of the 650,000 workers in the City of London – which account for over 10% of the capital’s total workforce (despite the City accounting for about 0.1% of its total area) – live – and thus vote - elsewhere in London.

Money isn’t the only thing to factor into the equation either. The Square Mile is the capital’s oldest and most historic region, and home to some of its most prized institutions – including of course the Museum of London, to which Sadiq Khan contributed £70m in 2019 for the new museum project, St Paul’s Cathedral, the Barbican Centre and many others besides. Add to this large sections of the London Wall built in 200AD, 37 other churches and 12 synagogues – most Grade-I listed for their ‘exceptional interest’ – and some of London’s oldest boozers and fanciest restaurants, and you start to get a sense of genuine cultural richness, in and amongst the stereotype of blue suits and big business. 

On the surface then, you’d think the Square Mile had a case to get a significant amount of attention in mayoral manifestos and pledges. In reality, though, direct mentions and policy pledges are few and far between. Now – I’m not going to be naive and suggest there aren’t reasons for the absence of mentions. The City Corporation is proudly independent and this status is one of the most important features to the successes of our financial system.

What I do see though is a need – and a significant one - for greater endorsement of the prized financial district from the Mayor. In the post-Brexit years, the City is facing new challenges. The FTSE 100 is up by just 6%, compared to a 50% rise in the Dow Jones over five years, and there’s been a series of de-listings and IPOs choosing other Stock Markets over London and while what happens on Bloomberg Terminals may appear to have little material impact on the Square Mile itself, this is reflected in the fact that office vacancy rates are to hit 12.1% in the City by the end of this year, up from 10.8% per cent recorded in 2023.

You’d think then, that in the confines of Guildhall, there may be a view – and a very fair one – that the next Mayor of London, in charge of a city whose economic health is underpinned by the success of the Square Mile, would and should be doing everything they could to be as pro-business as possible and a champion for international investment. We could of course therefore ask another question here: who is the best of the two most likely to win mayoral candidates to fly the flag for the City of London?

Susan Hall’s campaign so far seems very focused on the suburbs – her views on Brexit, her pro-motorist stance and opposition to tall buildings feels a bit removed from, and not perhaps not necessarily what is needed, in the Square Mile. The recent Conservative campaign video portraying London in an unfavourable light also doesn’t seem likely to have helped the City of London on the world stage.

Then there is Sadiq Khan. It remains to be seen however whether Khan (with Starmer as Prime Minister should the polls be correct) would be ready and willing to bang the drum for the City, or for that matter bring in the necessary regulatory changes required to ensure it remains globally competitive. Certainly as a party Labour has not shied away from suggesting they could be ‘radical’ in support for the finance and banking sectors, but these policies are yet to be fully formed, let alone put into practice. The scars of the 2008 financial crisis could well still influence Labour thinking.

There is potentially a ‘synergy’ (to use a lovely City-esque buzzword) between the incumbent Mayor of London’s mantra ‘London is Open’ and the phrasing of the City of London Corporation’s own plans to “boost the vibrancy of the Square Mile by opening up the City to new audiences”, as per its Destination City ambitions (my emphasis added).

There is also a planning angle. While Hall has made it clear her views on tall buildings, Sadiq Khan isn’t uniformly a fan either, and of course was the first before government to overturn the City of London’s decision to approve plans for Norman Foster’s 1,000ft ‘Tulip’. That said, one need only look out the window to see how the City skyline, and particularly the Eastern Cluster, has grown under Khan’s premiership. These views matter to the City of London, whose own draft City Plan for 2024 actively encourages the development of more premium office space to improve the Square Mile’s appeal to international business. With space rather limited, tall buildings are a somewhat of necessity.

So, whoever is to be the next Mayor, I think we can all agree that the answer to the question I posed at the beginning about what the City of London means to the Mayor should be - a bloody great deal. Perhaps there’s a follow up question - given the difficulties we’re likely to face as a capital and country over coming years - has there ever been a more important time for a Mayor of London to take action to ensure the strength of our beloved Square Mile?