London: A Tale of Two Cities
London: A Tale Of Two Cities
In 2016 London will be voting for only the third individual to be its directly elected mayor.
As a result, I think that it is not too early to begin a conversation about the challenges London faces and how an incoming mayor might use his or her powers.
And the question of what powers London should have is particularly timely in the light of the Scottish independence referendum campaign. Indeed, the Scottish referendum has a number of lessons for those of us in the rest of the British Isles.
Above all, if all Westminster parties now agree on the urgency of giving more political powers to the Scots, how much more pressing is the case for more powers for London which has a population of Scotland and Wales put together, and whose contribution to the British Gross National Product is twice that of Scotland?
The theme of my talk this evening is a Tale of Two Cities, I wish to talk about widening inequality in our great city. As someone who lives in Hackney but can see the towers of the City of London from her bedroom window, I am very aware of the widening gulf between rich and poor in London.
And it is not just between the very poorest and the super wealthy. Those in the middle are suffering too, average wages have fallen £50 a week in real terms since 2008. And accordingly many middle-income Londoners are struggling to cope with spiralling housing costs, transport costs, job insecurity and falling standards of living. We see a chasm opening up between them and the wealthiest, not to mention between them and the international glitterati who flock here in such numbers.
London is more unequal than any other part of the British Isles. The top 10% in London earn four and half times the bottom 10% and child poverty is a third higher in London than the rest of England as a whole. This is a gulf that is widening.
There are many issues that I could talk about but I want to concentrate this evening on talking about health, housing, and equalities in general. The inherent problem underlying it all is economic inequality.
There is no other area of policy that illustrates as well the vast inequalities that currently exist in London than health, particularly public health. For every stop on the Jubilee Line between Westminster and Canning Town life expectancy goes down a year. London is the city with the most multi-millionaires in the world but it is also the TB capital of Western Europe. It has some of the finest teaching hospitals in the world but two thirds of London GPs perform worse than the English average, particularly on access and for the poorest Londoners their GP is their route into healthcare.
London hosted the Olympic games in 2012 and gloried in the performances of the world’s finest athletes but two years later the Olympic legacy for the Olympic borough Newham is that it has the highest rates for obesity among ten and eleven year olds. Yet Newham is not alone in this, the numbers of overweight children has been rising in most of the London boroughs, the capital has some of the most obese school children in Europe.
To compound London’s healthcare issues, the city has been hit by a wave of hospital closures and ‘reconfigurations’ notably in Lewisham, Hammersmith and North West London. I believe that the current Mayor has missed the opportunity to strategically address the current and future public health needs of our communities at a pan-London level. I agree with the findings of Lord Darzi’s London Health Commission. I believe that the incoming Mayor should appoint a London Health Commissioner to work with NHS and Public Health England to drive an assault on public health inequality in London. There are a range of issues where progress will best be made London-wide, working with the boroughs, who now have responsibility for public health; for instance on HIV, air pollution, minimum pricing for alcohol and exclusion zones for fast food shops.
Exclusion zones for fast food shops is a particularly urgent necessity, for instance Newham has forty two chicken shops for every secondary school, is it any wonder that it has such severe obesity problems?
Mental Health is another key battleground which has been overlooked for so long particularly with regard to BME mental health. The role a London-wide health commissioner could play a crucial role in this matter.
Nobody doubts that London is undergoing a severe housing crisis. The average house price in London is £600,000, nearly twice that of the rest of the country.
The average monthly rent of flats in London was £1516, with landlords typically asking £1211 a month for one-bedroom flats and £1605 for a two bedroom. Across the rest of the UK the overall average was £655.
To illustrate quite how far the crisis has spiralled, in Hackney a garage was recently put up for market for £375000 and in Mayfair and eight car parking space was sup for £2.25m.
The effect of this is as follows: First, young Londoners cannot afford to buy, they are forced to rent well into their thirties or move outside the M25. Second, there are severe problems for recruitment. For instance the NHS in London has a low retention rate and some of the highest vacancy rates in the country and housing is the number one issue behind this. Third, high property prices are also behind spiralling rents and indirectly affect rents in the social housing sector.
The cause of this are as follows: there is an unlimited supply of super wealthy international buyers desiring to purchase property in Central London. They are using London property as a status symbol and a safe deposit box, often keeping the property empty for much of the year. Even in Hackney the largest proportion of a development in Dalston was bought off plan in the far East. This is causing a price ripple out through zones two and three, making it increasingly harder for hardworking families in previously affordable boroughs to meet housing costs.
The bottom line is that the London market is not a functioning market, and simply increasing the supply will not bring prices down for everyday Londoners. Fortunately there are measures that we as a city should take.
Firstly we need to tighten up on exploitative letting agents that hit new tenants with exorbitant fees. Secondly we need to allow councils to borrow to build. Thirdly and most crucially, we desperately need some measure of rent control as they do in New York, San Francisco, Berlin and across Sweden. We need to ensure that the price is tied to the market and mechanisms to make certain that landlords cannot arbitrarily raise rental rates. We are leagues behind global leaders in addressing this problem. Rent controls do not herald mass state led market intervention into property laws, but instead are a sensible and utterly necessary tool of regulation given the dire reality of the problem.
When it comes to the mansion tax and its objectives the fairest option would actually be to review Council tax. The current system was introduced in 1993 and based on 1991 valuations, it has never been updated although it was supposed to happen in 2007. However, it’s hugely unpalatable thus politically unacceptable so I am not suggesting that.
Ed Ball’s attempts to make the mansion tax fairer are to be welcomed, as it the extent to which it is a re distributive measure, but the fact is that it will be a hard sell in London.
When it comes to international non-domiciled buyers of central London property, we need to look seriously at targeted special rates of capital gains tax.
Some commentators have argued that the solution to London’s housing crisis lies in building on the Green Belt but painting it as a gilded green promise land that will solve all the housing woes of the capital is unrealistic and irresponsible. I believe that that proponents of such ideas have simply fallen into the developers trap. Of course the developers would love the permission to place new builds across the metropolitan green belt as I am sure it would be highly lucrative. But decision makers must face up to the fact that London’s housing issues must be addressed primarily within the M25. It would defeat the primary objectives of the Green Belt, namely to check urban sprawl and support biodiversity, which would upset both Londoners living on the edge of the Green Belt and the many people in the inner city who are rightly concerned about green issues. Instead, London’s leaders must look at the over 50,000 brownfield sites and incentivise development on these sites that could provide 366,000 houses across the city.
I believe that the way forward, in line with the recommendations of the London Finance Commission and the Royal Society of Arts City Growth Commission is to keep at least some of the proceeds of the mansion tax here in London.
I would hypothecate it to a London Housing Authority chaired by the Mayor which would build genuinely affordable housing for Londoners. I would also work with boroughs to pilot a scheme to give mortgages to public sector workers. Indeed I managed many years ago to get my first mortgage from the local council.
Some party colleagues are arguing that anyone who critiques the mansion tax is against more doctors and nurses. Actually nothing would do more to help us recruit more doctors and nurses in London than being able to offer them affordable housing within commuting distance of their hospital. This would also have the knock on effect of lessening our dependence of expensive agency workers.
In terms of wider equalities within London, it is well known that 50% of the nation’s LGBT community lives in London and Brighton. Ken Livingston rightly introduced civil partnership which paved the way for both Blair and then Cameron to bring in same sex marriage. But key support for the community is missing for instance in London-wide provision for HIV positive individuals. We all cross boroughs every day, for instance we can live in Camden, work in Lambeth and have a partner in Tottenham, access to health services should therefore reflect this.
Indeed we always think of London as an open and progressive place but just recently we saw a London bus driver throw an LGBT couple off a bus for kissing. Wherever it is in within the Mayor’s power, London should be a no go area for that sort of bigotry.
We have seen the rise of a toxic anti immigrant culture in the nation’s political discourse, and this is a result of the two main parties colluding to an extent.
London is a city built by immigrants. Whether it is the Irish Labourers who came over in Victorian times to build our early transport infrastructure, whether it was the Jews from Eastern Europe, West Indians, Africans, Turks, Kurds and now Eastern Europeans, immigrants have over the centuries and decades been woven into the very fabric of the city.
The anti-migrant narrative has always been the same, cries of job-stealing and exploitation of public services. But instead of scapegoating immigrants we must address the root causes of people’s unhappiness, namely ill thought out austerity measures that have hit the most vulnerable in our society amidst unstable employment prospects and a spiralling cost of living.
Show me the London hospital that wouldn't close down without the labour of immigrants and the children of immigrants?
Show me the public service in London that is not reliant on the work of so called ‘immigrants’.
London’s art, music, and culture have been immeasurably enriched by the contribution of immigrants, not to mention our restaurants…
So I firmly believe that London should be the ground zero in the fight against the anti-immigrant politics engulfing Westminster, we should be proudly celebrating the strength in diversity that London has come to represent.
In fighting poverty and inequality in London the most important thing is to get the economy growing sustainably. Education is the key to growth and that’s why I would advocate the return of the Educational Maintenance Allowance.
We currently have a bubble economy based on house prices and financial services. No wonder that we heard today that the deficit is actually getting worse. We currently do not have real growth. It is critical that London is able to borrow for investment in infrastructure and indeed in its latest World Economic Outlook, the International Monetary Fund suggests that borrowing for investment in infrastructure is likely to pay for itself, particularly if investments are well planned and executed. The UK currently has the second-worse infrastructure in the Group of Seven leading high-income countries, ahead only of Italy.
Michael Bloomberg the former Mayor of New York noted that: ‘Empowering cities to invest in their own futures not only makes them stronger, it makes their nations stronger too.’ That is why I support the proposals by the London Finance Commission and today the Royal Society of Arts ‘City growth Commission’ that London should be allowed to keep more of the property taxes raised in the city.
A Tale of Two Cities begins: “It was the best of times, it was the worst of times…’ and I believe that this is absolutely true of London today,
The city has never been more wealthy, vibrant and multicultural, but there has never been more poverty in our midst.
Some of you will have come this evening expecting a big announcement, but I have to disappoint you and say that there will be no big announcement tonight.
The priority for London Labour Party MPs has to be fighting to win key London marginal, but it is not too early to start a discussion about issues facing our great city and that is what I am here doing tonight.
London has done many incredible things for me, the daughter of the immigrants you hear so much about from UKIP and others. It provided me with a free education all the way up to university, offered me top quality free healthcare, I was able to buy my own home before I was thirty, and crucially as a result of this- I was able to fulfil my dreams.
Without real, concrete, and lasting change I do wonder how many young Diane Abbott’s just starting out today will be able to say the same thing decades from now.
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