It is a pleasure to serve under your chairship, Mr Western. I congratulate my hon. Friend the Member for Kensington and Bayswater (Joe Powell) on securing this vital debate.
If we are serious about national growth, we must invest in London. That should not be in dispute after what we have heard today. London is the UK’s top global city. It is home to more than 9 million people and generates almost one quarter of our entire economic output. Its net contribution to the Treasury now stands at a record £43.6 billion. That is why we need to invest in London—because London invests in the UK. It is essential.
On the way to this debate, I was talking to—or, more correctly, arguing with—a non-London MP, who was saying, “It’s about time we got some of that money out of London.” This is the environment that is being created when we talk about taking from London instead of saying that we need to invest in London and in the regions. We have heard how much tourists spend in London —a whopping £16.3 billion, even while still recovering after the pandemic. If the Government introduced a VAT exemption for tourists, that figure would be boosted, and an overnight accommodation levy of just £1 would bring in some more money, which could be used for the development of London by the Mayor of London. We need to stop the narrative that London is somehow separate from the rest of the UK and that we take from London to invest elsewhere. That was the attitude of the last Government, and it is the wrong attitude; it should not be carried over to this Government.
Let us take as an example the Bakerloo line, which my hon. Friend the Member for Kensington and Bayswater mentioned and which I travel on regularly. It is the oldest train service in the UK, and by gosh, when we are on it we can feel that. It very much needs to be upgraded. It runs right through my constituency of Brent East. If we invested in the Bakerloo line, not only would that make my life easier—although I know this is not about me—but the project would add £1.5 billion to the UK economy and support 150,000 jobs and more than 100,000 new homes. What is there not to like about investing in the Bakerloo line? In addition to that, two thirds of TfL’s suppliers are outside London—the new trains are built in Yorkshire—so that economic wealth is spread right across the regions. This is not London versus the regions; it is London working with the regions for the betterment of the UK. We can and must grow together.
The same applies to our safety and infrastructure. A safe and functioning London not only supports residents and businesses here, but ensures that our capital remains open to global investors, visitors and institutions. As we recently read, people now see London as the place to be and invest in. Companies are moving from the US to the UK: they want to invest here because of our infrastructure and our diversity, which we are proud of.
The reality is that after a decade of Conservative cuts and neglect, our emergency services are under huge pressure and are struggling to survive. The Fire Brigades Union had a lobby here yesterday. Ten or 20 years ago, there was talk of reducing the fire service because we had so few fires. Now, with the advance of electric cars, mopeds and bikes, we have more and more fires, so we need to invest. The Metropolitan police has delivered £1.2 billion in savings since 2012-13, and there is now talk of frontline cuts. We just cannot have that in London. That is a threat not just to London’s safety, but to our economic stability.
Past investment has delivered. To those who say, “That’s not the case,” I would point out that the Elizabeth line unlocked 55,000 homes, created tens of thousands of jobs across the country and added an estimated £42 billion to the economy. This is how we invest and make money. Not only that: the Elizabeth line has the best air-conditioned trains in the city—I think everyone appreciates that right now. We need to repeat that success, not retreat from it. We need to praise London.
Productivity in London has fallen since 2008. The Conservatives created funding formulas that pushed funding away from the areas that needed it the most. The then Prime Minister talked about that during the election—quite embarrassingly so. Since 2010, my borough of Brent has been forced to cut a whopping £222 million in funding due to the Tory austerity measures, and we still need to deliver. We need to stop cutting and start investing.
We are now behind cities such as Paris and New York in productivity. That should concern every single one of us in London and elsewhere. We need to work with London. I am concerned about the local government funding reforms, because although we are rightly introducing a new focus on deprivation, not including housing is a skewed way of looking at it. Often in my constituency, 70% of people’s earnings goes on housing.
I am always proud to see our London MPs—they are some of the best MPs in the House. I urge the Minister to reconsider the reforms and ensure that they reflect the unique, pressing challenges that London is facing. We should not shy away from that; we should be proud of what London brings to the UK. This is about not special treatment but sound economic judgment. A thriving capital fuels a thriving country. We do not have to choose between London and the rest of the UK. In fact, choosing London is choosing national growth, so let’s invest in our capital, our transport, our safety, our housing and our skills. Let’s back London, and let’s all love London.