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From the early 1990s right up until the 2008 Global Recession, London did not have to worry too much about economic growth. While the rest of the UK lagged behind other G7 economies, London powered ahead. This was particularly true of productivity – the ability to produce more wealth with fewer resources – which is fundamental to meaningful and sustainable growth. The challenges the capital faced were more about tackling the downsides of its economic success, with mounting pressure on its infrastructure, housing and environment, and by some measures, growing inequality.  

Of course, these problems have, if anything, become more acute over the last 15 years, but they have done so, even as productivity growth has stalled.  From 1998 to 2007, London’s productivity increased by 3% a year.  Whilst from 2008 to 2022, it grew at just 0.12%. 

It’s against this background that the Mayor of London has just published an ambitious new ‘’, pitched as his contribution to the Government’s ‘’.  This comes hot on the heels of the Government’s English Devolution plans, which emphasises the need for Mayoral Strategic Authorities like London to work more closely with academic funders, such as UK Research & Innovation, and with local universities.   

From the beginning, the authors of this Plan have had to wrestle with the two slightly awkward features of London’s economy.  First, most of the big factors behind the fall in London’s productivity are not the sort conventionally tackled in an economic strategy. They are more about affordable than, say, strategies to promote inward investment or strengthen skills.    

Second, the government’s own preferred , which involves backing a small number of high-potential industries, does not really fit the capital.  London has strengths in an exceptionally wide range of industries. It’s an agglomeration of agglomerations. The extension of the Bakerloo Line would probably do through generating additional houses and workspaces, all while cutting travel times, than even the most effective of economic strategies focused on, for example, encouraging small businesses to adopt new technologies, or supporting the Med-Tech or fashion sectors.  

Yet the capital does also confront some serious more narrowly ‘economic’ challenges, perhaps most significantly an under-funded and poorly co-ordinated vocational skills offer. And the Plan, which is clearly buoyed by the expectation that London will benefit from a new Labour government, sets out some clear ambitions and actions to tackle these.  

One particularly notable feature is the prominence it gives to universities, recognising the need and opportunity arising from the English Devolution White Paper.  Other economic development strategies have signalled the importance of universities, but I don’t think any has given them as much airtime. (For what it is worth, the Plan mentions universities 31 times in the body of the report, more or less the same number as , which is more than twice as long!).  

This in no small part reflects concerted efforts on the part of London’s universities, The Greater London Authority and London Councils to build equitable and enduring partnerships, including the establishment of our own London Research and Policy Partnership, dedicated to fostering closer and more structured collaboration between academic researchers and policymakers. And, too, the reality that the core activities of universities – advanced education, research and innovation – are becoming ever more important to London’s increasingly knowledge and innovation intensive economy.   

The Plan rightly recognises the value that foreign students add to the economy and calls for measures to ensure that they continue to choose, and are able to travel to, London over other destinations.  It sees universities as playing a central role in meeting current and future skills needs. It makes much of the evolution of London from a place that adopts and adapts ‘frontier technologies’ to inventing them.  And it highlights the role universities can play in promoting public sector innovation as a means ‘to solving problems for Londoners and, in doing so, grow innovation, particularly in frontier sectors’ .

The combination of the White Paper and the London Plan mark a significant and positive development for the context in which London’s universities and government operate.  It’s now up to both sides to build deeper and enduring partnerships.