March 12, 2013 11:14 pm

Politics: Running the ‘ungovernable’ city

“Is he the king of England?” onlookers asked of the blond-topped Boris Johnson as he progressed through the streets of Delhi last year, trailed by an entourage of officials and press.

The London mayor wears no crown but does share something in common with Britain’s constitutional monarch: heavily circumscribed political powers.

The city for which Mr Johnson fulfils an important figurehead role has been called “ungovernable”. Decision-making power is shared by central government, the mayor and the city’s 33 boroughs. Each vies for influence over the ancient villages that were swallowed up by 19th-century urban sprawl to form Greater London. Large planning projects, for instance, require the assent of all three layers.

Without a big budget for infrastructure, Mr Johnson must use personality and the controlled glare of publicity to maximise his influence and cajole government into committing money for essential city improvements.

“That is part of the pitch I have to make to government,” Mr Johnson told the FT. “If you want London, the motor of the economy, to keep roaring, then you must make sure that you invest in infrastructure, housing and transport.”

The last of these is the area over which Mr Johnson has greatest sway as chairman of Transport for London (TfL). He points to wins in securing government funding for the £14.8bn Crossrail project and an upgrade to London Underground. Plans for an extension to the latter’s Northern line in the Nine Elms development will be met by Treasury-backed guarantees on borrowing.

Flush with the success of his takeover of the London Overground rail network, which has been improved and extended, Mr Johnson wants to enlarge his transport domain further by taking on the suburban commuter rail services into London, currently run by rail operators.

Other Johnson initiatives have been less happy. The Emirates Air Line cable car across the Thames, originally billed as privately funded, has required £15.5m in construction costs from TfL, with running costs estimated at £6m a year. While this is a fraction of TfL’s overall budget, its dwindling passenger numbers – FT calculations suggest it may be running at 7 per cent of capacity – have caused embarrassment to those who envisaged it becoming a popular tourist attraction.

A 600-strong fleet of hop-on-hop-off buses – which Mr Johnson hopes will be “as iconic in London as phone boxes, Big Ben and Beefeaters” – has been ordered at an estimated cost of £180m. But the terms of the deal were questioned after it emerged the vehicles will not be held as assets by the bus operators according to convention, but placed on TfL’s books. As the transport body acknowledges, these are icons with no resale value outside the capital.

. . .

Elsewhere, London is feeling the sharp end of government cuts, with police and fire stations slated for closure and services to be reduced at a hospital in south London. Schools are running short of places and councils are feeling the strain of provision in adult care services.

Already, tensions over the planned cuts have emerged with boroughs, including flagship Tory councils such as Westminster and Kensington and Chelsea. A cost-saving plan to close a dozen fire stations, Westminster and Knightsbridge among them, faces delays after resistance from the London Fire Authority. For a mayor whose default style is ebullient and upbeat, the era of austerity is likely to present some uncomfortable choices.

The politics of London frequently intermingle with those of the Conservative party. Seen as a potential successor to prime minister David Cameron – an ambition Mr Johnson plays down with little success – his efforts to stand up for London sometimes bring him into conflict with government. For some, this is part and parcel of representing the city; others see evidence of a longer-term political aim.

Mr Johnson’s business-boosting trips to places such as India – and this year the Middle East and China – reinforce the impression of a mayor who is looking beyond the city walls. He has also waded into the debate on Europe, calling for the UK to withdraw to the status of a single-market participant.

The economic climate has tested London’s relationship with other regions of the UK, some of which resent the gravitational pull of an area that accounts for around one-fifth of the UK’s economic value added. They have sought fresh powers from a government inclined towards devolution as a way of boosting growth.

But London too can play at that game. Mr Johnson has asked George Osborne, chancellor of the exchequer, to give to London what he has already promised Scotland: revenues from stamp duty land tax on local property sales. He wants to use the receipts – one-third of stamp duty raised in England and Wales comes from London – to pay for regeneration and housing projects. Meanwhile, the independent London Finance Commission, set up by the mayor, is examining ways for London to retain more of its revenues. It will publish its conclusions before summer.

One issue more than any other encapsulates Mr Johnson’s tensions with Westminster: London’s airport capacity crunch. Mayor and government both fear a loss of business to overseas hubs as Heathrow, Britain’s busiest airport, fills to the brim. But they disagree on solutions.

The mayor campaigned vigorously last year on a pledge to resist expansion at Heathrow, which is already Europe’s noisiest airport. Instead, he favours two proposals for estuary airports or expansion at Stansted in Essex.

The government, however, signalled it may drop its former opposition to a new runway at Heathrow after it established an independent commission under Sir Howard Davies, former head of the UK’s Financial Services Authority, to examine the main options for more hub capacity – including at the west London airport.

Mr Johnson sparked a war of words with Downing Street over what he called the “ditherama” of its decision to delay the results of the commission until 2015, after the general election. He has even created his own inquiry, which will deliver its results to Sir Howard later this year.

The Heathrow debate will rumble on. But it is unlikely to be the last time the mayor clashes with other political entities who have a stake in the complex, multi-layered city he represents.

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