London gives UK Treasury £34 billion boost each year
A new report has highlighted the huge contribution that London makes to the UK economy.
It’s well-known that London is the business and finance hub of the UK, as well as being its biggest city by far and home to some of the highest relative property prices in the world. Yet the wealth being created in the capital also has a knock-on effect for the whole of the UK, according to figures from the Centre for Economics and Business Research (Cebr).
The report, published by the City of London Corporation, shows that London contributed a net £34 billion to public finances in the UK over the 2013-14 financial year, up substantially from £28 billion in 2012-13.
That means the capital is providing a huge boost to the Treasury’s coffers, supporting growth, jobs and public services both within the capital itself and beyond in the UK as a whole.
Overall, London offers strong returns for the UK as a whole. Public spending in the city is currently high – projects like Crossrail and other infrastructure programmes pushed the total to around £93 billion in the last financial year – but it pays much more back. In fact, the report finds that London generated some £127 billion in tax revenues for the public purse.
Westminster and the City of London were the districts that led the pack, collectively contributing £23.8 billion to the UK on the back of the highest employment rates in Central London.
But the other six Central London boroughs also contributed a considerable surplus over last year, indicating that high activity was paying dividends across the heart of the capital.
Unsurprisingly given the higher levels of business and financial activity in the capital, it has provided more to the economy than any other region in every year since 2006-7.
“Clustering business together in the centre creates an environment primed for economic growth – but this cannot work without out symbiotic relationship between all London boroughs,” said Mark Boleat, City of London policy chair.
“London works as a whole to complement the strengths of the other UK regions, and this report shows that it will continue to do so for years to come, supporting the UK’s wider economy and driving the recovery forward.”