Have we passed peak London?

Clouds over London. Image: Getty.

London has grown steadily for the past 30 years, in people, jobs and self confidence. Population growth has been driven both by in-migration (more people moving to London than moving away) and by natural change (more births than deaths). International migration – both EU and non-EU – has been a major factor in the city’s growth, outweighing domestic migration, where London has been a net exporter of people.

For some, London’s growth should be celebrated as evidence of its success as a global city: it’s a jobs machine; an economic powerhouse; a gateway to the UK; a generator of fiscal surpluses for the whole nation. For others, London is a “dark star”, draining the rest of the UK of people, talent, public spending and media attention. Its growth is seen as unnatural and unbalanced, leading to a large and increasing gap in opportunities, wealth and income between London and the rest of the UK.

These debates are familiar and entrenched – but perhaps they are becoming out of date. There are already some indications that London is at the edge of a major inflection point: could it be that, rather than continuing to grow, London is about to stall, or even go into decline?

Prime and decline

For much of the 20th century, London was in decline. After World War II, the city’s manufacturing and goods-handling economy faltered. Between 1966 and 1974, London’s manufacturing employment fell by 27 per cent - a loss of 390,000 jobs. Planning and economic policy favoured dispersal, more balanced regional growth and the creation of New Towns and Garden Cities outside of London. The capital’s population declined most rapidly in the 1970s: over the decade, the capital experienced a net loss of 740,000 people – that’s 10 per cent of the city’s population.

Few, if any, commentators foresaw the change that came in the mid-1980s, as the long decline in both population and jobs slowed and then reversed. Sentiment began to shift; London began to look like a place to be, rather than a city to flee. The completion of the single market, freedom of movement and EU expansion helped London to develop a specifically European economic and cultural role, alongside its status as a global city.

Globalisation – the easier movement of people, goods, services, money and ideas across borders – boosted London’s role as a centre for communication and control, and as a meeting place within the world economy. Language, time zone and cultural assets all helped. English became the global business language. London’s working day helpfully overlaps with Asia in the morning and with North America in the afternoon. And the city’s liveability, cosmopolitanism and cultural offer all made it attractive as a location for decision-makers, skilled workers and students. Complementing this economic growth, by the turn of the 21st century policy shifted to favour cities.

Without the benefit of hindsight, it is much harder to decide if we are now approaching a move in the opposite direction. There is some evidence of this: in the year to mid-2017, London’s population experienced the slowest rate of growth in over a decade, at only 0.6 per cent. International migration to London has declined to a net gain of only 83,000 individuals in 2016-17, though it remains the largest contributor to growth in the capital.

National Insurance Number registrations by people coming from overseas to work are dropping, with EU registrations falling 25 per cent year-on-year to the first quarter of 2018. Net internal migration saw a balance of 107,000 people leave London for the rest of the UK, more than 14 per cent higher than the previous year. Over 4.7m international visitors came to the capital in the final three months of 2017 - a noticeable 5.7 per cent fall compared with 2016.

Slowing down? Image: Merlijn Hoek/Flickr/creative commons.

Passenger journeys on public transport are also decreasing slightly. Falls in ridership may be an early sign that London is at or close to reaching peak growth. Or they may be driven by other factors – for example by changing work or commuting patterns, generational differences in housing choice and lifestyle or the rapid rise of ride-hailing apps.

Still the main attraction

Yet despite concerns over the impacts of Brexit, London’s economy has proved resilient, with unemployment continuing to fall and job numbers increasing. The number of jobs increased to 5.863m in the final quarter of 2017, a 98,000 (1.7 per cent) increase from a year earlier and a new record-high. The employment rate in London stood at 75.2 per cent in the three months to March 2018, also a record high. Job growth is predicted to continue, as job vacancies in the capital have reportedly increased by over 14 per cent in the year to the second quarter of 2017.


London continues to be the most productive region in the UK, although many new jobs have been created in low-pay and low-productivity sectors. And it’s still a very competitive destination for investment. In the EY 2016 European Attractiveness Survey, 57 per cent of almost 1,500 business leaders sampled put London among the top three cities for foreign direct investment in Europe.

So is London’s long boom finally coming to an end? Like any demographic or economic turning point, this one will be easier to spot in hindsight. If current trends continue, then London’s growth may slow considerably - or even perhaps reverse - over the next 30 years. Brexit could affect this in unforeseen ways - although the economic impacts of Brexit are likely to be worse outside London than within. And for the time being, London is still growing in terms of people, jobs and economic activity.

The Conversation

Mark Kleinman, Professor of Public Policy, King's College London.

This article is republished from The Conversation under a Creative Commons license. Read the original article.

 
 
 
 

Councils are failing to protect tenants from bullying landlords

Rental properties in Coventry. Image: Getty.

If your rented home has a broken boiler, mould growing up the wall, or a kitchen that’s falling apart, you won’t be surprised to learn that it’s not unusual. But it’s by no means acceptable: serious defects in the home can harm your health, so the law rightly requires landlords to keep their properties free of them.

Nevertheless, one in seven private rented homes has at least one severe hazard, and is classed as unsafe. That’s more than 600,000 households spending a large portion of their income on something that could make them ill.

Councils have responsibility for enforcing standards in the private rented sector. If environmental health officers find hazards on inspections of rented homes, they can take enforcement action, such as serving an improvement notice on the landlord, who is then compelled to carry out repairs. Failure to comply can result in prosecution, or, since 2017, a civil penalty of up to £30,000.

Yet most councils are not using their powers. Generation Rent made Freedom of Information requests to 102 of the councils with the largest private renter populations. Just 78 reported the Category 1 (severe) hazards they found in 2017-18 – a total of 12,592 of them. But in the same period, these councils served only 2,545 improvement notices – so only 21 per cent of landlords with unsafe homes were forced to do anything about it.

Just eight councils had a ratio of improvement notices to Category 1 hazards of more than 75 per cent, and five appear to have issued no improvement notices in the whole 12-month period.

Some councils tell us that taking informal action – such as sending warning letters and “hazard awareness notices” – is usually enough to convince landlords to make repairs before they need to reach for an improvement notice, which involves more staff time. But this pragmatic approach means that tenants are left exposed to a retaliatory eviction.

Because landlords can evict tenants without needing a reason – under Section 21 of the 1988 Housing Act – many use this to intimidate tenants into putting up with unsafe conditions. In 2015 Parliament passed the Deregulation Act which makes a Section 21 notice invalid if the council has served an improvement notice for severe hazards.

Our data show that only a handful of councils are reliably providing tenants with this protection. If councils aren’t routinely using their powers then tenants will continue to be cowed into silence.

This week a new law comes into force which goes some way to addressing this lack of support. The Homes (Fitness for Human Habitation) Act 2018 gives people starting tenancies from Wednesday onwards the ability to take negligent landlords to court over hazardous conditions. As well as forcing landlords to carry out repairs without relying on councils – which are, after all, experiencing deep budget cuts – courts can also award compensation to the tenant.

But unlike council-issued enforcement notices, the Homes Act does not protect plaintiffs from the no-fault eviction notice their landlord might issue in response. While compensation would be incentive enough for some to take action, there is a risk that any award would be swallowed up in the costs of moving home.

You’re much more likely to have a squalid home if you are on a low income, so the threat of having to find a new home when you have negligible savings is a potent one. Rather than rely on the Deregulation Act, tenants need to have basic assurance that they won’t be evicted for no good reason. Abolishing Section 21 would mean landlords would need valid grounds for eviction, so they couldn’t simply hang the threat of a forced move over tenants living in damp, draughty conditions. This – along with restrictions on rent increases, that other weapon of intimidation in criminal landlords’ armoury – would finally give renters confidence to exercise their rights.

Last summer the government consulted on a proposal for three-year tenancies, which would be a step forward in preventing retaliatory evictions, albeit only within the fixed term. We are still awaiting ministers’ decision on the next steps, but pressure is building across the political spectrum. On Saturday, the conservative Centre for Social Justice joined the growing chorus to scrap Section 21. Without reforming tenancy law substantially, the government can expect bullying of tenants to continue and the number of unsafe homes to remain stubbornly high.

Dan Wilson Craw is director of Generation Rent.

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