London’s Economy

It is very common. There are individuals who are happy to give money to their alma mater. As I have mentioned, there are 43 higher education institutions in London as a whole. It is perhaps easier for the better known institutions, such as Imperial college and the London School of Economics—two institutions in my constituency—to find entrepreneurs willing to sponsor junior research fellows in their 20s and 30s, who are some of the brightest and best brains and who will eventually get academic posts. However, the hon. Member for Edmonton (Mr. Love) has made an absolutely fair point, which, I fear, applies not only to academia but to areas such as medicine that are not ancillary to the financial services industry. It is one of the problems that needs to be dealt with, and all on both sides of the House will have great sympathy with the hon. Gentleman’s point. In recent years, 26 per cent. of foreign students were attracted to London to study, bringing with them a contribution of an estimated £750 million a year to the UK economy. Although that is welcome, challenges remain. A high-productivity, high-cost location is not necessarily ideal for a university—for example, King’s college, the best placed London institution, is almost six times less well-endowed than Oxbridge. If London universities are to continue to provide the same opportunities for home-grown talent as to overseas students eager for a world-class education, we must ensure that they possess the financial muscle to match the most powerful institutions worldwide. During my conversations with him, Sir Richard Sykes, the rector of Imperial college, has made it clear that he would like to attract more home-grown talent. However, the phenomenal difference between the fees that he receives from indigenous students and those from students overseas make it, to put it in rather brash terms, a bit of a no-brainer. To make ends meet, Sir Richard has to take on far more foreign students than he would ideally like to. No debate on the contribution of London’s economy should go without mention of the efforts put into the promotion of financial services at home and abroad by the lord mayor of London and the City of London corporation. Their promotional role for the financial services sector is strengthened by the direct representation that City businesses enjoy on the corporation’s main governing body, the common council. As you know, Mr. Williams, and as I am sure the hon. Member for Hendon would also point out, the City is the only place in which businesses participate directly in the electoral process. Understandably, that has been a matter of some controversy. Obviously, I am a democrat—I voted for a fully elected House of Lords. If I did not represent the Cities of London and Westminster, I suspect that I might take a somewhat different view. As it is, I have seen how the system works, and it works well in the City. As an arch-opponent of the City of London (Ward Elections) Act 2002, which introduced the reforms to broaden the City’s franchise, the hon. Member for Hendon may not wish to hear this, but I believe that those reforms have generally been pretty successful. About 75 per cent. of the eligible business electorate now register to vote. In his role as the City’s international ambassador for financial services, the lord mayor therefore directly represents the business community. It is worth adding that those activities, complemented by the work of the corporation’s offices in Brussels, China and India, are undertaken without any call on the public purse. Hon. Members will surely agree that London’s continued prosperity depends on its infrastructure. City businesses require sufficient support to sustain growth; in particular, the availability of quality office stock must meet the pressures of demand if raising rents and falling vacancies are not to dent London’s competitiveness. The position of London as a revenue generator needs to be recognised and proper investment made. As I have mentioned, projects such as Crossrail will facilitate essential access to and business in the City and help to relieve the burden on London’s creaking public transport system, making travel into the business centre attractive and efficient. Those concerns must be addressed if London is to deliver an exemplary 2012 Olympic games worthy of the whole nation and, more importantly, if we are to build an infrastructure legacy that will ensure not only a spectacular show for three weeks in the summer of 2012—I am sure that it will be—but great benefits beyond then. In conclusion, London is an asset to the UK, the European Union and the global economic world. At its heart, the City of London is the engine of the capital’s growth. We must ensure that the benefits of London’s success continue to be felt throughout the whole UK—particularly here in the capital—and we must keenly resist any threat to its prosperity.