Source: Mayor of London
- London Growth Plan aims to put an extra £11k a year in the pocket of every Londoner and provide £27bn extra tax revenue to fund vital public services in the capital and across the country
- The plan targets restoring London’s productivity growth back to 2% per year – making London’s economy £107bn larger by 2035
- Plan’s inclusive growth ambitions include a 20% rise in household income for the lowest earning 20% of Londoners
- £21m additional funding this year will revitalise local high streets
- The Mayor and London Councils issue joint call on UK Government for more investment and devolution to boost local and national growth
The Mayor of London and London Councils have come together today (Thursday 27 February 2025) with local leaders from business, education and the voluntary sector to launch a bold new plan to turbocharge economic growth and increase prosperity across the capital.
Developed together with London & Partners – in collaboration with businesses, trade unions and London’s communities – the London Growth Plan sets out a blueprint to kickstart the capital’s productivity, which has flatlined since the 2008 global financial crisis.
The plan aims to restore productivity growth to an average of two per cent a year in the next decade, which would make London’s economy £107bn* larger by 2035 and put an extra £11,000 on average in the pockets of the near-nine million Londoners. This would also mean the capital contributing an extra £27.5bn in taxes to the Treasury in 2035, providing vital revenues for investment in public services.
London’s productivity grew by an average of 3.16 per cent each year between 1998 and 2007, but between 2008 and 2022, average productivity growth was just 0.12 per cent a year. Growing productivity is the key to higher wages, higher living standards and increased investment in public services in London and across the UK.
The new plan focuses on inclusive economic growth to make sure that more Londoners can contribute to and benefit from the capital’s success. Helping more Londoners into work, bringing down housing costs and improving public transport are all vital to reducing poverty in London, improving living standards and driving growth. The plan aims to achieve a 20 per cent rise in the household weekly income (after housing costs) of the lowest earning 20 per cent of Londoners – which would mean more than a million London households would have an extra £50 to spend each week, on average, after paying for housing costs.
The London Growth Plan outlines huge opportunities for turbocharging the capital’s economy and harnessing the growth potential of sectors such as AI, life sciences, robotics, clean tech, quantum computing and the creative industries. Key drivers to deliver the plan’s growth ambitions for the capital include a renewed focus on nurturing world-class talent, helping Londoners get the skills they need for productive careers, backing business innovation with new investment and technology, taking a bolder approach to housing and infrastructure, and reinvigorating London’s local high streets.
A long-term strategic relationship between London and the UK Government will be a crucial part of delivering the plan. London is the engine of the UK economy and, with national support, this plan can harness its economic power and potential for the benefit of all Londoners and the whole country, helping to fund investment in public services across Britain.
Priorities in the London Growth Plan include:
- Backing business: London government will help to power ‘industrial innovation corridors’ around the capital – supporting new space, facilities and infrastructure to ensure innovation can thrive. This will build on the potential of the WestTech Corridor (anchored in White City going through Old Oak and Park Royal), the UK Innovation Corridor (anchored in the Knowledge Quarter going towards Cambridge) and the Thames Estuary (anchored in Queen Elizabeth Olympic Park going out to Essex and Kent). A new proposed London Tech and Inclusive Growth Fund could provide up to £100m loan and equity funding for high-growth small and midsize enterprises.
- Talent and skills: An Inclusive Talent Strategy will build the capital’s skilled workforce to unleash the potential of Londoners and – in turn – London’s economy. This will help create at least 150,000 high quality jobs, with a focus on fair pay and good work, to deliver Mayoral manifesto commitments. As well as supporting more people into work and ensuring all Londoners can get the skills or training needed to progress their careers, the strategy will help attract world-class talent to study and work in the capital. New rent-controlled Key Worker Homes will also help London to attract and retain its essential workforce.
- Housing and infrastructure: Local leaders will work with UK Government to extend and upgrade London’s public transport network, prioritising transformational projects to unlock new affordable homes and growth – including the Docklands Light Railway extension to Thamesmead, the Bakerloo line extension and the West London Orbital. The plan also calls for more devolution of London’s suburban rail services. This will be reinforced by the next London Plan, which will prioritise growth, increase housing delivery and ensure better digital connectivity.
- Inward investment and promotion: London will take the lead in implementing national reforms to the Local Government Pension Scheme, exploring the development of a major joint fund to invest in places that encourage innovation, including venture capital. The plan will also support London’s goal to be a net-zero city by 2030, attracting significant institutional capital for green infrastructure. There will be support to set up a new quantum tech incubator, London Life Sciences Week will be backed to become a key global event for the sector, and London leaders will explore a new business visitor centre to promote the capital’s world-leading offer by bringing companies together with agencies and developers.
- High streets and local economies: £21m additional funding this year will support boroughs with town centre regeneration, including potentially creating a publicly owned High Street Estate Agency to bring empty properties back into use. The plan also reiterates the Mayor’s commitment to revitalising neighbourhood policing so that the capital’s high streets always feel welcoming and safe.
Delivering the London Growth Plan will be a genuine partnership between the Mayor, local government leaders and central government, working in coalition with universities, incubators, accelerators, venture capitalists, innovation districts, corporate innovators, capital markets and international investors.
London’s leaders want central government to help unleash the capital’s economic potential by giving the Mayor and boroughs more freedoms to fund their own growth priorities, and the flexibility to spend money in the best way to drive good growth. This is on top of continuing to lobby the Government to secure agreements with our biggest international trading partners that ensure London’s key sectors can continue to grow and thrive.
Mayor of London, Sadiq Khan, said: “This growth plan provides a golden opportunity to turbocharge growth and unlock London’s full potential – for the benefit of all Londoners and the whole country.
“It’s a blueprint for how we can help to create 150,000 good jobs, build more affordable homes, deliver major new transport upgrades and skill up Londoners for the well-paid jobs of tomorrow. From AI, life sciences and climate tech to our financial and creative industries, London is home to many of the best businesses in the world, which we want to back to grow and thrive over the next decade.
“Ultimately, growth means little if people cannot feel the benefits or see the positive change it brings to their area. So our goal is to deliver economic growth in every corner of our city that helps to raise living standards, puts more money in people’s pockets and enables us to invest in our public services, as we continue to build a fairer and more prosperous London for all.”
Cllr Claire Holland, leader of London Councils, added: “The London Growth Plan is a blueprint to drive inclusive economic growth in the capital and across the UK, boosting productivity and ensuring more Londoners can feel the benefits of growth.
“It sets out our ambitions to unleash growth in the industries of the future, deliver new housing and infrastructure to support the London economy, and develop a new Inclusive Talent Strategy, helping more people to get into work and get the skills they need to progress.
“Boroughs are resolutely pro-growth and are committed to working with business, the Mayor of London and national government to turbocharge growth in every corner of our city.”
Laura Citron, chief executive of London & Partners, concluded: “This is a huge moment for our city: a shared vision, a clear plan, and now the momentum to make it happen. As the capital’s growth agency, we’ll be working closely with investors, entrepreneurs, partners, and places across the city to drive growth for London and Londoners – attracting investment, scaling our businesses, bringing in visitors and world-class events, while telling London’s story brilliantly. Our city is built on reinvention, and this is our next big chapter.”
London’s universities and research institutes will be key partners in nurturing the talent and innovation required to deliver the Plan’s growth targets. The Plan highlights University College London’s Person-Environment-Activity Research Laboratory and Imperial’s recent purchase of the Victoria Industrial Estate in the proposed WestTech innovation corridor as examples of the specialist spaces needed to support inclusive growth.
Prof Hugh Brady, President of Imperial College London, said: “Universities like Imperial play a critical role in attracting and nurturing world-class talent, fuelling inclusive growth, and strengthening London’s position as a global leader in innovation. That’s why the best innovation ecosystems have world-renowned research universities at their heart.
“The WestTech Corridor, anchored by Imperial College London, will be central to delivering the Mayor’s ambitious London Growth Plan, driving a vibrant innovation ecosystem in West London and acting as a powerful engine for investment, economic growth and job creation across the UK and the wider world.”
Dr Michael Spence, President and Provost at UCL, said: “Innovation, driven by universities working with local government and businesses, has huge potential to spur growth and create jobs in London. The London Growth Plan reflects the importance of universities like UCL in helping to attract, nurture and realise inclusive growth in our capital city.
“UCL’s campuses are at the heart of London’s innovation corridors, driving the talent pipeline alongside our cutting-edge facilities delivering world class research. Within ten minutes of our Bloomsbury campus, one of the world’s largest and most collaborative innovation districts is taking shape in the Knowledge Quarter, with huge potential to bring together life science, technology, healthcare and academia in one place. On Queen Elizabeth Olympic Park, UCL East is at the heart of the UK’s newest culture and learning quarter at East Bank, a driving force behind cultural and creative industries innovation and regeneration in London.”
The newly published London Growth Plan has also been welcomed by leading voices from across the capital’s business community.
Karim Fatehi OBE, Chief Executive of the London Chamber of Commerce and Industry, said: “LCCI welcomes the Mayor’s London Growth Plan to maximise London’s economic potential and maintain its position as the best city in the world to do business. Businesses of all sizes are the lifeblood of the London economy, and measures such as the London Tech and Inclusive Growth fund will help them grow and attract investment.
“We especially welcome the Growth Plan’s focus on skills – giving Londoners access to industry-relevant training, employment and careers support. This inclusive strategy will ensure London’s economic success means prosperity for all Londoners.”
Laura Timm, London Policy Representative at the Federation of Small Businesses, said: “FSB is delighted to see a strong, ambitious and upbeat Growth Plan that hones in on three key FSB drivers for small business growth—namely, access to targeted finance, cultivating a high-functioning skills system, and presenting opportunities for small firms to win public procurement contracts.
“Over 99 per cent of all firms in the capital are small in size but significant in growth potential. We look forward to working with the Mayor of London, the Deputy Mayor for Business and other stakeholders in implementing the Growth Plan – which we hope will create the environment that helps a local small firm take on their first apprentice, seal an exporting opportunity, and tackle the scourge of business crimes up and down our high streets.”
John Dickie, Chief Executive of Business LDN, said: “The bold ambitions set out in the London Growth Plan rightly focus on unlocking the city’s full potential so that businesses can succeed and Londoners thrive. Delivering on this agenda will require the city to double down on existing efforts to tackle barriers to inclusive growth such as housing and skills where we have the agency to act.
“The Government needs to ensure London has the tools it needs to turbocharge growth and help the UK get out of the economic slow lane. This means stepping up by providing long-term, flexible funding to unlock vital infrastructure and affordable housing so that the city remains an attractive place to live, work, visit and do business.”
Read more at www.growthplan.london.