The case for a more independent, post-Brexit London is gaining strength

Communities secretary Greg Clark has told the Financial Times he is “very keen” to devolve further powers to London and spoken highly of new London mayor Sadiq Khan, who he thinks “has shown himself to be a pragmatist that wants to work well with central government, to the advantage of London and the country”. That’s quite an endorsement, given that Clark’s fellow Conservative Zac Goldsmith spent the first four months of the year claiming that Khan is a dangerous, Corbynite ideologue and apologist for Islamist extremists.

If Clark is surprised by Khan’s approach, he shouldn’t be. The mayor has always been on Labour’s practical rather than its doctrinaire left. As he demonstrated throughout the mayoral campaign, he has long understood that unless London mayors work constructively with London boroughs, London employers and national government they get nowhere. Khan was never going to be Jeremy Corbyn’s creature in City Hall, as Goldsmith’s dire campaign falsely and fruitlessly alleged.

It seems possible that Khan might seal a better devolution deal for London than his predecessor Boris Johnson even hoped for. There was always the potential for that. When Johnson was lobbying for extra mayoral powers last year, Tory rivals were discouraging: George Osborne made fun of him and Theresa May kicked him in the water cannon. Now, as a “challenging” post-Brexit economic landscape takes shape - in large part courtesy of Johnson, you may recall - the Labour mayor and what currently passes for the Conservative government find themselves on common ground in trying to protect London’s economy for the good of the country as a whole.

Like or not, the capital is the source of 23% of the UK’s economic output, and a new study by thinktank Centre for Cities has found that it generates no less than 30% of the UK’s “economy taxes” - a growing proportion and as much as the 37 next biggest UK cities put together. Khan’s argument is that giving London more control over its own affairs can help it and the wider economy to better weather the Brexit storm. It is a case that’s gaining strength.

Khan is seeking additional responsibility for the spending of property taxes raised in London, and wants London government to more directly run skills training and further education. He’s also after further powers over housing and planning, transport, health and policing. This is not, Khan stresses, a demand for London to be handed more taxpayer cash than it already receives, but to be put more in charge of how taxes raised in London are spent in London, ensuring that the money is used to best effect.

He has also asked for a “full seat” at the Brexit negotiations, whenever they eventually begin, and has described remaining in the European single market as essential to London’s, and therefore the UK’s, economic resilience. This call underlines the awkward fact that EU leaders have insisted that single market membership means the free movement of people within single market territory too. Given that a wish to lessen foreign immigration was a large motivator for leave voters across the land, it’s hard to see how that circle can be squared.

And yet, as guests of the London Assembly’s economy committee remarked last week, post-Brexit uncertainty means all sorts of things are now worth discussing that were on no-one’s agenda before. Mark Littlewood, director general of free market thinktank the Institute of Economic Affairs, said that “asymmetrical immigration rules” within a UK that went in for devolution on a large scale are not “a technical impossibility”. There could, in theory, he explained, be different visa arrangements for different areas. It was possible, for example, to “imagine a world in which an immigrant qualifies for a national insurance number with an ‘L’ at the end of it”, which would mean he or she could work legally within Greater London’s boundary but nowhere else.

UCL professor Albert Weale pointed out that this might be tricky if a London-based company had offices elsewhere in England, but LSE professor Tony Travers drew attention to an article by Rohan Silva, a former adviser to David Cameron, in which Silva said it would be “straightforward” to implement London-only work visas on a “simple points system”, and that he’d been advocating this for years.

“At first sight that sounds a bit surprising,” Travers said, but added that “place-sensitive immigration systems” were now being discussed, and indeed already exist, notably in Canada. Yes, this was a complex and speculative area. However, Travers observed: “One of the intriguing consequences of the vote is that things are on the table to discuss which have never been considered before.”

London is a long, long way from becoming the independent city-state that some pro-EU Londoners, mostly half-jokingly, have dreamed of in the wake of the referendum shock. But momentum for it - along with other cities within the UK - becoming more independent within the UK appears to be growing in all kinds of fascinating ways.

Watch a webcast of the recent London Assembly economy committee meeting here.