Gallows humour is rife among moderate councillors at this week’s Labour Party Conference. But behind the pained expressions lies a real fear that the party’s lurch to the left could hamper the ability of Labour local authorities to deliver future development and work constructively with the property industry.
With Jeremy Corbyn returned with a strengthened mandate at the weekend – and his chancellor John McDonnell taking to the stage soon after to say how “the old rules of the economy are being rewritten” – this year’s conference is striking a divisive tone. As a result, many council leaders seeking to deliver homes, jobs and opportunity are finding more common cause with the property industry than with their own party leadership.
From Monday: McDonnell: Power shift from City to regions
Property’s upper echelons are well represented in Liverpool, more reflecting a need to keep an open dialogue with Labour local authorities than an anticipation that they might persuade the national leadership of any shared ambition.
The British Property Federation fielded Land Securities chief executive Rob Noel and Crown Estate chief investment officer Paul Clark at its devolution-themed event on Monday morning. With Legal & General supporting a number of fringe sessions, head of real assets Bill Hughes is also in town to make the case for investment in real estate and infrastructure.
And at a Mishcon de Reya dinner on Monday night a group of London borough leaders – including Southwark’s Peter John, Haringey’s Claire Kober and Barking & Dagenham’s Darren Rodwell – discussed effective working with developers and investors – with L&G’s Hughes, Essential Living’s Daryl Flay, First Base’s Elliot Lipton and CapCo’s Anette Simpson among their number.
For this group at least, aspirations were largely shared, similar solutions proposed and a recognition that for many big urban conurbations – Labour’s local authority heartland – joint working between the public and private sectors is about to become harder.
The as yet largely unspoken threat is that should these local authorities work too closely with the property industry, their leaders will find themselves at heightened risk of a challenge from within their own ranks.
Just as moderate MPs fear deselection as Labour moves to the left, centrist council leaders acknowledge the threat that they may be turfed out by their own party and replaced with someone whose politics are closer to the party’s national leadership. “We’ve got policies that scare the pants off me,” one borough leader warned developers at the dinner. “And if we go, you’re left with Momentum.”
For some leaders, it’s a double whammy. Last week communities secretary Sajid Javid rejected Southwark council’s application to CPO the Aylesbury estate as part of its estate regeneration programme. For the likes of borough leader Peter John, pressure is coming from both a different political party in government and from within his own party. It’s a trend that is not unique to Southwark.
Where many on all sides of the debate find comfort however is in the mayor’s office. Sadiq Khan’s deputy mayor for housing James Murray has impressed since he took on the role in May and already both developers and local authorities are looking to City Hall to help confront multiplying challenges. He too was at Monday’s dinner where he struck a mollifying tone.
For Khan and his team to be more effective, however, there is a need for more devolved powers, particularly in raising revenues. And with more mayors set to be elected next year – and yes, given that they will be in major cities, more Labour mayors – it is a demand that will only grow.
That at least is something that unites more than it divides. Local and regional authorities want it, course. Developers seek to work with pragmatic councils and greater powers will allow stand-out authorities to deliver the flexibility that this sector craves. Even shadow chancellor John McDonnell has vowed to shift power away from the City of London and Whitehall to the regions.
Right now the only question is: will the government yield? George Osborne did. Will Philip Hammond follow suit?
We should learn more at next week’s Conservative Party Conference in Birmingham.
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