The danger of Burnham’s good growth programme is that it risks mistaking redistribution for wealth creation
For a nation of Nimbys, Britain – or at least London – is remarkably fond of its skyscrapers. We love them so much we give them cutesy diminutives like ‘The Gherkin’, ‘The Cheesegrater’ and the ‘Walkie Talkie’. We boast about vistas from which you can see them, marketing properties for their ‘stunning view of The Shard’. Indeed the prospect of obscuring views of our treasured towers have been used to block planning applications for other tall buildings.
Yet, as ever, the dead hand of bureaucracy strives to deny what the heart desires. The housing minister Matthew Pennycook has halted the City of London Corporation’s redevelopment plans over concerns about tall buildings near the Tower of London. The minister said that the Square Mile authority should not be able to go ahead with its City Plan 2040 and that the Inspectorate should instead consider alternative proposals from Historic England.
Britain’s challenge is not that London is too successful; it is that too few other places are
The heritage quango has, of course, welcomed the intervention. Melissa Hammett, palaces and collections director at Historic Royal Palaces, which runs the Tower of London, said the tall buildings would be an ‘encroachment’ on the views from the fortress and ‘further erode the Tower’s setting’.
The Corporation, on the other hand, is unimpressed. Policy Chairman Chris Hayward warned in City AM that uncertainty over the future of the City Plan was putting 100,000 square metres of commercial floorspace at risk. Those offices could support 7,000 jobs and generate around £1.2 billion in annual economic output and unlock approximately £1.7 billion of investment. He said: ‘We are deeply disappointed this issue is being revisited. Introducing uncertainty into processes designed to provide long-term confidence and certainty to developers, investors and major occupiers, will hinder efforts to generate the growth we need.’
‘Disappointed’ is an understatement beneath which you can sense the Corporation’s utter astonishment that ministers, posing as pro-growth, would rather listen to Historic England than the government of the most productive part of the country. The City contributed £290bn or 11% of total UK GVA in 2025. Financial and professional services generated a trade surplus of £119.1bn. Londoners are 28.5% more productive than workers in other parts of the country and GDP per person is almost twice the UK average. One reason for the Square Mile’s success is its unique and ancient system of governance which affords voting rights to businesses. In other words, it is run partly in the interests of profit, not politics.
So, here we have a shining example of a devolved administration that is unequivocally creating growth which benefits the whole country – two things Labour claims to be keen on. Yet the Government is still allowing an arms-length Whitehall body to stand in its way.
Nobody would wish to demean the Tower of London, but nor can a globally competitive city remain frozen in 1078. In any case, what does ‘encroachment’ even mean? It’s the Square Mile, there are already tall buildings very nearby.
It is disheartening that a Labour Mayor has absolutely nothing to say about his own party’s Government taking such a heavy-handed approach to London’s financial district. But given that Sadiq Khan’s self-destructive target for 35% affordable housebuilding has brought almost all new development in London to a halt, perhaps we shouldn’t be surprised.
What is even more concerning is the hint it gives of the future under Labour. Ministers are already desperately signalling their left-wing credentials in the hope of winning a place in Andy Burnham’s cabinet – whether it’s Lisa Nandy flouncing off Twitter or Emma Reynolds paving the way for the renationalisation of Thames Water. Now Pennycook has indicated he is more interested in heritage than growth. Is this ‘place-first politics’ in action?
The danger of Burnham’s programme of ‘good growth in every postcode’ is that it risks mistaking redistribution for wealth creation. Financial services are Britain’s only consistently world-class export industry, yet there is a growing tendency on the Labour Left to regard the City’s success not as an asset but as evidence of an economy that is somehow morally unbalanced. Capitalism, in this telling, cannot really be good if it makes too much money in one square mile. That narrative may satisfy their ideology, but it is a disastrous way to run an economy.
Britain’s challenge is not that London is too successful; it is that too few other places are. Slowing down the Square Mile will only make the whole country poorer. So let the City build. We should nickname its next skyscraper ‘The Moneybox’.
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