Domestic tourism campaign at heart of plan to ensure survival of central London’s hard-hit retail, hospitality and cultural venues

  • Report from Arup and LSE published today shows London’s economy could reduce by £36bn over next decade if no further action is taken.
  • Mayor joins forces with Berlin, New York and Paris to share ideas and data about future of city centres.

The Mayor of London, Sadiq Khan has announced that £6 million will be invested in directly supporting the re-opening of London’s economy once COVID restrictions are lifted. This comes as a new report published today lays bare the full extent of the challenges facing central London’s economy.

The Mayor has announced in his budget new investment of £5 million to support the eventual reopening of central London, including a brand-new campaign to attract visitors and tourists back into the capital later this year. Through his London Economic Action Partnership (LEAP) a further £1million will now be spent on attracting people from across the UK to visit the capital post-lockdown, vital for the recovery of our hard-hit retail, hospitality and cultural venues.

Working with the business community, new initiatives will be brought forward to encourage Londoners and tourists from around the UK back into central London, likely to include major events that showcase central London’s public spaces and cultural riches. The money could also be spent on helping local businesses to put in place more al-fresco dining to enable hospitality venues to re-open successfully post-lockdown.

Today’s new investment comes as the Mayor publishes a final report conducted by Arup with Gerald Eve and the London School of Economics showing the future challenges and opportunities facing London’s Central Activities Zone (CAZ), which has suffered a sudden and rapid reduction in footfall due to the COVID-19 pandemic.

The report concludes that the central London ecosystem is well placed to recovery strongly, with world-leading sectors such as tech and its arts and cultural offer. But if home working remains the norm for office workers and no further action is taken, the report shows this could lead to an estimated 86,000 fewer jobs within the CAZ by 2031 with the losses in retail, food and culture. The economy of London would contract by £36bn by 2031 compared to a No-COVID-19 scenario – a significant hit to the UK economy as a whole.

The report supports the Mayor’s calls for more to be done at all levels of Government to attract visitors back to the streets of central London once restrictions are lifted, including promoting the area as a model for a sustainable, healthy and green urban centre, with more attractive outdoor spaces and enabling more walking and cycling. The report also emphasises the importance of hosting international events and more arts and cultural activity to draw people back. This could include London’s night-time economy needing to expand with shops, museums and essential services extending their opening hours in response to Londoners’ changing working habits.

If London’s Central Activities Zone (CAZ) can be re-invented, with more opportunities for increasing the residential population and increasing its attractiveness to visitors, the report concludes that the economic impact of more home working will be far less severe.

As part of his ongoing work, the Mayor is today announcing that London is joining forces with Berlin, New York and Paris to bring forward innovation that will speed up the revival of central London, and bolster the resilience of businesses hardest hit by COVID.

The four cities will be working together over the summer to share data and ideas. And from 1 June the Mayor will be launching an open call for innovators and entrepreneurs to come forward with new ideas that can help the sectors hardest hit – such as arts and culture – to adapt and thrive post-lockdown.

The Mayor of London, Sadiq Khan, said:

“Central London is the engine of the UK’s economy. There simply won’t be a national economic recovery from COVID unless all levels of Government realise the crucial importance of protecting central London’s unique eco-system of shops, hospitality and world-leading cultural venues. That’s why I’m investing £6million directly in attracting people back into London once COVID restrictions are lifted.

“This report published today shows that we can’t be complacent in assuming everything will return to normal. The excitement and buzz of central London will endure, but we will have to be bold and innovative over the coming months to ensure people return to central London in large numbers – whether as tourists, office workers, shoppers or for a night out.

“A key part of this will undoubtedly be doing more to showcase what London’s cultural venues have to offer. But we also need a step change in action to ensure our city centre streets are green, attractive and enjoyable places to spend time. As London always has done in the past, I know we will continue to adapt and innovative, and remain a leading destination for people from all around the world.”

Jace Tyrrell, Chief Executive at New West End Company, said: “The West End is a unique ecosystem of retail, entertainment, culture and hospitality which is a vital part of Britain’s global attraction.  Its appeal is not just to international visitors, but also to all those who chose the UK over anywhere else in the world to invest, work and study. We welcome the Mayor’s commitment to supporting these sectors which have been so hard hit due to lack of both domestic and international tourists.

“In the short term we need to ensure its speedy recovery to boost the economies of both London and the UK.  But we must all recognise the benefits for the whole of the country in supporting strong long-term growth in the West End.  A vibrant, global Britain needs a vibrant, global West End.”

Professor Tony Travers, LSE, said, “Understanding the impact of the pandemic on the economy of central London is an essential first step in planning for recovery. This report provides the detail necessary for policy-makers to decide where action now needs to be taken. There are implications for City Hall, Whitehall and London’s town halls.  While the capital has always proved resilient in the past, nothing should be taken for granted.

“It is in the whole country’s interest that city centres, especially London’s, return to their former creative strength.  There would be baleful implications for the theatre, railways, employment, environment, Treasury tax yield and the UK’s post-Brexit ‘soft power’ if central London’s economy is not fully restored”.

Cllr Georgia Gould, Chair of London Councils, said: “The pandemic has brought a heavy blow to the heart of the capital. Because central London accounts for 26% of all employment in the capital, the economic damage and job losses here have a massive impact on the wider London economy and the communities we serve.

“Getting central London back on its feet and attracting visitors and investment will be key to London’s post-pandemic recovery. Boroughs are committed to working with the Mayor and the government on this important agenda – reinvigorating central London so that it can continue playing a pivotal role in the future success of the capital and the national economy.”

Bernard DonoghueDirector of The Association of Leading Visitor Attractions, said: “The announcement of this significant investment by the Mayor is hugely welcome and timely. Tourism is London’s lifeblood. Without our cultural venues, theatres, museums and galleries, historic houses and heritage properties being open, London just feels ‘less London’. We want to get them back up and running, opening safely and sustainably and welcoming visitors back, and we know that Londoners themselves, and visitors from across the UK, will be the saviours of London’s visitor economy this year.

“This is the year to visit places that we haven’t been to since we were kids, to visit places we’ve always meant to, and to introduce our friends and families to our favourite attractions. This investment in promoting London, issuing an invitation to explore and enjoy London, will help repair tourism businesses’ balance sheets, kickstart our recovery and guarantee a summer of amazing London memories.”

Matthew Dillon, City Economics Leader, Arup said: “In just over a year, widespread homeworking has transformed the once bustling streets of our Capital and made them almost unrecognisable. As the end of national lockdown comes into clear view, today’s report from Arup with Gerald Eve and the London School of Economics highlights the uncertainty around the future of homeworking and the potential impact it could have on London’s economy if positive action is not taken.

“While our city faces many challenges ahead, the Mayor’s investment into central London will play a crucial role in re-inventing London’s Central Activities Zone (CAZ), positioning the centre as an international cultural hub, and a sustainable, healthy and green place to be. This will play a critical role in helping to attract visitors and tourists back to London, which will in-turn aid the recovery of the hard-hit retail, hospitality and culture sectors.”

The Mayor wants domestic tourism to be at the heart of London’s drive to ‘build back better’ and will relentlessly focus on putting jobs and the economy at the heart of post-pandemic planning. Working with the business community, new initiatives will be brought forward to encourage Londoners and tourists from around the UK back into central London, showcasing London’s public spaces, iconic landmarks and cultural riches.

The Mayor also continues to work to ensure women in particular feel safe when living, working and visiting London. This includes getting more businesses and organisations that operate between 6pm-6am to sign up to the Women’s Night Safety Charter – which commits signatories to take action such as training staff in how to spot and take action against intimidation and harassment.

A further finding of today’s Arup/LSE report is that with more home working, opportunities could be provided for the rest of inner and outer London outside the CAZ, with more office workers spending time and money close to their homes. This could see an increase of 116,000 jobs in non-CAZ London, compared to 2019 levels, concentrated in retail, food and beverage, and entertainment. However, this increase in economic activity in the rest of London is unlikely to make up for the loss of spending in the CAZ. The report concludes that it is essential for both London and indeed the financial recovery of the rest of the UK, that everything is done to encourage footfall back to central London.

And while moving to a more hybrid model where people work 2/3 days a week from home isn’t necessarily a bad thing, the Mayor recognises the benefits of getting employees back together into the office in the long term – whether around professional development, organisational culture, collaboration, or the creativity that can only come from people working together in person.

You can read the full Arup/LSE report here – https://www.london.gov.uk/business-and-economy-publications/central-activities-zone-caz-economic-futures-research

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