The Qureshi Report

I was pleased to see that Monday’s Evening Standard carried a report of Boris Johnson’s decision to allow the closure of the GLA’s offices in Delhi and Mumbai, which were set up by Ken Livingstone to promote the capital’s interests in one of the developing world’s largest and fastest growing economies.

Hopefully other sections of the media will take up this issue, because it is an important one for Londoners and for the capital’s business community in particular. As the Economist recently reported, the developing countries have grown in global importance economically due to their having escaped the worst consequences of the recession. So it’s vital that the Mayor should play an active role in promoting London in India.

I’d heard rumours that the GLA’s India offices were no longer functioning, so I tabled questions to Boris about it at Mayor’s Question Time last month. In a written reply he admitted that the offices in Delhi and Mumbai have not been staffed since last year, although he hadn’t bothered to inform Londoners that this was the case, and we would still be none the wiser if he hadn’t been challenged over it at MQT.

Boris’s vacillations and u-turns over the issue of the GLA’s international offices have been a sight to see. During his mayoral election campaign he initially condemned the offices as a waste of public money and said he would shut them down. In a December 2007 radio interview with Nick Ferarri, he was asked: “Would you continue bureaux in Venezuela, Delhi, Beijing and everywhere else? Yes or no.” Boris answered emphatically: “No.”

This went down well with anti-Livingstone journalists like Andrew Gilligan and Nick Cohen, and with parochially-minded Tory councillors lacking any concern for London’s strategic interests, but the business community recognised how damaging the closure of the international offices would be to the capital.

At a business hustings in March 2008, organised by London First, Ken Livingstone went onto the offensive over this issue. He told the meeting:

“The greatest challenge facing London businesses is globalisation, and therefore maintaining London as the most international and diverse business city in the world. To meet this challenge London has to build its position not only in traditional markets, such as the US, but in the huge new markets of India and China.

“Nothing therefore more clearly symbolises the difference between myself and Boris Johnson for London businesses, and the future of our city, than my opening offices to promote London in the US, China and India and Boris Johnson’s pledge to close down all offices promoting London abroad.”

The following month the London Chamber of Commerce and Industry announced that they had commissioned a ComRes survey of 238 London businesses which found that 67 per cent of companies said that the GLA should have offices in India and China to promote trade and inward investment into London.

Peter Bishop, LCCI international trade director, was quoted as saying: “These figures demonstrate that London firms are convinced of the value of operating these overseas ‘business embassies’. Strong business relations with the emerging economies of India and China are vital for the capital’s economic growth, creating jobs and attracting investment and tourism.

“In 2006 India was the second largest investor in London and Indian tourists outnumbered those from Japan. The London Chamber of Commerce hopes that all the candidates for next month’s mayoral election will take note of these results and pledge to keep these offices open.”

Faced with this opposition, Boris backed off and changed his line. In an interview with the Ethnic Minority Business Group (UK), he stated: “Whilst we fully endorse the representation of London overseas, we are also committed to reviewing the GLA’s offices abroad to ensure that London is getting maximum value from the money being spent on them. This review will be conducted as part of our larger investigation of the GLA and its agencies’ financial expenditures.”

Boris’s promised review was launched in May 2008, shortly after his election victory, and was headed by his then deputy Ian Clement.

At the time, Boris told the Standard: “We have started the process of considering which of the Greater London Authority’s international offices perform a useful strategic function and deliver value for money…. We will consider the role of the Indian and Chinese offices in encouraging inward investment and business opportunities for London. We are eager to get on and review the international offices’ role in increasing foreign investment and employment, delivering value for money and ensuring London takes full advantage of emerging international markets.”

London’s business community lobbied heavily for the offices to be retained. In a submission to Boris’s review the LCCI stated:

“Closing the offices in India and China as part of a cost-cutting exercise would be short-sighted and send entirely the wrong signals to potential investors and importers in two of London’s most important potential markets. The GLA may save £1 million, but it is London firms that may ultimately end up paying a much higher price. If the Mayor is not out there promoting London, someone else will be promoting New York, Paris, or Sydney instead.”

The review was supposed to be completed by autumn 2008. However, as is often the way with Boris, he missed the deadline and the results were not announced till the following January, when a press release from the Mayor reported that “the review found the rationale for London to have offices in key emerging markets is fundamentally sound”.

Boris’s press release quoted Ian Clement as saying: “It is absolutely essential given the current financial crisis that we do everything within our power to promote the capital in major markets around the world to ensure London emerges strongly from the downturn.

“We have taken a serious look at whether taxpayers’ money is being spent wisely and how to get the best possible deal for Londoners. The review has found that the GLA’s offices do play an important role in promoting London’s interests, from supporting the capital’s businesses to enhancing the image of our city around the world.”

Under the headline “Boris saves City Hall ‘embassies’”, the Evening Standard hailed the decision to retain the GLA’s overseas offices, reporting that the Mayor had decided to retain the offices “because they are a good way of promoting London abroad during the economic downturn”.

But it turns out that this was just eyewash. In response to my questions, Boris now concedes that the GLA’s representatives in Mumbai and Delhi “resigned last year and have not yet been replaced”, and that the offices will remain closed pending a decision on whether to reopen them. So much for Boris’s supposed commitment to promoting London abroad during the economic downturn.

Both Boris himself, and a spokesperson for the Mayor quoted in the Evening Standard report, have claimed that a review of the India offices is under way. They omit to mention that a review has already been held and that it came out unequivocally in favour of keeping the offices open. Boris has ignored the results of that review, mothballed the India offices and has now apparently launched a second review which he perhaps hopes will come up with a result more to his liking.

Some people take the view that Boris is a total opportunist who lacks any ideology other than a commitment to furthering his own political career. There is some truth to this. But Boris is not entirely without political principles. He remains an adherent of a Thatcherite free-market philosophy that deprecates state intervention and is concerned only with cutting the costs of government without any regard for the consequences. This has been exacerbated by Boris’s personal inclination to what might be politely termed a laid-back, hands-off attitude towards his duties as Mayor. It has resulted in a lethargic, non-interventionist administration which stands in sharp contrast to the energetic, proactive approach of Ken’s mayoralty.

As the scandal of the India offices shows, this combination of laissez-faire and laziness is proving seriously damaging to the interests of London.