Spending Review: Impact on London

  • Published

BBC London takes a look at how various sectors of the city have been affected by the government's Spending Review.

Mayor Boris Johnson has said he is "particularly pleased" that the capital's two big transport projects have been saved.

However the Labour group on the London Assembly said the review inflicted "swingeing cuts attacking police, transport, housing", which would "hit middle-income earners in London and attack the poorest".


  • The £16bn Crossrail and investment in Tube services will go ahead, although project deadlines could be delayed
  • Transport for London budget cut by £2.2bn
  • Western extension of congestion charge scrapped
  • Bike-hire scheme to be extended to east London by 2012
  • Concessionary bus fares will remain
  • The M25 will be widened between 10 different junctions
  • Tube fares for 2011 to be set at RPI plus 2%

Mr Johnson said: "I am particularly pleased that we have secured the future of Crossrail, upgrade work on the Tube and the protection of our bus services."

But London Assembly Labour leader Len Duvall said the mayor had made £6bn in cuts to London's transport and warned Tube and bus fares could go up by 7%.

Plans for step-free access across the Tube network, the extension of the Docklands Light Railway and upgrading Croydon's Tramlink have been axed, Mr Duvall said.

  • Nationally councils will lose 7.1% a year until 2014 in funding - 26% in total
  • The amount given by Transport for London to councils may fall
  • National cap on housing benefit and 80% tenants' contribution

The cuts announced were more than London Councils, which represents 32 councils, had anticipated in September - a 24% cut by 2014.

Colin Barrow, leader of Conservative-led Westminster Council, said his council had merged its children's services department with Hammersmith and Fulham and was looking for similar opportunities with Kensington & Chelsea and Wandsworth.

He said: "None of us want to cut front-line services, but if councils pool their resources and expertise and bring the public sector together under one roof people really can get more for less from local government."

London Assembly Green Party member Jenny Jones said the cap on housing benefits "could be the end of affordable housing in central London where market rents are very high".

Homeless charity Providence Row said the cuts would "result in an estimated 82,000 evictions and lead to a homelessness crisis in London".

  • The Metropolitan Police force is facing a 14% cut over four years to its £3.6bn budget
  • The Met is planning to save £36m in training, £39m by selling its properties in London, £7m in transport and £15m in catering
  • Several senior managerial posts expected to go following the 2012 Olympics

The Treasury said: "Counter-terrorism specific policing will be protected with a smaller percentage cut than overall police funding of 10% in real terms and we will ensure the right funding is in place to deliver a safe and secure Olympic Games in 2012."

Mr Duvall said the cuts would lead to a loss of 455 Met officers.

The number of buildings owned by the Ministry of Justice in London will also be cut from 18 to four.

  • The extension of Tate Modern and British Museum will go ahead
  • Free entry to the various museums and galleries across the capital will be untouched

But the UK's main tourist agency VisitBritain's has suffered a 34% cut in funding, which means its budget will be reduced from the current grant of £28.8m to £21.2m by 2014-15.

VisitBritain chairman Christopher Rodrigues said he intended to "create the strongest possible campaign around the 2012 Olympic and Paralympic Games".

The government had declared its aim to protect the health sector and, in keeping with that commitment, Chancellor George Osborne has not only ring-fenced its budget but increased it from the current £104bn to £114bn by the end of 2014.

Nationally, the schools budget has been increased by £4bn to £39bn and funds given to local authorities for schools will continue to be ring-fenced.

But the Building Schools for the Future programme which was introduced by the Labour government has been axed, prompting Waltham Forest Council in north-east London to begin legal action against the government.

The budget for higher education will go down from £7.1bn to £4.2bn although the government has promised to ring-fence funding for science and technology.

Universities as a whole are facing a 40% cut in funding which could leave students picking up the shortfall.

Lord Browne's review last week recommended lifting the current cap on tuition fees which could mean top universities being able to charge up to £12,000 a year.

  • Games contingency budget of £9.3bn untouched
  • Security budget of £600m protected
  • No cuts to funds for elite competitors preparing for the Games
  • But efficiency savings of £20m need to be made
  • Plans to wrap the Olympic Stadium in an 860m fabric wrap scrapped, saving £7m

The Olympic Delivery Authority, which is responsible for building the venues, will announce how it plans make the efficiency savings by 9 November.

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