The Two Cities Lowdown is Lowick Hedry’s weekly read on the City of Westminster and the City of London, written by the team that works both every day. An insiders’ guide, not an observers’ one. A read for the commute or over a coffee, not a council report.
The first full week of term delivered more than expected. Westminster lost one fight with government, part-conceded another to its critics, and picked two more with the Prime Minister. The City had its day in front of the planning inspectors, and is quietly rewriting a rule that has governed its skyline since before the First World War. Here’s what happened and what it means going into next week.
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Government has ruled that Oxford Street pedestrianisation needs no full environmental impact assessment, and Paul Swaddle has responded by accusing the Mayor on air of cheating the system. A revised licensing policy landed on Monday and goes to Full Council next Wednesday. Westminster has joined two neighbouring boroughs in threatening legal action over its funding settlement, and hit back at the Prime Minister over property tax. The reopened City Plan 2040 hearing came and went at Guildhall, and the inspectors have yet to report. The City’s Planning and Transportation Committee broke with its own officers over how planning decisions get made after 31 October, and is preparing to let companies put their names on the tops of buildings for the first time in over a century. And the Overnight Visitor Levy moved from theory to design, with the Mayor pressing for it sooner rather than later.
Out later today
A special episode of Political Business with Nabeel Khan, chief executive of the Oxford Street Development Corporation, on the transformation, the planning powers and what happens next. Given everything below, it’s the other half of the Oxford Street argument, straight from the body now holding the planning powers. Listen and subscribe on Apple Podcasts, Spotify and YouTube.
Westminster
Licensing: not a climbdown, but not nothing either
Last week I said Westminster would hold its position. It largely has, with the presentation substantially rebuilt around it. For anyone new to the patch: Cllr Paul Swaddle has led the council since the Conservatives took it in May, and Cllr Tim Barnes is his deputy and cabinet member for growth and planning. Between them they front most of what follows.
The council published a revised policy on Monday, confirming it will explain technical terms including “vertical drinking” more clearly, and stating plainly it never intended to ban standing at the bar. Barnes calls the alternative reading a wilful misreading of the proposals with clauses lifted out of context. The council’s own framing is that it has reconsidered how it explains and communicates licensing policy. That is a careful way of saying the policy was fine and the comms were not.
Substance intact, then. The interesting part is what has been bolted on alongside it. The council is now pressing hard on policing, noting the Met’s licensing team has halved and officer numbers are down, and asking for more visible policing, extended night buses and a Thursday night Tube.
Read that as a counter-attack rather than a consultation finding. Every item on that list is the Mayor’s responsibility, not the borough’s. Westminster’s case is now that the binding constraint on the West End’s night-time economy is public safety and transport, not council licensing rules, which conveniently moves the argument onto ground where City Hall holds the levers. It is a direct answer to Sadiq Khan, who spent August arguing you cannot run a world-famous nightlife district with a village-hall mindset. Westminster’s reply, in effect: fund the policing and run the buses, then we can talk about the bar layout.
The date that matters: the revised policy goes to Full Council on Wednesday 16 September for adoption, ahead of the 1 October statutory deadline. The council licenses more than 4,000 premises, over 1,000 of them in the West End. If you have an interest in how this lands, next Wednesday is the moment.
Oxford Street: “he has cheated the system”
Westminster lost the environmental impact assessment fight, and then escalated the language considerably.
Government confirmed on 4 September that the pedestrianisation plans do not meet the legal threshold for a full environmental impact assessment. TfL had asked ministers to rule on the question; ministers ruled in its favour. Enabling works begin imminently and the first section between Orchard Street and Great Portland Street could be traffic-free as early as October.
Swaddle went on BBC Radio London on Wednesday, as part of Eddie Nestor’s Meet the Leader series, and accused the Mayor of shortcutting the process. Every major development in London gets an assessment, he argued, and what the Mayor has done amounts to a shortcut. His words: “He has cheated the system.” He was careful to say he is not predicting harm, only that the impacts should be identified and mitigated, and made the point that residents understand the street better than many of the scheme’s supporters do.
That is a notable sharpening. Barnes’ written statement the same week was extremely disappointed in MHCLG and warned a rushed scheme would be a disaster for local people, businesses and visitors, but stopped short of alleging bad faith. “Cheated the system” is a different register, and it is the leader saying it.
The process detail matters, because it is what both sides are arguing about. TfL says it told the council and the OSDC on 5 August that it had asked ministers to rule. Westminster asked for a copy of the submission on 20 August, received it on 21 August and filed comments on 28 August. The screening document reportedly runs past 500 pages, is not public, and acknowledges increased noise in Fitzrovia and Marylebone plus air quality effects in Piccadilly. The Mayor’s office says he is pressing ahead on the back of strong support from Londoners and businesses, pointing to two consultations that drew over 6,000 and over 2,700 responses.
Note Barnes’ closing line, though, because it is the one to hold onto: if pedestrianisation must happen, the council will help make it work.
What actually changes on the ground: the stretch closes to private vehicles, buses, taxis, private hire, cycles, scooters and pedicabs. Servicing and delivery vehicles keep access between midnight and 07:00. Emergency vehicles, street cleaning and refuse collection are maintained throughout. A permanent design for the new layout, likely to include al fresco dining, is due by November 2027.
The formal route has closed and construction has started. The council’s remaining leverage is its OSDC board position and whatever happens when the diversions bite. Watch the first fortnight of live traffic changes rather than the press releases.
Barnes has also pulled the separate rows into one line of attack, accusing the Mayor of grabbing powers over Oxford Street, licensing and planning at once while failing to deliver. Sharper than three separate grievances, and the framing to expect from here. He took planning authority for the Oxford Street area through the OSDC on 10 August and is pressing for more. The practical effect for anyone doing business in the West End is that things are becoming more complex.
Money: three councils, one legal threat
The funding row escalated properly this week. Westminster, Kensington & Chelsea and Wandsworth have accused the Prime Minister of crippling them financially and threatened legal action over the Fair Funding Review. Swaddle’s line is that it strips hundreds of millions out of London councils, with Westminster singled out for one of the largest real-terms cuts in the country.
Then Burnham gave the Evening Standard an interview signalling he wants to reform property tax later in his premiership to improve fairness, which in practice means London and the South East paying more. Swaddle responded within a day. Worth keeping proportionate: the Prime Minister has separately ruled out replacing council tax and stamp duty with a single annual property tax in this Budget, so the immediate threat is smaller than the rhetoric. The medium-term direction is not.
Both stories point the same way. With the Budget on 28 October and a £160m gap to close, Westminster has settled on its most useful political position as the borough this is being done to.
An enforcement win worth £500,000
A tenant who illegally sublet a council flat near Buckingham Palace has been ordered to repay nearly half a million pounds. The anti-fraud team is having a good run, and expect this cited whenever the enforcement pillar needs evidence.
Open for business: consent at 27 Soho Square
A Lowick Hedry project through. Kajima Properties Europe has secured planning consent to refurbish 27 Soho Square, a 31,000 sq ft Grade A office building designed by Gibson Thornley, targeting BREEAM Excellent and EPC A, with new terraces on the fourth and fifth floors and streetscape improvements at ground level. Driving growth is one of the administration’s key priorities.
The City of London
City Plan 2040: the hearing happened, now the wait
The reopened examination session took place at Guildhall on 2 September. A second day had been scheduled for the 3rd and was not required, which tells you the argument was narrower than the stakes.
The stakes are considerable. The Corporation has warned that tighter tall-building controls around the Tower of London could put up to £1.2bn of annual economic output at risk. The Plan is built to support at least 1.2 million square metres of additional office floorspace by 2040, most of it in the City Cluster, which is precisely where the current wave of tower applications sits.
The mechanics are unusually constrained. Pennycook’s direction, issued in June and clarified in July under section 20(6A) of the Planning and Compulsory Purchase Act 2004, prevents inspectors Jameson Bridgwater and Alastair Phillips from issuing their final report, and limits them to a single question: whether the Corporation’s City Cluster tall-building contours or Historic England’s alternative strikes the better balance between protecting the Tower’s World Heritage status and not unduly restricting growth.
What has shifted since the earlier hearings is the international context. Historic England now argues there is a real risk the Tower could be recommended for the List of World Heritage in Danger next year without corrective measures. It wants a larger gap of clear sky around the monument and a skyline stepping away more gradually, which means changing the eastern edge of the Cluster. The Corporation’s position is that its own contours already strike the right balance and that Historic England has not demonstrated a material improvement.
The industry turned out in force. SAVE Britain’s Heritage backed Historic England’s contours as a minimum, while the City Property Association spoke for the draft Plan with four representatives, leaning on fresh JLL evidence on office attendance and demand. One line from the growth side captured the mood: constraining the Cluster at a moment of national economic urgency would be like entering a race with your shoelaces tied together.
No policy change has been agreed and the inspectors have not reported. Their findings then go to MHCLG for sign-off. This is now the single most consequential open question in City planning, with no published timetable. One knock-on: Tower Hamlets has postponed its own local plan examination, apparently because the same inspectors are tied up here.
Diary note. Historic England, the Corporation and St Paul’s unveil a new St Paul’s Cathedral Setting Study on 7 October. After the Tower of London, nobody will read that as academic.
Logos on buildings: a century-old rule on the way out
The best City story of the week, and one with more commercial consequence than it first appears. The Corporation is preparing to abandon more than a hundred years of resistance to corporate logos on office buildings, opening the door to firms putting their names on the tops of towers as they routinely do in Canary Wharf.
The current policy resists advertising above ground-floor level and is built around restraint and the character of the Square Mile. The underlying rules go back to at least 1911. In practice, City tenants have long read the guidance as meaning visible branding is simply not the done thing, and banks and law firms have found that increasingly out of step with how they operate elsewhere.
Shravan Joshi, deputy chairman of the Planning and Transportation Committee, told the FT that policy work is already underway and that decision-makers in the Square Mile want it to happen. His framing is competitiveness: an international firm wanting its name on the door should be read as a compliment to London, not an imposition on it. He is pointed about the City’s habit of naming towers after kitchen implements, and floats the Aon Tower over the Cheesegrater. He is equally clear this is not a licence for neon, and that any signage would need to stay conservative and in keeping.
Who is already asking. HSBC has sought permission to display its name above its new headquarters beside St Paul’s, ahead of relocating early next year. Clifford Chance made a similar enquiry for the headquarters it takes in 2028.
The practical timeline. A formal policy change needs approval from two committees and could take around eighteen months. In the meantime, firms can lodge requests on an ad hoc basis, which is where the immediate opportunity sits for anyone with a building and a name they would like on it. Expect early applications to shape the policy more than the policy shapes them.
Scheme of delegation: members overrule officers
The national scheme of delegation comes into force on 31 October and forces every planning authority in England to restructure how applications reach members. The City took its first substantive decision on Tuesday, and it did not go the way officers wanted.
At the Planning and Transportation Committee on 8 September, officers recommended a single dedicated sub-committee to handle applications under the new regime. Members instead indicated a preference for a rotating, multiple-panel model. That is a meaningful divergence, and it now needs confirming twice: at Policy and Resources Committee on 25 September, then at the Court of Common Council on 8 October, three weeks before the regime bites.
Why it matters practically. A single standing sub-committee would have meant a consistent group of members hearing every significant scheme, building familiarity with the pipeline and, in principle, more predictable outcomes. A rotating panel model spreads the load and preserves broader member involvement in a Corporation whose Planning and Transportation Committee runs to 35 members. The trade-off is consistency. If you are bringing something forward in the City after 31 October, you may not be able to assume the same faces or the same instincts each time.
Worth remembering the City starts from an unusually delegated position anyway. Its existing scheme already sends most applications to officers, with only 32 reaching committee since December 2022, and its submission to government argued for keeping “safety valves” so genuinely significant applications can still reach members even where they technically comply with the plan.
We circulated a fuller note this week on the 8 September meeting, the three options considered and what each would mean in practice. Contact Stephen Goodall at stephen.goodall@lowickhedry.com for a copy.
Two to keep an eye on
Bank tax. Nothing has moved publicly since the Treasury declined to rule out an increase last month. The Corporation’s case is unchanged, and its numbers will be quoted at you repeatedly before 28 October: over £97bn generated annually, one in five financial services jobs in Great Britain, £1.2bn in business rates.
The London Plan. The Mayor’s draft consultation closes on 15 October and remains the item most people are underweighting. Helpful on CAZ office space and cycle parking, a problem on embodied carbon, where the targets could constrain tall building delivery in the City Cluster. Five weeks left.
The Overnight Visitor Levy moved from theory to design this week, and it is the story with the broadest reach across both patches.
Housing Secretary Angela Rayner has been meeting mayors to set out the structure of the levy, and Sadiq Khan went public pressing for London’s to arrive “sooner rather than later”. City Hall is drawing up proposals for a levy of up to 5% of the room rate, expected to raise hundreds of millions annually, and is already working through how the money would be spent. Government has landed on a percentage rather than a flat fee, which City Hall welcomes, on the basis it protects budget accommodation. For comparison, Wales goes live at £1.30 per person per night from April 2027 and Edinburgh’s 5% scheme is already running.
Nothing is fixed. No final decisions have been taken on scheme design or revenue allocation, and the Mayor must run his own London consultation before anything is introduced. But the direction is now clear, and the arguments are about to get specific.
Where the City Corporation already stands. Usefully, it settled its position back in January, and it is worth knowing because it is not simply the Mayor’s. Three planks: support an implementation model that limits the impact on City hotels and visitors, recognising the cost pressures already hitting hospitality; back a 75:25 split of revenue between local authorities and the GLA, on the basis that visitor-economy services are mostly locally owned and run; and oppose central government control over how the money is spent locally, while working with City Hall on institutions with a genuinely pan-London reach.
That 75:25 line is the one to watch. The Mayor wants a levy that funds tourism at a London-wide level. The boroughs and the Corporation want the money staying where the visitors actually are. Both can support the levy in principle and still have a serious fight about the split.
Westminster has already moved. Swaddle is launching a petition calling for the borough to keep 50% of the revenue raised within it. Read that as the answer to the question of whether Conservative Westminster could back a Labour Mayor’s tax: not opposition, but a fight over the split, and a bid pitched well above the Corporation’s 75:25 ask because Westminster’s claim is borough-specific rather than London-wide. The underlying argument is the same one the council makes about everything at the moment. It services 800,000 visitors a day while collecting council tax from 200,000 residents, and it is staring down a £160m gap. A hypothecated visitor charge is close to a purpose-built answer to that problem, provided the money stays where the visitors are.
The counter-case. UKHospitality opposes the levy, warning it damages competitiveness on top of 20% VAT on accommodation, with the sector already absorbing rates revaluations and rising fixed costs. Note how neatly that dovetails with Westminster’s own licensing argument. Expect operators to make both points at once.
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