Burnham should focus on London to boost Britain, says former adviser

Andy Burnham should focus on improving London to help lift Britain’s fortunes, his former economic adviser has said. Lord O’Neill, a former Goldman Sachs chief economist, said that if the Prime Minister wanted to boost growth, he must dedicate greater resources to the capital. Mr Burnham, the former Greater Manchester Mayor, has refused to back key London initiatives such as Heathrow’s third runway , prompting fears that the capital will be disadvantaged at the expense of the North. Lord O’Neill said: “You’ve got to focus on the biggest places. If you’re really serious about this stuff, you’ve got to do something about London.” He suggested that the Prime Minister will make an announcement about the capital in Wednesday’s Budget, saying: “Let’s see in the Budget. I suspect there will be something.” London has grown faster than any other region of the UK since the financial crisis, but its growth rate is still much slower than in previous decades. The capital’s GDP grew by 42pc between 1998 and 2007, far more than the 28pc it has managed since then. When measured per person, London’s GDP has increased by only 8.6pc since 2007. The Prime Minister has made achieving “growth in every postcode” key to his pitch to voters, but his former adviser was unimpressed by the slogan. He warned it was “slight lunacy” to hand money to every postcode in the country. Lord O’Neill said: “A lot of places don’t have the capacity to actually deliver on how they might use that money in a way that you can have confidence that it is going to benefit the taxpayer.” He has previously said that if Mr Burnham wanted to boost growth, he must give London “some kind of priority” and that neglecting it would be a “really bad mistake”. The economist, who was Mr Burnham’s chief economic adviser ahead of Labour’s leadership contest, recently declined to take an official role in the Government . Lord O’Neill’s remarks also echo recent comments made to MPs on the Treasury committee. Speaking to MPs earlier in October, Lord O’Neill said: “If that is going to be at the centre of your approach to trying to achieve greater national growth, you really have to prioritise the places that are going to matter.” He added: “A slightly uncomfortable thing for me in this context is that, despite the fact that London’s own growth performance has been very weak by its own standards in the past 15 years and so the gap has narrowed, it is still the case today that London is the same size as the next eight most important places put together.”