Abolish The Last Rotten Borough

In an important display of the growing unity between Blue Labour and the Labour Left, John McDonnell writes: 

On the night Occupy LSX marched into the City tweets came into me asking for help as the police kettled activists on the steps of St Paul's. I went down there and did what little I could to prevent people being roughed up. Over the next few days the tents soon appeared and the occupation became a debating forum on the causes and creators of the economic crisis.

As days turned into weeks and the cathedral hierarchy split over whether to evict the camp, the occupiers soon discovered the existence of an organisation the vast majority of the population barely knows exists. The City of London Corporation was flushed out of the shadows in which it normally lurks to show that it was something more than the organiser of a good pageant in the Lord Mayor’s Show.

Naturally members of Occupy turned their inquisitive attention to this seemingly quaint body that was threatening to send in the bailiffs. Just as the direct action by UK Uncut transformed the issue of tax evasion from a dry debate for accountants into a popular cause, Occupy has helped turn the spotlight on the abuse of power that is the City Corporation.

In Michael Chanan’s and Lee Salter’s new film, “Secret City”, Maurice Glasman explains ironically that St Paul’s was the site of our earliest democracy, where the citizens of London in medieval times would hold hustings. In the sixteenth century the city took over from Amsterdam as the centre of international credit and maritime trade. Its coffee houses became banks and governments became dependent upon them for loans, largely to finance wars.

Government's reliance on the city to finance the national debt gave the city such influence that the Corporation was able to avoid the successive reforms that established democratic local government in the rest of the country.

Instead the City Corporation to this day retains the business vote, which overwhelms the votes of residents in the elections for its Common Council. The vast proportion of elections in the City have not been contested. Instead an old boys’ network amongst the companies sorts out which favoured son is to be bestowed the seat.

This usually prevents anyone slipping through the net who shows any spark of independence, although not always. Around a decade ago, Malcolm Matson was elected with 80 per cent of the vote but was known to favour reform. He was hauled before the City’s Court of Aldermen and was blackballed. Local vicar, the William Taylor, was also successful in being elected but as soon as he started asking questions about the Corporation’s unpublished accounts, his bishop received letters with more than a hint of a threat.

Matson and Taylor could not be tolerated because they were asking questions about the massive resources being spent on the secretive role the City Corporation plays as the lobbyist for finance capital. The Corporation has used its influence to dictate successive government’s policies on the regulation of finance and taxation.

This secured the deregulation of the “Big Bang” era of Thatcher and the hands off approach under Blair and Brown. City speculators were allowed to create the bubble that eventually burst to create the current economic crisis. London became a funnel through which trillions poured into tax havens and the concentration on financial speculation rather than investment in our manufacturing base unbalanced our whole economy. Obscene levels of incomes and conspicuous spending in the City have also created a society grotesquely scarred by inequality and a capital city in which immense wealth is located cheek by jowl with stark levels of poverty.

It was Labour Party policy since its foundation to abolish the City Corporation, until Blair arrived and the policy changed to reform. The City cynically interpreted reform as simply giving more businesses the vote.

The abolition of this last “rotten borough” would show that Ed Miliband is serious about tackling predatory capitalism.

Since 1999, I have been a Parish Councillor where there are about nine thousand people in an area which, excluding outlying hamlets and farms, is about one mile square. I am pleased to say that we have lots of businesses. But there is absolutely no suggestion that those businesses should have votes, still less that those votes should be greater than the votes of real people.

Unless the Miliband Government is going to exact particularly sweet revenge by making the Square Mile a Ward of the London Borough of Tower Hamlets, then the City of London needs a City Council, a London Borough as the City of Westminster already is, with each ward electing three Councillors as elsewhere in London, and with each year's Chairman serving as Lord Mayor. An ideal opportunity to use the system that we all urgently need for municipal elections above Parish or Town level, whereby each of us would vote for one candidate and the requisite number, never fewer than two, would be declared elected at the end.

All the pageantry and all the charity could and should remain. Such an inheritance is very common in local government. Have you ever been to Durham? The City could remain its own ceremonial county, since the link between those and municipal arrangements was cut all the way back when an unprotesting Margaret Thatcher was in the Cabinet.

And the existing wealth of the Corporation, a fine old word for this sort of thing, would also be retained, in addition to normal sources of funding. Do they pay business rates in the City? They do not seem to pay very much else. But they would. For there would be no more state within the State; at present, the Queen is forbidden to set foot in the Square Mile without special permission. Still less would there be any inability to tell which state was which.