MD1605 London & Partners 2016-17 Business Plan

Type of decision: 
Mayoral decision
Code: 
MD1605
Date signed: 
24 February 2016
Decision by: 
Boris Johnson MP (past staff), Mayor of London

Executive summary

London & Partners (L&P) have produced a draft 2016-17 business plan. In line with their 2014-17 strategy, L&P will work to deliver jobs and growth in London by attracting investment and visitors. The highlights of L&Ps 2016-17 business plan are:

•    The launch of Phase II of the Mayor of London’s Export Programme
•    The publication of a ten-year London Tourism Strategy
•    L&Ps most ambitious commercial income target 

The process this year varies somewhat from previous years as a result of an increased role for the London Assembly as part of a commitment to greater transparency by the GLA and L&P.

GLA’s Investment and Performance Board approved L&Ps 2016/17 business plan in principle on 10th December 2015. This Mayoral Decision requests approval of L&P’s business plan for 2016/17.

 

Decision

That the Mayor approves the London and Partners proposed business plan for 2016-17. 

 

Part 1: Non-confidential facts and advice

Introduction and background

1.1    London & Partners (L&P) have produced a draft 2016-17 business plan. In line with their 2014-17 strategy, L&P will work to deliver jobs and growth in London by attracting investment and visitors.

1.2    In 2015, the GLA endorsed the following two-year funding allocation for L&P (MD 1493):

•    2015-16    £12.446m
•    2016-17     £11.219m 

1.3    The Grant Agreement between the GLA and L&P states that no funding will be payable for any financial year prior to the GLA’s approval of the business plan for that financial year. 

1.4    In 2015, a Deed of Variation to L&P’s Grant Agreement was made to increase the transparency of L&P’s operations, including by bringing forward the decision making process for L&P’s business plan to facilitate the Assembly reviewing how L&P intends to spend the GLA grant as part of the Assembly’s scrutiny of the Mayor's budget.
  
1.5    In order to accommodate the above, the business planning round for 2016-17 began in October 2015, around three months earlier than in previous years.

1.6    L&P have shared their draft business plan with the London Assembly and it was discussed at their plenary on November 4th 2015. IPB gave in-principle approval of L&P’s draft business plan on December 10th 2015. 

 

Objectives and expected outcomes

2.1    L&P have produced a 2016-17 business plan, in line with their 2014-17 strategy, which has been scrutinised by the London Assembly, endorsed by IPB and needs to be signed off by the GLA in order to release funding, as per the Grant Agreement.

2.2    In line with its 2014-17 strategy, L&P will work to deliver jobs and growth in London by attracting investment and visitors. L&Ps (draft) objectives are to:

•    Deliver additional jobs and economic value for London, by convincing visitors, students and businesses to come to and invest in the Capital, and helping London based businesses to export.
•    Strengthen London’s reputation as a cultural centre and a leading destination for life sciences and high technologies. 
•    Secure support and active engagement from institutions, businesses and high profile individuals with an interest in London’s international promotion.
•    Build L&Ps reputation as a world leading promotional company.

The highlights of L&Ps 2016-17 (draft) business plan are:

•    The launch of Phase II of the Mayor of London’s Export Programme
•    The publication of a ten-year London Tourism Strategy
•    L&Ps most ambitious commercial income target 

2.3    A summary of L&Ps 2016-17 targets, compared against L&Ps 2015-16 targets, is set out below:

Target

2015/16

2016/17

Total GVA

£247m

£286m

Jobs created

7196

8,281

Non GLA income [1]

£7.2m

£10.7m

Additional GVA from leisure visitors attracted to London

£100m

£120m

Additional GVA from international students attracted to London

£20m

£24m

Additional GVA from business events attracted to London

£25m

£25m

Additional GVA from major events attracted to London

£17m

£17m

Additional GVA from FDI attracted to London

£85m

£100m

Capital investment into London property and infrastructure projects[2]

2 projects

2 projects

Advertising Value Equivalent (AVE) of positive international and

national media coverage

£70m

£175m

Stakeholder satisfaction

>80%

>80%

Staff satisfaction

>80%

>85%

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

[1] Includes commercial income, match funding and benefits in kind for tourism marketing activities and trade and investment activities, income from L&P’s office and income from Dot London Domains Ltd.

[2] At the IPB meeting on December 10th it was agreed that regeneration target would be reviewed and be stretching. It will consider smaller projects and Outer London as well.

 

Equality comments

3.1    L&P officers have worked with the GLA Diversity and Social Policy to ensure that L&P’s business plan adheres to the Public Sector Equality Duty. 

 

Other considerations

Key Risks and Issues

Risk

Mitigation

The Mayoral election in May 2016 may have an

impact on the remit and budget of L&P, potentially

even in 2016-17.

The Deed of Variation to the Grant

Agreement refers to this and L&P’s senior leadership team are aware of the implications.

L&P’s business plan will need to be considered in the

wider context of central government spending on international promotion.

Early analysis of the implications of the

Spending Review has taken place.

L&P’s 2014-17 strategy, agreed both by the GLA and

the L&P Board, sets targets to significantly increase

GVA and jobs created and to achieve parity between

GLA grant and commercial income.

L&Ps business plan will need to set out convincingly how it will meet these ambitious targets.

 

Financial comments

5.1    The GLA approved core grant funding for L&P remains at £11.66 million for 2016/17 although year on year comparisons of overall funding are affected by forward funding and other minor adjustments. Funding is subject to approval of the business plan. This compares to the GLA’s own grant funding from Government in 2016-17 which is anticipated to reduce by over 20 per cent. The GLA has also approved the retention by L&P of all revenues generated in 2015-16 and 2016-17 from Dot London.

 

Planned delivery approach and next steps

7.1    The next steps following this Mayoral Decision are summarised below:

Activity

Timeline

Approvals

MD – January 2016

Business Plan Start Date

Q1 2016

Business Plan End Date

Q4 2017

Project Closure

Q4 2017

 

Appendices and supporting papers

Annex 1 – L&P 2016-17 Business Plan