MD2980 London & Partners’ 2022-23 Business Plan and Grant Funding

1.1. L&P is the business growth and destination agency for London. It is a social enterprise, combining purpose with commercial rigour. It is funded by grants, partners and a portfolio of venture businesses.

1.2. This MD seeks to approve L&P’s new 2022-23 business plan, and the award of grant funding of up to £11.17m as a contribution to its costs in the 2022-23 financial year. L&P’s budget allocation for 2022-23 is equal to that of 2021-22.

1.3. Since May 2016, L&P has delivered significant outcomes for London during a period of significant change and uncertainty in the markets it supports. L&P has:

• added £1.5bn in GVA to London’s economy

• inspired 142m people through visitlondon.com

• reached more than 8m potential international students through studylondon.ac.uk

• attracted 1,191 events to London

• created or supported 37,300 jobs

• supported 1,025 overseas companies to set up or expand in London.

1.4. The twin challenges of Covid-19 and Brexit have meant L&P’s role in attracting investors and supporting businesses in high-growth sectors to scale has never been more important. Over the past financial year L&P has continued to succeed in attracting international investment to London. Since April 2021, L&P has secured 93 investments, creating 2,089 jobs and generating £115m GVA. L&P has also adapted its international trade missions to run virtually as part of the Mayor’s International Business Programme, generating almost £91m in GVA since April 2020, of which £53m was since April 2021.

1.5. L&P’s proposed 2022-23 business plan has been developed for the GLA’s consideration to enable it to determine whether it wishes to provide grant funding to L&P for use in the delivery of its business plan. L&P’s proposed business plan has also been developed to give direction to L&P’s team and communicate to L&P’s stakeholders how it will contribute this year. L&P’s proposed business plan is provided at Appendix 1.

1.6. Should any funding be awarded to L&P, its performance against key performance indicators (KPIs) will be monitored by the GLA on a quarterly basis at formal meetings attended by senior L&P and GLA officers. Grant funding payments will be made on a quarterly basis subject to satisfactory monitoring of performance against the deliverables approved as part of the 2022-23 business plan (for which approval is also being sought via this Mayoral Decision).

1.7. L&P’s work is also scrutinised by the L&P Board at quarterly board meetings. The Chair of the L&P Board is appointed by the Mayor, with GLA officers attending as observers.

2.1. L&P’s business plan for 2022-23 maintains continuity with L&P’s previous 2021-22 business plan, with the same four areas of ongoing activity. They are as follows:

• Supporting businesses in high-growth sectors: L&P will support businesses in high-growth sectors to scale-up by; bringing global businesses to London to set up; taking London-based businesses on trade missions to the world to increase their international trade; and incubating London-based businesses. L&P will also keep developing its role as a convener and thought leader. The intention of this work is to create employment, the outcome of which is measured through gross value add (GVA), which is a calculation of the number of jobs created and the value of those jobs.
• Developing London’s visitor economy: L&P will develop London as a destination and attract visitors and events. L&P will work with its partners to support the tourism recovery, as well as major events. This includes:
  • acting as the conventions and business tourism bureau for London, attracting high value events that drive visitors to the capital and increase the city’s competitiveness in the sector
  • attracting and amplifying sporting, cultural and other major events which show London at its best
  • working to support London’s recovery as a hospitality, leisure, cultural and retail destination taking account of both market need and any new public health measures.

L&P will also deliver a major domestic and international tourism marketing campaign in 2022-23. The Mayor has approved £9m of grant funding for L&P for the tourism marketing campaign, with £7m for the international part of the campaign that includes the US, France and Germany as its priority target audiences, and £2m for the domestic part of the campaign, with both parts being launched in the first half of 2022.

L&P’s visitor-economy work is intended to support jobs in a sector that, at the start of the pandemic, employed one in seven people in the city. L&P will use GVA to calculate its impact.

• Growing the London brand: L&P will grow London’s global reputation, helping to support economic growth, through effective media and messaging work (including with partners) to create a consistent, loud voice for London. This includes:
  • coordinating and managing London’s reputation by working with the wider London community to identify and respond to reputational risks
  • coordinating London’s proactive messaging by working with the wider London community to identify opportunities and to encourage joint messaging and planning
  • sharing L&P’s insights and research about global audiences with the industry to inform their decision making
  • broader media relations activity.
• The intention of this work is to support London’s communicators to tell the best possible story about the city. The nature of this makes it difficult to have formal metrics to calculate impact; however, L&P will use analytics to target its work.
• Creating partnerships and ventures: L&P will create partnerships and profit-making products and ventures to growth its revenues and reinvest in growth in order to scale its impact. L&P’s partnerships and ventures work generates financial returns to fund its activities and supports the delivery of the mission itself. Across the portfolio the balance between profitability and mission delivery will vary. The outcomes of this work will be measured by the revenues developed to reinvest in L&P’s London recovery work.

2.2. As L&P’s 2022-23 Business Plan aims to continue to deliver in these four areas, L&P’s core business KPIs remain as GVA; Net Promoter Score (NPS); and commercial income.

2.3. Although L&P’s 2022-23 business plan maintains continuity with its 2021-22 business plan in the four areas outlined above, it also focuses on four areas of change that will shape L&P’s future, as follows:

• Improve L&P’s financial position: L&P will build on the work of the last year to absorb the financial impact of the pandemic, by improving the profitability of existing programmes (Open Innovation Fellowship, West End Future Occupiers, London Leaders’ Network, and Business Tourism Trade Shows) and bringing new ones to market.
• Refresh L&P’s scale-up support: As the current EU funding for L&P’s scale-up programmes – Business Growth Programme (BGP) and Mayor’s International Business Programme (MIBP) – comes to an end in September and December 2022 respectively, L&P will build a new, sustainable model that improves the support L&P gives to London’s innovators with the highest potential.
• Define London’s tourism vision 2030: L&P will bring the tourism industry together to create a long-term vision for tourism that sets out a sustainable future and a plan to get there.
• Develop L&P’s team culture in a hybrid world: Understand and respond to the impact of hybrid working on colleagues and culture – building a model that works in this new environment.

KPIs and targets

2.4. L&P has robust outcomes that are independently audited, and its methodology is public. L&P will be required to report to the GLA on a quarterly basis on the following:

• GVA: Demonstrating L&P’s economic impact defined as GVA remains L&P’s primary outcome. L&P will set a GVA target of £178m for 2022-23, taking account of a weaker outlook for foreign direct investment (FDI) into London than last year, but a stronger outlook for business tourism and major events. On this basis, the £178m GVA target is slightly lower than the actual £193m GVA reported by L&P shortly before the financial year end of 2021-22. L&P will also track ‘green’ GVA (as a subset of the total GVA) using the GLA definition of the green economy.
• Commercial income generation: A commercial income target of £7.43m for 2022-23 has been set for L&P’s commercial and mission-driven activity.

2.5. Additionally, L&P tracks customer satisfaction by using NPSs for their core activities with the target of having positive NPSs across all of its clients, partners and stakeholders. L&P will investigate individual programmes if the NPS drops by 20 per cent or five points, or if it becomes negative. A score above zero is “good”; above 50 is “excellent”; and above 70 is “world-class”. These scores are calculated by combining positive and negative responses in a survey to establish a “net” consumer sentiment level. This is a standard industry metric for measuring customer satisfaction.

3.1. Under section 149 of the Equality Act 2010, as a public authority, the Mayor of London must have ‘due regard’ of the need to eliminate unlawful discrimination, harassment and victimisation; and to advance equality of opportunity, and foster good relations, between people who have a protected characteristic and those who do not. This duty applies to the decisions that are the subject of this form.

3.2. L&P committed to a new mission in 2021-22 that focuses on the quality as well as the quantity of growth; and on supporting resilience, sustainability and inclusion. The commitment to inclusion in L&P’s mission will continue to frame its work, guiding the sorts of businesses it supports, the sorts of jobs it seeks to create, and its work to connect people with jobs.

3.3. On this basis, L&P will continue to develop specific programmes to improve inclusivity in the businesses it supports, including through encouraging inclusive hiring and continuing to ensure representation of different communities and groups in the programmes that L&P runs.

3.4. Many of L&P’s trade and investment services are focused on supporting high-growth businesses to set up, expand or internationalise. L&P has integrated diversity and inclusion modules into its ERDF-funded BGP to support London-based SMEs. Its MIBP focuses on under-represented groups including missions made up of female founders. In 2021, L&P operated a virtual trade mission for LGBTQIA+-led American businesses looking to expand in London. In early 2021, the MIBP also collaborated with the Growth Company’s ‘Global Scale-up Programme’ in the joint Race Ethnicity and Cultural Heritage (REACH) virtual trade mission to North America, with founders from under-represented BAME backgrounds from London and Manchester (home of the Growth Company). This REACH concept is set to be a continuing partnership between the two cities.

3.5. L&P is also delivering an internal project to increase its focus on diversity and inclusion. This has the joint aims of ensuring that L&P reflects and champions the diversity of London; and creating an environment in which everyone is valued, feels supported to be themselves, and can thrive. This project is being implemented across L&P with a focus on areas such as recruitment; progression; mentoring; employee brand imagery and content; and diversity and inclusion education and training. It is being implemented in partnership with a well-supported employee network that includes active diversity and inclusion groups.

3.6. Officers have considered the likely impact of this proposed decision on groups with protected characteristics. For the reasons outlined above, they have concluded that there are no adverse impacts, and that impacts are likely to be positive.

Links to Mayoral strategies and priorities

4.1. L&P’s business plan aligns with the Mayor’s Economic Development Strategy, which focuses on the importance of a thriving London economy that is open to business and the promotion of London as a world leader in innovation, technology and creativity.

4.2. L&P’s proposed activity also aligns with the aims of several of the Mayor’s recovery missions (both in its general activity and as an employer). These are:

• A Green New Deal: L&P will encourage green tourism; encourage green economy businesses to invest in London; help investors to work with sustainable providers when they arrive; and help London’s scale-ups to contribute to net-zero goals.
• High Streets for All and Building Strong Communities: L&P will work with business improvement districts, landlords and local communities to help use investment to drive new uses of high streets.
• Helping Londoners into Good Work, and a New Deal for Young People: L&P will create jobs that are high-quality and long-term; and it will work with investors to help them find talent from across London’s communities.

Impact assessments and consultation

4.3. In producing its business plan, L&P has consulted widely with stakeholders across the sectors it supports and with relevant Deputy Mayors and GLA officials. That consultation has particularly focused on activity where L&P will be working in partnership with the GLA.

Key risks and issues

4.4. The business plan has been developed, taking into account the course of the Covid-19 pandemic at the time of drafting. However, both the business plan and the KPIs will be kept under review; and may need to be revised at a future date in response to unanticipated developments in the course of the pandemic, in which case a further MD would be sought if there are significant changes. This has been included in the following table of risks and mitigations which have been considered by L&P in its planning assumptions for the development of its 2022-23 business plan:

4.5. No one involved in the drafting or clearance of this decision has any conflicts of interest to declare. As the Deputy Mayor for Business is Chair of L&P, it has been cleared by the Deputy Chief of Staff.

5.1. The proposed GLA grant of £11.170m to London & Partners has been included within the GLA’s budget and spending plans for 2022-23. This grant will assist with London & Partners’ 2022-23 strategy including work on London’s continued recovery from the pandemic, with this specific budget provision held and project managed within the GLA’s Economic Development Unit.

5.2. In line with previous arrangements, payments will be made on a quarterly basis subject to satisfactory monitoring of performance against the deliverables approved as part of the 2022-23 business plan (for which approval is also being sought via this Mayoral Decision). This requirement as well as the standard break clauses will be incorporated into the funding agreement to ensure that performance and risk is managed effectively during the duration of the grant agreement.

6.1. The preceding sections of this report indicate that:

6.1.1 the decisions requested of the Mayor fall within the GLA’s:

• general statutory powers to do such things considered to further or which are facilitative of, conducive or incidental to the promotion of economic development and wealth creation and social development in Greater London (section 30, GLA Act 1999)
• discharge of its duties under section 378 of the GLA Act, to promote tourism to, in and through Greater London

6.1.2 in formulating the proposals in respect of which a decision is sought, officers have complied with the Authority’s related statutory duties to:

• consider how the proposals will promote the improvement of health of persons, health inequalities between persons and to contribute towards the achievement of sustainable development in the United Kingdom
• consult with appropriate bodies.

6.2. In taking the decisions requested, as noted in section 3 above, the Mayor must have due regard to the Public Sector Equality Duty under section 149 of the Equality Act 2010, namely the need to eliminate discrimination, harassment, victimisation and any other conduct prohibited by the Equality Act 2010, and to advance equality of opportunity, foster good relations between persons who share a relevant protected characteristic (race, disability, gender, age, sexual orientation, religion or belief, pregnancy and maternity and gender reassignment) and persons who do not share it. To this end, the Mayor should have particular regard to section 3 of this report.

6.3. Should the Mayor be minded to make the decisions sought, officers must ensure that no commitment to award the funding proposed is made until both the GLA and L&P have executed a funding agreement.

Appendix 1 – L&P Annual Business Plan – 2022-23