The government has intervened to block a controversial attempt by Labour-led Lambeth Council to dismantle the centuries-old City of London Corporation. Communities Secretary Michael Gove rejected the proposal that would have seen the unique local authority absorbed into broader London governance structures.
Historic Institution Under Threat
The City of London Corporation, which traces its roots back to medieval times, operates as a distinct local government body covering London's historic financial district. Unlike other UK councils, it maintains ancient traditions including the office of Lord Mayor and a unique electoral system.
Labour's Radical Proposal
Lambeth Council had submitted a formal request to abolish the Corporation as part of a wider local government reorganisation. The Labour motion argued the institution was "an undemocratic anomaly" that didn't fit with modern governance principles.
Key objections included:
- The Corporation's unusual voting system that gives businesses representation
- Its substantial financial reserves and property portfolio
- Perceived lack of accountability compared to other councils
Government's Firm Rejection
In his response, Mr Gove stated that abolishing the Corporation would require primary legislation and that the government had no plans to pursue such changes. He emphasised the Corporation's important role in supporting the UK's financial services sector.
"The City of London Corporation plays a vital role in supporting and promoting the UK's financial and professional services sector," the minister wrote in his decision letter.
Political Fallout
The decision has sparked heated debate about local democracy and institutional reform. Supporters of the Corporation welcomed the government's intervention, while critics accused ministers of protecting outdated privileges.
The controversy comes as the Labour Party prepares its local government manifesto ahead of the next general election, with some suggesting this issue may feature in wider debates about constitutional reform.
