Boris Johnson has signalled plans to further boost his powers in the capital by lobbying the government to let "cash cow" London keep more of the tax revenue it generates and secure more mayoral control over how the money is spent.
The Conservative mayor wants an end to London routinely paying more in tax than the government spends in the capital. If re-elected on 3 May, he intends to lobby the government to ensure London gets back in funding "what it contributes to the national purse".
Tony Travers, director of the Greater London group at the London School of Economics, said the "tax export" from London amounted to between £10bn and £20bn a year before the financial crisis, but was now closer to £5bn.
Outlining his manifesto pledges for the London economy, Johnson said one pound in every five collected in London was used to subsidise the rest of the country.
He announced plans to set up an independent commission in his second term to look at revised funding formula arrangements for the capital and ensure it gets a "fair share".
He also wants funding allocated without ringfencing so that the mayor can "determine how money is spent to match Londoners' priorities".
His London funding commission would examine existing funding arrangements and propose revisions. "I want to make sure that London's funding sources are put on a secure long-term footing, giving the mayor and the people of London increased certainty, Johnson said. "It will examine whether it is time we should keep more of the taxes Londoners pay in London.
"I want to ensure that London's place at the heart of growing the economy is secure. It is time to look hard at London's funding. With one pound in every five made in London now spent outside the city, it is time to recognise that London is the motor of the UK economy. The best way to keep the economy moving is to keep the motor full of fuel."
Travers wrote in the London Evening Standard that Johnson's plans were akin to the Scottish National party setting its sights on "devo max" powers in Scotland.
"If Johnson were successful it would be possible to increase investment in the city's infrastructure or services and/or cut local taxation," Travers wrote. "Elsewhere in Britain the reverse would be the case, generating a headache for the chancellor."
Johnson's manifesto also outlined plans for an annual jobs fair in the capital, funded by the private sector; 100 paid internships across the Greater London Authority; and a part-time jobs campaign to help parents return to work.
