LONDON will be a big winner in next week's pre-Budget report as the Government moves to protect jobs, families and businesses in the capital, Cabinet minister Harriet Harman said today.

The deputy Labour leader told the Standard that moves to boost lending to small firms, fast-track housing schemes and shore up the City's banking sector were all proof that Londoners would not be left to "sink or swim" in the recession.

Ms Harman, who is also Commons Leader and MP for Camberwell and Peckham, said that the PBR on Monday would provide its "greatest protection" for those struggling to make ends meet, a hint at a new tax cut for the low-paid. There would also "be a focus on business" in the Chancellor's statement, she said.

Taxpayer help to recapitalise the banking sector would help not just "fat cats" but the tens of thousands of people in secretarial and other jobs that depend on the Square Mile and Canary Wharf.

In a preview of her speech to a London Labour Party conference tomorrow, she also underlined the importance of Crossrail and the Olympics in providing a huge "fiscal stimulus" to the capital just as the downturn begins to bite.

"London is very much the engine of the nation's economy. We need to reassure people that we will leave no stone unturned, that we will take any action necessary to protect small businesses in London, jobs in London and to help as much as we can with the housing market in London," she said.

"The bank recapitalisation was very important. For London there's a particular importance of financial services and that's not just the people at the top, the City 'fat cats' - it's all the people who come in from all around London to work in the City." Ms Harman said that Crossrail was crucial, like the Games, to strengthen the capital's economy to allow it to benefit once the global upturn arrives, and to provide jobs and skills.

"It would be quite the wrong thing to do to be cutting back on these major capital infrastructure projects. First, we will need them when we come out of the downturn. Secondly, because it would make the downturn worse. Sometimes it's prudent to be bold."

The minister attacked Boris Johnson for criticising Labour plans to increase borrowing in the downturn. "It's quite unclear what he's for or against. On the one hand he is saying he doesn't want any fiscal stimulus. But on the other hand, he is supporting new housing projects, which rely on borrowing."

Ms Harman refused to be drawn on whether she believed Ken Livingstone would be the right candidate for Labour to take on Mr Johnson in the mayoral election in 2012.

But Trade minister Gareth Thomas will tomorrow seek to trigger a debate on the issue at the party conference and effectively accuse Mr Livingstone of ignoring the suburbs and fears about crime.

"Whether we like it or not, Labour in City Hall was perceived as being remote, inefficient and not listening - a toxic backdrop to the media coverage about administrative and financial management that dominated the last four months of our campaign," Mr Thomas will say.

"A critique of Boris won't be enough to win in 2012. We will need to demonstrate over the next three years that we have changed and understand why, despite a higher vote than in 2004, we couldn't hold the mayoralty this year."

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