Livingstone is urged to take advice from New York on how to run a great city

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Ken Livingstone, the Mayor of London, was urged to take tips on "how to run a great city" from Rudolph Giuliani after he was forced to abandon plans for a 35 per cent rise in council taxes in the capital.

Mr Livingstone was criticised by a Tory MP in the House of Commons yesterday, watched by his former New York counterpart, who was attending Prime Minister's questions.

Sir Patrick Cormack, MP for South Staffordshire, said Mr Livingstone should ask Mr Giuliani's advice. Sir Patrick asked Tony Blair to speak to Mr Livingstone, adding: "Would you tell him the Mayor of New York is a very welcome visitor in London and if Mr Livingstone wants to know how to run a great city properly he should have discussions with him."

Mr Blair avoided answering the question but the Prime Minister is due to have discussions with Mr Giuliani.

Mr Livingstone's plans for a £53-a-year rise in the council tax precept for Londoners were blocked yesterday by the Greater London Assembly. The assembly voted instead for a £22.88 a year, or 15.2 per cent, increase for Band D tax payers. Liberal Democrat and Labour members agreed but the Conservatives insisted the increase remained too high. The money will help to pay for an extra 1,240 police officers.

The cuts represent an £85m loss for Mr Livingstone's total budget of more than £4bn, which, he says, will hit his plans for transport improvements.

The Mayor, who had said that a £53 rise was equivalent to buying "a walnut whip a week" for Londoners, said yesterday he was pleased with the "sensible compromise" of a £22 increase.