A new report has called for a major shake-up in the way London is governed.

The commission on London governance, a cross-party body set up by the London assembly and the Association of London Government, said current structures were too confusing.

At present, services are run by a mixture of local councils, the assembly and central government quangos.

This has produced a "clutter of institutions running London's services", said Monday's report.

The effect of this is to "undermine attempts to engage communities with service providers".

And it identified a democratic deficit, with more services being provided by central government agencies of which Londoners have no direct control.

Among the report's recommendations was a call for a "dramatic reduction" of central government's role in the capital, and power for mayor Ken Livingstone over the capital's five Learning and Skills Councils.

Councils should have a greater role in health provision and all providers of public services should be compelled to consult local councillors, added the study.

It also called for greater flexibility for London boroughs to raise revenue through setting their own business rates.

And London bodies should also have appointment powers in the arts.

Hugh Malyan, chairman of the commission, said: "A new roadmap to improve the quality, efficiency and value for money of public services would give Londoners more influence over the services they use.

"London faces many opportunities and challenges in the years ahead of the 2012 Olympics, but the capital's governance is in need of reform.

"Public services are life changing and life enhancing and it is only right that people have a say in how they are shaped and delivered."