London’s mayor, Sadiq Khan, will launch his re-election campaign by promising £5m to bring jobs and tourists back to the pandemic-struck West End and calling for a postwar-style recovery package of investment in the capital. Khan, who will launch his campaign on Thursday with Labour’s deputy leader, Angela Rayner, said he would maximise his City Hall budget on a jobs creation programme to revive the city, where many small businesses have been hit by lockdown closures and commuters working from home. His campaign will highlight the 300,000 Londoners who have lost their jobs in the pandemic. He said the budget delivered on Wednesday was “lacking in ambition and vision” and the chancellor should have delivered a 1945-style recovery package that replaced the furlough scheme with a new jobs guarantee linked to in-work training and apprenticeships. “We owe it to everyone who has lost their lives, to the key workers who have done so much to keep us safe, and to all those who have suffered to ensure we build an even better London after the pandemic,” he will say in his speech on Thursday. The Labour mayor’s campaign began at Hot Milk, a north London cafe supported by a £5,000 back-to-business grant from City Hall, and which raised more than £12,500 through the Pay It Forward London crowdfunding platform promoted by Khan. The campaign will return to the familiar backstory of Khan, the son of a bus driver, and will emphasise his experiences of growing up in London. “We have had a dreadful year, but there’s finally some light at the end of the tunnel for Londoners,” Khan will say. “In 1945, a Labour government rebuilt Britain from the ashes of war. Like so many, I benefited from their work decades later as I grew up on a council estate and was given the opportunities to fulfil my potential and become mayor of the greatest city on earth. That’s why jobs, jobs, jobs are a top priority for my second term.” Khan’s campaign will also make new pledges on clean air, building council homes and a tougher stance on crime. The Conservative candidate for London mayor, Shaun Bailey, has focused much of his campaign on the rise in knife attacks in the capital and accused his opponent of presiding over an increase in violent crime. He has also accused the mayor of hiking his share of council taxes – in part to pay for Transport for London’s dire financial state caused largely by the steep decline in commuters which has forced the government to bail out TfL. Bailey has been hit by a number of damaging stories relating to past comments, including for an interview with the Sun in which he said teenage mothers pushed people who “do the right thing” down the housing ladder. He has also suggested that homeless Londoners could save £5,000 deposit for a mortgage. Earlier this week Bailey was criticised for arguing people paid a universal basic income would blow the money on “lots of drugs”. Khan said the election was a clear “two-horse race” between him and Bailey, despite the Liberal Democrats once hoping they could beat Bailey into third place. Khan said: “The Tory candidate doesn’t share our values and he won’t stand up for our city.”