This is a duet by The Kinks vocalist and songwriter Ray Davies and The Pretenders frontwoman Chrissie Hynde. The duo had a relationship in the mid 1980s, which produced a child, Natalie. Hynde and Davies had virtually no communication for years and it was Natalie who was the go-between for getting the song to her mother. Davies discussed the collaboration in The Independent newspaper December 11, 2009: "The single is the first song Chrissie Hynde and I have released together. She wasn't my first choice – I wanted Dame Vera Lynn, because the song has the sort of melody that she would handle rather well. Having said that, Chrissie came into the studio and did her bit brilliantly. I wasn't there at the time, and of course our relationship history adds yet another texture to the song. But it wasn't recorded around a log fire or anything. We weren't toasting marshmallows and cracking nuts. My girlfriend Karen sang on the demo and, with Chrissie, it was quite clear what the vocal parts were. Some artists are happy to let the writer direct things. There was no real discussion, which surprised me."

The song also features an epic crescendo with choral refrains from the Crouch End Festival Chorus. The symphonic choir previously collaborated with Davies on his 2009 choral album, The Kinks Choral Collection. "It feels as if the people I wrote the songs for are singing it," Davies said of the Crouch End vocal on this song. "They display an ingenious palette of choral techniques."

Davies told The Independent that some people think this "is a Christmas song. It wasn't meant to be one, although it does mention snow. I'm looking ahead to when I have grandchildren and they ask me: 'London – what is this place?' I feel the culture of the London I used to know is disappearing."
He added: "The places and things that I mention in the song – Waterloo Bridge, Carnaby Street, the Charlie Chaplin statue in Leicester Square – are icons or symbols of the London that I think is under threat. Hopefully they will remain, but if the buildings around them are all different, will they still have the same impact? Carnaby Street means a lot to me because The Kinks' office was round the back of there in Kingly Court. We were there every day."

The song's music video, which was directed by Julien Temple was shot in various places around London. It traces Davies's lyrical past including The Statue of Eros steps, Carnaby Street, beneath the Charlie Chaplin statue in Leicester Square and on the parapet of Waterloo Bridge.