Any other business

I’m proud to be a member of the 661-year-old Company of Merchant Adventurers of the City of York, having qualified on the strength of a first career spent trying to sell British financial services around the globe from Hokkaido to Gdansk. Before our annual feast last week we prayed optimistically for the discovery of ‘a better world’ from which we might bring back treasure, spiritual and material — and I couldn’t help thinking that UK trade prospects are a lot less straightforward today than they were in 1357, when the known world was eager to buy woollen cloth from English mercers as often as their little ships could cross the choppy North Sea.

I remember the arrival of Toys ‘R’ Us in Britain, because as a young banker in 1984 I was tasked with devising a menu of exciting financial products to offer a brash American retailer that was clearly going to take a bite out of our sleepy — and in those days still Christmas-seasonal — domestic toy market. How we sneered at that childlike reversed R in the logotype; likewise the Guardian, commenting on insatiable demand for Cabbage Patch dolls, derided the chain’s huge stores as ‘-cathedrals to kiddie gratification’. But however tacky its image, this was the ultimate ‘economic disruptor’, to use The Spectator’s current favourite phrase: a business that utterly transformed its marketplace.

As ‘business lobby groups’ go, the Institute of Directors has always struck me as worthy but unexciting: a more authentic voice of mid-sized corporate Britain than the fat-cat smugfest that is the CBI; a fount of sound advice on governance, gender equality and ‘mental health at work’; and a handy Pall Mall watering hole for business folk up from the provinces. But as the storm of revelations about personal behaviour topples one pillar of respectability after another, the IoD has suddenly been reduced to reputational rubble following allegations of racism and bullying against its chairman, Lady Judge — who resigned in fury last Friday, shortly after being suspended by the IoD’s Council.

The fallout from Carillion’s bankruptcy spreads in slow motion — just as the outsourcing and construction giant’s finances gradually stretched to breaking point over the months before it went down in January. The company’s auditor, KPMG, was rightly under the spotlight this week. But the impact on the ground seems to have been less disruptive than early reports predicted. Receivers have made 1,000 redundancies but have re-let many contracts, securing thousands of other jobs. Construction of the £335 million Royal Liverpool Hospital — one of the overrunning contracts that contributed to Carillion’s cash crisis — won’t now be completed this year, but outsourced services in many other places have been seamlessly reorganised.

The Serious Fraud Office has upped the stakes in the case of the controversial $3 billion Qatari financing that saved Barclays from a taxpayer bailout in 2008, by extending the charge of ‘unlawful financial assistance’ to the operating company, Barclays Bank plc, as well as the parent, Barclays plc. Four senior former Barclays employees, including the then chief executive John Varley, are already due to stand trial early next year on the same and other fraud-related charges. The significance of the SFO’s move is that Barclays Bank plc stands in danger of losing its licences to run banking businesses, including branch networks, in the UK and elsewhere if convicted of a serious criminal offence.

If you were the incoming or retiring chairman of the Federal Reserve, you might be quietly pleased to see stock markets plunge on the day of the handover. As Jerome Powell was sworn in on Monday to succeed Dr Janet Yellen as head of America’s central bank, the Dow Jones index of leading US stocks was falling by a one-day record of 1,175 points, with Asian, European and London markets following overnight. But this wiping out of recent gains does not reflect badly on Yellen, whose steady hand leaves behind US inflation at just 2 per cent, unemployment barely above 4 per cent and a strongly recapitalised banking system.

I visited St Thomas’ Hospital on Monday, to discuss fundraising for a cardiology research project. On the way in, I spotted an acquaintance taking her little boy for tests; she was busy explaining why the doctors needed to do what they were about to do, so I didn’t interrupt. I also spotted a block on the map labelled ‘future site of Evelina Children’s Hospital’, and my thoughts turned to the £650,000 pledged for Evelina at the Presidents Club dinner: £400,000 of it in an auction bid from the restaurant tycoon Richard Caring to secure naming rights on a high-dependency unit.

This column has long been a sucker for a grand projet. ‘Time for a trip to Boris Island,’ I gushed in 2010 when London’s then mayor came up with his much-mocked (though in engineering terms not unfeasible) wheeze to shift Heathrow to a giant man-made landing strip in the Thames estuary. But even I could see no merit in the Foreign Secretary’s equally unscripted suggestion, during the recent Sandhurst summit with President Macron, of a bridge across the Channel — which would play havoc with vital shipping lanes and cost upwards of £120 billion. If the objective is to facilitate continuing trade with Macron’s compatriots after we leave the EU, as one expert observed: ‘It would really be cheaper to move France closer.

Carillion is a disaster on all fronts, but my sympathies go first to the fallen contracting giant’s sub--contractors. Upwards of 30,000 smaller firms were already facing 120-day payment delays and may now have to fight court battles to get paid at all, driving many hard-pressed entrepreneurs to bankruptcy. But the political spotlight won’t help them, because Labour spokesmen who despise small business as well as large will merely use the case to attack the concept of outsourcing public services for private-sector profit.

I once commissioned Michael Wolff —currently the world’s most talked-about journalist as the author of the White House exposé Fire and Fury — to write for The Spectator. It was just before the 2004 presidential election in which Republican incumbent George W. Bush looked set to see off the Democrat challenger John Kerry, and I invited Wolff to tell us the implications for the stock market. His thesis was that the Democrats had become ‘the party of wealth and Wall Street’ while the Republicans had become ‘non-players’, Bush having turned his back on business to be ‘a God-squad cheerleader’. America was waiting in vain for a president who could ‘cast a spell of optimism over consumers and markets’.

New Year’s Eve was certainly a day for celebration in the household of 53-year-old Jeff Fairburn, chief executive of the housebuilder Persimmon. He was due to receive the first £50 million tranche of shares under a bonus scheme that has won him total entitlements of £110 million. He must have done a terrific job, you’ll be thinking, if shareholders value him so highly. But in fact his winnings (plus £400 million shared by 150 other Persimmon executives) are the freak outcome of a 2012 scheme that was tied to the company’s share price and dividend record but failed to include a cap on how high rewards might go.

The revenge tragedy at the London Stock Exchange whose plot I outlined last month has reached its third act, but the carnage may not be over. Chief executive Xavier Rolet has left the building, rather than staying one more year as the LSE first announced, and declared that he won’t come back under any circumstances. Despite whispers that ‘aspects of his operating style’ sparked this row in the first place, Rolet is due a £13 million golden farewell — which the Daily Mail called ‘obscene’ but his fans see as fair reward for all the value he has delivered. Chief among those fans is LSE shareholder and hedge-fund princeling Sir Chris Hohn, who agitated for Rolet to stay and LSE chairman Donald Brydon to go.

One week you’re fighting to survive the dance-off amid vicious backstage rivalries, the next you’re scoring a perfect ten from Bruno Tonioli for your shimmering tango. As it was on Strictly for Debbie McGee, so it was — well, almost — for Philip Hammond at the despatch box. Unlike many of the Budgets of his predecessors Osborne and Brown, this one did not unravel immediately or prove full of black holes and political tricks. Clear in its analysis, frank in its forecasts, limited in its objectives, it took modest steps to ease the housing crisis and encourage entrepreneurs — and not much else.

The Chancellor sounded purposeful when he declared that he’ll do ‘whatever it takes’ to boost the rate of housebuilding — including pushing developers and councils to use up land banks and act on existing planning permissions — with a view to hitting a politically symbolic target of 300,000 units per year. But I wonder whether the post-Budget small print will reveal any sort of plan to overcome the most basic obstacle to achieving this objective, which is a critical shortage of bricks? When housebuilding went into sharp decline after the 2008 crisis, many British brick factories closed down. To build even half of Philip Hammond’s target, the industry needs more than 2.