Martin Vander Weyer is The Spectator’s business editor
With Alistair Darling coming under increasing pressure after the loss of the personal data of twenty-five million people by Her Majesty’s Revenue and Customs, Martin Vander Weyer reviews how Darling and Gordon Brown have also moved into the firing line in the whole Northern Rock debacle. They along with its employees and shareholders now have the most to fear from the crisis. No one seriously argued, ab initio, that the Northern Rock fiasco was the government’s fault.
Is prison reform an economic issue, as well as a moral and social one? Well, if it’s uppermost in my mind and this column, then it must be — and it holds both of those positions this week not so much in response to the news that ex-jailbird Jonathan Aitken is to head a Tory ‘taskforce’ on the subject, but because I too have recently spent time inside. In fact I spent last Saturday morning in HM Prison Kirklevington Grange in Cleveland — where I was startled to find half the inmates had gone out for the day. Kirklevington is a Category C closed prison, which means it has a high fence and locked gates, but it is also one of only three specialist resettlement prisons in England.
I like to think I was the first (indeed I may have been the only) journalist to have been invited to climb the scaffolding under the clock at St Pancras station. That was back at the beginning of May, when the refurbishment of what is, from today, London’s Eurostar terminus still had a little over six months to go. The whole place was a mighty confusion of construction activity, large-scale and small, high-tech and low: I remember watching a man pouring what looked like hot tar for the floor surface of the main entrance out of the corner of a battered old wheelbarrow.
Rail delays are a daily fact of life, but Grand Central’s ghost train has set new records. Due to depart from Sunderland last December, it has yet to pass York en route to King’s Cross. I’ve read the timetable — three services a day north and south. I’ve read the BBC travel website, which reports that as far as ‘current disruption and engineering works’ go, Grand Central has ‘no incidents to report’. I’ve heard about the simplified, value-for-money fare structure — including a 50 per cent refund if no seat is available — and the personalised park ’n’ ride service.
‘A triumph for the European Commission’ (as USA Today chose to describe it) is not something usually to be celebrated here. But yesterday’s finding by the European Court of Justice against Germany’s ‘VW law’ – protecting Volkswagen against takeover via a blocking minority vote held by the state – really does look like a blow for greater dynamism, industrial synergy, and efficient use of capital throughout Europe. In Britain, the golden share was used to allow the government a continuing hand in the destiny of privatized businesses – but this ruling seems to mean that the device has finally had its day.
The concentrated aroma of — how shall I put it — deep piggy doo-doo that wafts through your car window as you motor up the A1 through North Yorkshire is, in normal times, nothing more nor less than the smell of money. So I was taken aback to hear a farmer from that part of the county declare that if prices carry on the way they’re going, ‘it’ll be time to shoot the pigs’. We will hear shortly from Merryn Somerset Webb, in our Investment column, about how to make money in ‘soft commodities’ — in which dabbling by you and me does no harm if it boosts farmers’ income and the value of their land.
Over the past 20 years or so, I have found myself almost continuously on the client side of building contracts, large and small, domestic, corporate and charitable, in four different countries: Britain, France, Hong Kong and Japan.
The proposals in the pre-Budget report were a desperate, knee-jerk response to the swing to the Tories in the polls. Rather than demonstrating Gordon Brown and Alistair Darling’s vision for the country, it revealed their commitment to blatant, vote-chasing expediency. Ultimately, this will make the country think less of them. Martin Vander Weyer There’s a new pair of eyebrows at the forefront of British public life. The Northern-rocked Governor of the Bank of England may have lost all traditional power of his once-splendid superciliary tufts – indeed, he might as well go the whole hog and have the damned things plucked, to discourage further comment – but the new Chancellor of the Exchequer, Alastair Darling, has a set to be reckoned with.
Can we make a link between the chopping of 1,500 jobs, mostly in London and New York, by the Swiss banking giant UBS, and the news that the City of London Corporation has come up with a £300 million contribution to the financing of Crossrail, the long-awaited Heathrow-to-Docklands transport link? Well, connecting unrelated news events on any given day and extracting lessons from them is what columnists are supposed to be for. So let me have a go. The jobs lost at UBS Investment Bank, which include that of its chairman and chief executive Huw Jenkins, are the tip of the iceberg of City redundancies to come this autumn.
When I bumped into Barclays chief executive John Varley at Wimbledon one mid-week afternoon in July, I thought he looked remarkably relaxed for a man locked in a potentially career-breaking takeover battle with his deadliest rival. We had just watched Venus Williams make mincemeat of Maria Sharapova, and perhaps Varley was cheered by the thought that it was possible to lose elegantly and still be loved by the crowd. Certainly I think he must have decided early in the ABN Amro game that he could do no more than play his best shots and pray for his formidable opponent, Sir Fred Goodwin of Royal Bank of Scotland, to be stricken by the market equivalent of agonising groin strain. That didn’t happen, and Goodwin should clinch the deciding set this week.
The first thing to be said about this combination of history, autobiography and polemic is how heavy it is — not in the literary sense, though it is by no means light reading, but in the literal sense that it is a surprising weight in the hand. Befitting its title, it is printed on unusually thick, glossy paper, the better to carry a set of beautiful illustrations relating to the development of paper money and the follies and manias connected with it. Befitting its multimillionaire publisher-financier-connoisseur author, the book is an idiosyncratic artefact, a craftsman-made container for the distillate of a lifetime’s observation of the interaction of paper and wealth. In short, it’s a rich man’s book, but none the worse for that.
Hindsight suggests that the Rock was always likely to get the Northern into trouble one day. The Northern Counties Permanent Building Society, founded in 1850 as the successor to the Newcastle Land Society, was by reputation ‘a serious establishment’ (one of its first decisions was to ban women from its board, a ruling observed by its successor until 1999) and its early growth was relatively slow. By the turn of the 20th century, it still had only 216 mortgage borrowers, and was one of no less than 29 building societies in a city of 270,000 people. During and after the second world war it expanded by absorbing smaller societies — the Crown, the Workington, the Elswick — but it remained firmly rooted in its home region and the high-minded principles of mutuality.
Don’t mind me asking,’ a Geordie lad accosted me on the train, ‘but aren’t you Sid Waddell?’ I looked blank. Don’t mind me asking,’ a Geordie lad accosted me on the train, ‘but aren’t you Sid Waddell?’ I looked blank. ‘Go on, you are, aren’t you,’ his mate insisted, pumping my hand. ‘Hiya, Sid.’ Thanks to an on-board internet connection and Google Images, I was able to prove to my new friends that I was not the veteran metaphor-mangler of television darts commentary. Nevertheless the three of us agreed that I might just have been mistaken for him across the fog of a crowded club in pre-smoking-ban days, and I felt a strange affin-ity with my newly discovered lookalike.
I’m back, as Arnold Schwarzenegger famously declared in Terminator 3: Rise of the Machines. In fact I haven’t really been away, just hovering in cyberspace to leave room for other contributors in our slimmed-down-for-the-beach summer Business section. I’m back, as Arnold Schwarzenegger famously declared in Terminator 3: Rise of the Machines. In fact I haven’t really been away, just hovering in cyberspace to leave room for other contributors in our slimmed-down-for-the-beach summer Business section. While I’ve been up there, financial markets have begun to look like a Los Angeles freeway visited by an enemy android at the wheel of a runaway fire truck.
Shoppers stay home as rates and floods rise — but there’s a bit of better news for M&S Shoppers have spent these past few weeks sheltering from incessant rain, rising interest rates and renewed threats of terrorism. Fuel- and flood-hit food prices are on an up-trend too, so we must brace ourselves for a spate of High Street gloom. At Marks & Spencer, like-for-like sales were up only 2 per cent in the April–June quarter, compared to a rise of more than 8 per cent in the same quarter of 2006. Still, that was slightly less bad than the stock market expected, and there was one bit of better news for M&S this week: George Davies is thinking of leaving.
The £6 billion merger of Saga and the AA is a gift for cartoonists: a company whose ideal customer is Victor Meldrew with a broken fan-belt on the hard shoulder of the A22. To complete a brand conglomerate for grandads — and since all three are owned by private equity funds — why not bring in Boots the Chemist as well? But most of all, the deal is another gift for the GMB union, whose leaders Paul Kenny and Paul Maloney have led such a creative campaign to blacken the name of private equity that they ought to be preparing their acceptance speeches for next year’s Baftas. They have already ensured that the AA — which was acquired by Permira and CVC Capital in 2004 for £1.
At wet, chilly Garsington last night I saw a spectacular production of Ariadne auf Naxos. Strauss's wonderful finale was all the more uplifting for the triumph it represented on the part of cast and crew, all partially exposed to the elements, over prolonged downpours in the second half. Before, after and during the so-called picnic interval, I watched the elegant audience stagger through the muddy parking fields and across lethally slippery grass slopes, some discreetly wearing galoshes or wellies under evening dress, others resigned to ruining decent shoes and risking humiliating falls.
Margaret Thatcher’s speechwriters always struggled to get her to do the jokes. I once had a similar problem with Shriti Vadera, the former banker who will next week become, arguably, the most powerful woman with a paid job in Downing Street since Lady Thatcher’s departure. Miss Vadera is Gordon Brown’s most trusted policy adviser and Whitehall enforcer. Next week she is expected to move from the Treasury to take up a key role in the kitchen cabinet at No. 10, perhaps even as the new Prime Minister’s senior ‘gatekeeper’. When I was briefly her speech-writer, however, she was a director of Warburg Dillon Read (now UBS Investment Bank) in the City. It was 1998, and we were at a conference on globalisation.
I have long been a fan of Patak’s, the Lancashire-based Indian sauce-and-pickle empire that was acquired last week by Associated British Foods for an undisclosed price thought to be somewhere north of £100 million. The business that now sells 30 million jars of curry sauce a year and supplies three quarters of Britain’s Indian restaurants has not only encouraged British eaters to explore the wider possibilities of subcontinental cuisine, but has set a shining 50-year example of family entrepreneurship.
In his Economics Made Easy column in the magazine last week, Allister Heath pointed out that the Consumer Price Index (CPI), the debased European measure of inflation which Gordon Brown insists on using - stands at 2.8 per cent, while the more realistic Retail Price Index (RPI) is at 4.5 per cent and Allister's personal rate - according to the calculator thoughtfully provided on the Office for National Statistics website - is at around 6.6 per cent. The difference behind these figures is that the CPI is based on the prices of a basket of goods which includes fast food, supermarket clothing lines, and consumer electronic goods (all of which remain relatively cheap and some of which are still falling in price) and excludes housing costs including mortgages.