Margareta Pagano: Bank of England needs to keep its brave maverick

If, as the noises off suggest, Paul Tucker is the next Governor, he has to persuade Andy Haldane to stay and maintain his fight against the system

It looks as if the Treasury is up to its old trick of feeding stories to the media to soften the blow; this time the leaks are over who will be the Bank of England Governor when Sir Mervyn King steps down next year.

Almost since the day the job came up for grabs, the bookie's choice has been Paul Tucker, the deputy governor. With his strong City backing; he's the insider's insider. Apart from a few flurries during the Libor scandal, Tucker has been odds-on to be crowned by the Chancellor, George Osborne, on 5 December when he presents the Autumn Statement.

That's why the report last week by the BBC's Robert Peston, that Tucker is the "favoured" insider after a survey of 10 senior regulators and bankers was so odd, particularly the bit which said the Treasury was aware of the City's views. As Bill Clinton would have said, let's orchestrate the momentum.

But, if Tucker does become Governor, there's one man he must keep on side – Andy Haldane, the Bank's director for financial stability, who sits on the crucial Financial Policy Committee. There are many who fear that should Tucker succeed, Haldane might leave: not out of pique – he's not that sort – but because the two do not always see eye to eye on the big issues.

That would be a tragedy, as Haldane is without question one of the UK's outstanding intellects. Since the financial crisis, Haldane is the only senior public servant who has persistently argued that the banking reforms don't go anywhere near far enough to prevent another disaster, including warning about the dangers of more quantitative easing.

In at least nine briliant speeches over the past year, Haldane has challenged the orthodoxy, whether it be asking why banks shouldn't be using fair value accounting to why crowd-funding is such a fascinating new source of finance. He's also causing a stir internationally. In one memorable speech – The Dog and the Frisbee – made at the Jackson Hole meeting of central bankers at the end of August, he caught the eye of many with his rather simple point that, despite decades of costly and cumbersome regulation, not one single watchdog caught the frisbee. So why, he asked, are regulators piling on more?

Haldane has also challenged plans to ring-fence retail banks, arguing that today's ring-fence is tomorrow's string-vest, which is why regulators should consider either doubling banks' loss-absorbing capital buffers to around 20 per cent or a full split between investment and commercial banking. Today's banks have become King Kong's again – Barclays and RBS are bigger than before the crash – and he would break-up those Too Big Too Fail because, ultimately, they are Too Big Too Care: $100bn is optimal.

But Haldane's most provocative contribution to public debate was last month's speech to an Occupy event. With chilling simplicity, he said the Occupy movement had been so successful popularising the problems of the global financial system "because they are right, not just in a moral sense but analytically too". This was a brave speech, and shows he's capable of taking on the banking lobby.

Privately, he also believes the Bank should play a more humble, conversational role in public life, explaining what and why it does what it does.

There are many – me included – who believe the Government should skip a generation and appoint the 45-year-old Haldane to the top job; at the least as a deputy governor. Youth is not a deterrent: Obsorne is 41, while Lord Cromer, a former governor, was 42 when he got the job.

Haldane may be as thin as a whippet but he's the only one inside – or outside – the Bank who has the guts to take on the banking beasts who will resist change until the day they drop. It's also why he is unlikely to get the big job.

So, Paul, ensure Andy stays.

BP seems, finally, to have drilled its way out of its legal black hole

Most of the world's oil and gas reserves, buried deep in the earth's crust, are covered by layers of salt deposits that have built up over the millennia and act like a lens, making it difficult to see what lies beneath. BP has the technology to peer through the lens to define the reserves – indeed, the Deepwater Horizon field in the Gulf of Mexico was discovered using such equipment.

It's an appropriate analogy for BP after a week in which the oil giant finally broke through the layers of litigation with two of the world's super-powers, Russia and the US; albeit at a whopping cost.

First, BP has settled with former AAR partners in TNK-BP, for $325m (£205m). Barring any last minute hiccups, so it can start afresh with its new Russian partners, Rosneft. Second, BP removed most of the US risk by paying a $4.5bn fine to the US to resolve all criminal charges and claims by the Securities and Exchange Commission over the Deepwater catastrophe, right.

BP has now paid around $36bn in fines but it's not quite out of hot water. There is one big trial to come in New Orleans in February. This is the Multi-Disciplinary Litigation being brought under the Clean Water Act to decide if BP was negligent, or grossly negligent, in the oil spill and how much water was damaged. BP will accept the lesser charge and is hoping to pay a fine of up to $1,000 on each oil barrel spilt rather than the $4,000 charged for gross negligence: the US estimates 4.9 million barrels were lost.

BP has set aside $3.5bn to cover these claims, taking total provision to $42bn. At last, investors can see through the salt to BP's reserves. It may just be time to buy BP again, down 2.07 per cent to 416.6p on Friday. Waiting for the next trial might be missing out.

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