George Osborne’s idea of turning the North’s great cities into an economic powerhouse, even a London-style megalopolis, with the aid of better transport links and powerful elected mayors to knock heads together and get things done is certainly a bold one.
A good one too? Well, yes, if it were to even partially address the yawning economic gap between a capital that appears to be on the cusp of another boom and a large part of the country that has barely pulled itself out of a recession largely inflicted on it by people working in said capital’s financial centre.
The problem, as ever, is with his conception of how to get there. And how much money he will be willing to make available (guess what: we’re rather light on specifics there).
Number 11 clearly wanted to create a splash with its announcement, which included plans for a high-speed rail link between Manchester and Leeds dubbed HS3. Hence the selection of Monday morning. It’s usually quiet in terms of news, and with England’s World Cup having ended the Chancellor basically had a more or less clear field to tell all those people living North of the Watford Gap who keep stubbornly returning Labour MPs to Westminster that he’s heard of them. Look, here’s a banana called HS3! Well, half a banana. Beyond HS3 there isn’t much in the way of meat on the bones. There isn’t much in the way of meat as regards HS3 itself, although the figure of £7bn has been mentioned (which might be reduced by using existing track).
And where does it actually get us anyway? To be sure, HS3 would address the farcical situation of journey times between two of the North’s premier conurbations being twice as long as those between London and Reading.
HS3 will also link with the existing high-speed project, which is chugging its way through Parliament, and could even help deal with one of the potential weaknesses highlighted by critics. Namely, the fact that the chief beneficiary of phases 1 and 2 is not so much Birmingham (HS1) or other cities further north (HS2), but London.
Even so, it’s still woefully lacking in ambition. What about Merseyside? Or Newcastle, sitting in splendid isolation in the North-east (perhaps because the chances of turning more than the occasional rural constituency blue up there are minimal). A Crossrail for the north this won’t be.
There are also problems with the aforementioned devolution, which envisages elected mayors in northern cities being handed similar powers to those that Boris Johnson enjoys in London (although they’re still rather limited when compared with mayors with real clout such as those on the continent or in the US).
This might not be such a dreadful idea, but the problem is that if your conception is to create a sort of London Mark Two out of the North’s big cities, you’ll only do so by pursuing some form of regional devolution with an elected leader for the whole shebang. As opposed to what the Chancellor is offering, which will Balkanise it at birth.
Will the smarting French mete out Gallic tit for tat?
Despite a lot of Transatlantic huffing and puffing it appears that French bank BNP is about to reach its Waterloo with the Americans, although it’s not quite clear who’s playing the role of the Duke of Wellington.
The huffing and puffing, of course, came from the French government, which was aghast at the prospect of a bank of this importance being hit with a penalty that won’t simply be able to be filed under the heading “costs of doing business in a tightly regulated industry”.
Rumoured to between $8bn (£4.7bn) and $9bn, the fine for alleged sanctions busting equates to substantially more than the bank’s annual profits. Unfortunately for BNP that may not be the worst of it. The penalty will surely be accompanied by restrictions on its business plus a lengthy spell on probation.
Whatever is left over after the fine’s been paid would therefore best be spent on hiring lawyers and compliance officers. They’ll surely be needed for the blizzard of box-ticking that is coming BNP’s way.
Meanwhile, if I were JPMorgan Chase chief executive Jamie Dimon I’d think very carefully about the decision to fight part of the EU’s attempt to fine his bank over the Libor scandal on anti-trust grounds.
As I’ve written, there are good reasons for questioning the EU’s logic here. But the French carry an awful lot of clout in Brussels. If they were to care to indulge in a little tit for tat, JP could find itself in a very uncomfortable place.
Time is against Clarke as he tries to stop the rot at Tesco
Is Lord MacLaurin right to say Philip Clarke needs more time to stop the rot at Tesco?
The former chief executive has recognised that Sir Terry Leahy, the man he appointed to succeed him at the grocer, hadn’t left the business in the best of health when the latter handed the reins to Mr Clarke.
Lord MacLaurin also thinks those calling for the head of Mr Clarke are guilty of the worst type of City short-termism, opining that it could take up to three years to put the business right. It’s not an unfair point. The problem with his analysis is that there is precious little sign so far that Mr Clarke has even stopped the rot, let alone turned things around. Despite the hundreds of millions pumped into refurbishing stores, and improving lacklustre service, customers continue to desert Tesco in droves. And he’s had three years at it already.
The supermarket that once fed Britain could yet need more radical surgery. Unfortunately it’s doubtful that Mr Clarke’s investors are willing to give him the time he needs to perform it, even if what Lord MacLaurin says is right.