High time that we in Britain learned a French lesson

David Bowen says government and industry need to work together more
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The Independent Online
A FRENCH manager who lives in London asked me a question the other day. "Why," he wanted to know, "are British businessmen so against the Government involving itself in industry?"

I told him the answer could easily be found in the history of the 1960s and 1970s. How Harold Macmillan persuaded companies such as Rootes to build factories in central Scotland - and how they failed because they were too far from their suppliers and their markets. How Harold Wilson's Industrial Reorganisation Corporation fixed mergers that should never have taken place: the British Motor Corporation and Leyland was just the worst of a bad lot. How Tony Benn's National Enterprise Board in the 1970s acted as a home for lame ducks, but otherwise did nothing useful.

The Frenchman was not convinced. "It must be good for government and industry to work together sometimes," he said. "Why do managers allow themselves to be bullied into making bad decisions?"

In France, where government and industry work so closely together that they sometimes appear indistinguishable, the state has indeed prompted businessmen to make bad decisions - attempts at reviving the regions, Macmillan style, have come to a sticky end. But overall, French managers are happy enough that the state is batting (throwing boules?) on their behalf.

Managers of loss-making groups such as Air France and Bull know that the government will do its best to bail them out - whatever the European Commission says. Exporters know that the government will give them all the assistance they need, openly or covertly. The Pergau Dam affair is regarded with bafflement in France - of course aid should be used to win contracts (even arms contracts). That is normal, is it not? And British defence salesmen in the Middle East watch with chagrin the activity of French rivals who are clearly trained intelligence officers with a very special inside track.

So why is it that the French civil servants and managers manage to work so well together, when their British rivals do not?

Simply, because they come out of the same mould. The elite in France, trained together at the Grandes Ecoles, are indifferent as to whether they go into the civil service, industry or banking. That is because they are likely to switch between them as they progress on their velvet-lined career paths. The equivalent of an under-secretary will suddenly find he has a senior job in the industry; then, maybe, he will become a banker. It may be elitist (it is elitist), but by golly it means the different arms of the wealth creation business understand each other well.

And here? Sir Terry Burns, permanent secretary at the Treasury, has decreed that all his officials above a certain rank must spend at least one day a year visiting industry. Bless him - and God help us.

But there is a minister who is at last taking the question seriously. Michael Heseltine has imported private-sector secondees into the Department of Trade and Industry to help with exports and technology. Not all of them are effective. Some are rejects from their companies and are unlikely to do anyone any good; others are cowed by the state apparatus.

But a fair few are making waves - at first making themselves unpopular with the civil servants (to whom they were as welcome as a cuckoo in a nest), then gradually building up trust while teaching their colleages about the realities of industry. It is not all one way, of course: the secondees learn about the civil service system and mentality, and can pass this knowledge on to colleagues when they return to the real world.

It's not France yet - but it's a start. When the secondee scheme has spread throughout Whitehall; when civil servants are spending not days but months or years in the outside world; when you cannot spot whether someone is a civil servant or a businessmanin less than five seconds - then industrial intervention on a French scale should be given a go. But not before: it just would not work.