Letter: Doing no harm to the economy

Sir: In describing as 'absurd' the notion that proportional representation would improve economic performance, Gavyn Davies (22 February) displays a profound unawareness of the root causes of our long relative economic decline. The political process over the past 45 years has added its own particular burden to industry's self-inflicted wounds of inadequate training, poor skills and weak management.

The damage has not only been in the roller-coaster nature of policies towards industry, as one set of ideologies has supplanted another - nowhere more evident than in the obsession with ownership rather than efficiency - but also in the damaging impact that adversarial politics have had on the institutions of industry, diminishing countervailing voices and encouraging a party political, rather than industrial, stance from these organisations.

Electoral reform would at the least assist in diminishing the damage that the present system has inflicted. Doing no harm may be a minimalist objective of policy, but it is an important one. Gavyn Davies points to Italy as an example of a country disenchanted with its proportional system, but D. L. L. Parry (Letters, 24 February) rightly points out that Italy's economic growth has far exceeded ours: indeed, the last OECD count showed Italy's standard of living to have exceeded ours by the early Nineties.

Whether such reform would also bring about a more intelligent and consistent approach of government to those policies which affect industry must be a more open question. But it could not do worse than we have. And while some aspects of such policies are inherently difficult, we can learn from the example of many of our competitor governments and their relations with industry.

Moreover, a pragmatic, rather than ideological, approach to training and skills shortages, which such a change might offer, could for the first time provide the basis for transforming this Achilles heel of our competitiveness.

The problem is not primarily an economic one, although it is in the interests of economists so to argue. It is not a matter of improving forecasts about an unknown future, useful though this would be. It is a problem of generating the political will to ensure that change is brought about in the fundamentals of performance with the object of making things happen rather than matching the dogma of the day.

Yours faithfully,

GEOFFREY CHANDLER

London, SE10

25 February