Letter: Even worse is to come until Britain learns to copy Europe's formula for success

Sir: It is to be hoped that the Chancellor's refusal to resign will end as did his refusal to devalue; not in order to assuage the call for scapegoats, nor even to salvage some shred of honour in politics, but to avert his threat of carrying on with identical policies.

Christopher Huhne ('How to escape from our history of failure', 18 September) got it right: 'To make British managers and their workforces better educated, trained, adaptable and responsive to what customers want than their rivals' is the only way to success. Today, however, money, not people and the development of their potential, whether in the classroom or the workplace, is the measure of all things.

Yet, as long ago as 1982, a study by the National Economic Development Office (due for extinction on 31 December) identified six characteristics in the industrial policies of our European competitors which appeared to underlie their greater success.

These were continuity and stability of policy; concentration of effort with mutually reinforcing packages of measures; a realistic view of long-term industrial priorities; an element of choice or selectivity; massive investment in human resources; and consensus (whether explicit or implicit) and commitment both at national and company level. None of these characteristics was dependent on a particular political or economic philosophy, whether market-oriented (Germany) or more dirigiste (France).

A further paper, examining British performance under these heads over the previous 20 years, and thus covering periods of both Labour and Conservative governments, showed how lamentably short we fell on all counts. Ten years later, the picture remains the same.

These characteristics are, of course, rooted in history and culture, at least in part, and cannot be taken off the shelf. But if we make no shift to learn from others - and particularly from our competitors' emphasis on the development of human resources - we will emerge from recession with no change in our fundamental weaknesses, simply with the expectation that the next downturn will leave us even worse off than now.

How big a disaster do we need to make this government hear and understand?

Yours faithfully,

GEOFFREY CHANDLER

London, SE10

20 September