Jeremy Warner's Outlook: Will immigration continue to keep inflation in abeyance? The MPC is beginning to think not

In the land of the dinosaurs, ITV is king; Is Corus about to attract a rival offer?

The policy debate on the Bank of England's Monetary Policy Committee has rarely been so heated. Two of the MPC's members broke ranks to vote for an immediate rate rise earlier this month, minutes published yesterday reveal, making prospects for a November increase look a virtual certainty.

Some sort of a split had been expected; we are at one of those junctures where there is bound to be a difference of opinion. The surprise was that it was the MPC's two newest recruits - Andrew Sentance and Tom Besley - who were the odd men out.

No one would have expected the former chief economist at British Airways to go out on a limb in voting for a rise. Coming from industry, Mr Sentance would if anything have been put in the more dovish camp. It just goes to show how quickly they go native once inside the Bank's imposing façade.

The two most hawkish on the MPC are widely assumed to be Sir John Gieve, the deputy governor, and the governor himself, Mervyn King. The vote could therefore so easily have been five/four. The only reason it wasn't is perhaps that Mr King instinctively likes to wait until there is a new Inflation Report to back his view before taking the plunge. The next Inflation Report is published a week after the next interest rate decision.

Yet this shouldn't lull anyone into the view that the MPC is basically all at one, with the debate really only about timing. The data continues to point both ways, instructing a wide range of views on the MPC. Yesterday's employment figures indicate continued slack in the economy and a consequent absence of serious wage pressures. The UK economy is still creating jobs, but it is not creating them fast enough to cope with a workforce still being swelled by immigration and greater labour participation. Unemployment is therefore rising, particularly in London, which is at the vanguard of the immigrant phenomenon, and wage pressures remain subdued.

Against that, there are plainly still lots of inflationary pressures in the economy, notwithstanding lower energy costs. And just when everyone thought house prices couldn't possibly go any higher, house price inflation is again accelerating, a function of growing demand on limited supply.

Will the extra capacity in the economy being created by a growing workforce hold inflation in check, or does the Bank need to choke off excessive demand with higher rates to keep prices under control? For the moment, it is the latter view which has the upper hand.

The big fear is that relatively high inflation as we approach the pay bargaining season will instruct higher wage settlements whatever the slack in the workforce. There was little sign of that in yesterday's earnings data, yet there is regrettably now quite a lot of survey and anecdotal evidence of companies trying to raise margins by pushing through price increases. As I say, the policy dilemma is an acute one.

In the land of the dinosaurs, ITV is king

A good time seemed to be had by all at a glittering farewell party held at the Natural History Museum on Tuesday night for Charles Allen, the chief executive of ITV. But answer came there none on the one question on everyone's lips - what on earth is ITV doing about finding a replacement?

It is now more than two months since ITV bowed to City pressure and announced Mr Allen's departure, yet still the company appears no nearer even drawing up a shortlist for the job, let alone anointing a successor. Meanwhile, the core ITV1 franchise continues to slide. The way things are going, the channel will soon be as extinct as the fossilised dinosaur remains on display at the venue for Tuesday's party. Is not a little more urgency required?

To judge from the gossip - well informed or otherwise - one of the reasons it is taking so long is there has been something of a boardroom row about it all. The chairman, Sir Peter Burt, wanted to appoint the former BAA boss Mike Clasper to the job. Already an ITV non-executive, and apparently available having recently left BAA, Mr Clasper was up for it. Unfortunately, some of the other non-executives weren't. Reaction from the City to his interest was also lukewarm to outright hostile. Mr Clasper seemed to share some of the same drawbacks as Charles Allen; he may well be an accomplished business leader, but he is not obviously a media type and there was therefore no evidence of the creative and strategic understanding necessary to give ITV a decent long term future.

Mr Clasper soon became only the latest in a long list of possible CEOs to rule himself out of the running. It is always gentler on the ego to rule yourself out than to suffer the embarrassment of rejection. Just to add to the farce, Sir Peter Burt then let it be known he wasn't interested in carrying on as chairman either, only to let it be officially unknown after being ridiculed in the press for his apparent lack of backbone.

It is as if ITV is trying to act out one of its own soaps in real life - a tragic comedown for a once-universally admired brand.

Surely there is someone out there who both fits the bill and wants to do the job? Or maybe not. One of the reasons why there is no queue of media types lining up to fill Mr Allen's shoes is that they know the scale of the challenge faced. ITV is in the midst of an industry in profound structural change as audiences fragment between a myriad of new digital channels and competing, new-media outlets.

The perfect candidate would perhaps be a cross between the creative and strategic flair of Greg Dyke and the penny pinching cost control of Mr Allen, not to mention an apparent gift for persuading regulators and government ministers alike into going along with his every wish. Unfortunately, the two things are almost certainly a contradiction in terms.

Mr Dyke's success as director general of the BBC was in large measure down to the open cheque book allowed by an inflation-proofed revenue stream. Mr Dyke made the right bets - on his scheduling, internet and digital strategies - but could he have done so without the licence fee? This seems more than a little questionable. Like many in the media, cost control is not Mr Dyke's forte. He's also a rebel, which as he found out to his cost, doesn't easily fit with a government that demands compliance from its media leaders.

The difficulty for ITV is that it must face both ways at the same time - it must think commercially to satisfy its investors, yet it must act politically too to answer its continued public-service obligations. The prison of the latter severely compromises the freedom of the former.

What's more, ITV is forced to compete with two powerful operatives - the BBC and Channel 4 - who like to behave in an aggressively commercial manner but are not hidebound by any of the usual commercial constraints. Neither of them are obliged to make a return.

The BBC is a wonderful organisation and a great credit to Britain's broadcasting traditions, but its presence at the centre of the market severely constrains development of a truly commercial media landscape that would allow for the innovation necessary to spawn new forms of media such as Google, MySpace and YouTube.

Out of desperation, Sir Peter may eventually have to fall back on Mr Dyke, who glutton for punishment that he is, still apparently wants to do the job. By chance, his old partner in crime from London Weekend Television days, Sir Christopher Bland, will also soon be available for hire. He's due to stand down as chairman of BT in July next year, after performing a remarkable job in stabilising and turning around the telecoms goliath. Now that's a partnership the City might be prepared to back. Did anyone say 130p a share? Shhh.

Is Corus about to attract a rival offer?

I'm getting ready to eat my words on Corus, which I argued yesterday was highly unlikely to attract a higher offer than Tata's 455p a share. The shares have refused to respond to this analysis, preferring instead to believe a Metal Bulletin story that Brazil's Cia Siderurgica Nacional is poised to enter the fray. Corus nearly merged with CSN four years ago, so it's possible. I wouldn't count on it, though.

j.warner@independent.co.uk