FED UP WITH THE ELECTION ALREADY?

 

 

FOUR MONTHS OF THIS?

 

As people lie in ambulances waiting for treatment, the sound of squabbling politicians rings in their ears.

 

If it’s not the NHS, it’s the economy. We got four or five rebuttal and counter rebuttal documents from the Conservatives and Labour on Monday about each other’s spending plans.

 

The electorate is already mightily disillusioned with the Westminster game. Four months of this will not just have them turning off in droves, it will make them angry.

 

Political reporters have already been overusing the phrase “the election campaign got under way today”, when we know that there will be multiple launches around the spring party conferences and when Parliament is dissolved. Oh for the return of the short sharp campaign. There is a view that people generally form a view two years out from an election. It is difficult to achieve significant changes in opinion amid the sound and fury of the last few weeks before polling day. To inflict this early period of claim and counter claim on a weary electorate is a mistake.

THE YEAR AHEAD FOR BUSINESS.

 

For business, the approaching election means the thing it hates most, uncertainty. The possibility of a change of government might mean that investment plans will be put on hold. This is compounded by the prospect that forming a new government might take weeks and involve multiple parties. Discerning what that will all mean for taxation and business incentives is very difficult, hence the Prime Minister comes up with his plea for continuity under the Conservatives.

 

But away from politics there are a number of other business related questions for the year ahead. How much longer are the workers going to settle for 1% pay rises and zero hours contracts? With unemployment dropping and the economy improving, are we going to see more robust demands for pay rises? These may particularly come in the private sector where there is some evidence of skills gaps developing. Public sector workers may be less likely to take part in a wage push because remorseless cuts are set to continue whoever is in power.

 

AN UNCERTAIN WORLD.

 

Uncertainty at home and uncertainty abroad. The slump in the oil price in 2014 took everyone by surprise. Whilst it provides everyone with lower costs in the short term, what it is telling us about the health of the world economy is another matter.

 

The American economy is surging ahead but the Euro zone’s performance continues to be an embarrassment for those of us who want it to succeed.

The Russian economy is tanking because of the oil price and sanctions, but how will Vladimir Putin react? Will he bow to the pressure or stoke up the fear that Mother Russia is under attack from the West.

 

A few years ago China’s rapid expansion sent raw material prices soaring. Growth has slowed. What effect will that have on China’s policy of increasingly investing in western infrastructure? Questions are being asked for instance about progress with the development of Wirral and Liverpool Waters.

 

A NEW MAGNA CARTA.

 

As we mark the 800th anniversary of this shake up in English governance, it would be nice if we could take a fundamental look at how we are ruled from parish council to the House of Lords.

 

It doesn’t look as if that is going to happen. Instead we will have to concentrate on incremental change. In that respect the question for this year will be whether Leeds, Sheffield and even Liverpool will be getting the Greater Manchester devolution deal, with or without elected City Region mayors.

NOW MORE THAN EVER, DEMAND A NORTHERN COUNCIL

 

 

SCOTLAND AND THE NORTH.

 

Now we see more clearly what we are going to have to contend with as we try and bring power to the North.

 

We knew about Boris land in the South East and London with its power to drain the brightest talent southwards and its vastly disproportionate transport spending.

 

Now we see the full dimension of the challenge north of the border. The Scottish Government will retain all the income tax raised in Scotland, a share of VAT and power over areas of welfare. Air Passenger Duty will be a devolved power and expect it to be cut. APD is an issue that Manchester and Leeds airports have been campaigning on for years without success. Now they face a competitive disadvantage which could be significant in the border region, particularly Newcastle.

 

The city regionalists have written to The Times along the lines of what’s right for Scotland is right for the cities. Quite right but even our northern cities are not fit for purpose in the new economic landscape. We need to build on the Rail North and One North concepts, adding functions that apply across the North and make it a democratically elected body so that ordinary people have a say.

 

Meanwhile, as I write, we await the Combined Authority deals for Leeds and Sheffield promised by Nick Clegg before the Autumn Statement. On Merseyside the problems continue. Phil Davies, the leader of Wirral and the City Region has now stated that the concept of an elected mayor should be put to a referendum. That is unlikely to please Liverpool Mayor Joe Anderson.

 

JUERGEN SHOWS THE WAY.

 

Business leaders usually recoil when it is suggested they become involved in politics. But with an elected mayor for Greater Manchester on the horizon, it is interesting to see some of the non political names coming forward. For instance Scott Fletcher of ANS Group, and lively contributor to Downtown events, has not ruled himself out.

 

Another man who impressed me this week with his wider skills and vision was Juergen Maier, Chief Executive of Siemens UK. He is also Chairman of the North West Business Leadership Team, an organisation that takes a region wide view on the big issues facing business.

 

It published its business manifesto this week. It calls for action in the areas of skills, transport, world class science and emphasising our energy resources.

 

Speaking to MPs at Westminster Maier made a number of key points including the fact that there are too many skills initiatives for business to cope with. He said devolution had to operate within a national framework to preserve coherence (that is why a constitutional convention is essential). He also showed how far behind we are in only now arguing for HS3. Essen, Dortmund and Cologne were linked 25 years ago. He also hoped the autumn statement might bring economic catapults in precision medicine and energy to the North West.

 

The North needs leaders like Juergen Maier.

 

AUTUMN STATEMENT.

 

Next week’s statement by the Chancellor will be important for northern business. With the election looming we can expect further measures in connection with the “northern powerhouse” as George Osborne seeks to confirm his position as a friend of the north.

 

But we mustn’t be distracted from some hard underlying truths. There are signs that the fragile recovery is stalling, the government has missed its deficit reduction targets by a wide margin and all these city region councils that are going to get devolved powers are facing remorseless cuts in their budgets.

 

 

AFTER PFIZER RAID, WHERE DOES INDUSTRIAL POLICY STAND?

 

It looks as if AstraZeneca is safe, for now, but the attempted takeover by Pfizer begs some important questions about our politicians relations with big business. This came to a head as I watched MPs trying to hold these mega companies to account last week.
Down the corridor they came for all the world like prize fighters heading for the ring. Large security men with ear pieces and stern expressions escorted the Pfizer representatives into the Commons committee hearing.
Pfizer make Viagra and it shows. AstraZeneca’s representatives entrance was equally impressive. Big Pharma was on display but Andrew Miller was ready for them. He’s the MP for Ellesmere Port, close to Cheshire’s chemical industry and he was once a lab technician.
Early in the hearing Ian C Read, CEO of Pfizer, (all top American executives have a middle letter) admitted there would be less scientists if the takeover went ahead.
“Shouldn’t there be more not less scientists?” asked Mr Miller.
Ian C Read said he didn’t know enough about AZ to answer that.
“You knew enough to make a £50bn bid” retorted the former lab technician.
And so it went on. MPs in the committee room asking detailed questions of Pfizer and Astra Zeneca executives followed by the Science Minister “two brains” David Willetts. The day before the hearing the Business Secretary, Vince The Cable, had hinted darkly that public interest legislation might be strengthened to protect vital British industries. Two Brains kept telling MPs he couldn’t go further than his master.
Exasperated a bearded West country Liberal Democrat David Heath put the killer question. “If the takeover goes through and promises are broken, there is nothing the government can do about it is there?”. Wlliett’s called that “an excessively bleak view” , in other words no.
That isn’t entirely true. I met David Rutley outside the committee room. We both agreed that we couldn’t get too worked up about poor little Astra Zeneca getting gobbled up by Pfizer after they took most of their work away from Alderley Park to Cambridge. Nevertheless Rutley pointed to research and development grants that are in the government’s gift. He wanted some sabre rattling from Vince The Cable.
As it is it looks as if AZ have seen off the takeover for six months at least. They still employ 700 staff at Alderley Park and the worst effects of their moving the rest of their business to Cambridge has been mitigated by the takeover of Alderley Park by Manchester Sciences Parks. AZ are putting £5m into a fund to nurture talent on the site.
Alderley Park is to become a campus for bioscience companies and we must hope some brilliant discoveries are made there because that is the way to protect our science excellence.
Although they mean well our national politicians, of all parties, believe in Britain being an open country to foreign investment and ownership. They will always make the right noises when these takeovers arise but the truth is we will have to take the rough (Kraft /Cadbury) with the smooth (TataTata/JLR).
 

 

 

 

 

THE QUEEN DROPPED IN

It’s not often that the Queen drops in on a business conference in Burnley. But a visit from the Windsors was what delegates to the Small Firms’ Summit experienced this week.

Debate on the burdens of red tape and lack of skilled workers was temporarily suspended as the Queen and Duke of Edinburgh met selected guests.

The visit may have contributed to the upbeat mood of small firm managers as they met at Burnley College on the impressive University of Central Lancashire site in the town.

Also helping put a smile on delegates’ faces was the opening speech by Stephen Falder, a Cheshire businessman who invented the highly effective anti microbial product Byotrol which he exports around the world.

Stephen is an avid Manchester City fan and his voice was still a bit croaky as he enthused about the advantages that small and family run businesses can have over the big boys.

“You need passion and fun” Stephen declared and told us how he’d named a product for keeping barnacles off the keels of boats “Slippery Bottom.” It rushed off the shelves.

He set off a lively debate by saying claims that regulation was strangling small businesses were overdone. He’d been to Europe and said regulators in Brussels and elsewhere were prepared to listen if you didn’t rant and explained the problem convincingly.

Byotrol had been through the hard times in 2008. Everyone-managers and workforce-had gone on to a four day week and were in a good position to spring back.

The conference then debated a number of issues affecting small firms including the quality of young people emerging from schools and higher education.

There seemed to be agreement that some youngsters were under the impression that a degree would guarantee them a place half way up the management tree when in fact they needed to be prepared to start at the bottom.

There was a call for teachers and university lecturers to get business experience on the shop floor and for youngsters to be given every encouragement to start enterprises when they were in their late teens.

Firms were encouraged to make work experience meaningful and the conference ended with calls to the government to take action on business rates and the growing number of extra charges firms were being asked to pay for a range of services.

CALL TO WORK TOGETHER….AGAIN!

Meanwhile over at the Liverpool Economic Forum calls were once again heard for all agencies in the City Region to work together.

The new mayor Joe Anderson was billed to be there but was already strutting the world stage at an event in Paris. This was one of the ideas around the creation of the post that seems to have got off to a quick start.

If Joe had swapped Old Hall Street for the Champs Elysees he would have heard an old cry for agencies supporting business in the Liverpool City Region to work together.

The panel including Wayne Locke (Space Northwest), Neil Murray (Redx Pharma) and John Schorah (Weightmans) clearly had concerns about whether the new Local Enterprise Partnership, Liverpool Vision and the councils on Merseyside were all pulling in the same direction.
This may be a task that Joe Anderson can undertake, but he is only mayor of Liverpool, an early sign of the folly of not making this a city region post.