CITY AND SUBURBAN
The euro goes down like a runaway lift, the Chancellor broods on new tests
CHRISTOPHER I- ILDES
ACity friend presents me with a tennis ball got up to look like a euro. He wants to test my theory that, eventually, it will bounce. So it will, but it hasn't. This year has been even worse for it than last year, which is saying something. It plunged through its dollar parity like a runaway lift in the Empire State Building. Wim Duisen- berg, its liftman, held on tight and explained that the pound would not get in for some time. Indeed, the Greek drachma may climb on board first, which will do nothing for the lift's stability. Even the Confederation of British Industry has stopped making the euro its good cause. Power in the CBI has shifted, and Digby Jones, the Brummie now at the wheel, thinks that his members are more interest- ed in transport than in the progress of the euro. He may be right, at that. Then there is the mysterious shift in the mind of the Chancellor. He has already given us five economic tests that must be passed before the pound can join the euro. To these he seems to be adding political tests. What Europe offers must be seen to be in line with British interests, there must be strong support for going further, and the govern- ment's management of the economy must have earned it the right to be trusted. These ideas have been going the rounds since an event which officially never took place, since those were its rules of engagement. This non-existent Anglo-French colloqui- um, then, heard what it thought was a speech from Ed Balls, who in real life, or what passes for it, is the Treasury's chief economic adviser, and the Chancellor's, too. It will certainly be a long time, as Wim says, before all these tests can be passed, and it will be for the euro, not the pound, to pass them. My tennis ball, when tested, bounced, but not much.
Bluff, bully, snoop
THIS is the tax-paying season and our returns are overdue, but even the Inland Revenue stops short of putting up posters, proclaiming: 'There are three households in Doughty Street, WCI, who haven't paid their income tax.' This mixture of bluff, bul- lying and snooping has been left to the British Broadcasting Corporation, which can charge for its services whether or not they are wanted, and hopes to charge more when technological change reduces our dependence on them even further. The best defence is a granny. In last November's 'green' budget, the Chancellor exempted any household where one of the inhabitants had reached the age of 75. He might just as well acknowledge that this licence is a tax, even if the BBC prefers to treat it as a pri- vate income. The shock would be salutary and its manners might improve.
Bumping and boring
THEY'RE heading for the Chair in the Grand International Boondoggle Stakes, and there's even more bumping than bor- ing. In this classic boondoggling event, the chair is reserved for the International Mon- etary Fund's next managing director, the Germans are cheering on Caio Koch- Weser, and so is Gordon Brown, amid calls for a stewards' inquiry. The great British hope is or should be Andrew Crockett, who heads the Bank for International Settle- ments, but he came from the Bank of Eng- land and the Treasury seems to regard him as not one of theirs. (Some bad blood was apparently spilt when we were on our way Out of Europe's exchange rate mechanism and has yet to be mopped up.) The Ameri- cans want someone to sort the IMF out, but Mr Koch-Weser made his names in the World Bank, which even the IMF does not regard as rigorous. My racing correspon- dent, Captain Threadneedle, has an each- way bet riding on Mario Draghi, a sleek entry from the Italian stable. These boon- doggle stakes are not always to the swift.
Down the drain
THEY still don't get it, do they? The Equi- table Life — unused, as its president says, to blame rather than praise — has turned to advertising. Its new ads hit your screen this week, shot in black and white and fea- turing John Peel, Tim Bell and Amanda
Burton, who are described as celebrities from Britain's baby-boomer generation. Their message is set out in Campaign, the adman's almanack: 'To capitalise on the fact that Equitable Life has mutual status and therefore no drain on its finances from shareholders.' Every business needs capital. Most businesses get it from shareholders, who run the risks and, in good times, col- lect their rewards. In mutually owned busi- nesses like the Equitable, the rewards and the risks come straight through to its mem- bers. Just now there is a drain on its finances, and the plug has been pulled out. The Equitable had guaranteed the rate of interest on the annuities its policies would buy when they matured. When it found out how much this would cost, the Equitable tried to wriggle round these promises by rendering them worthless, but the Court of Appeal has ruled that it must pay up, at a cost which has been put at £1,500 million. If the Equitable had shareholders, this would be their loss, but it hasn't. The society belongs to its members and the loss is theirs. They might say of mutuality what Bertie Wooster's Aunt Dahlia said about blackmail: its merits depend on whether you meet it coming or going. Alternatively they could echo the ads' punch-line: 'It's question time, the Equitable Life,' I'll say.
Greatplacetowork
THOSE tireless types at the Department of Trade and Industry have taken time off from investigating Geoffrey Robinson to start a website. www.greatplacetowork.gov.uk, it is called. Buzz it up and get on-message. 'What would you say,' asks the DTI, 'if you were told that the continuous improvement of your business depended on the knowledge, skills and creativity of your workforce? Cur- rent thought suggests that this is indeed the case.' Gosh. This must be the most helpful public advice since the Department of the Environment urged us to move to high ground and avoid being flooded, and the DTI's brightest idea since its canteen went in for what it called 'Euromenus — affecting UK businesses, affecting DTI policies'. Mus- sels (as you may recall) stood for Belgium and sardines for Portugal, while Germany's eurodish was cabbage leaves stuffed with Black Forest risotto. Next, indigestion, and after that, eating the DTI's words. What a greatplacetowork it must be.
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