The Big Society

What can business do to contribute to the big society ideal formed by the government? That was the main question primed towards a small audience of business leaders by Business In The Community at an event in Manchester tonight.  I hadn’t really given it much thought previously, however in the surroundings of Manchester Business School and in the company of some bright minds we attempted to try and identify just some of the facilitators and barriers.

What’s obvious is that there are no easy answers or quick fixes.  There is a massive societal shift needed. Who will move first?  Is competition too fierce in the global economy now for us to adopt these holistic ideals?  There were some interesting points made, however it was clear that it won’t be easy to get quick traction.  Nevertheless, here’s a few of the points I thought relevant (in no particular order).

  • Will people be prepared to work less hours for less pay to see more people in employment? - Tough one and the government might not like the answer.  We live in an age of consumption.  Of acquiring things.  My device is better than your device.  My TV is bigger than your TV.  Will people be prepared to trade down for the bigger good?
  • There’s no financial incentive. You really want to motivate a businessperson to get involved, show them an opportunity, not a draw on their time.
  • The bulk of business people represented on panels like this are normally large and successful. You only needed to see the audience in the room tonight.  All Gen X.  Board Directors in successful businesses.  You wont hear the view of  SME’s who make up 99.8% of business.  They are the ones you need engaged too as they employ half the UK workforce and can be more inciteful as to the conditions they would need to donate their time.
  • If the Big society makes us globally uncompetitive, forget it. Harsh, however social investments rely on economic prosperity, a fine balance.
  • Do Generation Y care like Generation X do? Generation Y (digital natives) have a completely different outlook on life.  They are pursuing fame and instant fortune (bit stereotypical I know), however this may get in the way of their ambitions.  You have to incentivise at all levels to get change happening.
  • You need some new innovation in there somewhere. Salami slicing public sector expenditure and then shifting the burden to business, just isn’t on.  We all know the public sector is hugely inefficient in many areas.  Why not incentivise private sector business to drive savings and efficiency in public sector?
  • Get local government to spend more of their grant with local businesses, not on national contracts. They can then insist on some of the big society ideals as part of the supply agreement.  Seen it done already and it works.
  • The future isn’t public or private. It’s a fusion of both in the big society.  A fusion of Enterprise.  Rip down the barriers to enterprise.  Make public sector procurement easier.  Making the planning process easier for businesses to build the premises they need.  By expanding, there will be more jobs in the economy.  Carving up current jobs – in my view – just isn’t the answer.
  • Do people have the time for all this? People are pressured.  T.A.T. rules.  Time is at a premium.  Work/Life blend is poor.

I’m not negative about it, just realistic. I’d love to see a society, which is more like Japan for example.  Purposeful.  Respectful.  More societal in its outlook.  However, people will need to see quick and early wins for this one to make it’s way out of the manifesto and into everyday practice.  It’s a big job, however a worthy aim.  What do you think?

Theresa Villiers Visits Manchester

Shadow Secretary of State for Transport- Theresa Villiers MP – visited Manchester today to talk about Convservative plans for the High Speed rain link from London (called HS2).  I chaired the discussion between her and about twenty other representatives from various businesses and sectors with a vested interest in understanding what the Conservative party are prepared to commit to, relative to this important project.  She confirmed that The Conservatives would build the link via Manchester.

Opening the debate, there were three central points I made: -

  1. That the Northern Hub investment be linked to the HS2 project.  This will basically link Victoria and Piccadily stations, meaning trains can travel from Liverpool from Manchester to Leeds.  Without it, all the benefits of a 1hr 25min journey could be lost.  Local connectedness is as important as national.
  2. That the entire economy needs to grow, not just the South.  Regional GVA is one of the key economic drivers for UK growth, Manchester is one of the regions driving the numbers.
  3. That a link such as this has Social, Economic and Environmental benefits.

The point of the HS2 – P1 – is to connect the key regional centres of London, Manchester, Leeds and Liverpool.  P2 will mean connections up to Scotland.  Journey times have been improved significantly from Manchester to London, with the overall travel time now taking just over 2hrs.  So what difference will the extra 40 or so minutes saved travelling between Manchester and London make?  In a world which is speeding up so dramatically, every second counts.  If you talk to the BBC, who are re-locating to Manchester,  a commute time of an hour and a bit makes a big difference to employees who are re-locating but still need to bounce up and down to London.  If you are using Manchester as a hub to travel to other places, it will compound to reduce overall travelling time to other destinations.   People see time as precious.

The West Coast line, despite £8bn of investment, is expected to be at capacity by 2015.  The HS2 is expected to be around 4-5 years in planning and up to 12 years in construction, so it’s a 20 year project (which means that we are in for a pretty miserable time between 2015 and 2027).  This isn’t good for business who rely on this route for business in London.  It’s going to take some serious investment, this has to come from somewhere, so brace yourselves.  When you look at public sector spending as a percentage of regional GVA, it’s about 50%, this has to change, particularly when Government want more work, for less money, to re-pay the economic debt.  Private sector businesses need to contribute more to the regional economies.  They can only do that by having sound transport infrastructure as one of the hygiene factors.

If you’ve ever travelled to Japan, you’ll understand what the future could look like for the UK if this project gets the full go ahead.  Lord Adonis, Secretary of State for Transport, is making an announcement tomorrow, let’s hope there’s good news for Manchester within it.  Hat’s off to The Conservatives who called this briefing at the last minute, clearly to grab some headlines before tomorrow’s announcement, that’s politics for you!

On balance, Theresa Villiers was impressive.  A former barrister, lecturer in law, Euro-MP and now Shadow Cabinet member, she’s clearly been round the political block.  Whether she remains Transport Secretary if The Conservatives win the election, jurys out.

Vince Cable visits Manchester

Veteran Lib Dem MP and Shadow Chancellor Vince Cable visited Manchester last night, to speak at the Institute of Directors (NW) annual dinner. I was there as a guest of Innovation Manchester, to see what the wryly old economist had to say. As someone that has met him and heard him speak a couple of times now I’m suffering from the law of diminishing returns. First time, thought he was brilliant and talked lots of sense. Second time, same story, can forgive that. Third time, I could have probably done the speech for him.
On the upside, he used an interesting metaphor to describe the economy, likening it to a patient who’d had a massive heart attack who was now on monetary “life support”. The patient was receiving “extraordinary economic medicine” and being fed with “economic steroids”. I thought that was pretty creative. On the downside, I’d heard his analysis a few times now and felt I wanted to move on to more solutions than post-mortems last night. He is a clever guy, not the most charismatic, dry at times, however he is one of the more credible politicians in the pack. So, my advice for Vince Cable? Move on to the solutions and recommendations so that business can clearly see what you suggest is the pathway forward.

Visit to the European Parliament

It’s been a busy week, so busy I’ve not been able to get fingers to keyboard in the evening. A week of planes, trains and automobiles. Middle of the week I travelled to Brussels meeting with MEP’s and hearing their view around how the EU can stimulate business. In particular, we focussed on the Small Business Act (2008)as a framework for creating the necessary conditions for small businesses to thrive. During a breakfast meeting we met with Eurochambres Secretary-General Arnaldo Abruzzini and Mechthild Wordorfer, who is acting director for SME’s competitiveness to discuss the act and our feedback. Abruzzini is a passionate character and I’m pretty glad he’s batting for team business as he talked a lot of sense.
Wordorfer was clearly expert in her area and someone who was completely focussed on trying to get the conditions right for start-ups. Following which I attended a panel debate with the four main European parties. MEP’s who sat on the panel were Giles Chichester (Con), Nigel Farage (UKIP), Peter Skinner (Lab) and Caroline Lucas (Greens). There wasn’t really much other than political point scoring between these four and – beyond soundbites – little substance for business to feel confident about.
What did stand out is – despite all the headline grabbing rhetoric – the UKIP isn’t actually doing very much for business by abstaining in all European votes – it effectively makes other countries stronger, so that was interesting to learn. MEP’s clearly have a job to do as the European Parliament is such a hugh institution, however I came away wondering about the detail and questioning what is actually achieved when Chambers of 400 MEP’s meet to debate , jurys out. End of the week I travelled to London where we picked up the BOSS awards Manufacturing Excellence award (+£10M) category, so that was a great end. Previous night we’d picked up Printer Vendor of the Year award at one of our key customers, so it was a real high to a very busy week.

The Fire Sale Begins….

Big annoucements from the Government today.  A sell off of assets to contribute towards the big budget defecit that we find ourselves in. Reaction has been lukewarm to this proposal, which promises to yield around £16bn in contribution over the next two to four years (providing they can find buyers). The problem I have is that it does nothing to tackle the bureaucracy and inefficiency of the government. All it does is pump more money at a problem, without fixing the root cause. Like it or not, there needs to be cuts in the public sector. Efficiency needs to improve. Tough decisions need to be taken.

Quantitative easing and other fiscal stimulus are absolutely fine by me, inefficiency, red-tape and bureaucracy aren’t. The private sector has been taking one tough decision after another for over eighteen months now and they expect all areas of government to have to make the same choices. Selling the crown jewels now, to put a plaster on the debt situation could be described as short-termist. What were the options? What other things have been considered? Why wasn’t it announced at the recent party conference? What is the income impact in years 5-10 and in the longer 10-20 year window? Lot’s of questions. I wonder if we will get the answers?

Cameron Speech

The party conference season is nearly over. In Manchester today, it was Conservative Party leader David Cameron’s turn on the stage to reach out to the party faithful and the British public with his”compassionate Conservatism” speech. Things are hotting up. What is most interesting is the debate around which ground the electorate will vote upon. Is it just a vote for change? Is it a personality vote? Is it a vote against the war? Is it a vote against the banking crisis? No doubt, the media battle will become frenzied in the time ahead.
My view is that the electorate aren’t silly. Whilst I’m personally not very politically driven, I think it naive to think that we can just keep spending money and ignoring the incredible debts that the country has, not just piling more and more on the UK credit card each month. I would rather understand the scale of the problem, the timescales involved to solve it and the steps that need to be taken to resolve it, regardless of party. Whether or not the electorate agree, we’ll see. The Conservatives have put themselves out there and taken a risk, I’d rather they do that, so that we can begin to see clearer differences between the parties and make clearer judgements on the future, rather than anecdotal references to the past.

Oliver Letwin – Tory Party Conference

Oliver Letwin is in town as part of the Conservative Party Conference 2009. Today, I met him with around ten other major business leaders in Greater Manchester as part of the Greater Manchester Chamber Large Business Forum. Business leaders were keen to understand the latest thinking behind the Tories who have been accused of being a bit “light on detail.” The key points he raised are below: -

First major priority = Getting the macro scene into order. Suggesting that the shape of the financial crisis is difficult to see and that the economy may get a rude awakening when quantitative easing comes to an end. He remarked that the a fair, realistic and achieveable plan is needed for recovery.

He suggested three key areas for focus to help contribute towards the above: -

  1. Getting young people back to work, to ensure that they are not casualties of the recession.
  2. Creating a step-change in the regulator scene. Changing attitudes in Whitehall to ensure that it is easier to do business.
  3. Re-balancing national priorities. That is, stimulating sectors other than financial services.

He spoke at length about the competitiveness of UK Plc in the global marketplace, citing specific states in the USA who totally pull all of the stops out to win re-locations into their regions. He also remarked about the fact that India produced 40,000 engineers last year compared to 4,000 in the UK, suggesting that this contributes to a de-skilling in our economy.

The most interesting part of the discussion was around the idea of “ministerial will.” This issue came up as a result of a question around reducing legislation and red tape. He claimed that the Conservatives would legislate less and rely more on existing legislation to run the economy. This of course requies an “iron will” from ministers not to collapse in the noise of media pressure.

There probably wasn’t enough substance today. It’s hard when you’ve only got an hour or so, everyone wants to ask a question, you’ve a party conference on (so nothing can be pre-announced) and you’re deliberately keeping things top level due to the sensitivity of some of the big announcements which came out later in the day. What is evident is that politicians do need to listen to business. Business creates the wealth, the GDP, the GVA or whatever else measurement you need to show success. To be taken really seriously by business, The Conservatives need to beef up the detail for business leaders. Championing red tape isn’t enough. The election clock is ticking.

Education, Education, Education

There’s been a big hoo ha in the media today around the issue of education. The CBI have launched a major report into funding for further education (you can read the news release here or visit their specialist Education website here). On the same day The Lib Dems have re-instated their aim for everyone to access further education for free (with a price tag of around £12.5bn around the proposal, it makes for an interesting debate).
The CBI make some interesting points and they’ve got the National Union of Students going, they described the CBI report as “offensive” and “hypocritical”, oh dear. Wherever you sit on the subject, at least we’re beginning to have a proper debate around it. What’s clear is that it will be difficult to go back from the current charging model back to a “free” model. The UK does need to raise its game. It spends less on education as a percentage of GDP than many other major countries, even the USA, where there is a culture of private funding. Business wants more engagement from the academic sector, more graduates with relevant degrees and a sense of collaboration to increase market advantage in an ever globalising economy.
If the politicians, business and the NUS got round a table to thrash things out, I think it would be a good thing, a great debate to start and everyone could learn something from each other.

Cut, Rut or Nut?

Lord Mandelson, Secretary of State for Business, Innovation and Skills was on Radio 4 this morning, being interviewed about Labours “wise spending, not big spending” public statement. In a tense interview with diehard Today programme interviewer Jim Naughtie, Mandelson -in prickly form – came under intense pressure to use the word “cuts” rather than rhetoric like “re-budgeting, a new reality, new challenges, re-planning and re-prioritisation,” you can listen to the show here. Lord Mandelson said that the government faced”tough choices,” but missed a golden opportunity to talk plainly and take the “tough choice” himself.
I think the mood with the general public – and business – is for some honesty and plain speaking. Most people I know prefer for less management speak and more plain speak, particularly if there is bad news. Dressing it up in rhetoric simply confuses the issue. A quality moment came at the end of the interview when political correspondent Nick Robinson came back to Lord Mandelson responding to a point which he had raised in a recent interview regarding a quote that Robinson cited from the Prime Minister. In a brilliant reply, Robinson cited the exact date and time of the quote in the House of Commons (he blogs about it here), ouch! Best bit of radio I’ve heard in ages.

Unemployment hits 14 year high…

Another bleak announcement from the government today. 2.44M people now unemployed – or in other words – around 7.8% of the working population. Buried in the figures is the worrying statistic that 40% of 18-24 year olds and 71% of 16-17 year olds are unemployed. Not a great start for our young people (living on benefits).

Last week a young man knocked on my door selling household items door to door. He lived in Middlesbrough and had gone to his Job centre to find work, saying that he wanted to sell motorcycles. They advised him that he needed sales experience and sent him to this company who sold dishcloths and the like, in order to get some experience. I spent about half an hour talking to him and was really touched by the effort he was making to get a start in life and some experience under his belt. He had travelled away from home, was doing a really hard job (with loads of rejection) and not getting paid a lot for it. But, he had an end game.

So often, young people get unfairly stereotyped, consumerism and reality TV gives them a reputation of doing nothing and wanting everything. I was inspired by this young man, he will make it and I think a great example for other young people.