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Posts Tagged ‘Lord Mandelson’

Accusations fly

Did protectionism force EADS to scrap a $35 billion bid to supply the American air force?

THE announcement on Monday March 8th that Northrop Grumman and its European partner EADS were pulling out of a bid for a $35 billion contract to build air-refuelling tankers for the United States Air Force was no surprise. Northrop had said that it would not contest the terms of the latest contract proposal, even though it thought they had been drawn up to favour the rival Boeing bid. The British and German governments, along with the European Commission, expressed concern at what they see as the Pentagon rejecting open competition in order to bolster Boeing. Lord Mandelson, the British business secretary, said it was “very disappointing” that the Ameircan-European bidders felt the procurement process was so biased against them that it was not even worth making a bid.

The outcome is a blow to EADS, which on Tuesday announced a loss for 2009 caused by the need to post a €1.8 billion ($2.5 billion) charge because of cost over-runs on another military project, the A400M military troop carrier, and further charges caused by delays to its A380 super-jumbo passenger aircraft. …

Chocs away

Kraft wins a battle for Britain’s Cadbury and will become the world’s biggest confectioner

THE intervention of a government minister in Kraft’s battle to buy Cadbury says much about the strength of British feeling for their favourite chocolate-maker. The American food giant’s sweetened offer, too toothsome to turn down, was accepted by Cadbury’s board on Tuesday January 19th. Kraft will pay GBP11.9 billion ($19.4 billion) for Cadbury in cash and shares, some 50% more than the firm’s value before the bidding started in September. Yet last week Britain’s business secretary, Lord Mandelson, warned a big group of the country’s institutional investors—doubtless fixing those from Cadbury with a narrowed eye—against the dangers of short-termism.

A month earlier he had promised Kraft that the British government would scrutinise a foreign buyer to ensure that “respect” was paid to Cadbury’s proud heritage. The firm has been catering to the British for 186 years. In a country that cheerfully waves in foreign buyers for its businesses the threat of “huge opposition” from the government was an unusual change of tone. Kraft too received some words of wisdom on its attempted takeover from a senior American, although the advice of Warren Buffett was of a more practical kind. His investment firm, Berkshire Hathaway, is a big shareholder in Kraft. Reckoning that Kraft’s shares are undervalued he counselled the firm’s bosses not to let their “animal spirits run high” and overpay for Cadbury. …

Belgian PM Herman Van Rompuy appointed first EU President

Belgian Prime Minister Herman Van Rompuy has been elected as the first President of the European Union, while Britain’s European Trade Commissioner, Baroness Ashton, is the new foreign minister of the council.
Poet-economist Van Rompuy is almost unknown outside Belgium.
A staunch advocate of European integration, he has backed policies including a European-wide tax on all [...]

Opel/Vauxhall still murky


Has the fog cleared over the future of GM’s European Opel/Vauxhall operations? To some extent perhaps, but major uncertainties remain.


Even if we assume that the deal to sell a majority stake to Magna is now a formality (I am a little wary of such assumptions these days; the deal has yet to be closed), there’s still the small matter of addressing a restructuring of operations to give the new ‘orphaned’ firm a fighting chance of long-term survival.


Where will the cost-cutting axe fall? Again, the politics of the situation – in terms of plants and jobs in different countries – will continue to be very much in the limelight. Will decisions be taken on economic grounds or political ones? We’ll see, but it has been pretty political so far.


It may not, however, be quite as simplistic as portrayed in the sense that German Chancellor Angela Merkel may have got the deal she wanted ahead of the German general election, but its the post-election period that will see any ‘bad’ news on German Opel jobs becoming evident.


Other national governments won’t sit idly by, either.


OPEL AFTERMATH: Factory, worker, futures unclear


Here in Britain the politicians are stirring, too. The future for Vauxhall’s Ellesmere Port looks pretty secure – it is making the new Astra and is seen as a relatively efficient plant. It also acts as a natural currency hedge while the UK stays out of the euro. But there are question-marks against the Vauxhall Luton plant that makes vans in collaboration with Renault.


On the plus side, the UK government is hoping to secure more work for Ellesmere Port, said to be earmarked to make the Ampera range-extender hybrid (the Chevy Volt’s European sibling). How has that project been ring-fenced to stop Magna and its Russian partners getting all over the technology? Maybe that’s been an open door for the UK government to push at for a while and maybe that helps to explain why Lord Mandelson hasn’t been too noisy through the whole Opel/Vauxhall sale process – there’s been a quiet ‘understanding’ with GM over the future Ampera project.


As I say, the politicking and speculation will continue for a while yet. Things should become clearer in October.

ANALYSIS: Fear and loathing in Luton

Inventor urges patent law change

By Nick Higham
BBC News

Trevor Baylis

A major British inventor is calling for a change in the law to strengthen protection against those who try to steal ideas.

Trevor Baylis, who invented the wind-up radio, has written to the business secretary urging him to criminalise the theft of intellectual property.

The move would involve a fundamental change to the law on patents.

Currently, inventors have to sue those they believe have stolen their idea through the civil courts.

Patent process

Inventors who want to stop others copying their ideas can go to the UK Intellectual Property Office (formerly the Patent Office) and take out a patent.

But that’s expensive for lone inventors without corporate backing: among other costs, the services of a specialised patent attorney will set an applicant back at least £2,500.

"I believe that UK plc should stand behind those courageous individuals whose ideas can change all our lives both commercially and socially"

Trevor Baylis

And patents enjoy protection only under civil law: a patent-holder who believes their idea has been ripped off must themselves sue for compensation through the civil courts.

"If I was to nick your car, which is worth £10,000, say, I could go to jail," Trevor Baylis told the BBC.

"But if I were to knick your patent, which is worth a million pounds, you’d have to sue me.

"And if I was a colossal company, or indeed another country, that had stolen your invention, how could you find a million pounds a day to take me to court"

The answer, he says, is to make stealing a patent a criminal offence – just as it’s already a criminal offence to steal copyright from creative people like authors and musicians.

That way the state, not the individual inventor, would bear the costs of going to court.

"I believe that theft of intellectual property rights should be treated as a white collar crime," he says in his letter to Lord Mandelson.

"I believe that UK plc should stand behind those courageous individuals whose ideas can change all our lives both commercially and socially."

"Honest, decent people running reputable businesses infringe patents. They might not know the patent exists, or their patent attorney might have told them it was valid or infringed"

Member of Chartered Institute of Patent Attorneys

Mr Baylis, who lives in an eccentric house-cum-workshop which he built himself on Eel Pie Island, in the middle of the River Thames off Twickenham, says he has the support of the Federation of Small Businesses, the Institution of Mechanical Engineers and of his local MP, the Liberal Democrat Treasury spokesman Vince Cable.

In 2002 Mr Cable introduced a private member’s bill which increased the penalties for copyright theft from a maximum of two years to 10 years imprisonment.

Patent theft, he says now, "is just part of life" and tougher action needs to be taken to stamp it out.

But the defenders of the present system say changing the law may not be the right answer.

Patents can be extremely complex things and the criminal law is simply too blunt an instrument to use when disputes arise.

Peter Jackson is a fellow of the Chartered Institute of Patent Attorneys.

"First of all you’ve got to decide whether the patent covers the thing properly." he says.

"And having done that you’ve got to decide whether what the alleged infringer is up to falls within that strict wording.

"That can take days and weeks and months of deliberation by highly skilled lawyers, and I’m not sure the criminal system is well-suited to that kind of action."

Other members of the institute are more forthright.

One calls the idea of criminalising patent infringement "barking mad".

Another says the parallel with copyright protection is not as close as it might appear: "Patent infringement is not remotely like flogging knock-off CDs.

"Honest, decent people running reputable businesses infringe patents. They might not know the patent exists, or their patent attorney might have told them it was valid or infringed."

And patent attorneys say criminalisation might have a "chilling" effect on innovation, by forcing a patent-holder’s rivals to "play safe" for fear of committing a criminal offence.

Instead they point to the mediation service run by the Intellectual Property Office as an alternative to costly legal action.


This article is from the BBC News website. © British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.

Timms to lead ‘Digital Britain’

Stephen Timms

Treasury minister Stephen Timms is to take charge of delivering the plan for the future of the UK digital industry.

Mr Timms, who remains as financial secretary to the Treasury, will report in the new role to Lord Mandelson and Culture Secretary Ben Bradshaw.

The Digital Britain blueprint was published in June by ex-communications minister Lord Carter.

The plan proposed measures including a £6-a-year charge on all phone lines to pay for next generation broadband.

The plan’s other key points include making broadband access available to all by 2012, a changed role for Channel 4, a consultation on how to fund local, national and regional news and a push towards digital radio.

Mr Timms is a former e-commerce minister who previously worked in the telecommunications sector.

Downing Street said creative industries minister Sion Simon would lead on aspects of the report in the Department for Culture, Media and Sport, with the work overseen by Culture Secretary Ben Bradshaw and Business Secretary Lord Mandelson.


This article is from the BBC News website. © British Broadcasting Corporation, The BBC is not responsible for the content of external internet sites.

PR and power

I was on the Continent earlier this week briefing staff on my company’s (excellent) progress over the past year. At one point a photo of David Cameron popped up on screen. I told them that this good looking young(ish) guy would in all likelihood be prime minister of Great Britain within the year. Barely a [...]

Whitehall’s 20-page guide to Twitter

Guidelines suggest tweets should be frequent, timely and credible

Even its author admits that a 20-page strategy paper for government departments on how to use Twitter might be regarded as “a bit of over the top” for a microblogging tool with a limit of 140 characters a message.

Indeed, the 5,382-word official “template”,which translates into 36,215 characters and spaces, would need roughly 259 separate tweets to put the word around Whitehall using Twitter.

But its author, Neil Williams, who describes himself as head of corporate digital channels at Lord Mandelson’s Department for Business, Innovation and Skills, admits that when he sat down to write a proper plan for his department’s corporate Twitter account, “I was surprised by just how much there was to say ‑ and quite how worth saying it is.”

Whitehall’s official use of Twitter was pioneered by Downing Street, the Foreign Office and the Communities and Local Government department.

Their low-profile experiments have grown into a regular feature of their official digital output.

Now Williams, a self-confessed web geek, has turned his template into an official Whitehall Twitter guide and posted it on the Cabinet Office’s digital engagement blog.

He suggests that nothing too onerous is involved. Each department’s “digital media team” should only need to spend less than an hour a day running their Twitter streams. A quick discussion of potential tweets at the morning press cuttings meetings should be followed by emails to minister’s private offices to gather more material, and any incoming messages should be replied to.

However, the idea of official government use of a tool that provides a confidential and confessional glimpse into somebody’s personal life and views appears at first sight to be something of an oxymoron.

The official guide seems to acknowledge this when it recommends that exclusive content such as “insights from ministers” and “updates on their movements” in a light or humanised style will be needed for the Twitter stream beyond the “business as usual” content of daily press releases and announcements.

It also concedes there is a problem with one of the basic Twitter features, the ability to “follow” any other users. It admits that if government departments start following individual users on Twitter uninvited, this may well be interpreted as “interfering ‘Big Brother’-like behaviour”.

However, once anyone does follow a Whitehall Twitter stream it recommends they should automatically be “followed back” on the grounds that it is not only good etiquette, but could result in a poor Twitter reputation if not done ‑ and in extreme cases could lead to the account being suspended.

In urging his fellow Whitehall civil servants to use Twitter, Williams sets out several grounds rules for the kind of content that needs to make it work:

• Human: He warns that Twitter users can be hostile to the “over-use of automation” – such as RSS feeds – and to the regurgitation of press release headlines: “While corporate in message, the tone of our Twitter channel must therefore be informal spoken English, human-edited and for the most part written/paraphrased for the channel.”

• Frequent: a minimum of two and maximum of 10 tweets per working day, with a minimum gap of 30 minutes between tweets to avoid flooding followers’ Twitter streams. (Not counting @replies or live coverage of a crisis/event.) Downing Street spends 20 minutes on its Twitter stream with two-three tweets a day plus a few replies, five-six tweets a day in total.

• Timely: in keeping with the “zeitgeist” feel of Twitter, official tweets should be about issues of relevance today or events coming soon.

• Credible: while tweets may occasionally be “fun”, their relationship to departmental objectives must be defensible.

Alongside the promised tweetable content of minsters’ thoughts and reflections following key meetings and events is something rather more sinister sounding called “thought leadership”. Also known as “linked blogging”, the idea is that by highlighting relevant research, events, awards and other action elsewhere on the web, the department’s Twitter feed gets a reputation as a reliable filter of high quality content.

It even holds out the promise of “crisis content” in which the Twitter feed becomes a primary channel alongside the official website for up to the minute guidance and advice in the event of a major incident.

Perhaps the biggest stumbling block is that in true Whitehall tradition everything that goes out has to be approved and cleared first. So news releases are to be cleared for use only if they have first been paraphrased for Twitter. All other tweets have to be cleared by staff at information officer grade in the digital media team and colleagues in ministers’ private offices and communications units have to be consulted as well.

The guidelines recommend that “light-touch controls” will also be needed to prevent “inappropriate content” being published in error such as embargoed news releases, information about the location of ministers that could put their security at risk, or other commercially or politically sensitive content. Steps are also to be taken to avoid hacking or vandalism of content.

But it is perhaps the “tone of voice” that is most troubling about the idea of Whitehall twitter stream. “Though the account will be anonymous (ie, no named officials will be running it) it is helpful to define a hypothetical ‘voice’ so that tweets from multiple sources are presented in a consistent tone (including consistent use of pronouns),” recommends the official template.

“The department’s Twitter voice will be that of the digital media team, positioning the channel as an extension of the main department website ‑ effectively an ‘outpost’ where new digital content is signposted throughout the day. This will be implicit, unless directly asked about by our followers,” it advises.

Williams, the author of this template, launched the first ever blog by a British cabinet minister. He admits he once ran a comedy website called idiotica.co.uk but the Cabinet Office confirm that his Twitter guidelines are genuine.

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds


Mandelson hints at tuition fees rise

Paying for excellence must not come at price of barring poorer students, says business secretary ahead of independent review

The government today gave its strongest indication yet that it wants university tuition fees in England to increase.

The business secretary Lord Mandelson told university leaders he would not preempt a review this autumn into whether fees, capped at £3,225 a year for students starting in October, should rise.

But Mandelson, whose department is in charge of universities, told vice-chancellors that excellence in higher education was “not cheap” and the country “had to face up to the challenge of paying for excellence”.

The peer would not be drawn over how much fees could rise. However, a report by vice-chancellors in March argued that £5,000-a-year fees would not deter students, even though the National Union of Students says this would leave most graduates more than £27,856 in debt by the end of their courses.

A separate poll has shown two-thirds of vice-chancellors want fees to rise and more than half want them to increase to £5,000 or more.

Mandelson, in his first speech on higher education, said: “When this government came to office, we faced the challenge of maintaining a world-class university sector with higher participation rates.

“We now face the same challenge with inevitable pressure on public resources. We cannot duck the issue: everything we want to achieve in higher education depends on a solid, sustainable system of funding … Inevitably, we are going to come back to the balance of state and user funding and this raises the issue of fees and their role in paying for world-class institutions.”

He said fees, which were introduced in England and Wales in 1998, had been a “radical and signal success in strengthening the resources available to universities without sacrificing accessibility to students”.

But the University and College Union (UCU), which represents university lecturers, said the vast majority of the British public were against tuition fees and that raising them would be “about as popular as the poll tax with hard-working families”.

Sally Hunt, UCU’s general secretary, said: “In a time of recession, the government should be considering how to make access to education cheaper, not giving the green light to universities who wish to charge higher fees.”

Mandelson used his speech to criticise universities, especially the most selective such as Oxford and Cambridge, for their “limited progress” in opening access to the poorest students.

He told university leaders that if they wanted to raise fees, they would have to provide more places for working-class students.

“I think we have to ask why, for all the work in the sector and the seriousness with which it has tackled this question, are we still making only limited progress in widening access to higher education to young people from poorer backgrounds – especially at our most selective universities?” he said.

“I am impatient about this progress and intend to turn up the spotlight on university admissions. We are at risk – as are all countries that aspire to excellence in their higher education sector – of failing properly to exploit the role of university education as a means of social mobility.”

Universities should see beyond exam results and spot talented students who had “exploited the opportunities open to them in their lives”, he said. But he stopped short of asking universities to lower their grades for the most disadvantaged students.

But Wendy Piatt, director-general of the Russell group of large research-intensive universities, said universities already drew on a range of factors not necessarily reflected in a student’s traditional qualifications to identify potential. “Some universities will take into account any particular barriers the candidate may have faced during their education, such as spending time in care,” she said.

UCU said that if institutions were allowed to charge greater fees, the amount of money poorer students would have to find would be dramatically increased. An increase in fees to £7,000 per year, for example, would mean a university would only be required to fund a bursary of £700. That bursary, coupled with the current state maintenance grant of £2,906, would leave the poorest students needing to find £3,394 a year, UCU claimed.

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds


Whitehall’s 36,215-character guide to Twitter

Guidelines suggest tweets should be frequent, timely and credible

Even its author admits that a 20-page strategy paper for government departments on how to use Twitter might be regarded as “a bit of over the top” for a microblogging tool with a limit of 140 characters a message.

Indeed, the 5,382-word official “template”,which translates into 36,215 characters and spaces, would need roughly 259 separate tweets to put the word around Whitehall using Twitter.

But its author, Neil Williams, who describes himself as head of corporate digital channels at Lord Mandelson’s Department for Business, Innovation and Skills, admits that when he sat down to write a proper plan for his department’s corporate Twitter account, “I was surprised by just how much there was to say ‑ and quite how worth saying it is.”

Whitehall’s official use of Twitter was pioneered by Downing Street, the Foreign Office and the Communities and Local Government department.

Their low-profile experiments have grown into a regular feature of their official digital output.

Now Williams, a self-confessed web geek, has turned his template into an official Whitehall Twitter guide and posted it on the Cabinet Office’s digital engagement blog.

He suggests that nothing too onerous is involved. Each department’s “digital media team” should only need to spend less than an hour a day running their Twitter streams. A quick discussion of potential tweets at the morning press cuttings meetings should be followed by emails to minister’s private offices to gather more material, and any incoming messages should be replied to.

However, the idea of official government use of a tool that provides a confidential and confessional glimpse into somebody’s personal life and views appears at first sight to be something of an oxymoron.

The official guide seems to acknowledge this when it recommends that exclusive content such as “insights from ministers” and “updates on their movements” in a light or humanised style will be needed for the Twitter stream beyond the “business as usual” content of daily press releases and announcements.

It also concedes there is a problem with one of the basic Twitter features, the ability to “follow” any other users. It admits that if government departments start following individual users on Twitter uninvited, this may well be interpreted as “interfering ‘Big Brother’-like behaviour”.

However, once anyone does follow a Whitehall Twitter stream it recommends they should automatically be “followed back” on the grounds that it is not only good etiquette, but could result in a poor Twitter reputation if not done ‑ and in extreme cases could lead to the account being suspended.

In urging his fellow Whitehall civil servants to use Twitter, Williams sets out several grounds rules for the kind of content that needs to make it work:

• Human: He warns that Twitter users can be hostile to the “over-use of automation” – such as RSS feeds – and to the regurgitation of press release headlines: “While corporate in message, the tone of our Twitter channel must therefore be informal spoken English, human-edited and for the most part written/paraphrased for the channel.”

• Frequent: a minimum of two and maximum of 10 tweets per working day, with a minimum gap of 30 minutes between tweets to avoid flooding followers’ Twitter streams. (Not counting @replies or live coverage of a crisis/event.) Downing Street spends 20 minutes on its Twitter stream with two-three tweets a day plus a few replies, five-six tweets a day in total.

• Timely: in keeping with the “zeitgeist” feel of Twitter, official tweets should be about issues of relevance today or events coming soon.

• Credible: while tweets may occasionally be “fun”, their relationship to departmental objectives must be defensible.

Alongside the promised tweetable content of minsters’ thoughts and reflections following key meetings and events is something rather more sinister sounding called “thought leadership”. Also known as “linked blogging”, the idea is that by highlighting relevant research, events, awards and other action elsewhere on the web, the department’s Twitter feed gets a reputation as a reliable filter of high quality content.

It even holds out the promise of “crisis content” in which the Twitter feed becomes a primary channel alongside the official website for up to the minute guidance and advice in the event of a major incident.

Perhaps the biggest stumbling block is that in true Whitehall tradition everything that goes out has to be approved and cleared first. So news releases are to be cleared for use only if they have first been paraphrased for Twitter. All other tweets have to be cleared by staff at information officer grade in the digital media team and colleagues in ministers’ private offices and communications units have to be consulted as well.

The guidelines recommend that “light-touch controls” will also be needed to prevent “inappropriate content” being published in error such as embargoed news releases, information about the location of ministers that could put their security at risk, or other commercially or politically sensitive content. Steps are also to be taken to avoid hacking or vandalism of content.

But it is perhaps the “tone of voice” that is most troubling about the idea of Whitehall twitter stream. “Though the account will be anonymous (ie, no named officials will be running it) it is helpful to define a hypothetical ‘voice’ so that tweets from multiple sources are presented in a consistent tone (including consistent use of pronouns),” recommends the official template.

“The department’s Twitter voice will be that of the digital media team, positioning the channel as an extension of the main department website ‑ effectively an ‘outpost’ where new digital content is signposted throughout the day. This will be implicit, unless directly asked about by our followers,” it advises.

Williams, the author of this template, launched the first ever blog by a British cabinet minister. He admits he once ran a comedy website called idiotica.co.uk but the Cabinet Office confirm that his Twitter guidelines are genuine.

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds


Off with their lordships

Just because No 10 wants a little expert help is no reason to grant outsiders a lifetime in ermine

It is hail and farewell time around Whitehall. Hail to Baron Sugar of Clapton, but farewell to Baron Darzi of Denham, not to mention Baron Carter of Barnes. Let the great big world keep turning without you, Baron Malloch-Brown of St Leonard’s Forest. And cheerio Baron Jones of Brum (though you’ve been gone quite a while already).

The last four were the leaders of Gordon Brown’s new pack, trailblazers for his government of all the talents. But now it’s the government of all the exits. Digby Jones vanished in under a year, talking about his “dehumanising, depersonalising” time as a junior functionary. Mark Malloch-Brown and Ara Darzi did rather better, notching two years apiece – until this month. Stephen Carter, Lord Broadband, wins the palm for a headlong transition. Appointed to a ministerial post in the Department of Culture, Media and Sport, October 2008: announced resignation, June 2009.

More comings and goings than Manchester City in the transfer window. More drama than an absurd BBC Trust meeting trying to decide whether Lord Hired of Fired can play apprentice finder in an election season. More dilemmas of a wholly ridiculous kind: first, why do talented outsiders wither and die in ministerial smog? But second, why do we have to give these chaps a job for life – attendance money, expenses, office costs, title – to sign them up for a few bare months of public service? What have they done to deserve decades of squirming in ermine?

Now, of course, it’s not quite possible yet to guess where the new, independent fees office will finally pitch their lordships’ expenses, beyond daily subsistence of £82.50 a day. Perhaps the four barons just departed won’t attend, won’t claim, won’t want to play the game at all. But it’s still a great game, eternal membership of a club that leaves the Garrick standing.

But why, pray, is it necessary to offer such enduring beneficence in order to get a little specific on board? There’s no reason for Downing Street not to add a noted surgeon or distinguished UN official to the team: reinforcements both sensible and necessary. A Commons full of professional members – no second jobs, no experience of life outside Central Office or some trades union HQ – isn’t likely to throw up much in the way of ministerial talent.

And this is a bind that will grow worse if David Cameron gets his way and reduces the number of MPs. Do we trust the people we elect to govern us? No: and we’re not exactly awed by them either. The wellsprings are running dry – and the true need for constitutional change has never been clearer.

Why go through the flummery of titles and bounteous cash flowing the wrong way in order to import expert ministers to do expert jobs? Why pavilion them with phoney baronies if they can just turn up in the Commons, make statements, answer questions and do the normal thing? Why pension them off to the Lords, where expense streams always run and nothing is truly proactive (or particularly democratic)? Let Mr Carter arrive, appear at the Commons dispatch box as requested, do his stuff – and then go back to being plain Steve again.

That’s the submerged logic of the new constitutional reform bill as tabled. What No 10 gives, life peers can henceforth shuck off. What heredity bestows no longer matters. But, why then deem that any of it matters? Choose a pragmatic version of the American cabinet system, fit for modern purpose. Spare Lord Mandelson months thinking up his title. Leave Lord Adonis in the right traffic lane. Impose no legacy for groaning generations to come. Here’s a very modest proposal that abolishes mindless contortions and futile cost. Watch Mark MB junk that upper house hyphen. Call My Lord Darzi just Dr once more. Lord Suralan, you’re terminated. That’s what you might call real reform.

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds


Public services ‘face decade of pain’

Institute for Fiscal Studies forecasts 16% cuts across Whitehall

Britain will face spending cuts of more than 16% to key public services, such as law and order and higher education, if Labour and the Tories deliver on their goals to protect schools, hospitals and defence, the Institute for Fiscal Studies has warned.

As the two main parties gear up for a bitter general election battle that will be dominated by this issue, the IFS says Britain is facing a decade of pain that will see the tightest constraint in public service spending since 1977.

Concern has grown already this week about immediate shortfalls in the culture and education budgets, but the Guardian is publishing research by the IFS at the start of a two-day series on the future of public spending which reveals that spending on a majority of public services will have to be cut by up to 16.3% over the next three-year spending period – 2011-14 – if the next government is to deliver real-term rises for health, schools, defence and overseas aid.

Labour and the Tories have both said they would like to protect these four areas. They have also agreed, at a minimum, to cut Britain’s record fiscal deficit from 11.9% of GDP next year to 1.3% by 2018.

Carl Emmerson, the IFS’s deputy director, said: “It could be eight years of pain … Unfortunately that is the kind of choices we are looking at. It will be very difficult for public services. Under the Labour spending plans at the moment it is the tightest three-year period since 1977 when the IMF were involved in setting spending plans in the UK.”

Gordon Brown and David Cameron are warned by Four former chancellors – Denis Healey, Geoffrey Howe, Nigel Lawson and Norman Lamont – say Britain is facing the most far-reaching public spending cuts since the 1970s. Speaking to the Guardian, Lord Lawson, who is advising the Tories, indicates that Cameron will follow the example of Margaret Thatcher, who held an emergency budget within 40 days of her election victory in 1979 to stabilise sterling.

Lord Healey, Labour chancellor from 1974-79, says: “It is always painful to many people depending on what area you cut. It will be very painful for those who get the money at the moment.”

Sir Michael Bichard, former permanent secretary at the education department, who is advising both the Treasury and the Tories, tells the Guardian that the political debate on public spending is still “pretty undeveloped”. He also calls for a “jolt to the machine” to shake up Whitehall.

“We all are currently guilty of engaging in a debate about tactical issues when there are some huge strategic issues,” he said. “I think the debate about public spending is pretty undeveloped. But you’ve also got an election in less than a year and there aren’t many politicians who want to be seen with an axe in their hand in the year before an election.”

He and other recently retired mandarins have urged the two main party leaders to consider a complete overhaul of Whitehall to avoid costly duplication in the distribution of public spending.

Public spending has already become the key election battleground. The row erupted when Gordon Brown claimed the Tories would threaten vital public services after Andrew Lansley, the shadow health secretary, said public spending would have to be cut by 10% if NHS spending were to rise in line with inflation, as the Tories have promised, and social security and debt interest payments were maintained.

The government softened its position last week, with Lord Mandelson saying that Britain faces years of spending restraint, after it became clear that Lansley made his comments on the basis of government and IFS figures. The IFS is to go a step further and explain how the 10% cuts will be increased to 16.3% if similar spending safeguards are offered to schools, defence and overseas aid.

guardian.co.uk © Guardian News & Media Limited 2009 | Use of this content is subject to our Terms & Conditions | More Feeds


Straw has wasted his chance

We’ll never get a clearer constitutional moment – yet this bill is mere fine tuning. The last hope is to launch a new localism

On becoming prime minister in June 2007, Gordon Brown insisted that constitutional reform would be a major theme of his administration. Recession made it appear a luxury, but the expenses scandal has made reform, for the first time since the era of the suffragettes, a genuinely popular issue. We are as near as we will ever get to a constitutional moment.

Yet Jack Straw, the justice secretary, in the constitutional reform bill, produced not a reformer’s broom but a dustpan and brush to tidy up anomalies. He proposed that the civil service code be given statutory force; that there be an end to restrictions on protests in Parliament Square; and that parliament be given greater powers over declarations of war.

This last measure is less radical than it seems. In practice, no government can take Britain to war without the consent of parliament, which can always withhold the funds needed. Every war Britain was engaged in over the 20th century, with the exception of the 1956 Suez expedition, had the support of the opposition as well as the government. So did the Iraq war. Tony Blair was the first, in 2003, to seek explicit parliamentary approval before taking Britain to war. But that, like the current measure, was a recognition of political reality.

The position of the attorney general – also a matter of contention during the Iraq war – will not be altered. This means the government’s law officers will remain ministers, collectively responsible with other members of the government for public policy, yet also agents of the state, in which capacity they cannot be responsible to anybody. It is a peculiarly British compromise.

The main emphasis of the bill, however, is on the House of Lords. But, in place of root and branch reform, there are a series of necessary, yet minor, changes. Elections to replace hereditary peers, when one of the 92 dies, will be abolished; the hereditary peerage will atrophy until it entirely disappears. Measures will be taken to expel peers, such as Lord Archer, found guilty of serious crimes. In addition, life peers will be given the right, which the hereditaries have had since 1963, to renounce their peerages. This would enable Lord Mandelson to resign from the Lords, seek election to the Commons, and become a candidate for the premiership.

The constitutional reform bill is more interesting for what it leaves out. There is nothing on an elected second chamber, electoral reform, or a written constitution. Perhaps these matters are too difficult for a government in its last year of office, with legislation subject to the 12-month delaying power of the Lords. The government, so it seems, can put constitutional issues on to the political agenda, but cannot put them into effect.

Yet there is one area of reform where Labour could ensure improvement even at this late stage – improvement that would mean more to the ordinary voter than such glamorous issues as proportional representation or a written constitution. The government could make a reality of the new localism that all parties claim to support.

As long ago as 1992, Brown claimed in a Fabian pamphlet that “in the past, people interested in change have joined the Labour party largely to elect agents of change. Today they want to be agents of change themselves.” That should be the leitmotif of the next phase of constitutional reform – giving people greater control over public services at local level.

Labour has begun this process through the creation of directly elected mayors in London and a few other local authorities. That has enabled people of genuine independence to be elected, free of the constraints of tribal politics. The extension of the mayor system has been resisted by local councillors, fearful it will undermine their prerogatives. But there is a case for Labour to impose mayors on the large conurbations – Birmingham, Liverpool, Manchester and Newcastle. In a recession, independent-minded figures are far better placed than traditional council leaders to secure the investment the inner cities badly need.

In 2000, Labour gave 5% of registered electors the power to require a referendum on whether their authority should have a directly elected mayor. This was the first provision for the initiative in British politics. But, if 5% of the voters can be entrusted with choosing a mayor, why should they not be entrusted with making wider decisions about the nature and scope of local services, even of services such as the NHS, which are not administered by the local authority? That would be a real example of double devolution – not just from central government to local authorities, but from local authorities to the people.

The Brown government is rather like a cricket team whose wickets remain intact, but which is yet to build a large innings. In the Commons , Straw played some sound defensive strokes. But it is time to score some runs.

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British soldier killed in Afghanistan

Death toll rises as David Cameron and Peter Mandelson enter row over poor resources and manpower in conflict

A British soldier has been killed while on foot patrol in Afghanistan, the 17th to die this month, the Ministry of Defence said today .

The soldier, from the 2nd Battalion the Royal Regiment of Fusiliers, died yesterday morning as a result of the blast in Sangin, in northern Helmand province.

Lieutenant Colonel Nick Richardson, spokesman for Task Force Helmand, said: “It is with extreme sadness that I must report the death of a brave soldier. He laid down his life for his country and the good people of Afghanistan.

“We grieve for his loss and join with his family and friends to mourn his passing.”

The Ministry of Defence said next of kin had been informed.

The soldier was killed as the row over troops, equipment and helicopters deployed in the country intensified with former defence secretary John Hutton saying the army needed more logistical support.

Also yesterday, David Cameron for the Tories and Lord Mandelson for the government once more crossed swords on the issue.

The latest death, the 186th among British forces since operations began in Afghanistan came in what is proving to be a particularly grim month for British forces, with five of those killed being only 18 and another casualty, Lieutenant Colonel Rupert Thorneloe, becoming the most senior officer to be killed in action since the Falklands conflict.

Sangin, the scene of the latest fatality, is where five soldiers were killed and a number injured ten days ago by a massive blast. They, too, were on foot patrol.

Just days before Bob Ainsworth, the defence secretary, told a London audience that Sangin town was a now relatively peaceful with a thriving market.

Last week General Sir Richard Dannatt, head of the army, said electronic counter measures and anti-explosives experts were a priority, along with more helicopters, for British troops in southern Afghanistan.

The rising toll has also seen thousands of people pack the streets of Wootton Bassett in Wiltshire to pay tribute as the bodies of dead troops are brought back to Britain through the nearby RAF base at Lyneham, and appeals to the media from local council leaders for less “intrusive” coverage of such events.

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Army pushes for more helicopters

The deployment of more helicopters to Afghanistan would save soldiers’ lives, the Chief of the Defence Staff, Sir Jock Stirrup, has said.

Following criticism of the government for failing to give troops air support, Sir Jock said more helicopters would "quite patently" prevent casualties.

The government insists that the military has never been so well resourced as it is at present.

Meanwhile, the 185th British death of the conflict has been confirmed.

A soldier from the 2nd Battalion The Rifles died in an explosion while on foot patrol near Gereshk in central Helmand, the Ministry of Defence said.

He was the 16th to die this month, as the Army continues an offensive aimed at increasing security ahead of Afghan elections planned for next month.

‘No panacea’

Prime Minister Gordon Brown spent 40 minutes with Sir Jock Stirrup on Friday morning.

Afterwards, Sir Jock told the BBC he was "busting a gut" to get more helicopters redeployed to Afghanistan.

"I have always said that there’s no such thing as enough helicopters in an operation campaign," he said.

"In a situation where you have lots of improvised explosive devices, the more you can increase your tactical flexibility by moving people by helicopter, then the more uncertain, more unpredictable your movements become to the enemy.

"Therefore, it is quite patently the case that you could save casualties by doing that."

He said operational commanders could always "do more and do things better" with extra helicopters, but acknowledged they were "no panacea".

His comments come after the head of the army, General Sir Richard Dannatt, said he was returning from Afghanistan with a "shopping list" of equipment to protect British troops from roadside bombs.

Sir Jock said he did not know how much this would cost, but said such things were non-discretionary and had to be provided.

BBC political correspondent Carole Walker said his remarks have intensified the pressure on the prime minister, who has insisted the government is providing the equipment and resources that are needed for the current operations.

‘Critical’

The prime minister’s spokesman said Sir Jock would go into further detail about equipment requirements in the future.

"Of course, we will take decisions in the light of that military advice," added the spokesman.

He said there would be a wider review of troop numbers, both at UK and Nato level, in the autumn.

"We will review the position on troops along with our allies after the election," he added.

The government has promised to consider demands for more equipment to protect UK forces in Afghanistan from roadside bombs.

The head of the British army, Gen Sir Richard Dannatt, says he was compiling a "shopping list" including surveillance and intelligence equipment.

More from Today programme

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Downing Street says the PM will take decisions in "light of military advice" and review troop levels with allies.

Gen Dannatt, who steps down from his role next month, told the BBC it was "critical" to tackle the problem of improvised bombs.

Doing this required more coalition or Afghan personnel to build intelligence, better "overhead surveillance" of Taliban activity and greater technical ability to see where they were planting explosives, he said.

"That will be a shopping list that I’ll bring back," he added.

The BBC’s defence correspondent Caroline Wyatt said: "He’s talking about things like UAVs [or unmanned drones]… that could spot where the Taliban are laying bombs."

However, she said with government budgets shrinking it was unclear whether the Ministry of Defence would be given funding to meet these requests.

Business secretary Lord Mandelson said the general’s views on troops’ equipment requirements would be taken "very seriously".

"They will not go without whatever they need to carry out their very important operations in Afghanistan," he said.

Gen Dannatt had said that, despite reports, the military never made a direct request for 2,000 extra personnel.

But he warned that reducing numbers to 8,300 would be wrong and that Nato might ask for more personnel for a 12 to 18-month period.

Conservative leader David Cameron said the government must listen to military commanders.

"The prime minister has been telling us all week that they have got enough helicopters and actually now we know they don’t," he said.

He refused to say whether his party would spend more on defence if it was in government, claiming it was about "commitment" rather than funding.

With commitment, he said, six Chinook helicopters which had been grounded by computer problems since their purchase at a cost of £250m eight years ago could have been in action.

Earlier, shadow defence secretary Dr Liam Fox had said it was "extremely likely" that a Tory government would agree to a request for more British troops in the short term.


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PM ‘will listen to Army demands’

Demands for more equipment to protect UK forces in Afghanistan from roadside bombs will be considered, the government has promised.

The head of the British army, Gen Sir Richard Dannatt, says he is compiling a "shopping list" including surveillance and intelligence equipment.

Downing Street says the PM will take decisions in "light of military advice" and review troop levels with allies.

Meanwhile, the 185th British death of the conflict has been confirmed.

A soldier from the 2nd Battalion The Rifles died in an explosion while on foot patrol near Gereshk in central Helmand, the Ministry of Defence said.

He was the 16th to die this month, as the British army continues an offensive aimed at increasing security ahead of Afghan elections planned for next month.

‘Critical’

Critics have accused the government of failing to properly equip troops and leaving them short of helicopter support.

Gen Dannatt, who steps down from his role next month, told the BBC it was "critical" to tackle the problem of improvised bombs.

Doing this required more coalition or Afghan personnel to build intelligence, better "overhead surveillance" of Taliban activity and greater technical ability to see where they were planting explosives, he said.

"That will be a shopping list that I’ll bring back," he added.

Business secretary Lord Mandelson said the general’s views on troops’ equipment requirements would be taken "very seriously".

More from Today programme

Soldier dies in Afghan explosion

Military doctor shortage warning

"They will not go without whatever they need to carry out their very important operations in Afghanistan," he said.

Gordon Brown spent 40 minutes with Chief of the Defence Staff, Sir Jock Stirrup, on Friday morning.

Afterwards, Sir Jock told the BBC he was "busting a gut" to get more helicopters redeployed to Afghanistan.

"I have always said that there’s no such thing as enough helicopters in an operation campaign," he said.

"If you are an operational commander, you can always do more and do things better the more helicopters you have."

The prime minister’s spokesman said Sir Jock would go into further detail about equipment requirements in the future.

"Of course, we will take decisions in the light of that military advice," added the spokesman.

He said there would be a wider review of troop numbers, both at UK and Nato level, in the autumn.

"We will review the position on troops along with our allies after the election," he added.

Gen Dannatt had said that, despite reports, the military never made a direct request for 2,000 extra personnel.

But he warned that reducing numbers to 8,300 would be wrong and that Nato may ask for more personnel for a 12 to 18-month period.

Shadow defence secretary Dr Liam Fox told BBC Radio 4′s Today programme it was "extremely likely" that, if the Conservatives were in power, they would agree to a request for more British troops in the short term.

"If we had a direct request from the head of the armed forces that they needed something specific to maximise the chance of success of the mission and minimise the risk to our forces, of course we would have to say ‘yes’ to that," he said.


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Labour orders green energy revolution

Miliband takes control of power grid and lays out plan for low-carbon UK

The government seized control of key levers in the energy sector today in an attempt to kickstart a stalling “green energy” revolution and head off the threats of global warming and a rundown in North Sea oil.

Ministers plan to take over the allocation of electricity grid connections in order to favour renewable schemes, force the industry regulator, Ofgem, to tackle carbon pollution and pass laws to compel power companies to help poorer families meet rising energy bills.

The moves came as Ed Miliband, energy and climate change secretary, set out an ambitious road map for the UK to meet its legally binding target of a 34% cut in greenhouse gas emissions by 2020. Measures range across homes, cars, business and farming, but clean electricity generation will deliver half the reduction.

Miliband said Britain would meet 40% of its electricity needs from wind, tidal and nuclear by the end of the next decade. The government’s overall plans believe 1.2m new green jobs will be created.

“Our plan will strengthen our energy security, it seeks to be fair to the most vulnerable, it seizes industrial opportunity and it rises to the moral challenge of climate change,” he said.

The government said £100bn had to be spent on energy projects and accepted that customers’ bills would have to rise to pay for much of it.

But Miliband said domestic energy saving initiatives should mean there would be no related hikes in utility bills until 2015 and by 2020 should mean on average 6% – £75 – a year on domestic bills. The decision to significantly strengthen government control of the planning and infrastructure of the energy markets in a bid to increase renewable power sixfold turns back some of the market-driven approach developed by Margaret Thatcher.

Lord Mandelson, business secretary, said: “We must combine the dynamism of the private sector with a strategic role for government to deliver the benefits of innovation, growth and job creation in the UK.”

The developments have delighted a clean energy sector frustrated by long delays to win access to the national electricity grid. “The renewables industry has had a tough time in the UK for many years and it has missed out on technologies where it should have led the world. What we heard … today shows a level of understanding and political leadership that suggests that may be about to change,” said Gaynor Hartnell, director of policy at the Renewable Energy Association.

Friends of the Earth also welcomed the moves. “Today’s announcements are a significant step towards the creation of a safe, clean and low-carbon future,” said Andy Atkins, executive director.

But some of the large power companies which want to build nuclear and coal plants as well as wind farms still felt the government was not doing enough. “The government has to give companies such as E.ON a market that also gives them confidence to build Britain’s low carbon future,” said Paul Golby, chief executive of E.ON UK, which is pushing to build a coal-fired plant at Kingsnorth but is also engaged in the world’s biggest wind farm, the London Array off the coast of Kent.

Ofgem denied it had been found wanting by the government. “We don’t see this as a kick in the teeth. We have been working under our existing powers to make changes to the grid access regime without much success. So [we] welcome the government stepping in,” said an Ofgem spokesman, who also said it was happy to take on a greener role.

Miliband said he was exercising reserve powers provided under the 2008 Energy Act for the government to intervene. He expects wind and other renewables to provide “over 30%” of the renewable power for electricity by 2020 but denied this was rowing back on a previous commitment to obtain 32%.

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Blair in frame to become first EU president

Britain’s new Europe minister says ex-prime minister’s candidacy would have full backing of British government

Tony Blair is a contender to become the first president of the EU with the full backing of the British government, the new Europe minister said today.

Glenys Kinnock, in Strasbourg for the opening session of the new European parliament, said that although the former prime minister had not formally declared his candidacy, it was “certainly” the government position to support him.

“I am sure they would not do it without asking him,” Lady Kinnock said. “The UK government is supporting Tony Blair’s candidature for president of the council.”

The new post is to be created under the Lisbon treaty, which will streamline the way the EU is run if it is endorsed in an Irish referendum in early October.

Blair would be the first sitting president of the EU, who will be appointed by European government chiefs for a minimum of 30 months and a maximum of five years.

If the Irish back the treaty on 2 October, EU leaders are expected to decide on who will get the presidency at a summit at the end of that month.

“Blair is seen by many as someone who has the strength of character, the stature,” Kinnock said.

“People know who he is, and he would be someone who would have this role and step into it with a lot of respect and I think would be generally welcomed.”

While Blair has declined to declare himself as a candidate before the outcome of the Irish referendum, Kinnock’s remarks were the first solid confirmation that he is to run for the job.

However, British diplomats said her comments remained speculation for the moment because the Irish could yet vote down the treaty – as they did in their first referendum last year.

“The reality is Lisbon has not entered into force,” one diplomat said. “Blair has yet to say whether he will stand.”

A spokesman for the ex-PM said: “The job doesn’t exist, so there is nothing to be a candidate for.”

If he stands for the post, the founder of New Labour could yet in to stiff opposition in Europe.

Fredrik Reinfeldt, the Swedish prime minister – who took over the rotating presidency of the EU this month and will chair the October summit – is known to be strongly opposed to a Blair presidency.

Reinfeldt told the Guardian he would not get into any discussion about names for the post, while a senior European diplomat said the presidency would be “the absolute top subject” at the October summit.

Reinfeldt said he expected to oversee the launch of the Lisbon treaty, “including the elected council chairman [Europe president]“.

He added that if the treaty was ratified by all member states, he expected “very many names” to be put forward for the presidency.

José Luis Rodríguez Zapatero, the Spanish prime minister, who will succeed to the EU presidency after Reinfeldt in January, is also an opponent of Blair.

France’s president, Nicolas Sarkozy, an early fan of the idea of President Blair, appears now to have turned lukewarm.

William Hague, the shadow foreign secretary, said the creation of a new EU president “could be enormously damaging for Europe”.

“Any holder is likely to try to centralise power for themselves in Brussels and dominate national foreign policies,” he said.

“In the hands of an operator as ambitious as Tony Blair, that is a near certainty. He should be let nowhere near the job.

“It shows what a grip Lord Mandelson now has over Gordon Brown that he has been forced to support his bitterest rival.”

 

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Rebalancing our shaky economy

With unemployment rising and manufacturing declining, the economy needs more state help for a speedy recovery

Today’s unemployment figures show that, although banks’ share prices may be recovering, the labour market continues to deteriorate. Unemployment is set to continue to rise through the rest of the year and probably for the first half of next year too. The full human cost of the recession is still to be felt as the number of people out of work climbs towards 3 million.

The message coming out of the recession is clear: we need to build a broader-based economy, less reliant on consumer debt and more focused on investment and innovation. What is less clear is where the new jobs will come from. In the last economic cycle nearly three-quarters of all new jobs were created in the public sector, finance, construction and retail. Jobs will not be created in the same sectors in the next economic cycle. Other sectors will have to pick up the slack if we are to return to full employment.

While the need for the economy to rebalance is clear, the scale of the challenge that lies ahead is greater than people realise. After the last recession it took eight years to return to the previous level of peak employment – it could take even longer this time round. Employment in manufacturing – often presented as a potential source of jobs in the future recovery – has been falling at an annual rate of 3.7% over the last seven years, so just halting this decline would be a major change of trend.

The UK will therefore be reliant on a big turnaround in manufacturing and on services that aren’t in finance, retailing or the public sector for jobs growth in the next few years. The challenge of creating these jobs and achieving more balanced employment may be large, but it is not insurmountable. The UK has strengths on which to build – high-tech manufacturing, pharmaceuticals, services for export, business services, publishing, media and creative industries, for example. It could also stand to gain from increasing demand for green technologies as a result of attempts to address climate change and for care services as a result of our ageing population. The weaker pound, growing markets in emerging economies and concerted economic stimulus at home and abroad will all help.

But a rebalanced economy will not develop by chance. Some strategic government support for industry is also needed. As the financial crisis unfolded, Lord Mandelson trumpeted an “activist” approach to industry in an attempt to create an economy “with less financial engineering and more real engineering”. This was a move in the right direction but has not gone far enough.

We believe there is a more structural role for the state to correct market failures. The role government should play in the economy doesn’t stop when the recession is over. That is why we are calling for the government to match its rhetoric with the creation of institutions and policies that will “fix” an activist approach into the wider economy – including the creation of an infrastructure bank, government-backed university-business links, a national ideas bank and greater control for city-regions over their local economies.

A debate is beginning about how the UK economy will grow and what role the government should play in the process. The government should seize the opportunity to put in place the institutions and policies required to build a more sustainable employment base and ensure a speedy recovery to full employment. There are reasons to be optimistic and tell a positive story about the possibilities for growth and job creation in the UK – but that optimism depends on a supportive, strategic government.

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Having tea with Russia’s Deripaska

Russian billonaire, Oleg Deripaska, normally tries to avoid the media spotlight. But Tim Whewell was able to spend some time with him and gain an insight into his life.

Russian billonaire Oleg Deripaska

Having spent a couple of days in the company of the 164th (until recently ninth) richest person in the world, I can report that he knows an awful lot about the properties of silver foil, plans to make Russia into a nation of white-van lovers, and is partial, late of an evening, to a cup of special Siberian herbal tea.

I can report nothing about the view from his spectacular yacht, the Queen K, where he famously entertained Lord Mandelson, the speed of his private jet, or the furnishings in any of his many homes – because that was not the "vulgar" subject matter the Aluminium King of Russia, Oleg Deripaska, had in mind when he invited me on a private tour of his empire.

No. We were going to roll up our sleeves, put on our safety glasses and hard hats – and talk production.

We were interested in the source of wealth, not its trappings.

In the 85% automation level on the assembly line at GAZ, his car plant at Nizhny Novgorod on the Volga – the 3,200 welding spots on his latest model, the Volga Siber – the accuracy on his quality control apparatus of one micron – a thousandth of a millimetre, the 415,000 amp current that electrolyses the alumina at his smelter in Sayanogorsk in southern Siberia – do not stand too close – and the scorching 730 degrees Celsius inside the furnace.

Mr Putin driving a 1956 Volga

These are statistics to conjure with, not those you may have heard before about Mr Deripaska – how he was worth $28bn (£17.5bn) last year and only $3.5bn (£2.1bn) now.

In any case, he disputes those figures.

He never had anything like as much as they say, and anyway, he parries jovially as we sit back in his company’s Swiss-style chalet high in the Sayan Mountains, do I know how much money I have got

Touche! I am stuck.

On the one hand, I feel a certain moral obligation to stand up for that portion of the world’s population that does need to keep abreast of its financial affairs.

On the other hand, do I really want my new friend to think I am some kind of Fagin, sitting up half the night over piles of pennies

Mineral exploration

From this you will probably have gathered that Mr Deripaska and I quickly established an easy, bantering relationship.

He not only looks much younger than his 41 years, he is positively boyish in his energy and enthusiasms.

And so we bound down the assembly line at GAZ discussing axles and suspension, touching on the benefits of the Toyota Management System, debating why Britain lets its engineering talent go to waste.

Later in the week, four time-zones to the east, he diverts his helicopter to take me low over the breath-taking Sayano-Shushenskaya dam, once the highest in the world, the source of all those amps in the smelter.

All the time he is pointing down excitedly at the spruce-covered hillsides, telling me what geologists might find next under Siberia.

He has cornered the market in aluminium, but that is not enough. Down there is copper. Further on, molybdenum.

The helicopter’s nice, furnished with cream leather sofas. But we are asked not to film it. For security reasons and also, you will remember, because that is not the kind of thing we are interested in on this trip.

He tells me about all the extra trees he is going to plant around his factory, down where the mountains meet the bare steppe. He tells me about the computers he is giving to schools.

Becoming friends

Only late at night in the chalet – and Mr Deripaska likes late nights – do we turn briefly to darker, more emotional matters.

UK Business Secretary Lord Mandelson

"Why," he asks suddenly and insistently, "do the British press hate Peter Mandelson so much"

And again I am stuck. Because while I can think of many possible answers to this question – all intriguing enough to occupy a happy hour over a pint down at my local – I am talking now to Peter’s friend, a guy I am trying to bond with.

And so we return to the subject of whether his light commercial vehicle, the Gazelle, could have been improved by technology from the British firm he once owned, LDV.

I will be honest. I am not very interested in vans.

But I liked Oleg Deripaska.

I liked his teasing grin. I liked his ready laughter. And I appreciated his delicacy in not wining and dining me.

Our trip to Siberia was good for both our reputations – because, in these stern days of expense-related scandals, I have almost nothing to declare – only his herbal tea, the master-class in foil making, the unforgettable swoop in the helicopter – oh, and a tiny souvenir ingot of the first aluminium from his smelter.

As for a journey on a gigantic yacht – as Frank Sinatra almost sang in "Who Wants to be a Millionaire" – I am so glad I did not.

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