Britain’s need for a reboot

THERE can be no pretending that Salzburg was anything but a bitter disappointment. Theresa May’s response, rightly, has been robust.

President Macron’s description of the pro-Brexit politicians as ‘liars’ was undignified. Boris’s battle bus will haunt Brexiteers but no more than the Remainers’ emergency budget with the immediate threat of a rise in income and wealth taxes.

The biggest problem for those who favour Brexit is the flimsiness of their pronouncements. It is no use simply saying the UK will revert to World Trade Organisation rules as if that is a complete answer.

Firstly, the economic case for making us less in thrall to the European Union needs to be spelled out clinically.

Secondly, Brexit will only work if our politicians are prepared to play to the UK’s strengths and fix the structural weaknesses in the British economy, pursue supply side tax reforms and invest.

The European Union may be a market of 500m people but its performance is abysmal. It is largely a low growth, high unemployment bloc. Germany’s outsized trade surpluses are a selfish indulgence and in danger of making it a global pariah. One only has to look at the breakdown of turnover of some of our greatest companies to recognise how the world is changing and Europe is less relevant. Some 43pc of sales at Anglo-Dutch Unilever are now in AsiaPacific and a further 32pc in the Americas. Europe is just 25pc of what it does.

Diageo is important to the UK because of Johnnie Walker but continental Europe is now just 10pc of turnover.

Commerce and industry recognise the best opportunities for expansion and profits are outside Europe.

If Britain wants to be in the best place to face the challenge it needs to be much better. The Government has a real opportunity to boldly address shortcomings in November’s budget and public spending review. The most obvious requirement is a ‘Marshall Plan’ for infrastructure. We need to get on with airport runway expansion, invest in electrification of trans-Pennine railways, finish Crossrail and press on with HS2 and shake up the management of the railways.

That requires a regulator with real teeth and a reformed accountable, driven Network Rail with strategic vision.

The rollout of high speed broadband is ridiculously slow. We need to embrace it with the same urgency as South Korea and Spain. Where is the money to come from?

That a nation with the most sophisticated financial system in the world should be asking such a question is preposterous.

There are no end of sovereign wealth and utility funds hungry for well-run projects and the Government could be the guarantor to such investment.

UK creative industries have been the fastest-growing sector of the economy since the financial crisis, expanding by 17.5pc. But they are suffering from a stripped-down curriculum in schools where art and design, literary skills and music are devalued.

Predicting the outcome of the Brexit negotiations has become impossible. What is evident is that the UK must be better prepared to be the best at what it does and go global. That requires willpower, vision and investment.

Cyber risk

BANKS do little else but think about technology and how to embrace it.

Jes Staley, chief executive at Barclays, spends up to 70pc of his time wrestling with digital issues.

Royal Bank of Scotland recently provided an impressive briefing on the bank’s digital ambition. It explained how the security of mobile banking is being improved using techniques which monitor the unique way in which we each use our devices.

All of this is fascinating but it would be nice if banks could get the basics right. RBS has spent a fortune improving botched IT inherited from the Fred Goodwin era.

In spite of this and its embrace of artificial intelligence, its online banking can still be unreliable as customers of NatWest and Ulster banks found yesterday.

We have become used to the idea that we can bank around the clock online, which is more convenient than queuing outside a branch at 9am to make an urgent payment. But confidence in online banking is easily eroded, as has been seen at TSB.

One understands why banks want to cut branches and bring down costs. Another 54 RBS outlets were axed this month.

But shuttering branches, when online services are so unreliable, is the economics of the madhouse.