Next BT chair will need to-do list like Bland’s
THE untimely death of former BT chairman Sir Christopher Bland has coincided with a fresh collapse in the telecoms group’s share price. Sir Christopher steadied the ship on his appointment in 2001, arriving hotfoot from chairing the BBC. I wonder how he would have reacted to BT’s latest woes?
His skill was to boil down complex problems into a manageable to-do list. Years after he ticked off most of the tasks that rescued BT from its giant £28 billion debt pile — demerging the mobile business, selling Yellow Pages, launching a bumper rights issue, finding a new chief executive — he still carried the list around on a dog-eared scrap of paper.
In contrast to such mountainmoving, the repair job from last week’s Italian accounting blow-up is small beer. But BT — which is in much better financial shape than it was back then — must still rebuild trust, if not its balance sheet. It would benefit from a far simpler plan of action. Chief executive Gavin Patterson has laudable ambition in returning to the mobile market and going head-to-head with Sky for sports rights. Consider at the same time that BT is battling to retain ownership of its local broadband network Openreach and galloping around the world selling low-margin services to corporate clients. Surely the company has not got the bandwidth to succeed on all fronts?
A decade after BT’s current chairman, Sir Mike Rake, succeeded Sir Christopher, the next in line will be unveiled within months. He or she must bring their own to-do list and real clarity of vision. Londoners than ever will have self-assessed this year. There are moves afoot to make the ritual easier — for the taxman at least. By 2020, small firms turning over as little as £10,000 a year will have to file online every three months, with some due to begin in April 2018.
The Treasury Committee can’t see why companies earning less than the VAT threshold of £83,000 need to be captured by the new system initially. It also cautions against rushing its introduction without proper consultation.
The switch to digital makes sense but, as currently proposed, all the risk and extra cost is piled onto entrepreneurs while the reward is reaped by HMRC, which believes the Making Tax Digital initiative will bring in extra receipts of
£625 million. How much more it might earn if the tycoons of tomorrow are not put off from setting up shop. Clarifying how world-class workers will continue to be welcomed at the UK’s world-beating businesses might seem a quaint request given Donald Trump’s latest actions, but thousands of internationally minded companies run from the capital are eager to know.
London has one of the most international workforces in the world, with 616,000 people born elsewhere in Europe — 12.5% of the entire workforce — working here. It also has more international students and more foreign direct investment projects than any other city in the world. There is a lot to lose. The Prime Minister says that “openness to international talent must remain one of this country’s most distinctive assets” — within the envelope of reducing net migration to tens of thousands a year of course.
Yet even the European Union nationals already living in the UK — of which there is a great concentration in the capital — aren’t clear yet whether they are free to stay on after Brexit. We are beginning to get some detail from the banks about how many posts they must shift abroad if they can no longer passport into the single market from London. A thousand here, a thousand there: the view is that that is manageable and the City will hang onto its European supremacy. In other industries, change has a lower profile.
A friend at one of London’s universities tells me that overseas undergraduate applications are buoyant because visa uncertainty has been offset by the weakness in sterling. On the flip side, some foreign academics who typically sign up for five-year tenures are choosing to go elsewhere because their worker rights are unclear — as is their EU research funding.
How unfortunate that firms are encouraged to trade abroad without a clear sense yet of how they can hire abroad. To borrow a line from London First’s 2036 jobs and growth agenda, we must preserve London as “the place where global business can find talent, and the place where global talent can find opportunity”. @mrjamesashton
‘Firms are encouraged to trade abroad without a clear sense of how they can hire abroad’