It’s heartening to see an authentic British entrepreneur heading this year’s Sunday Times Rich List, the industrial-ist Jim Ratcliffe, who has overtaken a coach-load of oligarchs as well as the Duke of Westminster with an estimated £21 billion fortune. This column has long admired Ratcliffe, whose Ineos chemicals conglomerate was built by buying up businesses his major competitors did not want. During his stand-off with the Unite union at the Grangemouth Refinery in Scotland in 2013, I called him ‘an industrial hero’ who deserved to be made a Knight of the Thistle for his willingness to invest in such an unpromising site. While BBC Scotland expressed the more common view of him as ‘the embodiment of hard-nosed, freewheeling capital’, one of Ratcliffe’s own early business partners told me: ‘You couldn’t meet a more decent bloke. He’s very private, but he’s also incredibly generous.’
It’s fair to say that Ratcliffe’s unspun Mancunian manner has never done him any favours, however. Up here in North Yorkshire, Ratcliffe’s face is unknown but the name of Ineos provokes fierce hostility as his company pursues plans to frack for shale gas, possibly including horizontal drilling beneath the North York Moors National Park. That’s a debate I’ve learned to duck, since so many of my neighbours are extremely upset about it, but it’s interesting to contrast the public image of Ineos with that of Sirius Minerals, the company that is constructing a giant potash mine in another previously unspoilt stretch of our countryside, close to Whitby.
Potash mining is by no means as controversial as fracking in terms of alleged health and pollution risks, but both bring ugly industrialisation to the rural landscape, to the understandable distress of local folk. Sirius — which is a public company, dependent on access to public markets — has been assiduous in building relations with landowners and communities, effectively winning over all nimbyist opposition. Ineos is a very private company (often represented in public by faceless consultants) that takes its tone from its media-shy major shareholder, Ratcliffe, and has won no friends at all round here. This is not advice I frequently offer, but Jim, you need a slick PR man.
Another remarkable set of employment figures, in defiance of faltering growth. The ONS says 32.3 million people were in work in the UK in the first quarter, up by almost 400,000 on the first quarter of 2017. Most of the new jobs are full-time; unemployment was at 4.2 per cent, as low as it has ever been since 1975, while pay was keeping pace with inflation. Productivity was down — new workers seem to be less efficient — but as spring blossoms, let’s count our blessings: plunging towards the Brexit precipice we may be, but at least everyone who really wants a job has probably got one.
Crossrail’s black hole
Until a few days ago, reporting of the almost completed Crossrail project had been focused chiefly on the impact of the new Elizabeth Line on local house prices, ‘Still time to buy into Acton’s Crossrail hot spot’ being a typical example. Now we learn that the project’s much repeated if slightly fudged claim about being delivered within an overall £14.8 billion ‘funding envelope’ has almost certainly been blown. A £190 million budget overrun for the year to March, and the departure of chief executive Andrew Wolstenholme to join BAE Systems, were the first indications of problems that may now require a £500 million bailout to see the job finished in time for its scheduled December opening by the Queen.
Transport secretary Chris Grayling will confirm the position in a statement next month. If it’s true that the new tunnels — or more likely, the associated surface works, power systems and signalling — have ended up in a half-billion-pound black hole, it will be a pity but not a catastrophe. Crossrail was about to be hailed as a showcase of world-class UK engineering skills, a boon to London commuters and visitors, and reassurance that we really are capable of delivering major infrastructure projects according to plan. Two out of three ain’t bad, given the formidable challenge of digging across the capital. Let’s not cancel the celebrations yet.
Meanwhile, Grayling has another file marked ‘Toxic’ on his desk: the East Coast Mainline rail franchise. He was expected this week to terminate the Virgin Stagecoach contract signed three years go, having signalled in February that it was ‘unsustainable’. This will be the third time in a decade the government has had to step in: a public–sector ‘operator of last resort’ will presumably take over until a promised new ‘public-private partnership model’ is concocted, some time in the next decade.
But regular passengers on the line, among whom I’m a 30-year veteran, have frankly ceased to care who the operator is — and if there are any who happen to be ardent free-market advocates, they sit in the ‘quiet coach’ these days. The successive efforts of Sea Containers, National Express and the current crew (actually 90 per cent Stagecoach, disguised by Virgin livery and marketing pizzazz) have all failed, while fares have risen 150 per cent since the first mid-1990s privatisation and no aspect of the service — punctuality, frequency, catering, wifi, ticketing systems, staff politeness — has noticeably improved.
It’s hard to imagine any sane entrepreneur, whether he be Jim Ratcliffe or the likes of Ryanair’s Michael O’Leary, thinking: ‘I could run those trains, better, offer cheaper fares and make a big bundle for myself too.’ The best thing Grayling could do next, as I’ve suggested before, is make an appointment in Berlin with Dr Richard Lutz, chief executive of the German state rail operator Deutsche Bahn, and plead with him to pick up the poisoned East Coast chalice.