Daily Mail, Saturday, August 17, 2019
B
ritain is one of the worst
countries in the developed
world for building infra-
structure projects. Figures
from the World EconomicForum show the UK is not even in
the top ten of 140 nations when
looking at how infrastructure con-
tributes to competitiveness.
Comparing all infrastructure projects,
the WEF ranked us in 11th position,
behind Spain.
in rail, the UK came in tenth position, and
in 26th place for roads.
Yes, when we do go for ‘les grands projets’
- whether it’s the renovation of King’s Cross
St Pancras or the magnificent Crossrail – we
do them surprisingly brilliantly. But there
are not enough of them.
Boris Johnson now has the opportunity of
a lifetime to change that and go big.
the Prime Minister can put what he calls
‘boosterism’ to the test by launching a cou-
ple of ‘rocket boosters’ to turbo charge the
economy with financing for a couple of bold
projects. and he can do so cheaply because
the Government can borrow in the bond
markets over ten years so cheaply.
at thursday’s price, the ten-year bond
yielded a tiny 0.46pc.
Professor Douglas McWilliams of the Cen-
tre for Economic and Business research
estimates for me that if the Government
spent an extra £10bn on infrastructure over
the coming year, the cost of borrowing
would be about £31m a year, or £310m over
ten years.
that, as they say, is as cheap as chips and
it’s why additional spending on some care-
fully selected, but vital infrastructure
projects, is a no-brainer.
Spending on longer-term projects has a
terrific knock-on impact on so many other
factors. For every £10bn a year more spent
on infrastructure, the wider economy would
be boosted by £18bn a year once everything
is in full flow.
Spending extra also leads to a permanent
lift in productivity, something this country
desperately needs.
there are social as well as economic ben-efits. For 1,000 jobs created by any one con-
struction project, there will be another 3,000
added elsewhere.
in his new book, the inequality Paradox,
McWilliams shows that improved infra-
structure helps reduce inequality.
Providing people with better links between
work and home improves health outcomes,
reduces crime and so forth.
Luckily the signs are that Johnson will not
need much convincing to spend on either
upgrading or building new infrastructure.
He has already made pledges for new hospi-
tals and investing in broadband.
His Chancellor Sajid Javid has similar
instincts and is likely to support Johnson in
such plans. Javid promised another £100bn
of spending on new projects as part of his
leadership bid and £50bn on social housing,
a policy he feels strongly about.
His earlier attempts to get money out of
the treasury for housing were blocked by
the previous PM.
now’s his chance to make good.
With borrowing costs so low, you could
argue that Johnson not only has an oppor-
tunity, but an obligation, to put much-
needed fizz back into an economy suffering
from Brexit fatigue and fears of a global
slowdown.
if he survives attempts to overthrow him,
a good start might be a bridge across
the Channel.End the apartheid
WHEn will the tV and newspapers start to
show young students grinning with their
BtEC results as well as those gaining a-
levels? the annual parade of pupils jump-
ing around with glee is wonderful to behold,
but only tells half the story of Britain.
For the other half of the UK’s 16 to 18-
year-olds study BtECs, vocational qualifi-
cations. they are a serious alternative. Half
of all white working-class and many black
students go to university with at least one
BtEC. Only when the media – and parents- start celebrating their achievements more
joyfully will we bridge this educational
apartheid. it is the BtECs who will be help-
ing to build the bridges and rail we need.
Wake-up call
WHatEVEr the reasons given by national
Grid for last Friday’s blackout, the melt-
down was a much needed wake-up call for a
radical overhaul of our power system.
the electricity grid has been running on a
dangerously low margin capacity for years
at about 1pc.
the national Grid, working with the regu-
lator, needs to come up with a better plan to
procure electricity and to operate the sys-
tem. With the rise of renewables such as wind
and solar – which now make up a third of
supply – and nuclear soon to fizzle out, such
events will become even more frequent.Time for a boost from Boris
45 energy firms at risk
UP tO 45 energy suppliers
could disappear in the com-
ing years as small firms
struggle to survive, custom-
ers are being warned.
Many have already gone
bust as tiny suppliers strug-
gled to cope with huge price
swings on the electricity
and gas markets. But there
are still 75 firms touting
their services – and experts
fear more will fail soon.
Mark todd, of switching
website Energyhelpline,
said: ‘there are simply too
many suppliers for the mar-
ket to sustain.’
this week Solarplicity col-
lapsed, affecting around
7,500 households, and UrE
Energy had its licence to
supply energy ripped up by
the regulator. When a firm
fails, regulator Ofgem picks
another provider for them.THE owner of Paddy Power
and Betfair has struck a
deal with Major League
Baseball as Britain’s book-
ies continue their rush to
conquer the US.
Flutter Entertainment’s
US arm Fanduel has sealed
a deal to become an offi-
cial partner of America’s
professional baseball
league. Under the multi-year contract, Fanduel will
gain access to MLB’s offi-
cial data and will be able
to use its branding in its
online games.
It is the latest push in Flut-
ter’s expansion in the US,
where gambling is surging
after a federal ban on
online sports betting was
lifted in most places out-
side of Nevada last year.POUnDLanD’s parent
company will be sold or
floated on the stock market
in a deal which could value
it at £3.6bn.
the budget retailer is part
of Pepkor Europe, which is
seeking to untangle itself
from its scandal-hit South
african owner Steinhoff.
Pepkor will seek bankers to
advise on a float or sale next
month, according to reports.Poundland has more than
800 stores. it spent a brief
stint on the stock market
before being bought by
Steinhoff in 2016 for £610m.
Steinhoff combined
Poundland with Pepkor, a
European discount brand,
and value fashion chain Pep
& Co. But the discovery of
an accounting scandal in
2017 pushed Steinhoff to
the brink of collapse.Baseball deal for bookie Poundland plots float
Maggie
Pagano
Page 107Hedge fund
hires former
spies to look
into Burford
by Lucy WhitePwC picked
for Rock job
despite past
audit scandal
taintED PwC has
clinched a £16.5m contract
to manage the Govern-
ment’s remaining assets
from northern rock –
despite failing to spot the
bust bank’s collapse.
the auditor won a con-
tract earlier this month to
control state-run UK asset
resolution, which manages
toxic mortgages issued by
northern rock, until 2030.
PwC won this work even
though it has previously
been slammed for compla-
cency in the run-up to the
lender’s 2007 meltdown.
northern rock was res-
cued by taxpayers after
becoming one of the first
major casualties of the
financial crisis. PwC was its
auditor, pocketing £12m of
fees in 2006, and was meant
to ensure its accounts were
in order.
there were claims their
relationship was riddled
with conflicts of interest -
particularly as rosemary
radcliffe, a non-executive
director at northern rock,
was a former chief econo-
mist at PwC.
the audit sector has
faced intense scrutiny after
a string of scandals, includ-
ing the collapse of depart-
net store BHS – which PwC
audited – Patisserie Valerie
and Carillion. PwC declined
to comment.
TED Baker has teamed up with Next in
an effort to push its children’s cloth-
ing lines out to more customers.
Debenhams, Ted Baker’s current
childrenswear partner, has been
given the cold shoulder and told their
relationship will not be renewed
when it ends in February next year.
It is understood that Ted Baker,
which sits at the more premium end
of the High Street, wanted a partner
which could help its children’s clothes
reach a more global audience.
However, it does not expect the new
deal to have a material impact on itsfinances in the current financial year
or in 2020-2021. Lindsay Page, Ted
Baker’s chief executive, said: ‘Next is
the outstanding partner to take Ted
Baker forward in this category, which
we believe will deliver significant
growth in the coming years.’
Next will create and sell Ted Baker-
branded baby, boys’ and girls’ clothes,
working with the firm’s designers, in a
range which will launch next spring.
Debenhams will remain Ted Baker’s
lingerie and nightwear partner,
which is ‘a mutually profitable rela-
tionship’, according to Ted Baker.a BattLE over legal firm
Burford Capital took a
bizarre twist as hedge fund
Muddy Waters hired former
spies to test its bosses’ state-
ments for lies.
Burford executives’ words were
probed by consultant QVerity to
‘measure’ if they were deceptive,
as part of Muddy Waters’ wide-
ranging attack on the firm.
QVerity, staffed by former
deception experts from US spy
agency the Cia, found a ‘signifi-
cant volume and density of
deceptive behaviour’ in Burford’s
comebacks to allegations made
by the hedge fund, mainly falling
into the categories of ‘evasion,
aggression and persuasion’.
a Burford spokesman declined
to comment, but sources close to
the firm described the report as
‘gobbledygook’ and ‘garbage’.
the spat between the firms
kicked off last week, when
Muddy Waters – which is short-
selling Burford’s shares, mean-
ing it profits when they fall –
released a market-moving
report alleging a number of fail-
ures at Burford. it claimed Bur-ford, which helps firms and indi-
viduals fund legal cases in return
for a cut of any winnings, was
manipulating its accounts in
order to mislead investors and
enrich its management.
Burford has denied all the alle-
gations levelled against it. But
QVerity claimed some of those
protestations of innocence
might be just a little too strong.
in particular it picked at the
statement from Burford direc-
tor John Lazar who said he read
Muddy Waters’ dossier ‘know-
ing there was no smoking gun’.
QVerity’s analysis said what
he ‘conveys with this unin-
tended message is that he was
told in advance there wasn’t a
“smoking gun”, or in other
words, concrete evidence of
what they’re doing’.
City analysts were uncon-
vinced by the unusual report,
with one calling the move
‘utterly bizarre’ and another
saying it was ‘total bull****’.
Muddy Waters has already
made a gross profit of around
£12m from shorting Burford.TED BAKER DUMPS DEBS FOR
NEXT IN CLOTHING DEAL