Quit for Norway: a new way to level-up
The business news that matters
Orkney has an interesting idea about how to level-up the UK economy - break away and become part of Norway instead.
The leader of Orkney Islands Council has tabled a proposal to explore “alternative forms of governance” that could secure “greater fiscal security and economic opportunities”. This includes looking at Orkney’s “Nordic connections” and changing its legal status so that it becomes a self-governing part of Norway.
James Stockan, the leader of the council, said that Orkney’s funding from the UK and Scottish governments is less per capita than other Scottish islands and that it has been "failed dreadfully" by London and Edinburgh. He told BBC Radio Scotland:
"We are really struggling at the moment, we have to replace the whole ferry fleet which is older than the CalMac fleet.
"We are denied the things that other areas get like RET [Road Equivalent Tariff] for ferry fares.
"The funding we get from the Scottish government is significantly less per head than Shetland and the Western Isles to run the same services. We can't go on as we are."
If the council supports the motion then it will explore the options in more detail and people in Orkney could be asked to vote on what they want the status of the islands to be. As well as becoming part of Norway, Stockan also wants to explore the Crown Dependencies model of the Isle of Man, Jersey and Guernsey.
Orkney was part of Norway until 1472, when it was handed over to Scotland as part of a deal between the countries involving the marriage of James III of Scotland and Princess Margaret of Denmark.
Whether or not Orkney presses forward with this, the publicity that its funding has got from Stockan’s comments means that the exercise has already been a success to some extent…
The council will debate the issue on Tuesday. Liam McArthur, the MSP from Orkney, is meeting local leaders today. The Liberal Democrat MSP said:
“As a Liberal Democrat, I’ve always believed in empowering individuals and communities to take decisions that best reflect their needs and circumstances. This is particularly important in our islands, where the effects of centralisation or a one size fits all approach by government can be most damaging, as we have seen over recent years.
“Nevertheless, recent history also highlights the dangers from putting up barriers between or creating divisions within communities.”
Other stories that matter…
1. Drivers are paying more for petrol and diesel because competition between fuel retailers has weakened and profit margins have increased, according to a new report by the Competition and Markets Authority. Customers are paying 6 pence per litre more than they were in 2019 because of this, the CMA says. That equates to £900 million in 2022 alone. The leading fuel retailers in the UK are supermarkets and petrol stations.
The CMA said the “historic price leaders” market - which it describes as “primarily Asda but also Morrisons to some extent” - have taken “a less aggressive approach to pricing by significantly increasing their internal margin targets for fuel over recent years”. The competition watchdog is also concerned about local variations in pricing and the cost of fuel at service stations.
The CMA has made two recommendations to the government on the back of the report. Firstly, fuel retailers should have to share their prices with a new “open data fuel finder scheme”, an app where drivers can compare the price of fuel at different petrol stations. Secondly, a dedicated department within an existing public body should be set-up that can monitor the industry and its prices. You can find CMA’s report here
2. Doncaster Council is looking for an investor and operator to reopen Doncaster-Sheffield Airport after it was closed last year by owners Peel Group. Story here
3. An extract from a new book about how Ineos was built features Sir Jim Ratcliffe talking about his management style and the state of the UK economy. Sir Jim says that the furlough scheme during Covid was too generous and has made inflation worse, and that UK’s public services need to improve. On management he says: “The first thing in all our meetings is safety. It is by far the most important thing we deal with. But you have to start with the truth, the unadulterated truth. If somebody drops something off a piece of scaffolding, then we don’t want management to hide it. If we know things have been dropping off scaffolding, then we can do something about it.” You can read more in The Times here
4. Nick Timothy, who was chief of staff for Theresa May when she was prime minister, has written in his regular Telegraph column that capitalism has failed. Companies have exploited the system to pay staff less than they should, he writes. Timothy adds: “Conservatives should accept that to criticise capitalism is not to succumb to socialism, but turning a blind eye to the failures and excesses of capitalism – especially the crony capitalism we have brought on ourselves – makes defeat to Left-wing parties more likely. It is often said that those without capital will not support capitalism, but if what we have today is capitalism, it should be up to conservatives to change it – and not just defend the indefensible.” You may not agree with Timothy or like him, but this is a thought-provoking column that provides some context to how the next general election campaign could look. Full piece here. Sarah O’Connor writes on a similar topic in the Financial Times, saying that GDP should not be the only way that countries judge the health of their economy and society. “For my money, life expectancy is the most important supplementary measure of how a country is doing,” she writes. “It is a solid quantitative metric based on mortality rates, and few things matter more than life and death.” You can find her column here
Timothy has written his column in light of the problems at Thames Water. The government and industry leaders are concerned that the crisis - and any nationalisation of the business - could deter overseas investors from putting their money into future infrastructure projects in the UK. Financial Times story here
5. Hiring the chief executive of a not-for-profit organisation to run your business results in a better corporate culture, a higher-quality management team, and more progress on environmental, social and governance issues. There is no difference in the profits of the company compared to hiring a chief executive from the private sector. That is according to new academic research which has been analysed by the excellent Klement on Investing newsletter. You can read more here
And finally…
It’s a big week of sport across the UK. Wimbledon starts today, the third test of the men’s Ashes series starts in Leeds on Thursday and the British Grand Prix at Silverstone is this weekend.
There was a dramatic finish to the second Ashes test at Lord’s as Australia won by 43 runs despite Ben Stokes scoring 155. Much of the analysis today revolves around the controversial dismissal of Jonny Bairstow, who was stumped after thinking that play had stopped for the end of the over…
The BBC’s Jonathan Agnew says he has never seen a day of cricket like it and that although Bairstow was technically out, Australia should have given him a warning about his dozy behaviour before actually trying to get him out. You can read his analysis here.
Gideon Haigh, the brilliant Australian cricket writer, strongly disagrees with this take and thinks the rules are clear - Bairstow was out. He writes: “Bairstow wandered off as though unable to credit that the world, so abundant in glad ‘Bazball’ vibes, could contain such traps and snares. But if his dismissal cost England this second Test, then what’s to blame was his naivety rather than Alex Carey’s alertness.” He is also critical of the Lord’s members who heckled the Australian players as they walked off, describing them as “puce-faced, dim-bulb snobs”. You can read his piece in The Times here
The Guardian has rounded up the reaction from Australia, where there is much amusement at England’s hypocrisy. Piece here. Even the Australian police have joined in…
Thanks for reading. If you enjoy Off to Lunch then please share it with others and spread the word. If this newsletter was shared with you then please sign-up below to become a member, get Off to Lunch sent directly to your inbox, and contribute to the work of Off to Lunch
Best
Graham