Democracy inaction

Brum plans 30 per cent spending cuts

Never let it be said that public spending cuts are painless. I hear Birmingham City Council is proposing drastic spending reductions in various departments. In some cases this will be as much as 30 per cent of the existing budget.

How will that play at election time when the councillors and their Conservative Parliamentary candidates are up for election and facing the full fury of the unions?

Wycombe wanderers

I hear that David Cameron’s centrally-imposed candidates’ shortlists are not going down well in the provinces. Never mind the “turnip Taliban”, I’m told that in one recent selection meeting, “the woman on the shortlist wouldn’t have got anywhere near selection” had she not been a member of the fair sex.

Likewise, there is much gnashing of teeth in CCHQ that the selection of a local, and a man, for the safe seat of Wycombe. Steve Baker slipped through the net, much to the fury of the party high command. Of course, they will say they are delighted, have every confidence, blah blah blah but the truth is distinctly otherwise.

Solihull goes off piste

Get a new flier through the letterbox from David Cameron urging me to give more money to the party to boost the chances of election victory. It includes a map of Britain and a list of target seats.

Embarrassingly for Maggie Throup, the candidate for Solihull, this map tells us that the constituency is already safely in Conservative Party control. This will come as a surprise to the woman who beat John Taylor at the last election, Liberal Democrat MP Lorely Burt. Mind you, I notice that the seat doesn’t rate a mention on the ConservativeHome website either. Is it possible that is where CCHQ gleans its information?

Cash and questions

Disgruntled Bromsgrove Conservatives are none the wiser following last week’s hardly shock news that Julie Kirkbride doesn’t want to resign after all.

The “expenses queen” has been assiduously re-cultivating her contacts for several months now and her attendance at last week’s executive committee meeting – not advertised in advance to the people who were turning up – came as a surprise to some, though it shouldn’t have.

The real issues now are: If there is to be a £40,000 postal ballot primary for the selection of a candidate, how many names will be on the ballot paper? Will Julie have to take her chances alongside several others people at the interview stage? Or will the question be simply, “Do you want Julie Kirkbride? Yes or No?”

Most concerning of all is the question: Who pays the £40,000?

The locals do not think the money they raise from raffles and lunch parties should be channelled into a mightily expensive PR exercise to promote Julie as the “comeback queen”. So that suggests the money will come from CCHQ which is fine, in theory, with the locals. But is it a good use of that money?

Admittedly, now the rich and very rich can see the way the wind is blowing, the Conservatives’ coffers are overflowing with cash, but even so, forty grand is still forty grant. It’s enough to keep the average MP in duck houses for several months.

It works for Julie

So the Bromsgrove Conservatives are willing to let Julie Kirkbride stand again as their Parliamentary candidate despite her outstanding position in the MPs’ expenses furore. There will be a lot of disappointed Tory wannabes.

Still, I don’t suppose for one minute all this local support has anything to do with the fact that the association’s chairman’s wife and his daughter both work for her.

Silk and cyanide

Have you ever tried buying a railway ticket for someone else, a teenager maybe, who has no money but wants to visit you?

Because if you have, you are probably bald by now having torn out most of your hair.

Teenagers have two particular traits which are enough to drive older relatives and friends to drink – they leave everything to the last minute and they never have any money.

That was the case when my nephew announced that, while he would love to visit us, he didn’t have the money for a train fare from Oxford to Birmingham.

Typical, I thought, especially as he didn’t make this announcement until the night before he was due to arrive.

So how to help him? Surely we could book a ticket for him. I called National Train Enquiries to discover it’s not that simple. Indeed, it’s so complicated you wonder if the railway system is designed to deter passengers.

I cannot be the first person ever in the history of rail travel to want to buy a ticket on behalf of someone else, can I? It seems as if I must be.

I thought maybe I could offer to pay for it over the phone, on my credit card, and my nephew could pick up the ticket at Oxford station the following morning.

But no, that won’t work. Apparently, in order to obtain the ticket, he would need to show the credit card it had been bought with – something he obviously couldn’t do because I had bought it. With my credit card. From my home not from Oxford station.

There was one other option, I was grudgingly informed. If my nephew presented himself at the station in Oxford and I presented myself at the booking office in Birmingham, I could avail myself of what is apparently called “the silk arrangement”.

I’d almost lost the will to live by this point, so I didn’t bother to ask why it was called “the silk arrangement” – certainly it’s not because the arrangement is as smooth as silk.

If I were to tell the booking office person that my nephew wished to buy a ticket from Oxford to Birmingham, the office in Brum would telephone the office in Oxford and the transaction could take place.

My nephew could ask for his ticket. The booking office in Oxford could ask for its £50 – fifty pounds! It’s outrageous – and the office in Birmingham could take payment from me, confirm receipt of my hard-earned money and the people in Oxford might finally offer my nephew a valid ticket.

Of course, this is such a rare and unusual event, so uncommon, one that puts our railway system to so much trouble, that they think it’s only fair we pay an additional £10 for the privilege of availing ourselves of “the silk arrangement”.

I wondered if I couldn’t simply wait until my nephew arrived at the Oxford booking office and telephone the place myself, from the comfort of my own home or wherever, rather than having to turn up at New Street Station a couple of hours before he was due to arrive.

If they’d only give me the phone number of the Oxford booking office, I needn’t trouble the Birmingham people at all, I suggested.

I must be joking, I was told. They couldn’t go giving out the phone numbers of railway stations up and down the country. What was I thinking of?

“No-one is allowed to give out any station phone number in the UK due to security reasons,” I was informed.

“If you start giving out train station phone numbers people will start making bomb threats and the whole rail network will collapse completely.”

Then he added the clincher: “And when the whole rail network collapses, there’s no chance whatsoever of your nephew getting a train from Oxford to Birmingham.”

“That,” the National Train Enquiries man told me with an air of triumph, “Is why you can’t start giving out train station numbers.”

Well I suppose he must have a point. Imagine how much mayhem could be caused by a hoax bomb call to Oxford station.

I suppose any self-respecting hoax terrorist wouldn’t simply phone National Train Enquiries and issue a hoax to them instead. Maybe National Train Enquiries would ignore it whereas the good folk in Oxford would take it seriously.

Anyway, it may well be that National Train Enquiries have a better understanding of the hoax-terrorist mentality than the rest of us, so we must respect their concerns.

That still leaves my nephew in Oxford and me with no way of getting him to Birmingham that doesn’t involve considerable inconvenience to yours truly.

It would be easier, cheaper and more comfortable if I simply drove to Oxford, picked him up and drove home again. No hidden surcharges, no to-ing and fro-ing between railway station booking offices, and change from £60.

It’s not all the railways’ fault. He should have had some money or have arranged, in advance, for me to transfer some into his bank account (assuming it wouldn’t simply get swallowed up by his overdraft).

But surely the railway system has had to deal with stranded, penniless passengers in the past and divined some method of getting them to their destinations while allowing someone else to pay the fare.

I discovered later, via the internet, that First Great Western’s “Silk Arrangement for a stranded passenger must be done at a station or via our Aftersales Team on 08457 000 125. Please note that only Standard Open Single tickets may be purchased in this event and a £10 administration fee will apply.”

So you don’t have to present yourself at a railway station after all. Pity they don’t know that at National Rail Enquiries or does this only apply to First Great Western? Who knows?

Why “silk”? Can’t find out. My guess is it stands for something like “Stranded In Location, Knackered.”

If it's good enough for Boris....

Cripes! Crikey! I say old chap! It looks as if Boris Johnson is turning into Ken Livingstone.

Forcing local Tory associations to take the candidate imposed on them by Conservative Party headquarters is one thing.

But forcing everywhere north of Watford to do without a regional development agency while protecting London’s is something else entirely.

The internal politics of the Conservative Party only matters to the activists.

The central control of candidates – including the imposition of all-women shortlists in safe seats – is bizarre given that David Cameron claims to support “localism” and wants to devolve power.

But this little local difficulty pales into insignificance beside the news that the next Conservative Government plans to axe every development agency but London’s.

This crass piece of centralisation ought to infuriate just about everyone. Love development agencies or loathe them, there is absolutely no sense whatsoever in keeping London’s and getting rid of the rest.

Of all the places in Britain which needs a development agency the least, it is London.

Our capital city already enjoys the best of everything – public spending included. It has the jobs, the Head Offices, the foreign investment, the transport infrastructure, the decision-makers, everything.

Any sensible Government would cut spending on London in order to redress the balance a little between the capital and the country.

So imagine the outrage – and outrage is certainly the right word – when Geoffrey Clifton-Brown announced to an audience of Brummies that he would certainly abolish Advantage West Midlands and all the other provincial RDAs – but retain London’s.

He told a conference at Aston University: "By and large the RDAs are going to be abolished. They have a number of roles we are examining in detail to see how they can be delivered.

"We need some small teams on the ground in key cities but only small teams."

Challenged on why London would keep its RDA, Mr Clifton-Brown said only: "That's the position at the moment."

"Where we can, we will bring all these services to the county council and district council. We believe development agencies are an unnecessary and expensive form of government," said Mr Clifton-Brown.

I was so gobsmacked that at first I wondered if I had heard him properly. They’ll keep London’s RDA and axe the rest.

The explanation seems to be that London’s structure – with Boris Johnson as its elected Mayor – means its RDA can’t just be done away with like everyone else’s.
For a start, Boris wouldn’t wear it, apparently.

But if – and I admit it’s a big if but even so – if London needs an RDA then it is unarguable that the provinces need them too.

It’s hard enough for those of us North of Watford to compete with London as it is. Pouring even more money into the capital while draining it away from the regions is inexcusable.

Advantage West Midlands has never been particularly popular and it’s often fairly incapable – especially in the hideous saga of its handling of the Business Link franchise for the region.

Even so, it does some good service to the region and if it were axed, some of its work would still need to be done.

The news that the “localism” of Cameron’s Conservatives doesn’t actually extend beyond the boundaries the area where MPs can’t claim second-home allowances, has not gone down well in the West Midlands.

One top banana in the West Midlands told me immediately after the Clifton-Brown debacle: "This conference is all about how the West Midlands economy is harder hit by the recession than anywhere else in the country.

"This man comes down from London with no thought for his audience in the West Midlands and announces that the capital city - with all its wealth - will be the only place in the country to retain a development agency.

"This is a terrible own-goal by the Conservatives. They really do need to think again about this."

Another said: "He has just destroyed the Conservatives' credibility. Of all the places to keep a development agency, why London? That's the last place which needs it."

It is difficult to understand why Mr Clifton-Brown, who is MP for the Cotswolds which are not a million miles away from Brum, was quite so cavalier with his remarks.

Surely he must have realised that telling Brummies they would once again be treated as London’s poor relations was not a way to win friends and influence people?

It’s true that a row about the fate of a few quangos will not affect many votes let alone the result of the General Election.

Even so, the Conservatives would be wise to think again. If this is the shape of things to come, Mr Cameron’s “localism” will be laughed out of court.

And he will perpetuate sense that there are still “two nations” – the haves of London and the have-nots from everywhere else.

Even natural Conservatives – which most business people remain – were astounded by Mr Clifton-Brown’s news.

It is difficult to imagine this wheeze will be any better received in the other English regions.

Already at a disadvantage compared with the wastefully expensive Scottish Parliament and Welsh Assembly, Mr Cameron will simply fuel resentment, suspicion and demands for real devolution to the regions.

The substitute – giving power to local councils or groups of them – won’t work. Certainly not in the West Midlands probably not anywhere else either.

One out, all out. London’s RDA has to be the first to go. Set a good example to the rest of us.

And if Boris demands its retention because, for some reason, he thinks it’s vital to the future prosperity of his empire then how can anyone argue against RDAs for the rest of the country?

Scrappage works - and proves the case for low taxes

If you ever needed proof that lower taxes are good for the economy and still bring in lots of loot for the Treasury, look at the car scrappage scheme.

Of all the Government’s ruses to dig us out of the hole Gordon Brown and the banks dug for us, the decision to knock £2,000 off the price of a new car when you trade in an old banger was probably the best.

Car sales in September, a boom month because it’s when the registration plate changes, were up 11 per cent on last year, which is pretty impressive during the depths of a recession.

In September 2008, car dealers managed to shift 331,467 new vehicles. This year, the figure is 357,929.

Of these, 77,316 were sold under the scrappage scheme where the Government knocks a grand off the tax and the dealer cuts the price by the same amount as long as the buyer trades in a car over 10 years old and it’s immediately crushed.

My niece, who was driving around in an L-reg VW Polo she bought from a cousin for £350, was faced with a huge bill to get it through its MoT test.

It made much more sense to trade it for a brand new, very smart and really quite sophisticated, bottom-of-the-range Fiat 500.

Thanks to the upsurge in demand for little cars, it took three months to arrive but when she drove it away from the showroom on Monday, she thought it was worth the wait.

Without the scrappage scheme, there would have been no chance of her buying a new car. And that’s obviously true for thousands of other people as well.

Critics complain it’s really only helping foreign car-makers. But, despite my niece’s purchase, car production in this country hit a 56-month high in August.

Believe it or not, we do still have a successful car-manufacturing industry which employs 280,000 people.

Indeed, the automotive sector as a whole – including sales and servicing – employs no fewer than 780,000 people. That’s a lot of jobs.

As a result of the scrappage scheme, Nissan in Sunderland took on 350 employees, having made 1,200 redundant in the depths of the recession.

Mini's Oxford plant is working a seven-day week; Toyota in Burnaston, Derbyshire, returned to full-time production for two months; Honda in Swindon re-opened; Ford’s engine plants at Dagenham and Bridgend have been working overtime.

It’s not exactly boom time for the British car industry but it’s miles better than it was nine months ago.

The Government set aside £300 million to pay for the scrappage scheme and later bunged in another £100 million to meet the growing demand.

But these figures are not what they seem. In the long run, it is almost certain that the Treasury will actually make money from the scrappage scheme rather than lose it.

I’ve done the sums. It’s complicated but I reckon that in September 2008, the Treasury took a total of £1,046 million in tax from the sale of new cars.

This September, with lower VAT and the scrappage scheme accounting for 21 per cent of sales, the total tax take comes to £1,002 million.

In theory, the Government lost £77 million by knocking a grand off the tax on each car bought under the scrappage scheme.

In reality, it cost the Treasury just £44 million – the cut price helped increase sales dramatically.

It’s fair to assume most cars sold under the scrappage scheme wouldn’t have been sold at all without the price cut.

Even so, that still leaves the Treasury out of pocket to the tune of £44 million in one month.

But then you’ve got to look at what would have happened to the motor industry if the scheme didn’t exist. Car sales could be down dramatically, instead of up.

And declining sales mean fewer jobs. Each person on average income who stops paying tax because they are out of work and starts receiving benefits instead costs the Treasury £14,000 a year.

The lost tax income and the increased benefit costs soon add up – it’s one of the main reasons why the nation’s finances are in such a terrible state.

If the scrappage scheme kept five per cent of all automotive industry workers in their jobs for the month of September, they would have benefited the Treasury to the tune of £45.5 million.

And that would mean the Treasury was making a profit of £1.5 million for the month.

I grant you these back-of-an-envelope sums may not be perfect (see below). But they do show that lower taxes work.

They have clearly stimulated car sales at a time when it was desperately needed. As a result, they have kept people in jobs who might otherwise have been thrown onto the ever-lengthening dole queues.

And – miracle of miracles – the Government has not actually lost out financially either.

Now all we need is a politician willing to accept that less means more and we could look forward to a thriving low-tax economy which supports growth in public spending.

Unfortunately, they’re all too busy arguing about their expenses to notice.

In maths exams, you always had to "show your workings", so here goes:

Can the Government break even on the scrappage scheme? This is how I worked out the sums. They make a lot of assumptions and may be incorrect – but I reckon they go a long way towards showing that the scheme not only pays for itself but that lower taxes not only boost the economy but do no harm to the Exchequer.

In September 2008, car sales totalled 330,295. (http://www.am-online.com/NewCarSalesFigures/)

In September 2009, car sales totalled 367,929 of which 21 per cent, 77,313, were sold under the scrappage scheme. (http://news.bbc.co.uk/1/hi/business/8292157.stm)

To calculate the tax, I have assumed that the average price paid for a new car is £14,000. This is based on a figure published in the Guardian last year (ie before the scrappage scheme came into effect and therefore before, in theory, the average price fell) (http://www.guardian.co.uk/money/2008/jun/16/motoring.consumeraffairs)

Given that VAT in 2008 was at 17.5 per cent and it is now at 15 per cent, I have assumed all calculations at the prevailing rate. In both years, the tax is the cost of the car, plus 10 per cent, plus VAT.

If the total purchase price is £14,000, the tax payable is: £3,169 (with VAT at 17.5 per cent). (The basic price being £10,831 plus 10 per cent (£1,083) = £11,914.10. Add in VAT and it comes to £14,000.

Thus in September 2008, the tax take from new car sales was £3,169 per car x 330,295 = £1,046,704,855.

In September 2009, the tax take on a £14,000 car would be £2,933. Thus the potential tax take would have been £2,933 x 367,929 = £1,079,135,757.

However, the estimated tax take is reduced by £77,313,000 (ie £1,000 per car purchased under the scrappage scheme). This brings the tax take down to £1,001,822,757.

As a result, the apparent shortfall between the tax take in 2008 and 2009 is £44,882,098.

It follows that the apparent cost to the Treasury of £77 million has actually been cut to £44 million.

However, the boost to the economy provided by the additional sales has an immediate impact on jobs. Of course it is difficult to calculate with any accuracy the true extent of that impact.

For instance, we cannot say that all 77,000 new cars sold under the scrappage scheme would not have been sold if the scheme did not exist. However, given the poor state of the new car market in recent months, it is reasonable to assume that most of these vehicles would have stayed in the showrooms without the scrappage scheme.

In fairness, fleet sales have been stimulated by the threat of VAT reverting to 17.5 per cent (or even going up to 20 per cent) but even so, we have to make some assumptions about the impact on the motor industry if the scrappage scheme were not in place.

According to the SMMT (see below) there are still 780,000 people employed in the motor industry. It is reasonable to argue that some of these people would have been laid off if the lower tax regime for some new cars had not been in place.

According to a National Employment Panel report (see below), the cost of someone switching from employment on average pay to unemployment and benefits is £14,355 to the Treasury in lost income from direct and indirect taxes plus additional expenditure in benefits. This works out at £1,166 per person per month.

Thus to account for the £44 million tax shortfall, the scrappage scheme would need to have secured work for 37,700 people for the month of September.

That sounds like quite a lot but it is actually only 4.8 per cent of the motor industry workforce.


Notes:

Employees in manufacturing:
http://www.autoindustry.co.uk/statistics/manufacturing/Employees

Employees in sales and parts
http://www.autoindustry.co.uk/statistics/Retail/Number%20of%20Employees

The cost to the Treasury is based on the statistics to be found in a case study report prepared for the National Employment Panel (www.northeastiep.gov.uk/.../CEI%20-%20Amion%20Case%20study%20report.pdf) which includes a table analysing the costs and benefits of employment compared with unemployment. This shows:

Earnings £22,170 Annual Survey of Hours and Earnings average gross earnings
Taxable pay £17,275 Above less personal allowance
Monthly £1,847 Gross earnings per month
Taxable £1,439 Taxable earnings per month
Tax £308 Tax tables PAYE per month
NI total £343 Employer and employee's NI contributions per month
Annual tax, NI £7,814 Total tax, NI, per year based on gross earnings
Net pay £14,355 Net pay before tax credits
Tax credits (2 kids, non-working wife) £2,839
Total tax, NI less tax credit £4,975 Tax take less tax credits
Indirect taxes £2,656 VAT, excise etc (assumption)
Total Tax, NI , VAT, less tax credit £7,631

Benefits £6,388 DWP accounts - benefit and admin spending per
working age claimant (ignoring spending on children)

Total exchequer benefit per annum £14,019

Thorough and fair?

Quite rightly, the controversy over all-women shortlists for the selection of Conservative parliamentary candidates will not go away.

As a contribution to the debate, I thought it worth drawing attention to the Conservative Party's guide for potential candidates:

"Local constituency associations have the final say in who they choose as their candidate. They will interview applicants, and through their own selection process, decide upon their chosen man or women. The process is thorough and fair, and allows every applicant to present themselves to the best of their ability. Associations want to find out about the real you. You will be required to make a short speech and answer questions. The most important thing is to be honest and to explain what skills you have that would make a good MP."

Make bankers invest in the real world

Here’s an answer to the bank bonus business – please tell me why it wouldn’t work.

We discovered a year ago that we need profitable banks. Yet the massive bonuses now being paid to some of their staff are beyond objectionable.

They are a slap in the face for every SME that’s struggling to survive in the teeth of a bank-led crackdown on the availability of working capital.

So here’s a solution.

Make the recipients of the bonuses invest their money for five years in British SMEs.

We can’t allow the fat cats to walk away with their ill-gotten gains, especially those who are employed by bailed-out banks now more or less completely owned by the taxpayer.

Yet it would probably be wrong to deny them their money, given that they are responsible for boosting these banks’ profits.

The problem exercising politicians and regulators is how to curb this excess.

Lord Myners, the Treasury minister, has summoned Deutsche Bank, JPMorgan, Goldman Sachs, UBS and Morgan Stanley to a meeting to discuss a clampdown. Barclays, HSBC, RBS, Lloyds and Standard Chartered have already been hauled over the coals.

But most solutions seem unworkable in practice.

A windfall tax on the banks themselves is tempting but it would do more harm than good as it would deny shareholders a dividend and/or delay the restoration of the banks’ balance sheets.

Let the bankers have their money but, above a nominal sum of, say £5,000, force anyone in receipt of a bonus to invest it in a national turnaround fund for SMEs.

If the fund succeeds, and the businesses survive, then the bankers would get their money back in five years’ time.

If it does especially well, they could see their capital increase and that would be their reward for supporting the SMEs which have been abandoned by their employers, the banks.

If it fails, they lose their money then they are no worse off than they would have been if the bonuses were somehow banned altogether.

Better still, these bankers would immediately have a personal financial interest in the health of the national economy and the SMEs which feed it.

Indeed, given that they are supposedly so clever their talent would allow them to move elsewhere if they were denied big bonuses, they would be free to offer their talents to the SMEs they invested in.

They would become, by default, active business angels. And that, in itself, would help to sort the talented from the chancers.

This need not be an expensive scheme. All over the country, regional development agencies have established modest turnaround funds to help SMEs survive when the banks have refused them any more money.

The one I know best is the Advantage Transition Bridge Fund in the West Midlands. It has received £9 million of taxpayers’ money and invested the lot. It has run out of cash.

The people in charge say they will eventually get the money back and, in the meantime, they have saved several thousand jobs.

Because the fund is out of cash, it cannot now help any more companies. But there is no doubt more help is needed.

One reason is that the tax “holiday” generously provided by Her Majesty’s Revenue and Customs has now come to an end.

HMRC now wants to collect what is owing. Unfortunately, some companies do not have the ready money. They have depended on the tax holiday to survive.

As a result, as one chartered accountant put it to me the other day, “HMRC has now become one of the country’s biggest sub-prime lenders”.

Now it’s payback time and a good many of the companies in debt to HMRC can’t pay. Without some other source of cash, they will go bust.

The banks won’t give them money so a new wave of company failures is likely.

However, if the bankers’ bonuses were invested in these businesses via a properly administered turnaround fund, they would be thrown a lifeline and given a chance of survival.

In the long run, this would benefit all of us – even the big-bonused bankers.

All we need is a simple piece of legislation.

Require employers paying bonuses over a certain sum (not just banks but any business offering what most people would see as excessive bonuses) to invest the money directly in turnaround funds, in the names of the appropriate employees.

Require the funds to support SMEs.

Permit the individuals to recover their money from the funds in five years’ time.

If the funds are in surplus, then divide the profits proportionately; if they are not, then divide the losses in the same way.

Of course, employers would want to get around the scheme, perhaps by offering staff massive salary increases instead of bonuses.

It would not be difficult to prevent that from happening by simply limiting pay rises among highly-incentivised employees to inflation plus a percent or two.

I can’t see anything wrong with this solution. It is workable and it is fair. It does not deny people their money but it requires them to put it to good use for the benefit of the real economy.

It even provides a link between the fantasy world of the fat-cat banker and the real world of the struggling business. It’s about time the two worlds collided.

The unholy Trinity

Once The Birmingham Post and the Evening Mail fell into the clutches of Trinity Mirror, they were doomed.

A series of appalling mistakes and misjudgements ensured the Post’s demise was hastened every step of the way.

The same happened at what I still call the Evening Mail, only there, the impact was even more hideous.

It was, after all, the Mail that kept the company profitable.

In recent years, the Post’s role was simply to survive so City investors were willing to stump up money. They liked the company because, to those who never saw it, the Post retained its reputation as a prestigious paper.

Trinity Mirror’s blight has now rotted away both papers and it is difficult to see where they can go from here.

The Post may survive as a weekly. If the owners actually wanted to do so, they could turn it into a very successful paper. I somehow doubt that they will, though.

As for the Mail, it will go to bed the night before it goes on sale and readers will be lucky if it even manages to include last night’s football results. It will be utterly changed, presumably in a bid to cut distribution costs and catch readers earlier in the day.

This looks doomed to fail.

The sad demise of the Post & Mail is not due to the slump in advertising revenue, changed demographics or competition from the internet. Or at least, not entirely.

These and other factors are hitting all newspaper publishers. They do represent a long-term challenge to the industry.

But why has the Post & Mail’s decline been so precipitate? Not because its journalists lack dedication or talent. Not because the city of Birmingham lacks an interest in local news. Not because of the competition from new media.

It’s been so sharp because Trinity Mirror never had a strategy for the company. It never had anyone with any interest in the city. Indeed, it seems never to have had anyone in charge with any affinity for the business of creating newspapers and communicating with readers.

In short, it is the result of ten years of rank bad management. The company deserves this dreadful day – the staff and the readers do not.

The company’s managing director John Griffith apparently broke the news to the huddled hacks by claiming it was only “the latest development in the proud history of the Post & Mail”.

When he invited questions, he was met with silence. That’s no surprise. As the representative of the absentee landlords, it is quite clear Trinity Mirror have got no answers.