ALEX BRUMMER: Don’t mock Musk… the UK could do with someone like him

Elon Musk is regarded by critics as a chump with politically incorrect views. He is also a genius with a futuristic imagination.

His embrace of Tesla, electric vehicles and autonomous driving alone would be enough to define him.

He is also a planetary pioneer through SpaceX, an innovator on subterranean rapid transport via the Boring Company and founder of Neuralink, which is experimenting with inserting micro-processors in the brain.

Musk is disparaged for value destruction at his £38billion ‘hobby’ purchase of Twitter and the decision to subject himself to the votes of users. They chose to oust him as chief executive in a Twitter poll in which 10m users voted.

In rare bout of boardroom honesty, he has declared he will resign when he finds ‘someone foolish enough to take the job’.

Working with such a mercurial proprietor could be tricky. But in his inimitable way Musk could become a corporate governance pin-up.

In publicly quoted companies, the electorate tends to the institutional investors who in the UK are driven by short-termism and quick-fire returns. 

Such attitudes have seen great swathes of the UK economy sold to foreign buyers, the diminution of the FTSE 350 vis-a-vis rival European exchanges and shareholder interests trumping those of the workforce, consumers and other stakeholders.

Imagine if the Musk model, giving consumers a say in boardroom affairs, were to be more widely adopted.

The only example which comes to mind is when Marks & Spencer’s army of small investors, who also happened to be customers, rose up in unison against the 2004 effort by Philip Green to add M&S to his now defunct BHS and Topshop empire.

Many companies take pride in parading client service surveys showing 90 per cent support. Most of these are self-validating and defy statistical standards. 

If customers really had a say regarding service levels at BT and the snail’s pace of fast fibre roll-out, compared with the rest of Europe, then chief executive Philip Jansen might feel obliged to resign. 

Bank chieftains who value the economics of branch closures above the customer needs of small businesses, the elderly and infirm would also be looking to their laurels.

Energy supplier Greg Jackson of Octopus, who has been antagonistic to ring fencing customer cash, would be out on his ear.

The UK firm that imbibes the spirit of Musk, by giving customers or users a voice, could spark a governance revolution.

Public interest

The obvious lesson to be drawn from the latest official data on government borrowing is that Downing Street can ill-afford to bow to the pressure of NHS and other public sector unions by meeting demands for double-digit pay awards.

The impact of the Ukraine war, energy prices and inflation are the main reasons why borrowing climbed to £22billion in November. 

The public purse is picking up the cost of the energy price guarantee for households and assistance for business.

The least well off in society pay the biggest price for inflation because food and heating costs are a larger part of their budgets. 

Yet in spite of the hard luck stories from food banks, it is not entirely a case of benign neglect. Welfare payments are rising with the cost of living and were £3.3billion more in November 2022 at £13.2billion than a year earlier.

The elephant in the room that has long concerned the Treasury is the rocketing cost of interest payments. 

As the Office for Budget Responsibility has pointed out, the UK is the only Western democracy that has tied a quarter of its interest payments on the national debt to the retail prices index (RPI). 

Yes, that is the outdated RPI when the Bank of England targets the consumer prices index (CPI) which is mostly lower.

The mystery of who is responsible for this debacle is buried somewhere in Whitehall. There is an overwhelming case for a deeper probe by the Treasury Select Committee.

Vacating plans

Tough times lie ahead for the travel industry in 2023.

The Retail Economics tracker found that 70.7 per cent of consumers plan to curtail holiday plans with almost one-third cancelling altogether amid a squeeze on disposable incomes. 

It should be no surprise the most affluent, some 13.4 per cent of those surveyed, plan to take to the skies and the high seas as if nothing has changed.

The rich are different.