CUTTING ROOM: Diana Tremblay, a sad loss for Luton; just how pricey is London?; Norway's minister shows the way; the ECB hit the right note after all ... Evan Davis at large

CUTTING ROOM: Diana Tremblay, a sad loss for Luton; just how pricey is London?; Norway's minister shows the way; the ECB hit the right note after all ... Evan Davis at large - Spare a thought for Luton. To date, it's been famous for two things - its sligh

by EVAN DAVIS, ECONOMICS EDITOR OF THE BBC
Last Updated: 31 Aug 2010

Spare a thought for Luton. To date, it's been famous for two things - its slightly hick airport and its car plant. Sadly, after this month the latter's long-awaited closure occurs. There'll be little fanfare as the last Vauxhall Vectra rolls off the production line; there's nothing to celebrate in saying farewell to one of the south-east's most important factories.

But lest you feel that all news about manufacturing is bad, let me report a striking feature of the Luton plant closure, since it was announced 16 months ago. The rundown of the plant has been handled in exemplary fashion. One might have expected that discipline would fall apart, manufacturing quality would collapse, productivity decline and that war would break out between unions and management.

Did that happen in Luton? Quite the contrary. Employees knuckled down; production quality rose; and management and unions co-operated and trusted each other.

At least some of that is down to the admirable plant manager, the diminutive American, Diana Tremblay. She took over at the plant on the day the closure was decided, so her time in Britain has been more tumultuous than she might have expected.

What lesson can one draw? In the boys' worlds represented by both cars and manufacturing, a woman's touch at the top may actually be an asset. It'll be a pity if Ms Tremblay leaves these shores and takes some other job in General Motors back in the States. We need the likes of her here.

One reason why car production may be on its way out around London is that the place is expensive to locate land-intensive work. Indeed, it's expensive to locate anything in the capital. But just how much more expensive is London?

Just on cue, out comes a little-publicised article by the Office for National Statistics in Economic Trends, 'Price Levels in 2000 for London and the Regions Compared with the National Average'. Just what I've been looking for.

But get this as a conclusion: according to the ONS, London prices in 2000 were only 6.8% higher than the UK average. Indeed, according to the study, package holidays for Londoners are 2% cheaper than average.

Well, I'm afraid the ONS rather let us down with these headlines. The Office excludes owner-occupied housing in the study. A rather important exclusion, one might say, as London house prices are 87% above the UK average, and it takes a lot of package holidays to compensate for that. Mortgage interest rates and council tax account for 8% of consumer spending nationally (far more for owner-occupiers). Take this into account and you have a London premium of more like 15%. Oh, and remove the capital from the UK average and London weighting should be nearer 18%.

Have I ever accused the Scandinavians of being boring? I fear I have, even in these hallowed columns. Well, let me apologise. I now hear Norway's finance minister, Per-Kristian Foss, has just married his male partner.

Amazingly, the whole episode was relatively uncontroversial. Indeed, there are about 100 gay marriages a year in the capital city of Oslo. And Foss himself is a conservative minister.

Clearly, Michael Portillo aside, the British Conservatives have a way to go down the tolerance road before they can be called pioneering libertarians.

I know I harp on about the euro, and that eminent economic commentators like Peter Hitchens accuse us at the BBC of being pro-euro in our coverage, but indulge me in one more retrospective piece about the changeover (the biggest economic story of my career).

Last year, those whose favourite sport is bashing the European Central Bank strongly argued for something called front-loading. They wanted notes to be sent out to the public ahead of 1 January, so that people were stocked up with the new cash before they went to the shops to spend them. It was a ferocious debate among banks, retailers and the authorities.

Well, what can we conclude now? The answer is the ECB got it right in not front-loading notes to the public. If people had notes early, they would have spent them ahead of time and there'd have been a phoney and confusing period before the official changeover, with old and new currencies in a twilight zone. So the authorities organised it right, and the critics should concede that the way it was done was the best way.

Sorry, Mr Hitchens, I'll try to think of something negative to say next time.

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