Bank governor in balancing act

IN some respects, the globally-respected Mark Carney could not have chosen a better time to become governor of the Bank of England. House prices are rising, car sales are increasing and manufacturing output is on the up – three key barometers of prosperity.

Yet, while it would be premature to say that Britain is now enjoying a boom, as some over-optimistic commentators have contended, the arrival of the fresh-faced Canadian contrasts with the departure of his predecessor Sir Mervyn King.

Now Lord King after being enobled on his retirement, he endured an uneasy relationship with taxpayers after failing to foresee the scale of the financial crisis before struggling to come to terms with the ramifications of the bank bailouts as each prognosis became more pessimistic.

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Yet, while Mr Carney earned many plaudits for navigating Canada’s economy through the downturn, the task that he inherits is still a formidable one as politicians strive for sustained growth to run parallel with the next phase of their long-term remodelling the public sector.

In this regard, Mr Carney was replicating Canada’s economic growth model when he said that interest rates will remain at a record low until unemployment falls below seven per cent. He hopes a longer-term outlook will encourage wealth-creators to invest in Britain, and that further reductions in the jobless rate hold the key to improving the nation’s prosperity.

However it is not a risk-free strategy. If the Bank has to deviate from its forward guidance policy because of an unforeseen occurrence, such as another crisis in the Eurozone, it could erode the personal credit that Mr Carney is building up.

With interest rates still low, inflation hovering just under three per cent and the Treasury trying to stimulate growth through its Funding for Lending Scheme and initiatives allied to the property market, these conditions are not conducive to savers – and attempts to persuade people to save for their retirement. As the respected economist and regular Yorkshire Post contributor Dr Ros Altmann pointed out yesterday, this is a hidden cost of current policies that cannot be ignored.

A tirade that will embarrass Ukip

EVEN though Godfrey Bloom was unrepentant in a tetchy and ultimately ill-tempered interview after accusing beneficiaries of overseas aid in “Bongo Bongo Land” of squandering taxpayers’ money on luxuries, his offensive choice of words has clearly caused great embarrassment to the UK Independence Party.

Not only was Mr Bloom – Ukip’s MEP for Yorkshire and the Humber – ordered to refrain from using distasteful and archaic language that panders to the prejudices of aid sceptics, his outburst undermined the party’s attempts to distance itself from the “fruit cakes, loonies and closet racists” caricature that senior Tories, including David Cameron, have painted of it.

This is not the first time that Mr Bloom has embarrassed Nigel Farage’s party. Nor is it likely to be the last, given his apparent readiness to play the role of the political buffoon. Others, meanwhile, will regard this as a publicity stunt to counter Ukip’s dip in the polls.

As well as having the potential to offend people of all races, a misjudgment compounded by increasingly irritable media interviews devoid of humility, Mr Bloom’s provocative language distracts attention from his key argument – whether Britain’s aid spending is sustainable in these austere times.

It is an issue worthy of future debate – even more so after the revelations about the scale of executive pay in the charity sector – but this tirade will neither further that debate nor assist Ukip’s efforts to be taken seriously as a credible force in British politics.

Airport lift-off: Passengers deserve a better service

THE extent to which Leeds Bradford International Airport defied gravity by welcoming three million passengers in the past year, and at a time of continuing economic turbulence around the world, illustrates how competition between airlines has helped to make flying affordable to the masses.

Yet, while LBA is right to celebrate this landmark as it looks to introduce flights to new business and holiday destinations to compliment ongoing improvements to its terminal facilities, its bosses should note the disquiet among those travellers – judging by the frequency and tone of critical letters to these pages – who contend that the ‘passenger experience’ does not compare favourably with other airports.

This needs addressing; one of the recurring themes in this correspondence is the apparent reluctance of LBA, or the airlines, to face up to these criticisms when they are made.

But another equally pertinent point needs to be made if this airport is to enjoy a sustained lift-off in the next decade. Progress needs to be made on transforming transport links to the airport from those parts of Leeds, and West Yorkshire, where it can be quicker – and more convenient – for passengers to fly from Manchester. In short, it is time for words and promises of the past to be put into action to secure the airport’s future.