You don't have Murdoch to kick around any more...

Murdoch gets huffy.

Rupert Murdoch insists that the decision to split publishing away from the rest of the News Corp empire has nothing to do with the hacking scandal.
But nonetheless, it is difficult not to be reminded of Richard Nixon’s last press conference when looking at the announcement. The disgraced US president memorably told the press: “you don’t have Nixon to kick around any more”.
And similarly, after a year in which Murdoch has faced a savage backlash from the politicians who spent so long courting him, he appears to be withdrawing from interest in the UK altogether.
Asked by US-based broadcaster Fox News whether he was pulling back from the UK he said: “No, but I would be a lot more reluctant to invest in new things in Britain today than I would be here.”
I’ve always defended Murdoch because of the huge amount he has invested in British journalism. There was something comforting about the fact that hundreds of millions made on films like Avatar were helping prop up the brilliant but massively loss-making journalism of The Times. Not any more.
Announcing the break-up of News Corp last week, he revealed he would not tolerate print losses anywhere: “Each newspaper will be expected to pay its way”.
The published accounts suggest Times Newspapers lost £12m in the year to July 2011, £45m in the year before that and £88m in the year previous to that. But the true figure could be even higher because the figures that reach Companies House provide only a partial account.
It is tempting to conclude that Murdoch subsidised his UK press operations to an extent because of the political clout they gave him, and now that clout has gone forever, he is going to run on them on less sentimental lines.
He will be chairman of both News Corp divisions but only chief executive of the entertainment division, which makes ten times as much money as the publishing side. This means that he must be planning to reduce his hands-on involvement in The Sun, Times, Sunday Times, Wall Street Journal and Australian titles.
Interviewed by Press Gazette seven years ago, Murdoch (then 74) appeared concerned about his legacy. He spoke about his pride at the union-smashing move to Wapping in 1986 which he said was an “absolute turning point for Fleet Street and the whole of the newspaper industry…I’m very proud of it and it will be part of my legacy.”
It now looks like Murdoch’s hands-on launch of the Sunday edition of The Sun in March was his last throw of the dice in the UK newspaper market. It is a remarkable story which began with his acquisition of the 6 million-selling News of the World in 1968 and which may now conclude with the sell-off of the unrivalled newspaper empire he has built up.
Newspapers, and journalism operations full-stop, always seem to do better when they are run by someone with a long-term vision which extends far beyond the immediate bottom line. Hence the success of the likes of Murdoch and Rothermere versus the managed decline at Trinity Mirror and Express Newspapers where titles appear to be seen as short-term cash generators.
If that ethos is now to extend to the NI titles, then Murdoch’s exit from the UK journalistic stage will be a sad day for Fleet Street.

This article first appeared in Press Gazette.

Murdoch, Photograph: Getty Images

Dominic Ponsford is editor of Press Gazette

Photo: Getty Images
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There are risks as well as opportunities ahead for George Osborne

The Chancellor is in a tight spot, but expect his political wiles to be on full display, says Spencer Thompson.

The most significant fiscal event of this parliament will take place in late November, when the Chancellor presents the spending review setting out his plans for funding government departments over the next four years. This week, across Whitehall and up and down the country, ministers, lobbyists, advocacy groups and town halls are busily finalising their pitches ahead of Friday’s deadline for submissions to the review

It is difficult to overstate the challenge faced by the Chancellor. Under his current spending forecast and planned protections for the NHS, schools, defence and international aid spending, other areas of government will need to be cut by 16.4 per cent in real terms between 2015/16 and 2019/20. Focusing on services spending outside of protected areas, the cumulative cut will reach 26.5 per cent. Despite this, the Chancellor nonetheless has significant room for manoeuvre.

Firstly, under plans unveiled at the budget, the government intends to expand capital investment significantly in both 2018-19 and 2019-20. Over the last parliament capital spending was cut by around a quarter, but between now and 2019-20 it will grow by almost 20 per cent. How this growth in spending should be distributed across departments and between investment projects should be at the heart of the spending review.

In a paper published on Monday, we highlighted three urgent priorities for any additional capital spending: re-balancing transport investment away from London and the greater South East towards the North of England, a £2bn per year boost in public spending on housebuilding, and £1bn of extra investment per year in energy efficiency improvements for fuel-poor households.

Secondly, despite the tough fiscal environment, the Chancellor has the scope to fund a range of areas of policy in dire need of extra resources. These include social care, where rising costs at a time of falling resources are set to generate a severe funding squeeze for local government, 16-19 education, where many 6th-form and FE colleges are at risk of great financial difficulty, and funding a guaranteed paid job for young people in long-term unemployment. Our paper suggests a range of options for how to put these and other areas of policy on a sustainable funding footing.

There is a political angle to this as well. The Conservatives are keen to be seen as a party representing all working people, as shown by the "blue-collar Conservatism" agenda. In addition, the spending review offers the Conservative party the opportunity to return to ‘Compassionate Conservatism’ as a going concern.  If they are truly serious about being seen in this light, this should be reflected in a social investment agenda pursued through the spending review that promotes employment and secures a future for public services outside the NHS and schools.

This will come at a cost, however. In our paper, we show how the Chancellor could fund our package of proposed policies without increasing the pain on other areas of government, while remaining consistent with the government’s fiscal rules that require him to reach a surplus on overall government borrowing by 2019-20. We do not agree that the Government needs to reach a surplus in that year. But given this target wont be scrapped ahead of the spending review, we suggest that he should target a slightly lower surplus in 2019/20 of £7bn, with the deficit the year before being £2bn higher. In addition, we propose several revenue-raising measures in line with recent government tax policy that together would unlock an additional £5bn of resource for government departments.

Make no mistake, this will be a tough settlement for government departments and for public services. But the Chancellor does have a range of options open as he plans the upcoming spending review. Expect his reputation as a highly political Chancellor to be on full display.

Spencer Thompson is economic analyst at IPPR