Beware of the snake oil salesmen

The problem with new Labour is not so much its deep involvement with business as its ignorance of it. Distance lends enchantment. Patricia Hewitt at the Department of Trade and Industry is the only cabinet minister to have held a senior position in a private commercial company, Andersen Consulting, and then only for three years, after much longer periods with such bodies as the National Council for Civil Liberties and the Institute for Public Policy Research. Most ministers know far more about trade unions, think-tanks, lobbyists, local councils, schools, universities and the public sector in general than they know about the profit-making private sector. They know public sector bodies and public sector employees with all their warts; they know the vested interests, the petty squabbles, the Spanish practices, the lax management, the tiresome obsessions with procedure. Familiarity breeds contempt. Business, by contrast, is a strange and magical world that, as Tony Blair has observed, transmutes your former school chums into millionaires. Business produces doers, not wafflers; people who act first and account for themselves afterwards. Business can build; business can create something out of nothing.

The result is that ministers allow themselves to be dazzled by business people and fail to ask the right questions. In fact, sometimes they fail to ask any questions at all, as seems to have happened when Mr Blair signed a letter to the Romanian premier backing a foreign firm's bid to buy that country's steel industry. Yes, ministers have people to advise them, but there is no substitute for first-hand experience in getting to the heart of things. Look how quickly Estelle Morris, a former teacher, grasped what is needed for 14- to 19-year-olds in our schools; look how often Tories made a pig's ear of it, simply because they hadn't a clue about state education.

When it comes to choosing between business propositions, however, Labour ministers are no better than the average householder faced with fast-talking double-glazing or pensions salesmen. Strapped for money in their first term, because of their pledges not to raise taxes, they have fallen for a variety of get-rich-quick schemes, in the form of "partnerships" with the private sector to build hospitals and schools and to refurbish London Underground, as well as outright privatisations. Ministers thought they could pull a fast one by getting expensive investment schemes off the official balance-sheet. In reality, the private sector often pulls a fast one on them by ensuring that, if anything goes wrong, the bill nearly always comes back to the government. The devil is in the detail of these schemes: the extent to which risk has been truly transferred to the private sector may only become apparent after many years.

The part-privatisation of air traffic control, however, has hit trouble very quickly, with the banks demanding £30m from the government (and very probably more eventually) just to keep the operation afloat. It is argued that nobody could have foreseen the disastrous effects of 11 September on airline travel. This is piffle. Air traffic is notoriously vulnerable both to economic recession and to international conflict; a combination of the two is lethal, as the early 1990s showed. The ability to withstand economic or geopolitical shocks should have been integral to any privatisation scheme. Politicians may wish to deceive the rest of us that happy, affluent, expansionist times can go on for ever, but there is no reason why they should deceive themselves.

Alarm bells should have rung in ministerial heads when BAE Systems withdrew from the list of buyers, saying that it wouldn't take over National Air Traffic Control Services (Nats) even if it had been offered free of charge. In the end, 46 per cent of the shares were sold to the airlines, so that nearly half the new company was owned by the people who were also its customers. Thus, all the normal routes for stabilising a troubled business were blocked. Cut costs on a large scale, and the system risks becoming unsafe. Raise prices (ie, landing charges) and the owners (the airlines) get themselves into even deeper trouble. Try to borrow, and the banks will say that they see no reason to lend more money to such a cock-eyed set-up unless the shareholders themselves put a bit in. And - guess what? - the only shareholder in a position to do that is the government.

The whole thing is not (so far) quite as big a disaster as it sounds, because the cost to the taxpayer might well have been greater if the system had remained wholly in the public sector. And since safety is as important to the private shareholders as to anybody else, there is little chance of another Railtrack. But ministers should be less trusting about the benefits of private sector involvement, and regard business people with the same wary eye that they regard, for example, the leaders of the public sector unions. Just occasionally, they may conclude, the public sector will give them a better, more straightforward and more honest deal.

The workers' kilo is deepest red

Did the ancient Romans, as their empire declined, cling stubbornly to their ridiculous numbering system, which made anything beyond the simplest addition sums almost impossible? Did they hold out for their heritage of Ls, Cs and Vs? Did they have their numeral martyrs as we have our metric martyrs? History does not record, but the Daily Mail columnist Melanie Phillips explains that we should resist metrication lest we are seduced by the "abstract thinking" of Continental revolutionaries. The English, she writes, prefer "the familiar and the useful"; the yard, for example, being "the distance from the nose to the outstretched fingertip of King Henry I". Even in the most elevated circles, it is not easy now to find a monarch on hand as one goes about, say, designing a garden. But the logic is clear: measurement, to her, is a privilege that should be confined to the elite. Ms Phillips has illuminated the battle between imperial and metric measurements: like most things in life, it is a class issue.