#british retail consortium
British Retail Consortium s clever game as it tackles business rates
No tax is popular but few company levies have proved as contentious as business rates with the exception, perhaps, of Air Passenger Duty. However, finding ways to reform the controversial levy on commercial property, which accounts for around 5pc of the country s total tax take, was never going to be a straightforward task.
Retailers clashed last year following calls by some for an online sales tax to level the playing field between internet companies and those that focus on selling their products through bricks and mortar stores. Other alternatives, such as increasing VAT, would be political suicide for any party in the run-up to the general election.
Against that backdrop, John Rogers, chief financial officer of J Sainsbury, took on an unenviable task when he agreed to chair a group of retailers looking at how the outmoded business rates system could be brought into the 21st century.
The four options set out on Tuesday by the group of British Retail Consortium (BRC) members are only embryonic the serious work of economic modelling will take place over the next few months. But the group s approach to the puzzle seems astute.
By framing the four options in the politically palatable light of supporting businesses that focus either on reducing energy consumption, increasing employment or make a large contribution to the corporation tax chest, the BRC group is playing a clever game.
Within all of those options there is a juicy soundbite in the making for politicians who want to point out to their constituents that they want to help local businesses, by scrapping or reforming the unpopular business rates system in favour of a scheme that could lead to more local jobs or reward businesses that pay their fair share of UK corporation tax.
Some of the options present new hurdles manufacturers have already given a frosty response to proposals for an energy-based tax but hats off to the BRC for bringing some fresh and big ideas to the table.
Laudable search for feedback at the Co-op
At first glance, Euan Sutherland s decision to ask the great British public what it wants and expects from the Co-operative Group is somewhat questionable.
For here is an organisation that has spent much of the past 12 months in the headlines for all the wrong reasons. From banking black holes to vulture funds or alleged drug-taking Methodist ministers, the Co-op has had it all.
And yet here it is, asking people who might have nothing to do with its shops or insurance business its questionnaire is open to all what it has done wrong. Given that the only criteria for the survey is to be over 16 and even that is not verified by the YouGov website that runs it the potential for high jinks and tomfoolery is high. In that light, Mr Sutherland s vow to publish the findings warts and all could yet come back to haunt him.
But, in reality, what Mr Sutherland is trying to do is laudable.
For too long, the Co-op has been beholden to a byzantine structure of governance apparently kowtowing to what the members want without actually asking them.
A separate review by Lord Myners will help to blow the proverbial cobwebs from a governance perspective, but arguably the Co-op hasn t known what its members want for some time.
Too few of its 7.8m members actually bother to vote in elections for its area committees, and less than 5pc voted on some resolutions at its last annual meeting.
Mr Sutherland, who admittedly hails from the public company arena, is grappling with how to recast the Co-op for a truly modern age. He can draw up all the strategy reviews he likes, but without knowing how this uniquely customer-owned organisation wants to redistribute its profits or be seen to the wider world, he is on a hiding to nothing.
The Co-op divi of old may well be dead, but that doesn t mean that the UK s largest mutual shouldn t be a force for good in the communities in which it operates.
Tech City faces a wait for its first flotation
The past two days have provided harsh lessons on the challenge Britain faces in its effort to create a bigger, sustainable technology sector.
Plans by King, the London-based creator of the wildly popular smartphone game Candy Crush Saga, to float on the Nasdaq have received a cool reception. As The Telegraph revealed on Monday, the company s initial public offering is now on hold for at least a year, and may never happen.
Similarly, it is now clear that Mind Candy, the creator of the children s online game Moshi Monsters, is a long way short of being a credible flotation candidate. Interest in the game has plunged and the company has been slow to adapt to the increasingly mobile online audience.
Named in the Future Fifty , a Government-backed initiative to help British technology start-ups make it to the public markets, Mind Candy now lacks a growth story to sell.
Yet the main problem with both King and Mind Candy, as far as public markets are concerned, is more fundamental even than that.
Both companies rely on one hit game as the basis of most of their business. These are not technology companies, although they are sometimes presented and misunderstood as such. They have not invented a tool like Google s search engine or even a service like Facebook that the world will use for years and can be built upon as a business.
Instead, King and Mind Candy are media companies with more in common with a film producer, except they have both so far had only one major box office success. No matter how popular Candy Crush Saga and Moshi Monsters are, or were, they cannot alone be the basis of sustainable public companies.
Investors were therefore right to shy away from King until it can prove it can repeat its trick. It seems natural that the structure of the mobile and online gaming industry will come to resemble the TV and film industries, with small, creative companies supplying the steady stream of hits the big studios and their investors demand. King still has the chance to become one of those big studios, of course.
But King and Mind Candy s problems are blows to Tech City, the technology cluster around Shoreditch, east London, where both are based. Most start-ups there fit into their digital media mould more than that of US technology giants. The cluster could be waiting for its first flotation for a while yet.