13 SEPTEMBER 2003, Page 33

The brothers plead their case to Mr Hoaxem and the gentleman in Downing Street

!the gentleman in Downing Street 'had to receive delegations, but loathed them. It was just like sham marching, he said — an immense dust, and no progress: To listen to their views! As if I did not know what their views were before they stated them! And then to put on a countenance of respectful candour! Were it not that, at a practised crisis, I permit them to see conviction stealing slowly over my conscience, I believe the fellows would never stop.' This gentleman, first sighted in Sybil, Disraeli's novel of the two nations, seems to be back in residence, and once again the delegations are plaguing him. He has had to receive two of them, with — as so often happens — mutually contradictory shopping lists. First came the brothers from the trades unions, needing to be placated before their conference this week. He had to persuade them that they were an estate of the realm, to be consulted before he embarked on his longpromised reforms. The brothers from the boardroom — eight chairmen from eight blue-chip companies — complained of being caught in the tentacles of tax and regulation. They find the new payroll tax (called National Insurance) a splendid stimulus to employment in Bangalore. One, at least, of their companies' boards has to decide, every year, whether its head office is in the right country. He had to convince them that he felt their pain. The gentleman in Sybil knew how to make contradictory promises, as he explained to his director of communications and strategy: have no doubt that you will get through the business very well, Mr Hoaxem, particularly if you be "frank and explicit". That is the right line to take when you wish to conceal your own mind and to confuse the minds of others. Good morning!'

Planting a tree

In a war-torn wilderness, the City is planting an olive tree. Derek Tullett, moneybroker and past Master of the Fruiterers Company, knows all about them. Now he is backing a scheme — Olive Tree is its name — to bring students from Israel and Palestine together at the City University, where Olive Tree will pay their fees and help with the cost of living. Starting next year, they can study for postgraduate degrees, on three-year courses, in the subjects of their choice, There will be special programmes for them. Afterwards, when they go home, they will be expected to make a professional contribution to one of a number of 'cross-community' development projects based in Israel and Palestine. Olive Tree's planters say that they hope to encourage dialogue and a sense of shared citizenship. Now more than ever, their project seems inspired: 'The wilderness and the solitary place shall be glad thereof, and the desert shall rejoice.'

Bad case of dysergy

Another wreath on the Tomb of the Unknown Shareholder. The new top brass of Royal & Sun Alliance is calling up a billion iron men to replace an army of financial casualties, victims of the insurance strategies of previous generals, now paid off or retired on pension. If synergy is the deal-makers' art of putting two and two together to make five, or seem to, then Royal Assurance's merger with Sun Alliance stands for dysergy. This was a cosy courtship, with jobs reserved for everybody at the top. Like the merger between RollsRoyce Motors and Vickers — compared by Patrick Sergeant to two dukes falling upstairs out of Annabel's, propping one another up — it bears out the old maxim that there are no successful mergers: only takeovers. Now this one needs £1 billion of new money to keep going. A generation ago, a desperate effort conjured up new capital and kept Commercial Union going. That proved to be a turning-point, and so may this, but it must be a last chance.

Lloyd's sucks eggs

Compare and contrast: as Royal & Sun Alliance suffers, Lloyd's of London prospers. Now that, you might say, is a turn-up for the book. Lord Levene, still a newcomer as chairman, is dusting off Lloyd's cobweb like committees, and Rolfe Tolle, the tough bearded German he brought in as franchise director, is reminding Lloyd's underwriters that they need to make a profit. They do not all enjoy his refresher course in eggsucking, but he has a point. At this happy stage of the insurance cycle, their instinct is to put on business and increase Lloyd's market share. At this stage in previous cycles, their predecessors wrote the business that came back to haunt them and to plunge Lloyd's deep into losses. Mr Tolle and his chairman do not want to see that happen again, and if they need an awful warning, they know where to look.

Grenadier Guardians

I have a helpful suggestion for the Chiefs of Staff, at their wits' end to find more troops to send to Iraq. Have they tried advertising in the Guardian? This, after all, is the noticeboard for recruitment to the public sector, and if taking the Queen's shilling does not qualify, what does? A basic infantry brigade would run to 3,000 men — three battalions, brigade headquarters, gunners, odds and sods — and the public sector is creating almost 6,000 new jobs every month. Read all about them: counsellors, monitors, health and safety enforcers, gay and lesbian facilitators, teenage pregnancy co-ordinators. How about a few lance-corporals and cookhouse orderlies? The Guardian could surely find an extra column for them in its 100-page supplements, leaving Gordon Brown to find the money. Ever since the Cold War ended, successive chancellors have awarded themselves the Peace Dividend, and this one is spending it like a drunken facilitator on everything except defence. Professor Niall Ferguson calculates that defence spending's share of our national output is as low as it has been since the Wars of the Roses. The trouble about dividends, though, is that you have to go on earning them. No peace, no dividend: this one looks uncovered.

Carry on voting

Sweden votes on the euro on Sunday, and the polls have the recalcitrant Nej camp (for No) in a narrowing lead. In the spirit of their great national hero, Count Oxeristierna, who warned us all of the unwisdom of governments, I still urge the Swedish people: Nista Nej till emu — and, of course, riista ofta.