Show Me The Money

All small businesses are exposed to the risk of slow or even no payments from clients. When you are a service business like mine, very often it is prudent to insist on upfront charges or faster payment. But sometimes, no matter what the contract says, if a large client pays late, there is little you can do but grin and bear it.

The inequity of the system is brutal as very often the very client who withholds money on you, is a company who has a cash business at the front end.

Large Companies Can Be The Biggest Sinners

I recently highlighted the problem showed in the Panorma Show where Boots plc had unilaterally, without warning, changed the payment terms for its suppliers.

I have experienced the same but without the courtesy of a letter - it just happened.

For most small businesses, while it would be great to actually slap a writ on a client, in practice it is not possible to get too heavy. A large client is, after all, providing a source of revenue and profit. However, this month things changed for me, when my largest current customer held payment on invoices dating back to before Christmas and has paid only the smallest invoices as a show of good faith which merely covered expenses not fees since. Having crossed the boundary of VAT due dates, I have now paid all the VAT on those invoices and without any cash in, so salary costs to my contractors and myself have been delayed.

However unacceptable I may think this is, and there have been plenty of urgent communications to get this sorted out, in reality I cannot get too angry and throw my toys out of the pram as they have shown in the past that they eventually pay, their credit rating is good and they are one of the lucky companies who are enjoying growth in recessionary times. It is the sort of client I can ill-afford to be without.

I suppose I should just thank the Lord my business is not dependent on the Public Sector who, despite the rhetoric of Mr. Brown, are the worst payers in business by a long chalk.

The Prompt Payment Code

The new Prompt Payment Code (PPC) was devised in and introduced in December last year. Any company can sign up to it and it is purely voluntary with no recourse in law - usual rules apply. Signatories sign up undertake to:

1. Pay Suppliers on time - within agreed terms at the outset of the contract, without attempting to change payment terms retrospectively and without changing practice or length of payment for smaller companies on unreasonable grounds.
2. Give clear guidance to Suppliers - by providing them with clear and easily accessible guidance on payment procedures and ensuring there is a system for dealing with complaints and disputes, which is communicated to Suppliers. Suppliers must be advised promptly if there is any reason why an invoice will not be paid within agreed terms.
3. Encourage good practice - by requesting that lead suppliers encourage adoption of the code throughout their own supply chains.

The PPC is being monitored by a festoon of organisations like the Institute of Credit Management, the Federation of Small Businesses and the Forum of Private Business. Sadly, none of these organisations have any real teeth and none have good membership from larger companies. The trouble often with such initiatives is that they look good on paper but because you do not have to buy in and cooperation of large businesses or Government Departments, then it is likely to fall by the wayside.

Our Worst Nightmare

I have been doing a lot of business in Italy of late and the one thing that strikes you is how businesses survive over there. Credit terms are generally understood to be 60 days at the very minimum but are often at least 90 days and more like 120 days and yet more with Government Departments regularly taking 6-9 months to pay bills. This, of course, has a massive ripple effect as it cascades through the supply chain. You might think that correspondingly prices are higher in Italy to compensate for this but the reality is the opposite - if anything, competition is more keen.

For companies entering the Italian market, if at all possible, do so via a partnership or Distribution and just make sure they are financially solid enough to manage your market on your behalf, even if that costs some extra discount as is likely.

Britain, in my opinion, is fast becoming the same way. Large firms are using suppliers as a source of credit as banks are not so easy with their money any more.

Spin And Guff

Professor Nick Wilson of Credit Management Research Centre at Leeds University believes the PPC is just PR spin both from the Government and the signatories and it has all been seen before. There have been similar attempts at codes in the past but Government did not get behind it and impose its rules - Government even withdrew funding for the Better Payment Practice Group which really said it all.

Wilson agrees with me - in his opinion, the situation has worsened considerably for smaller businesses over the last 10 years.

Your Rights

In 1998, the Late Payment of Commercial Debts (Interest) Act gave small businesses a statutory right to interest on money owed to them by large companies or the public sector and to claim debt recovery costs. However, it is a case of cutting off your nose to spite your face as few companies resort to the law for fear of losing their clients' business.

It is a real Catch 22 situation.

Naturally, when the rights were extended to big businesses, they had no problems enforcing it. For many smaller businesses, it means they are getting squeezed at both ends - larger suppliers giving them aggressive payment terms which they are penalised heavily for if they transgress while large companies refuse to hold to their payment terms who are their customers.

Also, a case in question is VAT payments. In the case when a large customer has not paid on time and you cross a VAT quarterly boundary, and if a large supplier has held off paying for 60 to 90 days, you can end up paying all the VAT without money coming in. The Government sees only you and not your customer, who they are happy in the same quarter to reimburse the exact same VAT you have charged them.

The system is a complete mess and penalises the company that has not been paid.

In reality, there is little that can be done about the situation. SMEs are right in the middle and we make up over 90% of the volume of companies in this country and account for 13m employees yet we have a minor say in how the process should run and no voice when it comes to large company customers and Government not paying.

Companies Signing The PPC

Notable companies like Asda, British Gas and John Lewis have signed the PPC code had little to say when contacted on the subject and this bears out Wilson's PR spin accusation. It's all for show. Asda, for one, has actually implemented some good schemes to help. They have won awards for their supplier schemes and 'Where's My Invoice?' is one which allows suppliers to go online and track their invoice through the Asda payment system to be able to tackle issues which may delay payment as and when they occur not when the money is overdue.

Real Experiences

The large customer I refer to has not signed the PPC and is not interested in doing so. Just this morning in answer to my latest protestations, an accounts clerk has asked me to send a Statement of Account, then having denied receiving it despite a read-alert warning telling me they had not only received it but read it, they then claimed they had not received any of the invoices despite me having read-receipts for them all.

Of course, calling them liars does not help the situation and may well jeopardise future business, but I don't think this is at all unusual for small businesses. We are at the mercy of the system and until Government actually puts their money where their mouth is on this issue like cleaning up the VAT payment scams, then we will always be at the bottom of the food chain.

I hope Lord Mandelson gets to read my blog - his ears should be burning at least!

Help Required For Small Businesses

In a recent leader article in an issue of Director Magazine from the IOD, Lord Mandelson asserted that no Government had ever done more for small businesses than the current one. Naturally such a daft comment was met with some derision and a volley of mail was sent to the Editors to refute the claim.

The Government Schemes

True to form, the Government has tackled the Recession from the point of view of banking and the Credit Crunch. By solving the Credit issue and easing cashflow worries, the logic was that businesses can survive while consumers would spend. To support this we saw the easing of VAT from 17.5% to 15% as a first step and then £1bn was set aside as a Loan Guarantee mechanism for small businesses which would help banks make more sensible credit decisions.

Neither initiative had any appreciable effect.

VAT Easing

It is argued that the VAT giveaway would actually release around £12bn from one form of tax so that consumers, who would actually fund the giveaway through their own tax returns, would spend more in the High Street. This logic was applicable only to retail business in the main as consumers spend the brunt of the VAT in this country. But a mere 2.5% easing had zero effect and the recession hammered home. Concerns about job security, negative equity and repossessions and a decrease in household income were the main issues, spending would be cut by most consumers who already collectively owed £1 trillion as unsecured debt on credit cards. The Government had also forgotten where most of the 'new wealth' had come from - not household disposable income from wages, which had shrunk, but mortgage equity release. And that had dried up due to the collapse in house prices.

VAT easing was a complete waste of money.

Loan Guarantee Scheme

The sentiment in the letters replying to Lord Mandelson's assertions were that he had no idea about how small businesses are run.

In fact, over the course of this Government's tenure, higher burdens in terms of taxation, regulations and red tape had been placed upon small businesses as if they were actually much larger concerns which had taken away entrepreneurial spirit and made business people focus more on compliance. Instead of spreading the burden of things like maternity, each company had to fork out directly for each employee who was on maternity or paternity leave and the impact on businesses was disproportionate - a BT can easily accommodate excellent conditions for working mums while a company of just 9 staff, say, would be badly hit. It definitely caused employers to stop and think - and it was not the only regulation to affect disproportionately, as general employee HR issues were much more in favour of the employee in case of poor performance.

I don't care what anyone says, it is getting far harder to deal with under-performing employees who are Employment Law savvy than ever before.

More importantly, while large businesses like banks and drug companies, can afford to find exotic ways to avoid paying tax by relocating their headquarters or moving Intellectual Property into offshore havens, small businesses do not have the financial muscle to hide and so pay a disproportionate amount of tax for the profits they create compared to larger companies.

This Government has done little to decrease this inequity in the system as small businesses, like law-abiding citizens for parking and speeding fines, are soft touches and always pay.

The Government Loan Guarantee Scheme is more to help a small number of companies raise a loan who might not get it before. It still will not get you money just for survival - do not mistake this as simple benevolence by the Government or banks. Mandelson has been hard on the fact that the Government is not a bank and will only step in as the 'lender of last resort' and never just to save a failing business. Unless of course you are a bank when the rule book is thrown away and any amount of money you like can be used, no questions asked - certainly not about how you spend it or on who. So this Loan Guarantee Scheme has a very limited use and is really just there to give the banks some comfort in their normal lending.

Speaking to Bank employees involved in risk assessment and loans to small businesses, even without use of the Government Scheme, they had hit all their targets for loans regardless and saw the Scheme as just a publicity stunt. Loans to small business on a regular basis was never the issue.

Real Help To Small Businesses

The thrust of the letters into Director Magazine beyond telling Lord Mandelson where to go, was that the real help that could be provided for small businesses was in the form of tax breaks, and I wholeheartedly agree.

Firstly, for all business to business firms, VAT is just a bureaucracy and a tax collection service for no reward. If you deal with companies who do not pay their bills on time, it is also an unnecessary and onerous burden on cashflow - and I am experiencing precisely that in the last month which has stopped salary payments, it has got so acute.

Lowering tax for small businesses will allow more entrepreneurs to invest more in their ideas and business, allowing them to market more widely or employ more staff which will help create more sales - hence more profit and more tax in the long run. Instead a huge slice in a small business' profits, the same percentage as larger ones, goes into the Government's coffers.

National Insurance (NI) is a particularly nasty tax. Right now, the theory is it pays for a raft of things associated with benefits and pensions. At this point, over 1 in 4 jobs are in the Public Sector, yet all businesses pay some 12.5% Employer Contributions for NI. For the vast majority of us, what we get out of the system is a fixed, small national old age pension. What Public Employees get is a superb, final salary, index-linked superannuated pension, on top of the minimum old age pension, which is disproportionately funded by private businesses.

The whole system is an elaborate 'Ponzi Scheme' - the money in gets you no relative output, as there is no investment pot which is growing. The money goes immediately to those Public Servants in retirement to give them superb pension rights. Yet small businesses have no choice but to pay up, and the tax has risen and will rise again in order to pay for new Public Sector retirements.

Fending For Ourselves

Beyond decreasing tax which could directly help small businesses, where help could be put in place is to help businesses attract overseas money in terms of export of goods and services. One of the reasons that Britain has not been able to capitalise on the weak pound is that exports are a relatively small part of the country's GDP.

Would it not be a good idea to give incentives to any business to drive foreign based business by either giving tax breaks or even making money available to increase marketing or sales activities to generate sales?

Most small businesses have to fend for themselves and I have blogged ad nauseum about ways in which small businesses can drive costs down and conserve cash. But none of that help comes from the Government - it seems to believe that credit is the only thing that is needed for survival and growth.

For Lord Mandelson's edification, it is orders and sales that will drive business forward. The more of those sales that come from other countries, the better. Of course, it is difficult to see that when his head is in the clouds and the businesses he has been exposed to need the likes of Nat Rothschild's help.

Laptop Only Required

As a veteran of the SaaS (Software as a Service) industry, I can tell you everything is rosy until the darn Internet gets in the way. For all the benefits in the world you just need the unavailability of the Internet for a short while to evaporate the lot.

Or so it would seem. Recent studies on availability of Exchange Servers or inhouse networks show that internal network or component failure is more common than major Internet outages and it's just that they are seen as 'usual events' rather than complete failure to work. Anecdotally, how many times have you been told that a business or individual within has had trouble sending or receiving mails or lost important data or files, worse still, has had major applications inaccessible for periods? It seems that internal shortcomings of applications or networks are so run of the mill as to go largely unreported - yet the self same people who experience that level of poor internal service are the first to speak out against the advance of SaaS or the new phenomenon of Cloud Computing.

The Growth And Dangers Of SaaS

Salesforce.com is one of the major successes of SaaS and it has popularised the use of high availability centrally accessed information for particularly mobile users. As a former user of Salesforce.com, I can safely say it is streets ahead of all other dedicated applications for contact and sales management I have ever used. The beauty was that whenever I logged on I had direct access to all my information, with the latest revision of software and in the form of the application itself so I could do all the things I needed to manage my own contacts and my those of my reports anywhere in the world.

And with the growth of Mobile Broadband, it means that you can do this without the need to be static. Now you can go onsite to a customer presentation or meeting and have full access to all information needed and you can catch up and work in a coffee shop or over lunch, while updating the central database for everyone else to see what is going on.

The obvious downside is the reliability of the connection or availability of the Internet or more frustratingly, if the Vendor suffers an outage or failure at their end. It has happened - as recently as January Salesforce.com suffered problems leaving 900,000 users without access to their application and information while Citrix, Webex and others have had problems. In my particular companies, Genesys and PlaceWare (now InterCall and Microsoft RTC respectively) we had many instances of failure.


Cloud Computing is an extension of SaaS - it is also the concept of having online storage and processor power highly available, as an when you need it. This is a superb solution for small businesses who find it difficult to cope with the cost of scaling their business - particularly if you have to start flexing server, storage or licence muscles in order to cope with growth. At early stage, the cost of adding an incremental, fully kitted out user is very high in proportion to over all costs, once you have grown to a certain size, the cost as a proportion to overall costs gets progressively smaller. Equally, the cost of failure of any one component is disproportionately high or the cost of insuring against such failure. Maintenance contracts are at minimum 20% of the hardware value which typically over 3 years amortisation is cheaper to replace and this does not allow for the cost of application support.

Cloud Computing takes that strain away. With the growth in things like Google Apps, you can not only have a full suite of Office applications at your finger tips, but all the associated storage and computing power needed, anywhere in the world for a single monthly fee. It takes the hassle away of worrying about scaling as it is simple and less of a proportion of your costs, while maintenance and upgrades are taken care of and the whole system gears in size in exact proportion to your own requirements at every step - there are no sudden jumps as you go from 100Gb to 1Tb storage or requiring a new server as you hit the limit of the old one - it's all taken care of for you.

I dealt with one client in the US that had 20 staff in 20 different cities in the US allowing them to 'appear' like a national organisation and they supported the whole lot through Cloud Applications even their Accounting System and Budget/Forecasting system as well as classics like Salesforce.com. No need of an internal network or costly server, everything was hosted in the cloud complete with a hosted VoIP centralised phone system from RingCentral. Meeting me at the IOD Hub in London he showed me how he could run his business in exactly the same way from London as in California, right down to answering the phone.

I also host my Exchange server at Fasthosts who also host my web site - this means that anywhere in the world, as a small business, I have full access to a full Outlook client as if I were on my own network, fully maintained and backed up for me for a single annual cost which allows me up to 10 email accounts and plenty of storage - and it is a fraction of the cost of having my own server with maintenance and storage - plus someone to run and support it for me.

I also use Spare back up which automatically runs each day no matter where I am and backs up all files which have changed and I can restore any I accidentally lose at a single touch easily - this covers all my PCs for a single charge of £29 per year for a huge storage space that I have only used 19% of so far.

Not Just For Small Businesses

In ComputerWeekly last July, Taylor Woodrow announced they would be migrating all 1,800 employees from traditional desktop applications to Google Apps. The estimated saving to the company would be £1m over 3 years according to Rob Ramsay, the IT Director, just on Office applications. He said that Google Apps will allow Taylor Woodrow to scale up and down much more easily and in a more cost efficient way.

In these tough times, Rob Ramsay's logic is sound. Not only does Cloud Computing support expansion efficiently but also contraction. This recession has hit very hard with many industries having to lay off staff. When that happens, typically the money spent on supporting the staff lost is itself wasted or at least until the company can re-use them again. In things like Microsoft Office licences, you typically pay an Enterprise licence fee so you are stuck with the cost whether the people use the licences or not. Cloud Computing allows you to simply add up the numbers and pay for what you use only, so downsizing actually produces savings, while scaling back up for the upturn becomes a less onerous task in terms of people time and cost.

New Kinds Of Business

Cloud Computing is also allowing the introduction of new types of business. Huddle is an Enterprise 2.0 start up that not only uses Cloud Computing for its own use but uses it to deliver services to its clients, some of whom are Boots, Centrica and MasterCard. Huddle is a secure, online collaboration and networking service for companies of all sizes - not dissimilar to the likes of Citrix and Webex but it started because of Cloud Computing.

If you use applications like LinkedIn or Facebook as your contact management system, then you will understand these are also gifts from Cloud Computing as is Google Apps. With packages like Huddle, Webex, Yugma or Skype plus applications like Vonage or RingCentral or Yak.com you can have a full communication and collaboration suite at your disposal for a reasonable cost without the costly outlay for capital purchase or lease of telephone equipment and use your PC or WiFi or mobile phone as your only telecom apparatus. Accounting packages like http://www.freeagentcentral.com/, budgeting packages like http://www.adaptiveplanning.com/ or CRM packages like Salesforce.com start to complete the picture - you can have your entire business run by a single laptop, anywhere in the world for monthly charges.

High Availability, Low Down Time

The Internet has come an awful long way since the heady days when I ran PlaceWare Europe Ltd. Then Internet outages were rare but frequent enough to cause angst and doubt in customers' minds. Things have changed dramatically and now the Internet is nearly ubiquitous with the advances in WiFi and mobile broadband. As a small business, I am completely reliant on access to the web and I don't have a problem with it, being able to work offline when required and online when I need to with equal effect and a fraction of the cost of if I had to fund and maintain it all myself.

Now is a good time to consider the alternatives, whether you are a large business or small. Feel free to give me a call or drop me a mail if there is anything you would like to discuss further on +44 (0)207 193 2356 or nigel.dunn@calxeurope.com.

'It Wasn't My Fault'

While there are some who wonder just what a 'City Minister' does, I for one am feeling very sorry for Lord Myners who yesterday gave a 'robust defence' of what appeared to be gross incompetence in the 'Fred Goodwin Pension Fiasco' which faces the Government.

"I was assured the pension arrangement for Sir Fred Goodwin reflected 30 years of service," said Lord Myners yesterday as he mounted a very sound defence of his actions in the lead up to the fiasco in the Lords. The fact it sounded as a forlorn defence against the gathering cloud of Brown and Darling revisionism regarding the truth of the affair in order to appoint a scapegoat made it all the more poignant.

Just Doing His Job

Of course, if you are an ex-City type yourself and the Government is being advised by a horde of Investment Bankers at extreme cost to the taxpayer, then no one would quibble about a 'fair pension' after 30 years service to one of their own. And £693,000 per year doesn't sound much in the great scheme of the fantastic numbers that are being thrown about in the bank bail outs, after all it was commensurate with his final salary.

But as Harriet Harman has seized upon, such an embarrassing number is vote winning if something can be done about it in retrospect. It becomes even better if a specific individual, not directly related to the Government hierarchy, like Lord Myners, can be blamed for it. Then they have a scapegoat as well - perfect - and Harriet knows it. By mentioning it herself over the weekend that Sir Fred should 'not count on' keeping his pension, the Government and specifically Harman, seems hell bent on spending any sum of money to block him having it and so gaining the public's confidence that they are acting in our interest, not just being totally incompetent as it it appears. Harman also advances her public stock for a future leadership challenge.

How Did Fred Get Away With It?

The villainous Fred Goodwin, as he is now portrayed by the Government (and it will come as a source of some glee to Harriet Harman that Goodwin was a close ally and friend of Gordon Brown and his retinue of famous Scots now seen to be on the make), is the man who seems to have hoodwinked a raft of lawyers, Board members, Ministers and banking advisers and got away with a fabulous pension it is now deemed he does not deserve.

Myners claims that in fact he did not meet with Tom McKillip, the RBS Chairman, and Bob Scott, a Non Executive Director, who were charged with negotiating Goodwin's exit package (and hardly likely to be nasty to their old boy), until after they had already agreed Goodwin's exit package and they told him only that Goodwin had been given a pension reflecting his 30 years service. No warning bells here then, as Goodwin had agreed to waive his entitlement to 15 months salary - which on the face of it was cheap as Peter Mandelson had got a 3 year pay off from the EC when he was appointed Business Secretary which the taxpayer pays for.

At the meeting, Myners was accompanied by a Government lawyer who trotted out a 'standard script' to set out the Government's position. Myners also says he told McKillip and Scott that "In exchange for support, there would be no reward for failure. We would expect Boards to minimise the cost of severance."

The problem was that Goodwin, although being forced out, was leaving as an early retirement not as a sacking. So McKillip and Scott were acting on that path - the Government did not have the balls to say Goodwin should be summarily sacked and receive no compensation or pension. The let-off was all of their own making. Goodwin, by waiving his pay off, was actually being perfectly fair in insisting on his pension rights after 30 years of service, the maximum under the company scheme.

All the facts were staring everyone in the face - they knew his salary, they knew his length of service, they knew what he was entitled to it.

So why has it come as such a shock as to how big the pension was?

Taking A Hit For The Team

The ground is being prepared for Myners to be sacrificed brutally in the wake of the affair. Alistair Darling is already sloping his shoulders and has sinisterly warned that the Ministers must have the 'humility' to admit mistakes. If that were the case we wouldn't have the time left in the Universe to hear them and the associated excuses, but the pointed remark was for Myners alone.

He was expected to fall on his sword or be roughly pushed on it very soon.

Myners, though, was having one of it as his Lords statement showed. He claims that he knew Goodwin would get a 'large sum' but not how large that was. It wasn't an issue at the time - he had negotiated Goodwin out as he was told, avoided the embarrassment of a pay-off, surely Goodwin could have a fair pension to live on?

Locking The Gate After The Horse Has Bolted

Gordon Brown has confirmed his sudden rabid hatred for the man he was so friendly with not a few months ago by confirming he has instructed lawyers to find out how much of Sir Fred's £16m pension pot can be kept away from him. It is too little, too late, naturally and an expensive way to solve a problem that with just a modicum of foresight and attention to detail, he could have prevented beforehand.

There are no real excuses here. Everyone was involved in the bail outs, everyone was involved in the specific task that surrounded RBS, everyone knew the stakes they were playing with. Everyone knew the size of the salaries of these individuals from Sandler to Goodwin to Hornby - they knew the kind of money they could be entitled to beforehand - this is not rocket science and it is not an unknown quantity as it is at the very heart of the entire problem identified in the City. The rewards are just too high.

So bleating afterwards about Goodwin's pension is just a smokescreen and by saying that Ministers were not aware of it is just compounding the issues we face on bail outs. If you do understand the basic figures that make up the huge numbers in the City, then you cannot possibly know how much the big numbers you throw at the problem are going to affect it.

I return to a common point. This Government, from start to finish, had no idea about the economy and how it was functioning and they have far less idea about how to remedy its collapse. This whole saga about one man's pay off is absolutely indicative of how little they know or care in their blind panic to try and rectify a situation they made for themselves.

Now we have the unseemly clamour for the scapegoat. Personally, I think Brown, Darling and Cooper should go along with Myners - they couldn't organise a party in a brewery, least of all a bank bail out.

Spend A Penny?

It had to happen - Ryan Air are considering charging for using the toilet on their flights.

Today, I bring you an exclusive interview from the marketing genius behind the idea, Penny Pertwee.

Rising Cost Of Service

I asked Miss Pertwee (with a silent 't') what gave Ryan Air the idea to charge for using the toilets on their flight.

"Well, to be sure," she said, "We have charged for most things now and are limiting the hand baggage to just 10 Kg so that you are forced to put some luggage in the hold as you would be hard pushed to put two rats in a bag and weigh less than 10 kg. Then we can charge the customer for the luggage in the hold per kg over the maximum allowable which will change to a much lower number for sure soon."

I pointed out that this makes Ryan Air in danger if actually being far more expensive and less attractive to travel on then their rivals.

"Be gone with yer," she replied with a disarming smile and a twinkle in her eyes. "With the height and weight restrictions coming in soon, Ryan Air will always be the cheapest airline if you are 5 foot dwarf weighing less than 25 kg, with a 10 kg bag, no luggage and not needing the toilet, food or water. We are committed to providing that level of service for those sorts of people."

What about the plan to charge for using the toilet then?

"Well the cost of allowing passengers to walk up the aisle to the toilets is rising," she said. "Particularly as we plan to remove the carpets in the aisle and install small seats for travelling rodents or other pets at a small charge. Also there is an impact on the environment, as if you have been to the toilet before the flight then you will weigh less when you get on and so the plane will use less fuel particularly at take off which is easier on the environment."

Spending A Penny?

How much will the service cost and how will it be charged for, I asked?

"We had quite a time working out the charging levels and how to charge," she said. "You know some big people can, let's say, need more of the facilities than smaller folk, so the charging needs to be a balance between the most fair charge and the most lucrative for the airline. So we have come up with a unique 'menu' of charges.

"A standard No. 1 of up to 30cl is just €1. For between 30 to 50cl it is €1.50 and then it's €3 for above 50cl and Guinness drinkers. The way it works is that you take a measuring cup inside the toilet with you, and once you have finished you pour the contents into the measuring machine we have fitted in the toilet and the amount rings up on the convenience lights outside so the steward or stewardess can read it and charge you on the way out. If you do a No. 2 then the toilet is fitted with a patented 'guffometer' which measures odour - the charges vary depending on weight and odour but suffice to say a standard poo will cost around €2 and if have had a curry then it will be €5 minimum. For those who 'paid a penny and only farted' then it's just €0.50, the same if you want to just 'powder your nose' which is just a euphemism for a good fart. By the way, we determine the weight by having the person stand on the weighing scale before they enter the toilet and then when they come out - the convenience display shows the staff the combination of weight and odour to charge for, and toilet paper can be bought on the drinks trolley at roughly €1 per poo or other."

The Screaming Habdabs?

I pointed out that what if someone is ill or incontinent? Surely this system of charging penalises those sorts of people?

"Come now," she said reproachfully. "As you well know, if you are disabled and need a wheelchair, then you have to pay. That's the rules and it's only fair. Just the same as, if you choose to get on a Ryan Air flight needing the toilet that's your lookout - and for those who are ill, we are a cheap airline not a flying toilet. If you are ill, then don't fly with us - it's you choice."

I asked, what about children - shouldn't they be able to use the facilities for free?

"Now why would we do that?" asked Miss Pertwee. "They occupy space on the flight, they breath the valuable oxygen in the cabin and they can pee and poo as good as anyone and they spend time in the toilet which limits the time for others to use them. No, they are charged just the same. And before you ask about nappy changing facilities, that counts the same as a good fart."

The Way Of The Future

I asked if Ryan Air plan any further charges in the future?

"God, we have only just started," she shrieked noisily. "We plan to charge in the near future for using a pilot and then for the level of their ability to fly. We also plan to charge for looking out of the windows, the seats (as we plan to suspend normal passengers from the ceiling for the flights, you can pay extra for a seat), we plan to charge for a proper landing not one at high speed with a thwack which is the usual, and then we will charge for cabin oxygen, heat, lighting and the air displaced during the plane's journey. We are working on other charges and they involve charging for safety demonstrations, life jackets and using the emergency exit in case of an emergency.

"At Ryan Air we are committed to low cost travel so long as you are below 5 foot, weigh less than 25 kg, have 10 kg hand luggage, no bags in the hold, do not use the toilet, want to eat or drink, can hold your breath, don't look out the window, don't mind if a trainee flies the plane and don't use the emergency equipment if we should crash."

Taking The P***

The above interview is clearly a spoof and is not representative of Ryan Air's views.

However, Ryan Air's intent to charge for using the facilities on their flights is. If, like me, you have used Ryan Air and their idea of carting people safely from A to B, then you will know that between their pathetic check in facilities and obsession for charging for the most popular basic requirements for anyone wanting to travel any distance, then they are just trying to advertise low cost fares and charge you for anything you would normally need. It's a carrot to draw you in and then sting you for the obvious.

This is quite literally 'Taking the P***' and they know it.

The Clay Fist of The Law

A report out this week confirms what many people already knew, that the credibility of Community Sentences and Suspended Sentence Orders were laughable.

In a study which involved giving interviewees a £20 M&S voucher, which about summed it all up, around 25 Probation Officers and 16 Offenders were interviewed. The consensus was that offenders regularly left courts laughing and going back to tell their mates about their pathetic sentences and re-offend while Probation Officers think they are sending out the wrong message.

Soft Law - Hard Law

While many motorists who have unblemished records on insurance are targeted for speeding 10% above the limits and parkers who steal an extra few minutes are ruthlessly hounded for their offences by officers and modern technology, real criminals are actually set free under these useless schemes. Suspended Sentence Orders are particularly useless as they don't even carry a penalty if the offender re-offends as is often the case - they just get a further warning. The Community Sentences are pathetic as they just get to do some hours low-level community service and remain at large.

As so often in Britain, law abiding citizens who do not steal, cause damage or behave anti-socially are the people who are targeted by police in different ways because they are the people who will pay up without question, on time. Those who are real criminals have a habit of avoiding paying. So police methods, investment and resources are skewed toward this easy money collection to balance the books and away from preventing and solving real crime and bringing hardened criminals to justice to receive penalties which should deter them from repeat offences.

It's all part of the daft target system that the Government runs in the Public Sector - it's all about figures to prove points.

It is way too easy to get a fine for a small motoring offence like parking 2 minutes extra while a person who wilfully causes damage, steals or hurts another individual or their property will get a tiny, stupid sentence if at all.

But that's this Government and modern Britain for you. Crime pays nicely for some.

A Week Is Along Time

They say a week is long time in Politics - sometimes it is just not long enough.

As Tony Blair sets off for his first visit to Gaza as he has been so busy earning money elsewhere, Fred Goodwin is kicking back on the next week of his well-negotiated retirement and we discover that simple calculations put the top up of his pension pot at some way higher than first anticipated. It was reported last week that his pension pot was topped up from £8m to £16m to pay his £693,000 per year pension for life from his current age of 50. Sadly, as usual, the Government got the number wrong and at current projections, Independent Financial Advisers like my wife, immediately said he would need double the pot and sure enough that's what is estimated.

A mere slip of the finger on the calculator by Darling, Myners and Brown cost us a further £16m in a short negotiation. If only they had more time.

But the situation should be solved any time now as Harriet Harman has stepped in and warned Fred Goodwin directly that he should not 'count on' keeping his pension. Once again, it is a super-sound bite by Harman designed to increase her popularity in the slow process of building a bid for the Party Leadership. Sadly, it has already been said to no effect by Darling and Myners but she got the last word and that's what counts.

Fat Finger Syndrome

But that's nothing. Spare a thought for the UBS Trader who had 'Fat Fingers' and inadvertently pressed the wrong buttons to place an order for 3 trillion yen ($31bn or £21bn) when he meant 30m yen. Everyone had a good laugh and allowed him to pull the order.

If only we could do that on our Government's idiotic mistakes on failed bank executive's pensions.

Big Number Syndrome

It seems Gordon Brown has got obsessed with big numbers. It won't take millions to solve things but billions every time so when Goodwin talked of wanting no pay off versus the billions he lost, no one bothered to look at the millions he asked for topping up his pension as he would only get paid less than a million a year. It's that simple - Brown, Myners, Darling et al all thought it was a fair deal. It's only when you stack it up to what the average teller earns that it becomes significant and that's the problem.

You deal in large numbers only, you forget the detail.

It's rather like watchdog chiefs and Government Advisers. You wouldn't want cheap ones as that smacks of lack of intelligence. But then we had Lord Turner and Hector Sants wheeled into the Treasury Committee, a more Lily-livered pair of obsequious twerps you could not have found. They nodded and cow-tailed to the Government and toned down their approach to banks so that 5 out of 10 major ones went bust. The incompetence is shameful, their excuses even worse, yet incredible failure is rewarded. They did what they were asked to do so they keep their jobs and lucrative salaries and benefits, a sure sign they did exactly as Darling and Brown asked of them.

Can we blame them? Yes - but once again, the Chancellors get away with total negligence.

Rewarding Failure

One absolute fact of this Financial mess we are in is that there is money in failure - both here and in the US. It is a far cry from the performance-related culture that business has tried to portray and Government force on workers.

As millions in Britain face a Big Freeze on pay, it is really heart-warming to hear that bankers who blew billions on poor decision-making like Fred Goodwin are set up for life. On top of Goodwin, the man who is widely blamed for blowing HBOS's billions via poor Corporate lending, Peter Cummings, walked away having 'retired' on a pension of £5,000 per week. Andy Hornby, ex CEO of the same bank, was dismissed and then retained as a 'Consultant' at £60,000 per month until he was shamed into waiving it.

How Cummings was allowed to choose 'early retirement' at 54 and get that kind of pension is once again negligent by the Government which now owns 43% of the newly merged bank between Lloyds and HBOS - yes the one where Brown personally intervened to see it through and then bail Lloyds out.

Time and again we hear of these 'minor' mistakes by the Government in the bank bail outs - how could they keep on top of the detail? Well, that was the whole point. The reason why we need a bail out is that there was negligence on a mega scale - now we see equal negligence in the solution. So we must ask the questions - where will all these billions go? How did you come up with these numbers and what will the money be used for - line by line?

Because right now, all we hear about is fat cats getting paid lots of money for failing, Government not being on top of the situation, thousands getting laid off and no credit feeding into the system. It has been an utter, disastrous failure on a scale too big for most to comprehend. But we understand the bits about Goodwin, Hornby and Cummings all too well.