HemmersChess

Set to go into the record books today with a No 1 hit in a whole new genre, the veteran singer once again displays his astounding ability to reinvent himself

A few weeks ago Sir Tom Jones was flying back to London from Dean Martin's old Bel Air home where he's lived for the last three decades, when he got chatting to the steward. Jones loves chatting almost as much as he loves singing. And Tom Jones's favourite subject is Tom Jones, and so it proved on this occasion. "Look, your album's in the paper," commented the steward.

Jones was impressed: a spread dedicated to his 39th studio record, Praise & Blame, an upcoming collection of bare-bones spiritual and gospel covers. Then he read the story. Praise & Blame had been afforded so much space because the vice-president of Island Records, one David Sharpe, had found his opinion on the album leaked to the press. "Imagine my surprise when I walked into the office this morning to hear hymns – it could have been Sunday morning," Sharpe had emailed a colleague. "My initial pleasure came to an abrupt halt when I realised that Tom Jones was singing the hymns! I have just listened to the album in its entirety and want to know if this is some sick joke????" Apparently this wasn't the record Sharpe had in mind. "We did not invest a fortune in an established artist for him to deliver 12 tracks from the common book of prayer [sic]."

Speculation at a huge own goal soon gave way to a conspiracy theory: Sharpe's email happened to be leaked during Praise & Blame's promotional campaign, some 17 days after it was written. But if it was a PR stunt, two things are certain. One: that Jones wasn't in on it – "No, no, no," he told Radio 4's Front Row last week, when asked if he'd ever met Sharpe. Adding, darkly: "I think it's better that I don't, really." And two: that Sharpe was happy to keep the ruse rolling. "Parts of this record company wanted to deliver an album for the typical Tom Jones fan," he's since clarified. "Shall we say we've paid for a Mercedes – we've got the hearse that's arrived."

Let's hope Sharpe is better at accounting than he is at spotting hit records or, indeed, motor vehicle metaphors – because today Praise & Blame is expected to knock Eminem off the top of the charts to become Jones's third No 1 album of new material in his six-decade career. Furthermore, it will put Jones in the Guinness World Records – at 70, he will be the oldest male musician to reach No 1. More accurately it will put him back in the Guinness World Records: Jones won the same title 11 years ago with Reload, but lost his crown to Bob Dylan in 2009.

Reload offered a musical volte-face characteristic of Jones' singular career: on that occasion the Welsh entertainer most famous for showboating MOR tunes like What's New Pussycat? and Delilah duetted with musicians both contemporary (Robbie Williams, Stereophonics) and surprisingly credible (Portishead, Van Morrison). In 1988 he'd pulled off a similar trick, covering Prince's Kiss with avant-garde synthesiser act The Art Of Noise, for which they won an MTV Award.

Jones is surely the only artist to find success performing pop, rock, country, showtunes, disco, drum and bass, film scores, a Bond theme; even hip-hop.

In that sense Sharpe's expectations were on shaky ground: there hasn't been such a thing as a "typical" Tom Jones record for years. Made with Kings of Leon's producer Ethan Johns, Jones intended with Praise & Blame to record "some carols, or something for Christmas". Instead the pair conspired to "look for some spiritual things, uplifting things, things that mean something" and found themselves tackling material by pioneering gospel artists Sister Rosetta Tharpe and Roebuck "Pops" Staples, and John Lee Hooker. Their methods were stripped-down, bluesy, live. On the latter's Burning Hell a bass drum is banged like an old shoebox, while a lone guitar is viciously over-cranked: The White Stripes, effectively. Mojo magazine, who know about these things, declared the album "remarkable".

Jones's popularity has always been built on his versatility and an x-factor personality, in the original sense of the term. Like Kylie, he endures as a musician because you can hang new things on him. What remains is Jones the Voice. He was also raised, he points out, singing spiritual music, so the album is perhaps a less radical departure than it may appear.

Jones grew up a miner's son in Pontypridd, and would have followed his father down the pit had he not been struck down by tuberculosis at 12 and told to stay in bed for two years. By that point he'd already been singing at weddings and funerals – and was encouraged to do so. Demonstrating a tenacity that would serve him throughout his career – not to say a capacity for enjoying the limelight – Jones disliked singing with others. He hated the school choir. At Christmas he'd go carol singing alone.

He wasn't much good at school – he says he might have been a bit dyslexic, or just a bit thick – and left at 15 to carry hods on a building site. At 16 he was married to his girlfriend Linda, living at her mother's house with their baby, Mark. (They wanted more children, but a miscarriage left her infertile.) "I think it's good that I had some experience of the real world before I became successful. When I realised I could do what I loved and be paid for it – I thought, 'This is unbelievable.' And that feeling has never left me."

Indeed, this down-to-earthness, this good-blokiness, is surely part of Jones's appeal. Asked recently about cosmetic surgery by one journalist, he gleefully rattled through the work: teeth capped, nose straightened, eyes fixed; the goatee grown to disguise the scars where he had the fat cut from his chin.

At 23 he was fronting local act Tommy Scott and the Senators, dressed in black leathers and a frilly shirt. He travelled to London to record for famously loopy producer Joe Meek, but nothing came of it. In 1964 he was spotted at Cwmtillery's Top Hat Club by Gordon Mills; a songwriter who would become his manager. Mills wrote It's Not Unusual, intending it for Sandie Shaw. She passed, saying she'd never be able to sing it like Jones – and he was off.

When it went top ten in America, he was advised not to put his photo on the album cover – everyone assumed he was black. "I remember Elvis saying the same thing, 'How the hell do you sing like this?'" Jones told him he grew up listening to black singers.

In the 1970s his income tax hit 98%, so he and Linda cleared off to LA. He had his TV variety show and his Vegas residency, though his career nosedived at the end of the decade . Worse, he'd become a parody of himself. The onstage knicker-chucking – not to say the backstage groupie area known as "the workbench", for which he would apparently prepare himself by dipping his genitals in Listerine – had taken over. Once, doing Howard Stern's radio show in New York, Roger Daltrey came on after him and said he thought Jones must be in the building: he'd had to walk through a room full of knickers.

So passed a 15-year period without Jones having another British hit. The 1986 death of Mills would be the spur to get him back on track. His son Mark became his manager, steering him away from the alarming outfits, tight trousers, hair dye and Listerine, towards more contemporary material.

Linda has stuck by him for more than 50 years, despite all the philandering – on-record affairs include one with a reigning Miss World, a two-year fling with The Supremes' Mary Wilson and one with 24-year-old model Katherine Berkery in 1989 that resulted in a son Jonathan, whom he's never met. Shy, agoraphobic to the point of having to rely on tranquillisers and terrified of flying, Linda stays in LA with "the cook, the maid and the man who looks after the place". Not that's she's a pushover. Jones has confessed to a thumping after she read of one affair. (They no longer take a newspaper.)

While his enthusiasm for the job has never been in doubt, the same cannot always have been said for his credibility. If he becomes the oldest man ever to reach No 1, Jones' greater achievement may be in discovering a musical style that helps him find credibility again. To put the knickers behind him. He's already talking about a follow-up with Ethan Johns, and has joked he'd like to duet with Eminem. "It's great to be top of the charts with Eminem, maybe next time we could be top together."

Given what's come before, it actually doesn't sound that ridiculous. You wonder what David Sharpe would make of that.

Maybourne Hotels Group said to be in final stages of talks that would give American investors a £200m stake in the firm

by Katie Allen

The company that owns London's five-star Claridge's, Connaught and Berkeley hotels is putting the finishing touches to a £600m restructuring that will involve two US property investors becoming key stakeholders in the luxury hotels group.

Maybourne Hotels Group is said to be in the final stages of talks with US property manager Westbrook Partners and one further real estate trust, as it seeks to refinance a £600m loan from Anglo Irish Bank and Bank of Ireland.

New York-based Westbrook and the other unidentified firm are discussing taking an equity stake worth about £200m, according to reports.

A spokeswoman for Maybourne this weekend declined to discuss the situation, but said: "Our refinancing is in final stages and we are not in a position to comment until it is complete."

The hotel group, partly owned by Irish property tycoon Derek Quinlan, needs to refinance around £600m of loans by the end of the year. There is said to be interest from some investors to buy the group outright in order to snap up the high-class hotels.

The three properties could attract US, Middle Eastern or Asian multimillionaires seeking trophy assets and a place to impress potential clients or investors. The hotels each trace their history back more than 100 years and guests have included royalty, Hollywood stars and celebrities from Queen Victoria to Cary Grant and Audrey Hepburn to Madonna.

But any such spin-off looks less likely now the owner says refinancing talks are concluding. It has been working for several months on a deal with Deutsche Bank and Barclays. The £200m stake for US investors would be likely to form part of a wider restructuring that also covers the remaining £400m.

There is also talk that some of Maybourne's existing shareholders, which include several of Ireland's most prominent entrepreneurs – among them property developer Paddy McKillen – could pump fresh cash into the business. Other investors include Moya Doherty and John McColgan, the entrepreneurs behind Riverdance.

New money would strengthen the company's stretched balance sheet. According to its latest accounts, in the year to the end of June 2009 the group lost £3.2m, although that was an improvement on the £9.2m loss the previous year.

The group's troubles have coincided with a sharp fall in commercial property values but luxury hotels have been more resilient than many other real estate assets.

Coalition proposals to limit the number of non-EU citizens UK firms can employ have angered City bosses

Leading City employers are furious about the limits being imposed by the government on the number of non-EU citizens they are able to employ and are urging a dramatic rethink of the government's policy.

The financial district prides itself on its cosmopolitan workforce and is concerned that the quotas on migrants being set by the coalition will make it impossible for them to keep operating effectively.

A senior City source described the new rules as a "disaster". Firms were told the implications of the policy by the government last week. Industry sources said that some top City companies believe they will be restricted to hiring as few as six non-EU nationals during the remainder of the year.

The immigration policy is being introduced at the same time the Square Mile is moaning about unpopular taxes and the Financial Services Authority's warning that 2,500 City companies would be covered by its bonus tax. Some experts reckon all these factors together could make London a less attractive location for major international firms.

Stuart Fraser, chairman of the Corporation of London's policy committee, said: "With all these things, it's as if we're saying if you're talented in finance, don't come here."

Employers' body the CBI said it was in dialogue with the Home Office over the migration caps while the City's trade body, the Association for Financial Markets in Europe, said its members were worried: "There is a concern that it will become more difficult to move people around their businesses on a global basis."

The CBI was reluctant to criticise government policy, saying it "remains of the view that a managed migration policy which meets the skill needs of the economy can operate within a cap on immigration".

A spokesman added: "Last week saw the first communication with companies about the interim cap. Naturally, there will need to be a dialogue to resolve any issues".

Fraser said he was concerned a numeric cap would always be problematic and that a points-based system such as the one used in Australia might be more effective. He felt that the individuals currently being affected – highly skilled, high-earning taxpayers – were not the ones the restrictions were aimed at. The government is consulting on its immigration policy until September.

The concerns were raised as the UK's major banks prepare to publish figures for the six months to end of June. Bailed-out banks Lloyds and RBS are expected to return to profit. The improvement is likely to be dramatic at Lloyds, after it revised up the consensus for its figures this weekend to £1bn. That compares to a loss last time.

Banks with big investment divisions such as Barclays are likely to suffer amid predictions of falls in profits of up to 40% in some divisions. Even profit rises in their high-street operations may not cushion the declines.

Anti-ageism campaigners believe UK employers are targeting mature workers for forced retirement

The number of over-60s forced to retire against their will increased dramatically last year to 100,000 as employers targeted mature workers for job cuts in the recession.

An average of just 25,000 sexagenarians had been forced out of the workplace in each of the previous two years, according to Age UK. The charity highlighted the fourfold jump as the government unveiled proposals to scrap the default retirement age of 65 and decreed employers should no longer be free to push someone out of their job because of their age.

The business lobby has mounted a campaign of fierce resistance, arguing that if it loses the right to shed older staff it will reduce flexibility. But anti-ageism campaigners say the figures are evidence that employers are too keen to lay off older workers.

Age UK reckons axing of the 100,000 mature employees cost the UK £3.5bn in lost economic output, and accused business organisations of trying to maintain "an unequal status quo".

"Employers are trying to breathe life into dead arguments in a desperate attempt to keep the upper hand over older workers' retirement decisions," said director Michelle Mitchell.

"The government has made the right call on forced retirement and we encourage ministers to stand by it."

Employers have argued the changes will make it hard to discuss the subject of retirement with older workers who may not be able to work so effectively as younger staff, particularly in manual jobs.

Business groups have also attacked the timetable for change – of just over a year – as too tight. But Age UK says they have already had plenty of time to find new ways to talk to older staff about their future."There must be a better way of broaching this subject than waving the threat of forced retirement at them," said Mitchell.

The government wants the law changed to keep pace with rising life expectancies and the costs entailed. Announcing the plan, last week, it published an "impact assessment" claiming the benefits outweighed the costs.

"There's overwhelming evidence that older workers, the UK economy, public finances and employers themselves will all benefit from the abolition of forced retirement," said Mitchell.

Katharine Whitehorn, page 29

Ruth Sunderland, page 40

Unions angered by payout to chief executive who mothballed Teesside plant with loss of 1,000 jobs

Kirby Adams, the outgoing chief executive of Corus who threw 1,000 steelworkers out of a job this year, is believed to have been paid more than £2m.

The jobs were lost after the partial mothballing of one of Corus's plants, Teesside Cast Products (TCP). The trade union Community described Adams's pay as "an insult to all steelworkers".

Talks to sell the TCP plant have entered an advanced stage. Corus has been in negotiations with the Thai steelmaker SSI since May and a deal could be reached within weeks, which would provide a rare boost for the struggling economy of the north-east. But one industry source cautioned that there was no certainty that the sale would go ahead.

Adams will leave Corus next month for "personal reasons", less than 18 months after taking the helm at the troubled group. Local MPs accused the 54-year-old American of "relishing antagonistic confrontation" during negotiations with unions over the future of the TCP plant.

According to the GMB union, Corus – now a subsidiary of Tata Steel Europe – has cut 6,000 jobs across Europe since Adams joined the company. The chief executive was dubbed "arrogant and disrespectful" by MPs in March after he declined to give evidence to the north-east regional select committee about the closure of the TCP plant.

According to the annual report of Tata Steel Europe, the highest-paid director for the financial year ending in March received £2,039,140. Because it is no longer publicly listed – after it was bought by the Indian group Tata Steel in 2007 – the company does not have to identify the director in question. But it is almost certain that Adams, who is to stay on as a paid consultant when he quits his present job, was the beneficiary.

Last year the company imposed a pay freeze on all workers, including directors, because of the global economic downturn, which saw demand for its steel products slump. During the first nine months of last year, Corus made pre-tax losses of £662m but since then it has returned to profit.

Adams continued the restructuring of Corus set in motion by his predecessor, Philippe Varin, and has been helped by the economic upturn this year.

Michael Leahy, general secretary of Community, said of the £2m payout: "When Corus has been crying poor and offering pitiful pay rises to our members, who worked tirelessly to bring the company back to profitability, this revelation of boardroom excess is an insult to all steelworkers."

Community is now negotiating with management over a pay rise for the current financial year, after an initial offer of 1.5%, improved to 2%, was rejected. The offer included a one-off payment of £200 in recognition of sacrifices made by workers over the past year, when shift levels were cut and pay was frozen.

One of the complications surrounding the sale of the TCP plant has involved the fate of the accompanying carbon credits. Steelmaking is highly carbon intensive and plants must participate in Europe's emissions trading scheme, which requires them to own "licences to pollute" in order to operate. Last year, Corus was awarded about €100m worth of carbon credits. If it decides to sell those attached to the TCP plant, the value of the plant will be hit as the new owner would have to buy new credits on the market in order to operate.

The plant was partially closed in February, several months after an international consortium reneged on a 10-year deal to buy steel made at the site. Adams insisted that the sudden loss of this contract meant closure was unavoidable.

The American has described himself in an interview as a "straight shooter". "I don't sugar coat and I might irritate some people," he told the Financial Times. "If this is what some people might call 'adversarial', then it seems to me that this could be a compliment."

Employers have warned that economic recovery could be snuffed out if banks refuse to lend to businesses that need to expand.

Ministers have set great store by an export-led recovery, as well as expressing hope that cuts to services and staff in the public sector can be made good by a surge of activity from private companies.

But John Cridland, deputy director general of employers' group the CBI, told the Observer that "the jury was out" over whether the private sector could get sufficient capital from banks to fund expansion and re-stocking.

Cridland said: "Policymakers should make sure that they don't reduce the capacity of banks to act by requiring them to build a deeper capital cushion [to withstand shocks].

"Incidentally, that is why we are opposed to European-inspired rules to restrict the actions of private equity and hedge funds that can furnish [companies] with additional liquidity."

He added: "We are aware that many foreign banks have withdrawn from the UK after the credit crunch, so when companies seek to refinance loans, they will be even more dependent on British institutions."

Cridland added that banks needed to provide funding to firms that were in urgent need of capital to meet demand for new orders. "Otherwise recovery will be in jeopardy, "although we are not unduly pessimistic."

Last week business minister Vince Cable warned he might ask all banks to sign lending agreements if they failed to increase the supply of credit.

In the consultative green paper, Financing a Private Sector Recovery, Cable said the coalition was prepared to extend the lending targets inherited from Labour from state-supported banks to those that had not needed direct taxpayer support.

He said it appeared to make little difference to a bank's lending performance whether or not it was part-owned by the taxpayer. "I don't want to focus too much on the state-owned banks. There is a danger of putting them at a disadvantage when in truth all banks are being supported by government liquidity arrangements.

"We are looking at the lending practices of all of them and not just these two (Lloyds and RBS). We want to see evidence of restraint in bonus payments and dividends."

The green paper noted that the recent Financial Stability Review from the Bank of England had estimated that the banks could generate an extra £10bn of capital, which in turn could sustain £50bn of new lending, if they limited bonus payments to levels seen before the financial crisis and dividends were pegged at 2009 levels. "I am making it clear that the banks should be very, very self-conscious about bonuses and dividend payments. I also want to make them aware that the government is not devoid of sanctions it could bring to bear.," Cable said.

The green paper said there was a risk that banks were boosting their profits at the expense of their customers and that this "would be a cause for concern and a potential justification for government action".

Metro bank will be open for business today, as competition for customers sparks new names and branch networks

Shoppers piling out of Holborn tube station on their way to Covent Garden today will be greeted by an unusual sight: a bank open for business on a Sunday. Metro, the first new bank to open on the UK's high streets for more than a century, will be hoping at least a few of them wander into its large hall on what will be just its fourth trading day, even if only out of curiosity.

Metro, a privately owned operation and the brainchild of US banking veteran Vernon Hill, whose fondness for dogs means that biscuits for customers' canine friends are one of his marketing gimmicks, is one a of a number of new banks determined to inject fresh competition into the high street following the disruption caused by the banking crisis.

Others with the same idea include experienced City figures such as Lord Levene and Sir David Walker, who are looking for financing, while Spanish bank Santander is poised to take control of 318 Royal Bank of Scotland branches this week. Virgin Money is also promising to offer a range of banking products, while Tesco is preparing a full-front assault on the industry.

When banks reveal interim figures this week they are expected to report a rise in profits in their high-street arms after a period of losses caused by the financial crisis, which also wiped out traditional competitors in the markets. Halifax, a fierce rival, was gobbled up after being rescued by Lloyds. Northern Rock was wiped out after the group was nationalised.

Within three minutes' walk of the imposing glass-fronted Metro branch – or "store" as Hill would have it known – are branches of Barclays, NatWest and Lloyds. Each tells a story. The NatWest branch, part of the bailed-out Royal Bank of Scotland group, and the Lloyds one are classic in appearance with their brick walls and high windows. Staff remain hidden inside, despite the party on the pavement a few metres away. Both banks were bailed out by the taxpayer.

The Barclays branch, though, is light and airy, with floor-to-ceiling glass walls. Its staff are getting into the spirit of things, embarking upon guerilla marketing tactics with a town crier shouting Barclays' wares and bikes decked out in the bank's corporate blue zipping up and down the street. They appear to be taking the Metro threat seriously – or at least seeing it as a marketing opportunity.

Deanna Oppenheimer, the Barclays executive who runs the branch, is an American familiar with Hill's business model – service rather than price. While the focus of the world for the past three years was on the crisis in the banking sector, Oppenheimer was redesigning the bank's branches, "the window of Barclays on the world".

The makeovers were meticulously planned at a warehouse in Nottingham, where there were long debates about the "choreography" of where to place the tellers, cash machines and the areas for private discussion. Attention was paid to every little detail. Oppenheimer also hired executives with retail experience, particularly from Tesco.

But, as is often the case, banking has been here before. Longer opening hours, one of Metro's major market propositions, have already been tried by other players. NatWest has long-styled itself "SatWest" to trumpet Saturday opening. Some branches also open on Sundays and a handful open on bank holidays.

Hiring retailers has also been done before. A decade ago Halifax appointed Andy Hornby, later to become chief executive and at the helm when the bank was rescued by Lloyds, from Asda to add a bit of spark to the staid world of banking. HSBC followed, hiring Joe Garner from Dixons. For a while the Halifax tactics worked as it promised to the "eat the big four's lunch" with sharply priced products, marketed in a quirky way.

But some think there is a need for a "new Halifax" after the HBOS rescue by Lloyds formed a banking mammoth with market shares of 30% in some business lines. Ian Gordon, banks analyst at Exane BNP Paribas, points out that other competitive forces such as Northern Rock, nationalised and still in rehabilitation, have also disappeared.

Others argue that the banking crisis has allowed new competitors to thrive, notably Santander, which bought Abbey National six years ago but has only begun to grow dramatically since acquiring banks wounded by the banking crisis – Alliance & Leicester and parts of Bradford & Bingley. It is now taking the bold step of scrapping the individual branding and hanging its red flame logo everywhere. Santander also knows how important a high-street presence can be. Queues formed out of the doors when it launched a market-beating 3.5% Isa in March. It also knows what happens when a product is too popular: the bank was recently bottom in a Which? survey of customer satisfaction.

While Santander sees itself as "challenger" in the market, other new competitors will have to emerge as a result of demands from EU regulators that RBS sell 318 branches and Lloyds more than 600 of its network in return for the £75bn of taxpayer funds they have received. Northern Rock, which had to wind down its mortgage business for a time, could also become a force again once it is sold, possibly this year.

Again, Santander stands to benefit by buying up branches RBS is being forced to sell. Its network will become bigger than HSBC's if the deal can be pulled off, and crucially it will allow Santander to take a huge leap in banking to small businesses, something business secretary Vince Cable is determined to promote during the economic downturn.

While competition in retail banking is under scrutiny, generating competition in small-business banking is notoriously tricky. But, by buying the RBS operations, Santander's market share in this field will jump from 3% to 8% overnight.

It is an area that Santander's Abbey arm has tried to crack but in which it has been thwarted by regulatory changes recommended under Labour's major review into the industry by Don Cruickshank. Price controls were imposed on the incumbents, leaving Abbey and Halifax without any means of competition.

Bankers cite this episode as a warning to the coalition government's banking commission, which could also come up with additional proposals to inject more competition into the system. The Office of Fair Trading's review of barriers that may stop new banks being set up is also looking at how important an extensive branch network is to running a successful bank. The OFT is scrutinising "whether the importance of branch networks has changed over the last few years, for example due to increased use of the internet and mobile banking".

The telephone, internet and hole-in-the-wall machines are the other ways to allow customers to get their hands on their money. "If you look at the choreography in the branches, are you expected to go and queue, go to the cash machines... [it's about] what is the customer experience going to be?" says Steve Davies of Pricewaterhouse Coopers.

This is where Metro is determined to make its mark, rather than competing on price. Its single store in Holborn should be joined by three others in a year and there are plans for a 200-strong stable. It is largely a proposition aimed at the south-east of England, a move that Ben Steer, a director of consultants GfK Financial, believes is crucial.

"London current account holders are prime targets for Metro Bank," he said. "They are the UK's most dissatisfied customer group."

Even so, he is sceptical about how willing customers will be to move their accounts, as is Stephan Butscher, managing partner of consultancy firm Simon Kucher & Partners, whose office overlooks the Metro branch: "I think there's enough competition. I don't think they will make a huge difference."

Labour tried to tackle this problem of current account inertia by forcing banks to co-operate when customers wanted to switch accounts by helping with the mechanics of shifting direct debits. Even so, Steer notes that just 1.2m out of 60m current account holders moved their bank last year.

Watching the jamboree outside Metro – mobbed by camera crews at its three-day launch party – Butscher remains sceptical: "They are getting a lot of headlines, but after a week that will go. They just don't look like a competitor."Metro is refusing to listen to detractors. Since opening at 8am on Thursday, it insists there have been queues outside and that hundreds of new accounts have been opened by dissatisfied customers of other banks. It is reluctant to indicate how many it hopes will sign up today, the first time it will get a feel for whether there is a mass appeal for its promise of seven-day-a-week opening.

Advertising is up, but chief Adam Crozier needs to find the x-factor that will bring long-term success

Though it may seem like only yesterday City investors were calling for management scalps at ITV – as the share price plunged and advertising all but dried up– that's all changed. Now the company is being touted by analysts as a recovery story after the departure of Michael Grade and the appointment of ex-Asda chief Archie Norman as chairman and Adam Crozier, former head of the Royal Mail, as chief executive.

They say timing is everything. Crozier and Norman have hit the jackpot, with advertising rebounding just as they were getting settled into their offices at ITV's headquarters on London's South Bank.

The World Cup and blockbuster hits such as Britain's Got Talent have helped ITV turn the corner, but more importantly advertisers have been prepared to spend again as Britain has emerged from recession. Interim figures to be published by the company this week should make good viewing: advertising is expected to have increased by about 20% on a year ago. And as advertising makes up 75% of ITV's revenues, it is central to the group's performance.

But structural problems remain. The advertising cake is fragmented since the emergence of digital, cable and satellite rivals. And gone are the days when the company used to dominate commercial television, and advertisers knew they could regularly reach a majority of the population with a well-timed promotion during prime-time viewing.

Norman and Crozier have been conducting a strategic review of the group's operations, but few believe there will be a "big bang" announcement when the half-time numbers are published on Wednesday. "I think that what we will see at ITV is evolution rather than revolution," says Paul Richards, media analyst at Numis Securities.

Richards believes ITV should do what it does best and focus on improving its offering on ITV1. He says rising profits should encourage Crozier and Norman to plough millions into programme making, producing its own "quality" non-crime drama, rather than being reliant on reality TV.

A TV executive says: "It's all very well paying ever-increasing sums to people such as Simon Cowell for The X Factor, but these programmes have no shelf life beyond their first transmission. You can't repeat them. But hit programmes of old, such as Inspector Morse and Jewel in the Crown can be shown again and again. What ITV should be doing is investing heavily in top-notch scripted drama and comedy."

How ITV is reshaped by Crozier and Norman matters a lot, because few believe the advertising bounce will continue into 2011. "Don't forget that 2009 was nasty, so we are coming from a low base," says Richards.

Numis is forecasting just 1% of advertising growth in 2011, against 14% for 2010 as a whole – assuming there is no double-dip recession. Richards is confident that the trading environment will be more stable than in recent years: between 2006 and 2009 ITV operating profits halved from £400m to £200m. After writedowns and exceptional costs, the company lost £2.7bn in 2008, the nadir of its fortunes.

The challenge for Norman and Crozier is to find ways of hedging against the advertising cycle, which is closely linked to GDP. One solution would be to come up with a compelling pay-TV operation, but that isn't easy when Sky dominates the sector with 9.86 million subscribers. Sky has massive bargaining power, so negotiating an agreement that makes commercial sense for ITV is "a big ask", says Alex de Groote at Panmure Gordon.

He adds: "Everyone remembers the failure of ITV Digital 10 years ago – when former ITV head Michael Green lost £1bn on a venture that eventually had to be abandoned.

"Aggressive marketing by BSkyB for its own digital service, Sky Digital, made the ITV offer look unattractive."

One way around the Sky colossus would be to develop ITV.com and provide a paid service via the internet. But with so much free broadcasting available – not least from the BBC – there is no guarantee of success.

Norman said recently: "We have no product suitable for a pay platform right now. Speculation we might take ITV 2, 3 or 4 onto a pay-tv platform is not realistic. Were we to develop a proposition in the pay-TV market we would need a very different product than we have at this time. Is there, in principle, a case for looking at it [a channel] out of content and programming we have already? Absolutely."

ITV's digital offering is being studied by Fru Hazlitt, the former chief executive of radio group GCap, who was appointed as ITV's head of advertising and online activities with a mandate to look for new sources of income. She told the Financial Times: "ITV has to look at exploiting more activities beyond spot advertising. The way you build on that traditional strength is the way you will be transformational."

She said Project Canvas, the technology that will blur the distinction between computers and TV when it is introduced in 2011, would be a significant part of the transformation.

Crozier says it's crucial that the company gets "better at exploiting our brands fully across all platforms and reducing our reliance on a single volatile revenue stream".

Another key area that ITV's new management is targeting for growth is its programme production arm, ITV Studios, which has been neglected. Norman has moved to scotch persistent rumours that he would sell off the production business to allow ITV the flexibility of buying the best content available on the international market. Some shareholders support a sale but Norman does not. He says it makes commercial sense for ITV to own as much of its content as possible in a world where experts contend that "content is king". That piles on the pressure for ITV's production arm to come up with blockbuster hits, and preferably ones that can be sold overseas, especially in the US.

To meet the challenge, Norman and Crozier have appointed a new head of ITV Studios, Kevin Lygo, who joined from Channel 4 in the spring. The production arm had a turnover of nearly £600m last year, but has suffered from the loss of a number of senior creative figures as the broadcaster slashed costs. It has seen its share of commissions from ITV fall from 65% in 2004 to 47% this year. Lygo said that his goal for ITV Studios, the home of shows such as Hell's Kitchen, Emmerdale and Poirot, was to "keep those programmes fresh and relevant, develop new hits and exploit the full value of those properties across all platforms in the UK and internationally".

Peter Fincham, ITV's director of television, channels and online, who was involved in recruiting Lygo, said that reinvigorating ITV Studios was a "high priority" for management. Guardian columnist Steve Hewlett wrote recently that the strategy is sensible in principle: "Put simply, too many of ITV's hits are made (and ultimately owned) by other people – think The X Factor and Britain's Got Talent.

"On the upside, those shows help to improve ITV's on-air performance and ad income. On the downside, you can't have a credible "profitable content" growth strategy if you don't own the content."

But he warns that Lygo's mission is a hard one. "Tension between producers incentivised to build their content business and broadcasters strapped to the wheel of maximising on-air performance has proved impossible to resolve (in the past).

"The temptation to pressure ITV commissioners to favour in-house ideas will be hard to resist. But the minute that results in a less-than-optimal on-air performance, investors will get nervous."

That is why some City shareholders believe a better option would be for ITV to ditch its in-house production operation and simply buy in the best programmes from around the world.

Elsewhere, the regulatory climate remains difficult. The company was recently knocked by a Competition Commission review, which ruled that restrictions on how much it can charge advertisers must stay in place. The contract rights renewal (CRR) system determines advertising rates and is designed to prevent ITV abusing its dominant position as the largest free-to-air terrestrial broadcaster. The rules were a condition imposed by the regulator for waving through the merger of Carlton and Granada in 2003, a deal that led to the creation of ITV plc. ITV has long argued that CRR is a straitjacket which restricts the group's ability to recover from the advertising slump. Norman said CRR's abolition was a priority, but that ITV should not depend on rule changes to lift its fortunes.

But what of the mood inside ITV? The company's recent decision to ask 150 of its senior staff to undergo psychometric tests went down badly with managers suspecting the exams would be used to root out people that ITV wanted to sack. The company denied this was the case and said the process was designed merely to understand "the ongoing development needs of each member of the team".

One insider said: "There is less enthusiasm for criticising Norman than the previous Grade regime. But the atmosphere is hardly upbeat. Norman, Crozier and Hazlitt didn't have experience of television before they joined, which hardly inspires confidence. But let's see what they come up with. These are early days."

Crozier is in line for a pay packet of more than £14m over the next five years if he can turn around the broadcaster's fortunes. But can he do it? Toby Syfret at Enders Analysis says there is "no magic formula, but the priority should be to protect its (48%) share of the television advertising market, and not get too preoccupied with diversification".

The UK's 200 largest companies have a pensions shortfall of £100bn and the downturn is likely to make deficits worse

The coalition's move to abolish the default retirement age of 65 is a step in the right direction, but simply allowing people to work longer will not solve the pensions crisis, either for individuals or for companies. Neither will the piecemeal measures announced so far, including the downgrading of inflation-proofing of benefits in line with consumer price inflation, which tends to run at a lower rate than the previous benchmark, retail price inflation.

The UK's 200 largest companies have a combined pensions shortfall of £100bn, according to Aon Consulting. In the short term, the economic downturn is likely to make the deficits even worse, due to technical factors related to the market in government debt. Companies are pinning their hopes on long-term recovery to reduce the red ink, but the deficits in themselves may be impeding economic revival. A study by the CBI and actuary Watson Wyatt found that a third of employers believe the need for additional pension provision had "significantly obstructed" mergers and acquisitions, or led to reduced competitiveness. Almost 40% claimed the pension fund had drained away money that would otherwise have been used for business investment.

Allowing employees to carry on into their late sixties and beyond is a sensible move. Those who want to continue should not be subjected to age discrimination, and older workers should increase productivity in the economy as a whole. If mature employees carry on working, they contribute to the economy and to the exchequer. Any blocking of opportunities for younger colleagues may be offset by the fact they are reducing the burden of elder support.

None of this, though, is a magic bullet for businesses grappling with final salary pension schemes. There is already a trend for companies to close them to new entrants and to scale down benefits, but that does not deal with their existing obligations, which in some cases amount to more than the market value of the company itself. Allowing people to work for longer doesn't cut costs: the length of time they draw a pension will be shorter, but it will be at a higher level.

In the past few weeks, there have been a number of rows about pensions. BT is battling regulator Ofcom, which has banned it from raising the prices it charges rivals to help plug its £6.6bn deficit. Workers at an AstraZeneca drug factory are holding a strike ballot over plans by the company to freeze pensionable pay for its final salary scheme in a bid to tackle its deficit of £1.4bn. Uniq, which makes sandwiches and salads for M&S, had a plan to pay off its £436m deficit rejected by the pension regulator.

There will be more of these conflicts as companies seek to bring their pension liabilities under control, not only with employees and regulators, but also with shareholders. Despite the overall weakness of the UK economy, some large companies are seeing profits flow again. Dividends are being raised at British American Tabacco, BAE, Centrica, BskyB and Rolls-Royce, and AstraZeneca has increased its share buyback programme.

Questions will be asked about why investors are benefiting from the cash generation ahead of fund members, though this is complex. The largest shareholders in the UK are in fact pension funds, so depriving them of dividend income seems self-defeating.

Companies have some difficult judgments to make: on extra pension contributions versus dividends, and on ploughing money into the fund versus investing in the business. Some will behave cynically, and some funds will be impossible to save. The Pensions Regulator reports an increase in potential avoidance activity, and 160 schemes have gone into the lifeboat scheme provided by the Pension Protection Fund.

Most people, understandably, prefer not to think too hard about their retirement finances. The credit crunch has put us in fear for our jobs and the value of our homes – pensions are just one more worry. There is only one message, and it is not an easy one for politicians to deliver: work longer, save more and spend less, supposing you are fortunate enough to be able to do so.

The BBC's move to Salford, and executives' apparent desire not to live there, raises questions over its approach to regionalism

The one big winner in the BBC's mass move north to Salford would be Sir Richard Branson (I reckoned last week, looking at the curious decision to disintegrate an integrated newsroom and shove BBC Breakfast on a fast train to Manchester Piccadilly). At which point, rather too instant confirmation arrives ahead of cue. Peter Salmon, the director of BBC North, may or not be moving to the quays. His deputy, plus the head of Five Live and the director of sport seem similarly indecisive and are thinking of renting weekday flats at licence-fee payers' expense.

Is that (as the Daily Mail inevitably posits) a ludicrous cop-out? It depends what taking 1,500 BBC jobs to Salford is all about. If they're just bums on northern rather than southern seats, then contributing to Greater Manchester life isn't part of the deal. If the idea is to give Salford and surrounds a cultural infusion, then the bosses can't be serial commuters.

But what is corporation (or, come to that, governmental) regionalism all about these days? You could call that a second city question, repeatedly raised since the demise of Pebble Mill in a Birmingham that barely makes anything but Countryfile and local news these days.

Few bums on seats equals no buzz. Is Salford a surrogate for everywhere but London? A hardship posting to set alongside Sarajevo? Or could Brum make a comeback because commuting home to Surrey is much faster? It would be good to get a definitive answer before the first-class carriages from Piccadilly to Euston fill to overflowing.

Perhaps culture secretary Jeremy Hunt has plans to call in Boris Johnson's dad to take the helm of Ofcom or the BBC Trust

Paul Farrelly, the Labour MP for Newcastle-under-Lyme, had a Commons question for our new culture secretary last week. Would the rules governing impartial television news remain sacrosanct in coalition land? To which Jeremy Hunt could have said simply "Yes – I've no plans to change anything".

But in fact he went on for a rather fascinating couple of sentences. "We will take no lessons on impartiality from the opposition," he said, somewhat brusquely.

Then he added: "There are two people responsible for impartiality in British broadcasting – the head of Ofcom and the head of the BBC Trust. One is a former Labour councillor and the other is a former Labour special adviser."

Do the shades of night begin to gather around Ed Richards and Sir Michael Lyons? Call for Boris Johnson's dad for Ofcom and Ann Widdecombe for the Trust in the interests of – as Fox News might say – real fairness and balance.

Can Sherlock Holmes shed light on the Indy's plan to drive sales?

Sherlock ... you know the dog that didn't bark? What about the bulks that didn't make sense?

You mean the way the Independent sliced 23,000 copies a day off its claimed foreign sales in June, and shunted them over into the next column as bulk give-away copies, Watson?

Exactly, Holmes. I remember asking you what was going on a couple of weeks ago, and you said it was a two-pipe problem.

Certainly, Watson, two pipes and a packet of reefers: but try this for a thesis. The two Independents need to put on a bit of a spurt in the autumn. That nice Mr Lebedev, sitting in Moscow like professor Moriarty pondering his next move, expects nothing less for all the cash he's piling in. So why not try a little twist on the free marketing wheeze they tried in the spring and giving supposed sales a sudden surge?

So shifting some foreign copies to WC1 is flexible planning, Sherlock?

Precisely, Watson. The dog is barking furiously. Just remember to turn your hearing aid on.

Economics is a still male-dominated profession, but with more women and those from ethnic minorities, the dismal science may realign itself with the real world

When the Bank of England's monetary policy committee meets this week to set interest rates, it will be the first time that a full-strength gathering of nine has been male-only.

Kate Barker, who has been replaced by leading academic Martin Weale, served a nine-year stint. In the past, eminent women, including Dr DeAnne Julius and former deputy governor Rachel Lomax, sat on the committee. Weale commands huge respect, and the MPC's work is far too important for it to indulge in tokenism, but it seems a shame there were no female economists considered worthy to fill their shoes.

Economics is still a male-dominated profession. Only about a third of the 60 or so City economists polled by Reuters on interest rates are women. In a 2008 report, the Royal Economics Society found that 22% of academic economists are female, only 17% from ethnic minorities, and that both groups were under-represented at a professorial level. Last year, Elinor Ostrom became the first woman to win the Nobel prize for economics, 41 years after its inception; depressingly, her victory provoked misogynist blogging.

Economists contributed to the financial crisis by promulgating unfettered markets, by misrepresenting their discipline as a science, by relying too heavily on abstract models and by assuming human beings behave as if they are entirely rational, financially motivated robots. Is this a particularly "male" way of thinking?

That's too crude: but it is noticeable that those who predicted the collapse, such as Nouriel Roubini and Gillian Tett, did not fit the mainstream Anglo-Saxon male template. There is a case that a more diverse economics profession might be more in touch with the real world.

Payoffs for Corus executives leave a bitter taste especially when their stewardship fails to benefit communities

Kirby Adams, the outgoing chief executive of steelmaker Corus, devastated the community in Redcar when he mothballed the Teesside steel plant with the loss of 1,000 jobs. The announcement in July that he is soon to leave the firm was greeted with joy in the north-east, where he was widely seen as not having done enough to save the business. He appeared uncaring and insensitive, with MPs branding him arrogant and disrespectful for refusing to turn up to a select committee hearing on the closure. The view on Teesside is that Adams's abrasive style torpedoed the chances of finding a buyer. All hopes are now pinned on a sale to Thai steel firm SSI.

Parent company Tata Steel Europe's accounts reveal the highest-paid executive, almost certainly Adams, received a £2m package last year. His no-doubt generous payoff will not be disclosed until 2011. Executives deserve high rewards when their activities and innovations benefit society, but lavish payments are distasteful when they leave a trail of unemployment and traumatised families in their wake. The contrast between Adams's circumstances and those of the redundant steelworkers does not need spelling out.

Tony Hayward's departure can't disguise the fact that the oil giant's motives are purely mercenary

A recent newspaper advertisement for Ryanair has a big picture of Robert Mugabe shaking his fist, under the headline: "Here's EasyJet's New Head of Punctuality". This sends out a confused message. I'm no Zimbabwe expert but I'm fairly confident that the main charge levelled against Mugabe isn't one of unpunctuality. It's no more meaningful an insinuation than saying that Kim Jong-il is Virgin Atlantic's new head of catering or that Mel Gibson has been taken on by Thomas Cook to handle its IT.

And while Mugabe's an evil man, there's no reason to think that, had history panned out differently, he mightn't have made quite an effective "head of punctuality" for an airline. If what people say about Mussolini and trains is to be believed, a bit of murderous megalomania doesn't go amiss when it comes to getting transport services to pull their socks up.

But we'll never know how he'd have got on because Robert Mugabe isn't easyJet's new head of punctuality at all. It's not clear whether he even applied. Apparently he really, really wants to stay on as president of Zimbabwe. It would have been an eccentric career change – like when Alastair Campbell moved from handling the press for that unsuccessful war to doing the same for a rugby tour that went even worse. But maybe, like Campbell, Mugabe would have been glad of the comparative rest. EasyJet, for all its faults, isn't as unpopular as the government of Zimbabwe. It's not like it's Ryanair or something.

Ryanair is the unashamed villain of the corporate world. Other companies probably do worse things but Ryanair is the only one that delights in stepping into the public eye wearing an opera cloak and laughing maniacally. This horrendously unfair advert is typical. The sole basis for associating its rival with a brutal kleptocrat is a couple of quotations from newspapers both quoting the same third source claiming that easyJet's flights from Gatwick are "less punctual than Air Zimbabwe".

Michael O'Leary and Ryanair realise that this will seem underhand but they also know that their customers don't need to like them. They're running a "no frills" airline and have worked out that frequent flyers subconsciously consider civility and fairness to be frills. "These people will keep their prices low," we secretly think, "even if they have to treat us like cattle and stab their competitors in the back to do so."

This approach is unusual and refreshing. Most companies persist in trying to persuade us that they're nice and care about charitable causes, the obesity epidemic, equipment for schools or the environment. As I've said before, they're incapable of caring – they're merely trying to make money for their shareholders and believe that this affectation of human feelings will help them to do so. Conversely, Ryanair has attracted customers canny enough to know that a public company can only have mercenary motives but who are happy to do business with it anyway.

BP has not reached this level of corporate development. In common with most other oil companies, it spends a lot of its marketing budget assuring us that it's obsessed with alternative forms of energy – that walking on to a BP forecourt and asking for petrol is like trying to buy a VHS cassette at the Apple store. "Petrol, you say? Not much call for that these days. Wouldn't you rather a quick zap from a solar panel or wind turbine?"

This strategy led the Today programme's John Humphrys to ask a silly question last week: "Isn't the reality that so long as the oil companies are as greedy for profits and nothing else as they are, this problem is not going to go away?" he said, with reference to the issue of replacing oil with renewable energy. It's silly because it only demonstrates Cynicism 1.0: he knows these corporations aren't as eco-committed as they claim because they can still make money out of oil. But he implies that a time might come when plcs aren't "greedy for profits and nothing else". Cynicism 2.0 is realising that it won't and that we can only properly harness the power and wealth of oil companies for developing sustainable energy sources by creating a business environment in which that activity is as profitable, or looks like it will become as profitable, as drilling for oil.

The continued prevalence of Cynicism 1.0 is presumably one reason BP considered it politic to remove its chief executive, Tony Hayward, last week. The oil spill is an environmental disaster and the company still thinks it's worth trying to appear as if it genuinely cares about that, and not just about the consequent financial and reputational cost. So heads must be seen to roll, even if Hayward's was detached by a generous severance.

The generosity is because no one at BP, and few unemotional external observers, holds him particularly responsible for the disaster. At worst, he's deeply complicit in a corporate culture where such spills weren't made as unlikely as they could have been – but that's a long way short of it being directly his fault. At best, it was a very unfortunate accident and he's blameless. He made some PR gaffes and seemed a bit callous, but no one has suggested that any of that either hurt or saved a single extra sea bird.

This makes the decision to axe him seem illogical. Businessmen of his seniority are incredibly well paid and this gets justified by the claim that their acumen is so rare that they more than earn their wage. If this is true, surely BP can ill afford to lose a man who has ably run the firm since taking up his post in 2007 merely because his tenure coincided with an accident? If he was worth the money they were paying him, he will not be easily replaced.

Yet he has been, and things will be fine, says BP. Apparently it wasn't like trying to find another Andrew Flintoff or Tom Stoppard – people with amazing talents in their fields. It was more like replacing a good heart surgeon: Hayward's skills are uncommon, but not unique. He isn't, for example, the person who finds all the oil. That such executives know they're over-remunerated is implicit in their "it was nice while it lasted" willingness to step aside when their luck, rather than their competence, runs out. Deep down they know they're only human.

But I doubt Michael O'Leary would go that quietly. Neither, for that matter, has Robert Mugabe.

A dialogue from heaven: what the economist John Maynard Keynes might now have to say to the Lib Dem politician Vince Vable

A letter from heaven from John Maynard Keynes ...

Dear Dr Cable. Forgive me for addressing you so formally; I know from my sporadic perusal of the Galaxy Gazette and the Earth Times that everyone refers to you as "Vince". And one gathers that these days down there one can receive correspondence, and these funny things called emails, in which complete strangers have the presumption to go straight on to first-name terms. But that is not the way my generation was brought up, and old habits die hard – especially when one is supposed to have died with them – from which you will gather that, having solved the major economic problem of the day, I have now solved the eternal one. My ashes may have been scattered over the South Downs in 1946, but miracles do happen, and here I am, fresh from the Nectar Lounge of the Ambrosia Hotel, where I have just enjoyed a (literally) divine glass of champagne with my great soulmate up here, Bert Einstein. People down there were always speculating about the afterlife, but up here we call it the afterdeath.

Enough by way of introduction. Let us proceed to my reason for sending you what is no doubt your first "space-mail". It is this. As you will no doubt be aware from my copious writings, not to say the extensive biography of me by the good Lord Skidelsky, I was always a Liberal – a Lloyd George Liberal, if you like, although I should prefer, if I may be so bold, to be thought of as a "Keynesian Liberal".

This is not as widely known on Earth as it should be. Just as there are people down there who still do not realise that my name is pronounced as in "cane" rather than "keen", there are many who labour (as it were) under the delusion that I was a leftie. Heaven forbid – an expression I can now use with some private enjoyment. I commend to you the judgment I made on Soviet communism, which is there in one of my best books, Essays in Persuasion. I wrote that I had been "brought up in a free air undarkened by the horrors of religion" – which means it was a bit of a surprise to find myself up here, but that's by the way.

My mission was to save capitalism from itself, because there was a time – a long time – when it was threatened by communism. Hence Keynesian economics, which taught, essentially, that, when one is in a hole, it is unwise to dig deeper, and that if the citizenry, businesses and governments all cut back at once, a recession can easily become a depression. Household economics do not apply to the nation. On the contrary, government must spend more when the rest of the economy takes fright.

I was also a champion of liberal values, the arts, the good life, and once wrote: "The moral problem of our age is concerned with the love of money." But you know all this; indeed, yours was a powerful voice before the general election in criticising the excesses of bankers' bonuses and, more important, attacking the idea of an emergency budget, designed to introduce drastic reductions in public spending at a time when a sustained economic recovery was far from assured.

Now, when I first heard the news of the election result on 6 May I rejoiced that the Liberals were in power (to an extent) for the first time since William Beveridge and I set out some principles for modern liberalism to build the good society. I was never one for undue modesty, so let us agree that where our ideas have been implemented sensibly, they have underpinned prosperity, freedom and equality in equal measure – and rather better than the ideologies and programmes of the extreme left and right. So imagine how excited I was that there was a serious chance of a Labour and Liberal coalition.

Alas, now I read that a couple of conversations between leading Liberals and the governor of the Bank of England were enough to frighten you into conducting a volte face (or "U-turn", as I believe the popular phrase now is) on the deficit, and accepting the Conservative case for an emergency budget. End of a realignment of which I and others – Lord Jenkins is up here too! – had dreamed of for years.

And to think! You were such a hero to so many people. There was going to be a special place reserved for you up here. But now we are not so sure.

Yours sincerely,

Maynard Keynes

spacemail: jmk@paradisehotel.com

The abolition of quangos amid sweeping government cuts has serious ramifications for financing of the arts

Government-funded arts bodies have been preparing for bad news for a while and will have braced themselves further after last month's warning from the culture secretary, Jeremy Hunt, that their funding could be reduced by 30%. But the Film Council certainly wasn't prepared for what was to come.

When it was announced last Monday that five arts quangos would be axed (the Museums, Libraries and Archives Council among them), it was the sounding of the clapperboard on the Film Council that caused the most disbelief and dismay. The council's chief executive, John Woodward, said the decision had been taken with "no notice and no consultation", while directors and screenwriters voiced outrage.

The Film Council is one of 55 public bodies that the Department for Culture, Media and Sport wants to cut, merge or streamline as part of the government's extensive cost-cutting drive, but there is something specific about the arts bodies hit or threatened. Since 1945, governments have been wedded to the "arm's length" credo of arts funding; in other words, the belief that decisions should be made not by ministers within the department but by independent, if affiliated, bodies. The scrapping of the Film Council may well prove, over the next year or so, to have set a precedent for the way arts are funded in this country – and for many, that will be an unwelcome change.

In the case of the Film Council, it had proved to be an arts quango with commercial nous as well as cultural importance. Among the 900 or so films that the council has backed are the award-winning and critically lauded likes of Gosford Park, Bend it Like Beckham, The Constant Gardener, The Last King of Scotland and, as detractors have unkindly reminded us, the roundly panned flop, Sex Lives of the Potato Men.

While there have been some suggestions that axing the council might encourage more risk-taking and innovation in British film-making, the more commonly held view is, as John Woodward put it, that "whatever structures do remain to champion British film-makers will inevitably be more fragmented, less powerful and more incoherent".

The government has stressed that lottery funding of British films will continue, but has been vague on whether the amount of funding will stay the same and vague too on who will manage the funds, with Hunt simply citing "existing organisations".

It therefore seems likely that funding decisions will be brought back under the control the Department of Culture, Media and Sport, which would mean the politicisation of decisions about financing the arts. In this sense, the abolition of arts quangos has ramifications that go beyond the practical and into the realm of principle.

The WikiLeaks log showed the failures of the Afghan war – but the media moved on, overwhelmed by the weight of material

Plaudits first. WikiLeaks, the stateless site of secret data, seems like an information source turned irresistible force. And the Guardian, New York Times and Spiegel did a brilliant editing job last week as they took nearly 92,000 classified documents from WikiLeaks.org and turned them into a compelling commentary on the failures of the Afghan war. This is what journalism – and data-handling in the 21st century – may turn out to be all about.

But now, as with anything new, for a couple of problems. First, the question of what happened next. We're talking impact, consequences, the difference that revelations can make. And scratching our heads.

Julian Assange, WikiLeaks' founder, was brooding in similar vein a few months ago to Computerworld magazine. "It's counter-intuitive", he said. "You'd think that the bigger and more important the document, the more likely it is to be reported on – but that's absolutely not true. It's about supply and demand. Zero supply equals high demand, because it has value. But as soon as we release the material, the supply goes to infinity – so the perceived value goes to zero."

Which, being interpreted, means: load 92,000 items onto a ubiquitously available website, and nothing much ensues. What every newspaper or broadcasting station has, nobody values for long. So Assange picked out three prime professional organisations and gave them a few weeks to sift, check and choose what to publish. Now, any impact assessment is bound to be subjective. You could hardly describe it as long-lasting, though. BBC News was more interested in police-force restructuring 12 hours later. Newsnight chose to lead on a tedious hike around broken coalition promises. The tabloids didn't clear the front page. And two American headlines on the second day spoke volumes. "WikiLeaks telling us the obvious ... disclosures unlikely to change course of Afghanistan war," said the Washington Post. "Document leak may hurt efforts to build war support," murmured a profoundly cautious New York Times. Enter Barack Obama himself, asserting how moth-eaten he found the entire package.

This wasn't – as initially claimed – the Pentagon Papers all over again. This was a sensation sinking below the horizon (save for David Cameron in India stirring up Pakistan).

Why? Because much of the torrid drift of the documents was known. Because Afghanistan is a war lost already, exit dates set. Because 92,000 bits of bad news equals a massive migraine. Because – unlike the Pentagon Papers, a top-down, not bottom-up series of revelations – no government moved to fight a court suppression battle, and thus to draw a censorship line that concentrated rather than diffused public concern.

But also because this is a fidgety, multimedia age. Websites bowed down by a sudden weight of traffic can't carry the load alone. Any huge story needs television for added oomph – but there's nothing very terse or visual about 92,000 documents on an overloaded site. TV moved right along its 24-hour path, attention-denuded span as usual. Beyond that, the story was simply too big (in an amorphous way).

Look back last year to the Telegraph and MPs' expenses, another massive collection of facts. The government, after suitable deletions, wanted to bung it all on a Commons website at the same time. The Telegraph, eschewing deletions, played it one moat, one duck house, at a time. On any single day, the tale was comprehensible, focused– and poised for fresh illustration. Momentum built. Anger mounted. Something had to be done.

But demand for the Afghan logs was just a "flash flood", said Slate, the online magazine. Could Assange have orchestrated more? Could he have released the truly shocking rise in civilian casualties one day, the killer units pursuing Taliban leaders the next, the evidence of Pakistani connivance the day after that? Of course. And the Guardian did some of that for itself. But day two saw the New York Times pretty well washed up and protesting its unimpeachable seriousness. The denials and the write-offs and the counterattacks had open season, which meant momentum faded – and, indeed, the course of the war seemed "unlikely to change".

The second problem follows naturally, then. The sharpest question about WikiLeaks' technique – asked by Obama, President Karzai, the Times of London and even the New York Times itself as days passed – was whether some Afghan Nato informants hadn't been unwittingly exposed in the process, whether Assange's inevitably scanty team of assessors hadn't put lives at risk by their mass data dump?

Assange called the New York Times "pusillanimous and unprofessional" for checking the documents it used with the White House before publication (on precisely these personal security grounds) and for not cross-referring its print stories to the whole WikiLeaks.org experience. But "we're not in any kind of partnership or collaboration with him," said Eric Schmitt, one of the New York Times reporters on the case. Bill Keller, Schmitt's top editor, soon weighed in, too.

"Assange released the information to three mainstream news organisations because we had the wherewithal to mine the data for news and analysis. I think the public interest was served by that. However, his decision to release the data to everyone had potential consequences that I think anyone, regardless of how he views the war, would find regrettable."

Data-processing, yes: data-dumping, no? Not with necks on some faraway front line? The matter of source versus partner clearly has some way to run as assorted WikiLeakers grapple with the one dilemma no true investigative journalists wants: is it the story you're breaking that matters – or are you stuck with being the story yourself?

Compensation schemes can give you peace of mind - whether you save with new kid on the block Metro Bank or an overseas-based financial firm

One of the first questions most people ask when confronted by a new bank, or one they have never heard of before, is: can I trust them with my money?

It's perhaps no wonder, after the collapse of the Icelandic banks in 2008 – including Icesave, the UK savings arm of Landsbanki – that people want reassurance that their cash will be safe with a company they don't know.

Metro Bank's staff have presumably already become used to rattling off the relevant information to customers who ask: it is an "independent UK bank" (and plc); not affiliated with any other bank or organisation; authorised and regulated by the Financial Services Authority; and covered by the Financial Services Compensation Scheme (FSCS), the official safety net for customers of financial firms that have gone bust.

Under this scheme, the first £50,000 of an individual's total deposit is protected if a bank fails. The general advice for anyone looking to put more than that into savings is that they should spread it around a number of institutions.

Things get a little more complicated if the bank's parent company is based in Europe. Under an EU directive, all member states of the European Economic Area (EEA) must set up a deposit guarantee scheme which gives a minimum level of protection of €50,000 (about £42,000) per person. A bank based in an EEA state and also operating in the UK should be a member of that country's compensation scheme.

"Where the bank's home state scheme provides lower compensation than the FSCS, the bank may choose to join the FSCS to 'top up' the level of protection offered," states the UK scheme. So if one of these banks went under, there would be a two-step process, with the home state scheme taking responsibility for paying the first part of any compensation and the FSCS paying the rest.

Many of the Post Office's savings products are provided by the Bank of Ireland, and accounts including Instant Saver and Reward Saver are covered by the Irish Deposit Guarantee Scheme, which provides up to €100,000 of cover per person, though there is the additional benefit of an unlimited guarantee from the Irish government until 29 September. Depending on when they were taken out, some accounts - including the Growth Bond - are fully guaranteed either until that date or until they mature, according to the table. However, some Post Office savings products - including the investment Isa and child trust fund - are covered by the UK compensation scheme. All in all, it's quite a lot for people to get their head around.

Northern Rock used to have an unlimited 100% guarantee on savings, but the Treasury's pledge to underwrite all retail deposits at the bank came to an end in May. National Savings & Investments, however, is still able to boast that it is backed by the Treasury, so "you can rest assured that all your capital is 100% secure, however much you invest".

George Osborne signals big changes to financial reform

Before the election, George Osborne avoided being photographed in posh clothes for fear of pandering to popular caricatures of the over-privileged Tory boy. But within weeks of becoming chancellor he had to deliver his first Mansion House speech, which meant obligatory white tie and tails.

He used the opportunity to spell out sweeping changes to how finance will be regulated. The Bank of England will supervise banks, keep an eye on overall risk in the economy and oversee a new consumer watchdog to police the retail end of financial services. Big banks might be broken up into separate high street and investment banking operations, a favourite Lib Dem policy the City hates.

But with public opinion against them, the bankers know not to make a noisy fuss; discreet lobbying is their style. Osborne will be invited to don his dinner jacket quite often in the months ahead.

POPULARITY FACTOR: 7/10 It will look bad if cuts are biting while bankers are still receiving big bonuses.

SPLIT FACTOR: 2/10 If the City implodes again, the government falls as one. No survivors.

RADICAL FACTOR: 7/10 Splitting the banks would be a truly bold move.