Episode 57 Show Me the Money

She survived. It is time for Show Welcome back to Show Me The Money,

your weekly guide to who is making the cash, how they're doing it and

had what it means for the way we work. Showing us that running a

charity is more than child's play, Camila Batmanghelidjh, the chief

executive at Kids Company. Dr Andrew Sentance, he wanted interest

rates to rise when he was one of the people in charge of borrowing

costs at the Bank of England. We will find out if he still does.

Lucy Armstrong is the voice for small business that the big bosses

club, the CBI. So, will there be a crackdown on boss's pay? All the

big parties say they is too much money for two little success and

today, David Cameron said shareholders should get more power

to take on directors in the boardroom. Labour says he should go

further and put someone representing workers into the

boardroom when we make their decisions on top pay. Lucy

Armstrong, you need hands talk to small businesses across the country

all the time -- you meet and talk to. A lot of them are annoyed about

how much pay the big bosses of the biggest companies get. I think they

are but I think it is because they hold a dual responsibility of being

both shareholders and directors whereas in a large business those

roles are separate. Most businesses I spend time with an represent in

this recession and the credit crunch, the owner and the managing

director normally the same person, were the first person to take a pay

cut, the first person to suspend paying themselves. We Whinnerah

Landes -- when you are in a large bureaucracy it is rather different

but perhaps shareholders need to exert more power over the board of

directors, or need to set a clearer framework and guidelines. It is

about transparency and honesty and about a fair reward for a fair and

good outcome and no rewards for failure. I wonder if this business

about giving shareholders more power is a red herring, because

shareholders already do vote on top -- on pay for top bosses. It is

like some of the election returns that we used to see in countries

with mid- elections. 80, 90, 95% of shareholders will routinely say,

yes. They will and that is the large pension funds. One of the

issues is that large pension funds represent people like you and me

and we don't exert much influence on our pension funds about our own

views about rewards. I think the other thing is shareholders'' votes

come way after the pay has been agreed by the remuneration

committee at board, so there has to be something a bit more

sophisticated than simply bolting the stable door after the horse has

already shot out, probably some years ago. Andrew Sentance, looking

at the effectiveness of some of these proposals, would giving

shareholders more authority, more power, make any difference? I think

the key here is to make sure that the processes within business are

working properly because cities after all in businesses' interest

to get this right. Business is a team effort. It is not determined

by what happened -- happens at the top, it is determined throughout

the company. People get demotivated if they feel the rewards are not

distributed fairly and quite rightly so. So it is bad economics

to have a big, disproportionate gap between the very top eight and to

pay for everyone else? Welcome I think to see in a business that

different groups are not sharing in the fortunes or the difficulties of

the business is obviously a negative signal, so it is quite

important that business sorts this out and I am sure that is the

direction that many companies will want to go. Another option might be

instead of fiddling around with powers for shareholders, just use

tax? I don't think we need to get too heavily into tax and regulation

in this area. We already have quite a high tax rate on higher incomes

and is already a contentious -- contentious issue as well. Camila,

do you care what the bosses of our biggest companies are paid? I care

what they do with their money. I would like them to donate to

charity is an to put it back in the community. I think David Cameron

should actually think about measuring companies and bosses in

terms of how much contribution they are making to do that -- to the

community at Chase those who are tax-dodging. In fact I would be

very interested to see if they went after the people who are tax-

dodging, versus the adjustments in pay, which one of those would bring

the country more money and I suspect actually going after the

tax dodgers is worth more energy spending on it. It is a very

difficult thing to do, to the social good that an individual is

doing, that her boss would do? you can have an index of how much

charitable giving, for example, they engage in. There is some

company directors who do it, genuinely, and they are

philanthropic, but there are others who are pocketing the money. The

other argument is these very wealthy people are actually

spending money so they are spending their wealth and that in a way

contributes to the economy, so you could argue it both ways. I am not

into banker Bashir. Thank you, more from our guests in a moment. First,

time for Boom or Bust, the stories that you have probably wished you

missed this week. Starting with this. It is freezing in the north

of China. That did not stop 300 people plunging into an icy pool

and calling it fun. It is the 12th annual polar bear swim. They say it

keeps them healthy. Events include the 25 metre breaststroke and of

the 100 metre dash to the nearest hospital for resuscitation! 100

years on from sinking, how do you fancy a job with the Titanic?

Would-be employees for a new visitor centre in Belfast are being

asked to make a three-minute video on part of the tragic ship's story.

They will be given a script which they can act out, or give their own

interpretation. If they are successful they will have a more

formal interview. Here is how you beat stress and Shanghai, with a

pillow fight. You pay your money, pick up your pillow and take out

your frustrations with a few soft bags. It is an alternative, I

suppose, to have a nice cup of tea and biscuits. Andrew Sentance,

jumping into the icy cold water in the north of China. Did that

appealed you? It doesn't appeal to me personally but I do remember

that in the Christmas period we used to have stories about people

jumping into the Serpentine, a think, in London, and that was the

big story and I think the interesting thing here is that we

are looking at what is going on in China and seeing it as part of our

world. We run a very global economic environment and we are

increasingly interested in what is going on in Asia and China. Quite

rightly because that is where a lot of the future economic prosperity

is coming from. We may not follow their example exactly. I think we

are increasingly interested in what goes on over there. Lucy, they are

taking risks to enliven their lives. In business, risk needs to be taken

occasionally to enliven the business. Absolutely. You have to

remember that risk and opportunity are two sides of the same coin and

it is about taking a leap. You do the same in charities when you have

a passion and drive forward. Business is no different. I'd live

in Newcastle-upon-Tyne, we did a lot into the water. We call it the

local swimming baths. We also do it in the North Sea. That is your

summer activities. This does not compare to the hobbies that you

have yourself. You are learning to dive. You chainsaw for fun? I do, I

learnt to dive off the north-east coast and I can tell you in June it

is chilly. By then went to Egypt and died there. It was a little

warmer. I could dive in a T-shirt on swimming costume and in the

North Sea and needed eight inches of material to keep me from going

blue. OK, Camila, the people trying to get a job at the Titanic museum

in Belfast, they are having to act and perform and show that they are

really engaged in the stories. How do you find the right people for

your organisation? We are very lucky at Kids Company. People are

queuing up to work with us and I don't have to advertise. I think in

15 years I have only ever advertised for two specialists,

once, and that was it. One of the techniques we used to find out how

good our staff are is that we get our most disturbed kids and get

them to act out what they're capable of in terms of damage and

insults and see how prospective employees cope with it.

improvisation is done the other way round. It is done the other way

round. Are you good enough to do this job? Absolutely, because you

have to have patience and the whole room descends into absolute giggles

and sometimes I get right old staff to act out our most difficult kids

and see how new people cope with it. Andrew, did you have to put on a

performance for the Governor of the Bank of England when they ask you

to be one of the interest rate controllers? No, but I did perform

regularly in a rock band in the place I love them music has always

been my area of performance, so has been buying interest. But you did

not have to turn up with a guitar and a bowler hat to impress? I did

turn up at the last meeting of the Monetary Policy Committee, I re

wrote the words of a popular song to liven up proceedings. It was

Help, by the Beatles. It got a few laughs around the table.

stressing tips. How do you de- stress? I go swimming. Chain

soaring. I don't church bell- ringing. I don't think of it as de-

stressing, I think of it as the whole of my life needs to have

different elements that are different unstimulating, some on my

own, some with other people, some making money, some giving money

away, getting a sense of balance, rather than work is everything.

case anyone missed it, you said church bell-ringing. I did say

church bell ringing. How do you de- stress? I love silence. Just

sitting down and not having any kind of stimulation. Just stillness.

How easy is it to get that in this modern world with its hurly-burly?

Well, it is difficult but you have to make the time for it. I try and

do that, just to be silent. OK, in the points when you are not silent

you are running Kids Company and it is a charity, people have different

views about what different charities are but yours has 600

paid workers, 11,000 volunteers to manage and you provide services for

17,000 children. This is quite a major organisation. How do you read

it? Well, I think the workers, the staff and the children were at --

run it. My role is to find talents in each one of these individuals,

volunteers, the children and the workers, and released that talent

into the organisation. To do that I'd try and really get to know

individuals within the organisation, find what they are good at. For

example, one of the best people, the champion of Italy, she had

never worked with children but she was absolutely brilliant.

rollerblading champion of Italy. Hired for what role? To work with

children, it was brilliant. Another time I had Gina, the pub landlady,

who had never worked with kids, arrive with two big earrings. No

one would have hired help to work with children but I looked and I

saw you are going to be brilliant. Now she runs the counselling

service. That is a risk for you to take. You are looking at people who

might be passed over by other, less cautious employers. What gives you

that sense that you have got the measure of person that you judge

it? Well, I don't interview like other people interviewed. I'm

really into view, digging into their personal life as much as

possible, finding out about their relationships, their attachments,

because what I am hiring is somebody who needs to have the

capacity to love children who were not always lovable when they first

start with us. They are difficult, they spit at you, they scream at

you, you have to be able to see past that. Really what I am hiring

is individuals who can parent children and for that I don't think

you need a PhD. You needed a quality of integrity and a passion

for the well-being of children. I don't pay much attention to see

these at all. You have to raise �40 million this year, in the year when

money is tight and families across the country, where companies are

afraid to spend their cash because they don't know what is around the

corner -- �14 million. How do you persuade individuals and businesses

to give money to good causes in It is very, very difficult. I have

to work seven days a week to late at night to find different sources

of money. But the general public are extraordinary. They have kept

Kids Company going. A lot of our customers suffer further off the

street hearing about other children who have used our provisions. So we

have no commissioning agent. It is difficult for us to generate a kind

of business work for example, we take 100 children and certain local

authorities pay. We have zeroed local authority funding because of

self referral by children. So the general public and the

philanthropists have kept Kids Company going. I hope that all keep

happening this year. The state of the economy will be on the mind on

the people of the Bank of England who set interest rates. Dr Andrew

sentence, you are not on the panel anymore. What should they decide

about interest rates this week? They will be looking at a couple of

things. How the problems in the Euro area and the global economy

are affecting the UK economy. Some of the evidence we have had on the

UK economy has shown it has been more resilient than some people

expected. It is very encouraging so some positive news. The other thing

the MPC will be looking at his inflation which has gone up to 5%.

It should come down this year. That is the main remit of the committee.

And the extent to which they can change monetary policy depends on

them getting inflation back to the target of 2%, which is said by the

Government. It is a difficult balancing act of course, because

you don't want interest rates so high to squeeze out what little

growth there is in the economy, but you don't want to be too slack in

case it stores up problems in the future. You had argued for some

time that interest rates should have gone up at an earlier stage to

squeeze at the risk of inflation in the future. Given the state of the

economy, D has the right judgement? I think it is the right thing to do

in late 2010 and early 2011. But it is not what the Monetary Policy

should be doing now because confidence is fragile. They should

be taking steps that will build confidence and emphasise stability.

But I think interest rate rises will come back onto the agenda

perhaps later this year or early next year. You're not recanting on

what you thought before? No, there is an important issue that savers

in this country have suffered low rates on their savings. We need to

get back to normal interest rates, and that to some big the MPC do

need to focus on. What is it like in there? I have been on a tour of

the Bank of England and I have been shown the room away you sit and

there are other powder-blue walls and a chandelier. And a picture of

a former governor of the Bank glowering down at you. It felt

claustrophobic almost? There is a lot of history around the Bank of

England. It has been on the site it is on now since the 18th century.

The building itself was rebuilt in the 1920s. The MPC is a mixture of

tradition and actually quite a lot of maternity. The Monetary Policy

Committee has only been in existence recently. A deal have

arguments, bus stops? I am talking about persuasion, not people

throwing things around the room. That is the way you would expect

things to be conducted at a central bank. There is an important point

about this edition of the Bank of England. It stands for the

confidence we put in the value of money. And that is ultimately what

the MPC is there to do, make sure money continues to retain its venue.

On that what lies behind what the MPC does. If we look at but the

economy is telling us at the minute, this coming week we will have Argos

saying sales will have dropped. Tesco said it has had the worst

Christmas in decades. Is there any optimism? Yes, if you spend time

with private and family businesses, which is to represent and work with,

they are performing robustly. Particularly those who are

exporting. If they are exporting into the growing economies like

Asia, Brazil, they are performing well. Confidence is really low. It

is about getting people to feel the future is positive. The point about

interest rates, it is important, instead of hoarding cash,

businesses have the confidence to invest, invest in growing so they

can have higher employment, then produce more profits and pay more

tax and up-country grows out of this. Companies, large companies

have huge amounts of money in the bank? I read in the newspaper today,

the bill UK multinationals are holding 130 billion of sterling at

the moment. Private business is doing the same. I spent my life

urging my private business colleagues to invest. When interest

rates are only 0.5%, if they don't believe they can return something

higher than 0.5% to their shareholders by investing in their

own skills and ability to run their business, they shouldn't be running

their businesses. They should be investing for the long term. It is

the job of the media to encourage them and give them the confidence

to grow their business. Conference is in growing when Mervyn King says

it is the worst economic situation since the dawn of time as to mark

policymakers need to make sure they're getting the right balance

between describing a difficult economic situation and giving

confidence. This issue about companies having the money to

invest is going to be important. If we do see some pick up in the

global economy, it should be released and we should see some

growth as well. New Year, new career? Some of us

promise ourselves for new job or a pay rise as part of our resolutions.

Some of us even make it happen. Victoria Fritz tells us how.

As workers battle the wind and rain to turn up at the office this week,

undervalued and overworked may have wished that they had ditched the

rat race. One man who has done just that is Lee Harris. I changed my

career from being in a bank. I spent 20 years working in Barclays

Bank. A large part of that was a local business manager. I was bored

with the drudgery of a nine-to-five job, which ended up being 828 most

days. I wanted more out of life, and that coupled with my dad, who

work in racing, who had an accident and made me reappraise my life. I

am now working with horses and I have not looked back. It sounds

scary changing this drastically. I needed to do research and

understand the market. There is not that much you cannot overcome. It

is easier than people think. Setting up and managing your own

business isn't for everyone, but it doesn't mean you have to give up on

your dreams. There are employers out there to suit the most obscure

of interests. I am a watchmaker's assistance. I worked in a workshop.

Previously aware that a PR agency but found I wanted to do a job

which involved using my hands and following my passion, which is

watches. Since I was a kid I have always loved them. I have been

fascinated by the mechanical device on your wrist, ticking away. One of

the most interesting watches I have purchased recently was this one,

which was made by my great grandfather's watchmaking company

in Bristol. How easy was it to get into watchmaking? I had never seen

an advert for it. It is not easy. The jobs are not advertised. For

someone wanting to become an apprentice you have to cold call a

lot of the companies. I did a lot of research, found out which

companies were based in the UK and what roles they might offer. I

ended up picking up the phone, writing letters and trying to find

out if they would be interested in meeting with me. There is plenty of

the support in the UK for people looking to land that plum job. Next

is a government-funded service available to adults across England.

The can access the service online, over the telephone or with an

adviser, face-to- face. New Year, new start, you'll be thinking about

how you are going to move on? adviser can help you with CV and

interview techniques, searching for courses on line and funding that it

might be available. If you are thinking of moving on, similar

schemes are available in the rest of the country to help you take

charge of your career. If you would like more information

Next week we will hear from the boss of a building company who