Bogus economies

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One of the worst borrowings from economics by politicians and others has to be “economies of scale”. The idea fits neatly into the thought that increasing size reduces the impact of overheads and justifies specialised investment.

What it also demands is greater ability in top and senior management which may not exist and clearly does not on too many occasions. This ability is distributed like any other, with good, bad and average managers being obvious in all walks of life.

How this misplaced belief in scale works out in the real world bringing mischief in so many sectors is clear.

Police and fire services seem the latest examples following in the train of financial services. It is surprising to note its continuing charm with experts bemoaning the lack of activity on mergers and acquisitions. Probably the special interests of those who take their fees from such events explain the attraction.

LV McEwan

Kirkhill Road