Jason Nissé: BA's alliance with American would never have hit the ground running

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Corporation of London goes for 'trade union block vote'

I have always wondered about the sense of British Airways' planned coalition with American Airlines.

When it was first announced, back when dinosaurs walked the earth and Bob Ayling was still considered one of Britain's brightest managers, it was a merger of two dominant players. All the rivals quaked in their boots and cried to the regulators. They sensibly put so many hurdles in the path of the two leviathans that they retired to their lairs to reconsider their position.

BA then set about finding an alternative – and alighted on merging with KLM. That made little sense because it delivered neither of the things BA really wanted: upmarket passengers on long haul or a chance to consolidate routes in Europe. Rod Eddington scuppered the deal after he replaced Mr Ayling and went back after BA's original quarry, American Airlines. A deal was struck before 11 September which would bring an "alliance" within the context of an overall "open skies" settlement – a classic mixture of spin and political correctness. The two sides want to merge, not be allies, but they could not say that, and they do not want open skies, because that gives smaller rivals an even break. But they had to concede on open skies or else the regulators might spot what BA and AA really wanted: a near monopoly over the Atlantic.

The 11 September disaster should have made things easier for a BA/AA deal to be approved. There would be the sympathy vote, as AA lost airlines and staff in the terrorist attacks. And then BA and AA lost substantial business, making their already poor performances seem dreadful. However, at this point the game changed. European airlines wobbled and Sabena and Swissair tumbled. BA had a chance to step in and take a bid player out of the equation, Alitalia or Iberia perhaps. Instead it was still preoccupied with the AA deal. This has proved extremely foolish. For a start, the chance to strike a blow in Europe may well have passed. And the regulatory ruling on AA has shown this deal was faulty from the outset. However touchy-feely BA is trying to present itself as, no one buys it. BA used to have a reputation for naked aggression and ruthless efficiency. The fact it has shown neither in recent years does not change the perception. The Federal Aviation Authority said BA and AA would have to give up 224 – count them, 224 – slots at Heathrow to secure this deal.

Thankfully, BA has realised this is too big a price to pay. It has pulled out of the alliance. It is now working on Plan B. But after wasting so much time on Plan A (or was it Plan AA), Plan B is a lot less attractive than it might have been.

Vote farce

The alleged description of Lord Rees-Mogg as one of the "best brains of the 1880s" springs to mind when considering the latest attempt to reform the Corporation of London. Out will go voting by sole traders and partnerships, and replacing it will come voting by employee. This means that if I opened a sandwich shop on Cheapside, I would get to vote in two London boroughs, a clearly ridiculous situation.

The idea that someone like Goldman Sachs or Royal Bank of Scotland will get one vote for every 50 staff is both absurd and open to abuse. A firm with 6,000 employees would get 120 votes, yet some wards will have an electorate of 1,000 or less. Though nominated voters will ballot secretly, the potential for coercion into voting for someone their employer wants is outstanding.

This would merely be an affront to democracy were the City not such a key local authority. Its planning decisions have ramifications as far away as Tokyo and Los Angeles, while its previous mistakes let Canary Wharf become one of the world's most successful building projects.

The old voting system was out of date even when it began in the 19th century. The new electoral structure would have seemed quite good in 1880, but even Lord Rees-Mogg might agree it is not right for a 21st-century financial centre.

j.nisse@independent.co.uk