Has the rug really been pulled from under Mark Carney?

The heated debate about whether or not Bank of England Governor Mark Carney has engaged in a humiliating climbdown over his forward guidance on interest rates is destined to sink beneath the waves of flooding news.

Which is probably not a bad thing.

The debate is an important one, but was being turned into an egotistical contest about who knew most about UK monetary policy: a Canadian bank governor or City scribblers.

The scribblers appear to have decided long ago that Carney was an outsider who'd blundered. After all, what on earth was this suspiciously slick Canadian doing making his first major announcement about policy in Nottingham of all places?

This was where, last August, he said the Bank wouldn't even consider putting up interest rates until the unemployment rate fell to 7%.

This was breaking new ground on two fronts. First, it meant the Bank was no longer tied by inflation – it had another factor to consider. Second, Mr Carney was a whole lot more open about what he meant (finding meaning in an interview with Mervyn King, his predecessor, was like searching for a needle in a haystack).

Mr Carney's view was that the Bank needed to lose its lofty air, get out into the economy and explain to worried consumers and uncertain businesses that it wasn't going to do anything which would torpedo a fragile recovery they would depend on for jobs, wages and revenue.

If you look back, you'll see that he dropped plenty of hints to suggest that seven per cent was far from an automatic threshold. It was, he said in an interview with the Nottingham Post, "only a staging post" and "No one should assume that it is a trigger for raising rates".

He also made another important point, one with which few would disagree: that the Bank's decision on interest rates would not be dominated by the strength of the economy in London and the South East, which is on a different level to the rest of the country.

Remember his comment: "Nottingham is the bellwether of the broader British economy. It is not over-weighted with finance, we get enough of that perspective in London."

This is one the City scribblers would do well to dwell on. Mr Carney may have been caught out by the speed with which the unemployment rate has plunged close to a 7% national average. But it remains significantly above that level in some regions, the recovery that is clearly motoring ahead in the South East remains patchy elsewhere.

Similarly, the debts that lie underneath many households (and some businesses)haven't miraculously disappeared.

Confidence is coming back, for sure, and the Bank's new GDP growth forecast for this year – north of 3% - signals real momentum.

But don't get lost in debates about whether the precise nature of Mr Carney's forward guidance was right or wrong.

Economists are now expecting the first rate rise to take place in Spring 2015, with the base rate having risen to a forecast 2% by 2017.

Whatever technical changes have taken place, Mark Carney's most telling comment in Nottingham was – and remains – this: "As you see things picking up, don't worry that the rug is going to be pulled out from under you too soon."

Is the number up for Northern cities?

A FEW weeks ago The Economist magazine took the brave step of suggesting that some northern towns and cities were in such dire straits we should abandon them and bus residents elsewhere.

Well, it didn't put it quite like that, but its analysis of the way places like Middlesbrough, Burnley, Hartlepool and Hull absorbed huge sums of public money without their economies making progress was put forward as a reason for switching the money to more promising locations and providing transport links to their jobs.

The Economist's article was a clinical analysis of some unpleasant facts: unemployment rates in these towns are double the national average, young people are draining away and their high streets are "thick with betting shops and payday lenders, if they are not empty."

In other words, their economies are no longer working in a sustainable way.

It pointed out that fortunes have been lavished on regenerating them when the economy was booming, often on "grand projects" which could not survive without life support from the taxpayer. That life support has gone, and The Economist's conclusion was that Government money should focus on helping people rather than propping up places.

How? "That means helping them to commute or move to places where there are jobs – and giving them the skills to get those jobs."

There were some predictable outpourings of rage. Some of it was genuine pride in cultural identity, some of it was political bluster from people who probably have a few questions to answer (the most serious implication of The Economist's analysis was that giving businesses and people incentives to come and set up in these towns is propping up local politics, not local economics, and diverting business from places where it might be more successful).

Hull's response was cleverer than that. And it'll interest Nottingham.

Academics from the city's university pointed out that the 'facts' about Hull that The Economist's analysis was based on weren't accurate because they were based on a political boundary not economic reality. In other words, it had missed Hull's affluent suburbs.

Sound familiar? Nottingham has struggled in numerous rankings for exactly the same reason. In business, we know the city as capital of the East Midlands, one of England's eight core cities and a pretty attractive location which mixes big business, entrepreneurial vitality, academia of international standing, an attractive lifestyle and some beautiful places to live.

Yet the official statistics about poverty, health and education make for a miserable roll-call of below average readings. Why? Once again, because the data is taken from a tightly-drawn inner city political boundary – not the functioning social and economic entity that includes the likes of West Bridgford, Wollaton, Arnold and Mapperley.

The traditional response is that these local government boundaries should therefore be changed. This raises all sorts of political issues (not least self-interest) and seems unlikely to happen anytime soon.

In any case, there's a cheaper and quicker way of doing it – simply adopt the methodology used in the University of Hull's (miserably-titled) "index of multiple deprivation". It looks at all the relevant measures in a series of concentric circles from the inside of a city to the outside, reflecting the way a city functions rather than its politics.

As The Economist points out, cities and their conurbations don't always form neat circles so the index isn't infallible. Nor should such measures be used to suggest that things are OK on average when festering problems remain unsolved. 'Inner' Nottingham's education issues are serious and need serious attention.

But they need to be seen in context. There is clearly no need to hop on a bus and abandon Nottingham - quite the reverse, in fact. The numbers about the city need to make that abundantly clear.