01/11/2011 Daily Politics


01/11/2011

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Hello and welcome to the Daily Politics.

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The City of London is telling the anti-capitalist campers they've got

:00:26.:00:31.

48 hours to leave, or face eviction. Could this lead to running battles

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on the steps of St Paul's? The UK economy grew by 0.5% between

:00:36.:00:39.

July and September, a surprise for many, so is it proof the

:00:39.:00:46.

Government's plan is working? Meanwhile, the Greek Prime Minister

:00:46.:00:49.

has stunned the rest of Europe by announcing a referendum on the

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latest bail-out deal. So, does the whole future of the eurozone now

:00:53.:00:59.

hang on the result? And, the Prime Minister has always

:00:59.:01:02.

vowed to protect Britain's aid budget, but a lot of his own

:01:02.:01:07.

backbenchers are sceptical. So is it time to look at where the money

:01:07.:01:15.

is going? All that in the next half hour. Jo

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and Andrew are off today, so joining me for the whole programme

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is Dame Barbara Stocking, the chief executive of Oxfam. Welcome to the

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Daily Politics. Hello. I'd like to get your thoughts on what's

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happening down at St Paul's today, where the protesters look as if

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they're going to be served with legal papers giving them 48 hours

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to pack their tents. But first, let's get the latest from our

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correspondent down there, Tamsin Smith. There's a real sense that

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anticipation is building here. We know there's a meeting ongoing at

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the Guildhall, where they are hammering out the details of an

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eviction notice that is going to be served to the protest camp. You can

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see the camp behind me. They've set up a university, where they are

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having elects tures, and debates. There are portaloos, a media point,

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and so they are very much bedding down to stay. It's been a very damp

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night. There are lots of duvets out airing, but they say that, despite

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they eviction notice which is going to be served by the City of London

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Corporation, they will not be moving. They say that, in fact,

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more protesters will be coming to join them. Interestingly, they say

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they are also getting lots of funding as well. �1,000 a day, we

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hear, is pouring in to help fund the protest camp here. And it

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continues to be an embarrassment, an acute embarrassment for St

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Paul's Cathedral, who want to stress today that the eviction

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notice is not being served by them but by the Corporation of London.

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Do you think there's a risk that the protest might become

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confrontation as a result of all of this? Sorry, I missed that question.

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Do you think this protest could become confrontation as a result of

:03:02.:03:06.

this eviction notice? Well, there is not a sense of that. Certainly

:03:06.:03:11.

it is very peaceful at the moment. I've been speaking to some of the

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protesters, asking them about how long they think they will stay.

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They say they are happy to stay here until Christmas. Interestingly,

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they say that this whole debacle, the dilemma it has put the Church

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in, they say it is positive for them, because it is helping to draw

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attention to their cause, which primarily is one of anti-capitalism,

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but you might have seen behind me some of the banners here. There's a

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raft of disparate cause, very disparate me messages. There isn't

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a huge sense of cohesion, in terms of the message they are putting

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across at the moment, but they are riding on the back of the dilemma

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that's engulfed the St Paul's Cathedral at this moment. Thank you.

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Dame barb remarks what do you make of what's going on at St Paul's?

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is going on all over the world. I was in America last week, in

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Washington and New York, and you've got people camped out there. They

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are the tip of an iceberg of a lot of people who are really worried

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about the way the free market system works, and what's happened

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to banks and the financial system and so on. So they are a small

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group but they certainly represent a lot hor of the thinking and

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concern that there is. There are protests two a penny day in and day

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out, yet why is this one getting the coverage and the impact that

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others don't? I guess it is because it is global. Also because I think

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it hits this core that people have, that's what has happened in the

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last few years in the economy is not fair, not fair for the poorest

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people in the UK, not fair for the middle income groups who are seeing

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all the jobs going. People genuinely feel that something is

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happening here that is not fair. They are not against the Government

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dealing with the debt crisis but they are saying, "Why is it us?"

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you think the reason it is making an impact is, in your view, the

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rightness of the cause, not the tactics they are using in terms of

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the occupation and the taking on the Church in the City of London?

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It is a bit of both. A lot of people fundamentally agree with

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their concerns. They may not agree with camping outside St Paul's. But

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as they've said on reporting from St Paul's, they've been given a

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media blessing by the sense of the eviction and all the concerns. Can

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I understand why the protesters are saying this is getting us into the

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media and that's good news, it is amplyifying our voice now. Is Oxfam

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going to learn there from this in the way you campaign? I don't think

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there is anything wrong with what they are doing as long as they are

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peaceful. The worry is you might get into a violent situation now.

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It is perfectly sensible for people to want to demonstrate about things

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that are wrong in their own society. We would absolutely back that. The

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tricky bit is it is not entirely clear which bits they are really

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campaigning against, but that general sense of unease with the

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economy. Barbara, for now, thank you.

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So, the latest growth figures are out, and for once the Government

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may well have let out a sigh of relief. The figures are the first

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estimate of the third quarter of 2011 and they show that Britain's

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economy grew by 0.5%, a little better than the 0.3% many expected.

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However, to give this some context, growth in the last quarter was 0.1%,

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so some rise was expected. Ed Balls argued earlier in the week that

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growth would need to be 1.3% for the Government to meet its targets.

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What's more, separate figures out this morning show that the

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manufacturing sector shrank by the sharpest rate since June 2009, when

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Britain was still in recession. Speaking earlier this morning,

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however, the Chancellor, George Osborne, welcomed the growth

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:07:01.:07:03.

figures. I think this is a positive step forward for the British

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commitment it's a better figure than some were expecting this week,

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given what's happening in the world. And, of course, the British economy

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has got a difficult journey to take from its debt-fuelled past. That's

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a journey made more difficult by the kind of problems you see today

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in the eurozone. But the important thing is today we took a step down

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that road the road will lead to recovery and prosperity. As the

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Chancellor said, across the Channel things aren't looking good.

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Yesterday the OECD downgraded its growth predictions for the eurozone

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in 2012 from 2% to 0.3%. And this morning the markets took a tumble

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as they digested the news that the Greek Government has decided to put

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its latest austerity plans to a referendum. Most opinion polls show

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a majority of Greeks don't support the measure, and if the vote is

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lost, it could derail the EU's recovery plans. With us now is the

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economist, Vicky Pryce, who is Greek herself. Welcome to you. From

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the Labour frontbench, Chris Leslie, and for the Conservatives, Matt

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Hancock, a former Bank of England economist and adviser to George

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Osborne. Welcome to you all. Vicky Pryce, can I begin with you? �0.5%,

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what can we take from that, what does it mean for the economy?

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of all it is better than expected, so that is good news. Everybody

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indicator we've seen in the last couple of months suggests that in

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fact we are moving into a slower pace of growth, with manufacturing

:08:31.:08:36.

being hit. And the services sector, which did so well in the last

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quarter it is now also slowing down. Europe is very significant for us.

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Manufacturing itself, which had done rather well because of Germany

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in particular, having become a locomotive for growth, is going to

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suffer, because Germany itself hurts now, showing signs of not

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growing at all. So a glimmer of positive news for the last three

:08:57.:09:01.

months but it is looking pretty grim for the next three? It does.

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We had recovered from the previous three months. We had a series of

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accidents like the bad weather, and then the Royal Wedding. The

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problems in Japan with the tsunami and the nuclear explosion that we

:09:15.:09:22.

had. There was a serious slowdown in demand for goods in the whole

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region really, because basically we were exporting quite a lot to them

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as well. That's recovered. It had to recover, but it is not

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sustainable, given what's going on around the world. The OECD figures,

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the forecasts now which are so low, suggest that the problems are going

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to be significant in 2012 as well. Matt Hancock, how do you tackle the

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criticism that the Government's policies aren't working enough

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simply because there is not enough growth in the system, there is no

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sign of it to come? I'm not sure that's the criticism. I agreed with

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almost everything that Vicky said. These figures are better than

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expected, so they are positive, and positive news in that sense. But of

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course the world economy is in a very difficult place. We learn that

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Italian Government bonds for instance, interest rates in Italy

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are now over 6%, which is crippling for them. I look at that and I

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think, thank goodness that isn't us. So, of course it is very difficult,

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but the best thing that we can do is make sure that we have the UK as

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a port of stability in this great crisis that's going on around the

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world rather than itself facing the wrath of the markets, who are after

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all the people that we borrowed all this money from. So Chris Leslie a

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port of stability? I worry there's a bit of complacency creeping in

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here. I think the idea that 0.5 % growth is a great triumph or even a

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sign of recovery moving forward, as the Chancellor seems to have

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sometimes suggest is completely out of touch with reality. The

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Government shouldn't be taking any comfort from these statistics.

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Particularly when all the for tents are in terms of manufacturing we're

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back into contraction, according to the PMI index today. The

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construction sector has fallen back by 4% in the last year. This is

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0.5% growth since the Chancellor's great Spending Review. The previous

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year before that, 2.6%. We really have had a recovery that was

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completely choked off by the decisions that the Chancellor has

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made. They are going to try to use this eurozone crisis as an alibi by

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the export situation doesn't stand up to that story. This is a move

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backwards because of the choices, the idealogical choices that the

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Chancellor of the Exchequer has made. A lot of the Treasury

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background today has been, look, we are in a global crisis, there was a

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crisis in the eurozone, we are not an island, the politics of John

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Dunn. How do you respond to that criticism? The policies the

:11:58.:12:02.

Government are mer suing have an impact on growth at the moment.

:12:02.:12:07.

This is an international very difficult situation. The idea that

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any of the tone of what I've been saying is anything other than that

:12:11.:12:14.

we are in this difficult situation and we are trying to get Britain

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through it. But what you don't do to get through it is to borrow more,

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when the problem is that we are in a debt crisis. So, it is, it is

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serious, it is difficult. What we need to do, I think actually, is on

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the growth side we need to do more to get growth growing. So for

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instance, let me give you an example. Make it easier to employ

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people, by changing from one year to two years the merd that you can

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employ them -- the period that you can employ them. You can make all

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the supply-side changes, but if demand isn't there it doesn't

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matter how much you change employment law. That's why I

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thought it was right that the Bank of England engaged in another round

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of qeezing to get money flowing. And we are going to go into credit

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easing, which is about getting that money into small businesses. The

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question for people like cries, you can't borrow your way out of a debt

:13:10.:13:14.

crisis. Are they going to support the other measures we are taking to

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get growth going? You can't cut yourself out of this situation

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either. Cut sog far and so fast as George Osborne has done has caused

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problems. It is important that you listen to the people of Britain,

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who are compass rated by this Government's failure to do anything

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on growth. The idea that removing employment rights is going to be

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the salvation for our economy is completely off the planet. It is

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time you started to take serious measures to boost growth, cutting

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VAT or putting a banker bonus levy. We've got a five-point plan. What

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do you make of this debate and are you in Oxfam getting some impact?

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What impact is it having on organisations like your known

:14:00.:14:10.
:14:10.:14:11.

the moment, not too bad that. Comes -- not too bad. People are

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concerned and generous about people internationally. Our income from

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the public has stayed the same. The thing it does do is nobody will

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commit to the future. Everybody knows that something may happen to

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their job, so we don't get new people signing. What do you mean by

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that? We have 400,000 people who commit to giving to Oxfam regularly

:14:30.:14:34.

a fixed amount on direct debit. We can't get new people to sign up to

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that. They are too uncertain about what will happen to them in future.

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There is plenty of uncertainty about but for us people have

:14:43.:14:53.
:14:53.:14:56.

Minimising that uncertainty is so important for the future. We need

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to minimise that rather than borrowing further. Talking of

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uncertainty, Vicki - a referendum in Greece. How much uncertainty in

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the short term has that placed over the whole eurozone packet? Huge.

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Everyone was shocked to hear that they have called for a referendum,

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and a very interested to hear why they should have done it. Whatever

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happens between now and when the second bail-out package comes in

:15:32.:15:35.

and then austerity measures for the next couple of years have to be

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passed, he needs to know he has the backing of his parliament.

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isn't the risk enormous? It is huge. First of all, we are not sure

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whether a referendum will take place. He has to pass a confidence

:15:50.:15:54.

vote first of all this week, which includes the referendum. If he

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doesn't pass that, we will have elections. And what that means is a

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huge uncertainty over the coming few months anyway. But in addition,

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what it has shown is that we cannot rely on the deal that has been

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agreed just a few days ago. It may all be reopened. The uncertainty

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about the situation is very worrying, and they think if we were

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genuinely worried, we would have a stronger economy that could

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withstand some of these international wobbles.

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Unfortunately, because we are so flatlining in terms of this

:16:31.:16:35.

negligible growth, any internal event destabilise the market and

:16:35.:16:40.

put our economy in jeopardy. This is why we have to have a strong and

:16:40.:16:44.

positive efforts, not just here at home for growth, but the Chancellor

:16:44.:16:48.

and a prime minister who will argue for growth and jobs in Europe. That

:16:48.:16:53.

was the missing factor and a lot of the euro-zone arrangements.

:16:53.:16:57.

Do you think as some Euro-sceptics in your party believe, that this is

:16:57.:17:00.

the moment, if a referendum takes place, that could see the

:17:00.:17:04.

withdrawal of Greece from the euro, and that could bring the whole

:17:04.:17:09.

house tumbling down? They are lobbying with glee about this.

:17:09.:17:13.

the referendum is past, that will give the Greek Prime Minister a

:17:13.:17:17.

strong mandate to drive through the changes to deal with their debts.

:17:17.:17:22.

At the end of the day, at the heart of this crisis, it is a debt crisis.

:17:22.:17:28.

In Greece, in Italy, across the eurozone and here in the UK. That

:17:28.:17:31.

is what the Greek Prime Minister is having a referendum, in order to

:17:31.:17:39.

get the mandate to deal with it. And the problem? Some people may

:17:39.:17:44.

say that a disorganised downfall would be a good idea. I think it is

:17:44.:17:48.

in Britain's economic interests that the euro is strong. Thank you

:17:48.:17:53.

very much indeed for joining us all here today. This debate is clearly

:17:53.:17:57.

one that is going to go on and on. This weekend, the Prime Minister

:17:57.:18:01.

was promising to get tough when it comes to which countries should get

:18:01.:18:06.

aid from Britain, and warned regimes with bad rates on human

:18:06.:18:09.

rights that they might not get cash. But Tory backbenchers are still

:18:09.:18:13.

worried about the size of the Budget at the Department for

:18:13.:18:15.

International Development. Adam has investigated.

:18:15.:18:19.

On a visit to Kenya, then Development Secretary Andrew

:18:19.:18:22.

Mitchell, the only Cabinet minister whose budget is protected from the

:18:22.:18:27.

cuts. It is part of a pledge to eventually bring spending on eight

:18:27.:18:37.
:18:37.:18:38.

up to 0.7% of national income. -- spending on aid. It will go up from

:18:38.:18:45.

�5 billion a year in 2006 to �7.7 billion now. Earlier this year,

:18:45.:18:49.

there were a couple of big reviews, which saw the number of countries

:18:49.:18:54.

receiving aid from us from 43-27. Places like Russia and China came

:18:54.:18:59.

off the list. There has also been a change in priorities, with an

:18:59.:19:03.

emphasis on helping countries develop economic Klee, and helping

:19:04.:19:09.

places affected by conflict. This has raised concerns even among the

:19:09.:19:15.

Department's supporters. They are cutting back room staffed by one

:19:15.:19:22.

third. They are going into more fragile states, places like Somalia

:19:22.:19:26.

and the Democratic Republic of Congo, and therefore the dangers of

:19:26.:19:31.

corruption become greater. And the temptation will be to put more

:19:32.:19:35.

money into multinational organisations like the World Bank

:19:35.:19:39.

for Unesco, where the British taxpayer will not be able to

:19:39.:19:43.

monitor of where their money is going. At this weekend's

:19:43.:19:45.

Commonwealth summit, the Prime Minister repeated his message that

:19:45.:19:50.

aid is going to come with more strings, especially when it comes

:19:50.:19:54.

to human rights. But he has still got to convince some sceptical Tory

:19:54.:19:59.

backbenchers like Caroline Dinenage, who took these photos on a recent

:19:59.:20:04.

fact-finding trip to India. Some of the politicians we spoke to had a

:20:04.:20:07.

sense of almost arrogance about their position on the world stage

:20:07.:20:11.

at the moment. It is almost as if they are the pretty girl at school

:20:11.:20:15.

that everybody now suddenly wants to go out with, and almost an

:20:15.:20:18.

ignorance of the fact that this incredible economic position that

:20:18.:20:22.

they find themselves ent has been built on the back of a population

:20:22.:20:27.

for whom the average wage is a quarter even of China. And then

:20:27.:20:31.

there are those who are question whether any of our aid makes a

:20:31.:20:37.

difference. We are still stuck in what I think of as the 1984 mindset,

:20:37.:20:40.

where yes, there are starving people, and we have got to help and

:20:40.:20:45.

teach them and inoculate them, and we have to do stuff to them.

:20:45.:20:48.

Actually, it should be a partnership where they are doing it

:20:48.:20:55.

and we are helping to enable that. The aid pledge is completely non-

:20:55.:20:59.

negotiable for this government. Future arguments will be about how

:20:59.:21:09.
:21:09.:21:10.

Adam Fleming reporting there. Barbara Stocking, why should the

:21:10.:21:13.

government protect it international aid budget more than its budgets

:21:13.:21:18.

for health or education? Defend the basic position. First of all, the

:21:18.:21:21.

government made the commitment, and this was a pledge given several

:21:21.:21:25.

years ago. I do think the British people think it is a good thing

:21:25.:21:30.

which governments do what they say. They don't always. No, but that is

:21:30.:21:35.

generally a good thing. The British people are generally committed to

:21:35.:21:39.

aid and to make sure that something happens for the poorest people. We

:21:39.:21:44.

see that in the way people come and give money to ask. But will that

:21:44.:21:48.

continue as the economy continues to stagnate? People have given

:21:48.:21:52.

money towards trying to make other people's lives better three times

:21:52.:21:55.

when they have been at their poorest, so I don't think that will

:21:55.:22:01.

be dramatically changed. It is in Britain's interest to do this. When

:22:01.:22:06.

I was over at the UN, it is amazing to see the influence that Britain

:22:06.:22:14.

has. Generally, Britain does this rather well. We have a lot of

:22:14.:22:17.

influence, and we will have a lot of influence in the countries where

:22:18.:22:22.

aid is currently going, because in future, they will be our markets.

:22:22.:22:26.

There are so many different reasons why it is good to stick to the aid

:22:27.:22:32.

commitment. And are you happy for aid to be used as a tool of policy

:22:32.:22:37.

to combat terrorism, create future markets, reduce instability?

:22:37.:22:44.

not directly. It must be directed at the poorest people, and the

:22:44.:22:47.

countries that came out of the bilateral review are in fact the

:22:47.:22:51.

countries which are the poorest and most unstable, and instability is

:22:51.:22:54.

actually one of the things that poor people are mostly concerned

:22:54.:23:00.

about in their countries. Being in an insecure country is just hell on

:23:00.:23:05.

wheels. We are watching that very carefully, because we are worried

:23:06.:23:10.

about whether it were just going to security. The UK NGOs are concerned

:23:10.:23:14.

about where this money is going, and we will continue to watch. But

:23:14.:23:18.

money that goes to countries like Yemen, Afghanistan and Pakistan,

:23:18.:23:24.

where there are huge numbers of poor people. And India, with its

:23:24.:23:28.

space programmes? India is interesting, because they have so

:23:28.:23:34.

many poor people, but can we use the aid tactically to make sure

:23:34.:23:39.

that it reaches the poor people? With Oxfam, we now have an Oxfam

:23:39.:23:44.

India. That is fantastic because it is saying to Indian middle classes,

:23:44.:23:48.

you have a responsibility for your own poor people. Very quickly,

:23:48.:23:52.

should British policy be discriminating, or should it

:23:52.:23:56.

withhold aid from countries that banner, sexuality? I think you have

:23:56.:24:06.
:24:06.:24:09.

to be very careful with that. ban homosexuality? If you go to

:24:09.:24:14.

local NGOs and onwards, you don't have to pull out just because you

:24:14.:24:17.

don't approve of the government, you can take different steps. We

:24:17.:24:21.

would be nervous about taking money away from the poorest countries

:24:21.:24:25.

because their governments don't have policies we agree with.

:24:25.:24:29.

you detect no change in government policy on this? We think they will

:24:29.:24:34.

stay committed, and we will hold them to that. Thank you very much.

:24:34.:24:38.

Have one organisation making quite a big difference to how Parliament

:24:38.:24:41.

works is the backbench business committee. The green benches were

:24:41.:24:46.

packed as huge numbers of Conservative MPs defied David

:24:46.:24:49.

Cameron's pleas not to vote for a referendum on our relationship with

:24:49.:24:52.

the European Union. That came about because the backbench business

:24:52.:24:56.

committee made it happen. Today, they will be considering whether or

:24:56.:24:59.

not to have a similar debate about the extradition of British citizens

:24:59.:25:05.

to face trial in foreign countries. 1 K is often cited is that of Gary

:25:05.:25:09.

McKinnon, who suffers from an autistic spectrum disorder. He

:25:09.:25:16.

broke into an American computer network and claims he was just

:25:16.:25:20.

looking for UFOs. His mother claims he would not survive the prison

:25:20.:25:27.

system. The US wants him extradited. Dominic Raab is pushing for this

:25:27.:25:32.

debate. Why do you think the extradition system is unfair?

:25:32.:25:36.

had a big drive for enhanced Corporation on counter-terrorism

:25:36.:25:46.
:25:46.:25:48.

after 911. I think the pendulum has swung too far the other way. Also

:25:48.:25:55.

under the European arrest warrant, we have fast track extraditions

:25:55.:25:57.

tainted with evidence of spurious grounds. We need to rebalance, put

:25:57.:26:00.

in a bit more common sense, and basic judicial checks and

:26:00.:26:05.

safeguards. I think it is important to have this debate, because it is

:26:05.:26:10.

the job of Parliament to protect British standards of justice.

:26:10.:26:13.

former Court of Appeal judge, Sir Scott Baker, came to a different

:26:13.:26:22.

conclusion, and he said the system was adequate. Yes, and they read

:26:22.:26:27.

all 486 pages of his report. There were a few flaws in it. They ducked

:26:27.:26:31.

the big issues. Take the Michael Turner case, the case of fast-track

:26:31.:26:35.

extradition, not for a prosecution but a police investigation. That is

:26:35.:26:40.

the kind of case that shouldn't be happening. The Baker report denies

:26:40.:26:44.

it happens, and Michael Turner's case is confined to a single

:26:44.:26:48.

footnote in the report. The second major flaw in the report is that

:26:48.:26:53.

they didn't interview any of the victims, and therefore it is that

:26:53.:26:57.

of shorn of all human dimension. If you are subject of this extradition

:26:57.:27:00.

and you are innocent, it turned your life upside down. What impact

:27:00.:27:06.

you think a debate would have? have the Joint Committee on Human

:27:06.:27:09.

Rights report as well. Lawyers can give their legal opinion. But I

:27:09.:27:13.

think ultimately it is up to elected lawmakers to stand up our

:27:13.:27:17.

justice system and our citizens and to have their voice and they say

:27:18.:27:21.

before the government response than this. How much support you think

:27:21.:27:26.

you will get? At the moment, we have cross-party support. So Ming

:27:26.:27:35.

Campbell, how Francis, -- Sir Menzies Campbell. Particularly

:27:35.:27:38.

constituency MPs for constituents who have suffered under the

:27:38.:27:42.

European arrest warrant. Barbara, due think this new development of

:27:43.:27:46.

the backbench business committee and more backbench power is a good

:27:46.:27:51.

thing? Definitely. The more that people's voice can be heard, and

:27:51.:27:56.

that is a better way of more people being engaged in the debate.

:27:56.:28:04.

Lobbyists feeding into the debate? Yes, we do, and we raised full

:28:04.:28:06.

parliamentary sittings. But that wider view of what the British

:28:06.:28:10.

people are wanting and the debates they want to have held has got to

:28:10.:28:14.

be good for democracy. And in the wake of expenses and the

:28:14.:28:18.

downgrading of Parliament, you think it is a good thing?

:28:18.:28:23.

Definitely. There is a bigger issue here as well. We tend to assume

:28:23.:28:26.

that politicians are all the same, but there is a difference between

:28:26.:28:31.

Parliament and legislature, and the executive. There is also my job as

:28:31.:28:36.

a backbencher and a lawmaker to hold the government to account and

:28:36.:28:39.

scrutinise policy. Thank you both very much for being with us here

:28:39.:28:44.

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