30/11/2011 Daily Politics

Good morning and welcome to The Daily Politics. 2 million public

sector workers walked out in the biggest day of industrial action in

a generation. Schools in England are closed, airports and hospitals

are affected. They are striking about pensions. Has the Chancellor

just poured or ill on the flames of the government's relationships with

the public sector unions -- Port oil.

Pain today, tomorrow and the day after. That was the message from

George Osborne yesterday but should we just accept George's less than

marvellous Medicine, what does Labour have a better cure?

The coat of arms of the right honourable Mr Speaker, John Bercow

to you and me, who explained what the 15,000 pound heraldic symbol we

bought for the Speaker of the House of Commons really means.

And in these austere times, should politicians still be intensely

relaxed about the super rich, or does something need to be done

about the widening gap between rich With us for the duration this

morning, the Leader of the House of Lords, Tom Strathclyde. And we hope

joining us soon, chukka and winner, he is probably soon -- Chuka Umunna,

probably trying to get to grips with the Autumn Statement. We are

told he is on his way. The estimated 2 million public sector

workers are on strike today, only 13% of schools are expecting to be

fully open in England. Hospital appointments have been cancelled

and the Border Agency has warned of only slightly longer than average

queues at airports. I am told at Heathrow, you would not know

anything has happened, it is probably as miserable as ever. The

government has said the action could cost the economy half-a-

billion pounds, though that is just an estimate. It is not clear how

they get to that. Today's strikes are about proposed changes to the

pensions of employees in the public sector. The government say the

offer on the table is much more generous than pensions available in

the private sector. Many workers will be better off in retirement.

They have condemned a strike which they say is taking place as

negotiations continue. The unions say they have not met with the

government for weeks and have been forced to take action to protect

the pensions of some of the lowest- paid workers.

The Chancellor further of curated the unions yesterday, announcing in

his Autumn Statement that public sector pay increases would be

capped at 1% for two years. That comes on top of a two-year pay

freeze. A further squeeze on spending means there will be an

additional 300,000 job losses in the public sector. The Chancellor

also announced a consultation that is likely to end national

collective pay bargaining. We might be able to speak to Len McCluskey

from Unite later. I am delighted to say that the late

Chuka Umunna has arrived. I am still alive! We will be the judge

of that! Let's see if you still are by 1:00pm. I know Rachel Reeves was

supposed to come, but she has duty in the house. Tom Strathclyde, we

have got the strike today, some painful changes having to be made

to public sector pensions. Why, given that, as the Chancellor,

after yesterday, declared war on public sector workers? I don't

think he has at all. We are operating against an extremely

difficult economic background. We have seen more volatility and

uncertainty than we have seen probably at any time since the

Second World War. That is the background against which we are

operating. I think what George Osborne was trying to do yesterday

was give it a context, including working with the public sector,

making sure we were going to invest in infrastructure and employment

projects, to try to get us through what is undoubtedly going to be a

very difficult period, not just for this country but the rest of Europe.

I understand the broad picture. But this is the issue. Public sector

workers, like most of us, will have to work longer. There have been

changes in their pensions, they will not be as generous as they are.

They have a pay freeze at the moment. You have now told them

after the pay freeze, they will get a 1% pay rise, a maximum for two

years, which in real terms will be another cut in their pay. Job

losses are going to be over 700,000 in the public sector, not 400,000

as you originally told us. And national collective pay bargaining

is under threat. If that is not war, what would you call it? It is

reality. It is being realistic and honest with the people of this

country, and with the public sector. What we can afford and what we

can't afford. The pain is going to come in certain sectors. What this

government is trying to do is to protect the very worst of, which is

why more money is going to go into education, we have protected the

budget of the NHS. We are going to talk about that later. I am more

concerned about the strikes at the moment, and what many will see as

warn the public sector. Given the litany of things that the public

sector will now have to suffer, you say you are spreading the pain, but

it is a 1% pay rise following a freeze. It is a loss of hundreds of

thousands of jobs, changing their pensions, it could be the end of

national collective bargaining. What have you done with the banks?

You have increase the bank levy from 0.075 per cent, to 0.88 per

cent. Compared to what the public sector workers are going through,

that is nothing. We are raising �2.5 billion out of the bank levy.

That is nothing. We are not going to -- we were not going to achieve

that march which is why the rate went up yesterday. The most

important thing -- that much. The most important thing is how we are

There are many people who already believe that the tax taken in the

United Kingdom is too big. We want to inspire growth which is why we

have made some of the technical changes yesterday, which will be

rolled out over the course of the next few years, to make that

difference. But yes, people in receipt of good pensions, some of

the best in the world, they are still going to receive very good

pensions, better than the private sector. We are all going to be

living longer and working longer and it is entirely right. You have

not reformed pensions in Parliament. I think we have. Not by much. I am

confused about Labour's position on the strike. In your party's view,

should be struck be going ahead. Perhaps if I explain it like this,

we are talking about people here. Wijk -- I have very close friends

and family who are out taking industrial action today. I can't

support the mass disruption it causes for constituencies whose

children can't go to school today. I simply can't condemn it either.

It is very revealing, the Commons Many of the arguments the

government has been putting forward is the sustainability of public

pensions going forward. All the has been talking about his deficit

reduction. The thing that greets for public-sector workers is they

are being asked to pay a 3% tax -- that grates. Because the extra

monies are not going into the extra different schemes, it is going back

into the general pot. Let's remember, if you look at the medium

pension drawings for a public sector pension at the moment, it is

not a lot of money. If you broke your leg on the way back to your

car, Andrew, who is going to be wheeling you around? A member of a

trade union. People talk about trade unions doing this and that.

These are trade union members. We have people taking industrial

action for the first time ever today. Given that, why don't you

support it? Because I can't support the mass disruption it will cause

constituents. Every time you say it, I don't support the disruption,

people ask you three times, why don't you support it? I have said,

we don't support the disruption but I am not going to condemn those

people. I understand that, I know it is the party line. I strongly

believe it. Haven't asked you to condemn it, I have just asked

whether you have supported it or not, and you have answer that

question, and I am grateful for that. Ed Balls has said that both

sides need to give more ground. What grounds do you think the

unions should give? There is a diversity of views around these

things amongst the different unions. The PCS has a different view to

other unions. Think there has got to be an acceptance that we are

going to have to work for longer and contribute more in the long

term. As to what the calibration of that is, that is something where

the details will have to be handed out by government and the trade

unions -- hammered out. You don't want a trade -- you don't want a

government seeking to divide up society. The role of government is

to seek a resolution to this dispute. If the NHS doesn't work,

the transport system doesn't work, the different elements of public

service to work, we can't function as a society. You are implying if

it was a Labour government in power, you would have to continue the

reform of public sector pensions as well. We started reform in

government in any event. Look up the numbers of days lost to

industrial action during labour's time in government. Proportionate

Lee, the number of days lost to industrial action under this

government is dreadful -- proportionally. You could go back

as far as you want! What about the We are grateful that neither of you

is on strike, so we will continue. Let's come to the Autumn Statement.

I think we can now talk to Len McCluskey in central London, can

you hear us, the general secretary of Unite? Yes, I can. Just about, I

think. I have a big, powerful voice, so I will use it. Chuck it women

are from the Labour Party has just said that he can't support the

strike action -- the chukka and the What do you say? The only

irresponsibility is the government's. They have had nine

months to try to sort that out. The Government's is responsible for

bringing teachers, nurses, care workers, people who look after the

vulnerable people in our society, decent public sector workers, they

are the ones responsible for bringing them out on strike.

Workers don't like taking strike action, they do it because they

feel there is a deep sense of injustice and nobody is listening

to them. That is what the case is with this government. It is a

question of laying the blame where this squarely lies, at the feet of

the government. Rather than laying the blame with the government or

them laying it with you, what about trying to reach some sort of

negotiated settlement. You don't want to be on strike, the

government wants to make a deal, we have just heard on the programme it

is time for both sides to give ground. What ground will you give?

The reality is, of course we would love to reach an agreement. That is

what trade unions do. The media try to project as and the Tories have

tried to project as as people who just want to have strikes all the

time, that's nonsense. 95% of our time is spent with companies and

governments, trying to reach agreement. You have a government

that is totally in transient. How has it taken the Government nine

months -- totally intransigent. Why did it take them that long? Because

the government are playing games. They believe they have the public

on their side, they are playing games with people's jobs, pensions,

and they are decent people who serve our community, and it has

backfired on them. The opinion polls are showing that. 60% of the

public support the strike, 80% of Labour supporters. Which is why the

Labour leadership need to listen. Instead of trying to sit on the

sidelines... I know Ed Miliband has condemned the government, he won't

condemn the strikers, that is the right thing to do. We want fairness

and justice. Of course we want to get around the negotiating table to

resolve our differences. Thank you very much.

After delivering yesterday's Autumn Statement, which was more like a

full-blown budget, as if to emphasise that the economic crisis

stretches beyond our shores, the Chancellor went to Brussels again,

to attend another meeting of European finance ministers, to

discuss, you have guessed it, the Uruzgan crisis. The Office for

Budget Responsibility said that if the euro falls apart, the impact on

our economy would be unquantifiable. You may not be able to count it but

we know it would not be good, and it could be disastrous. Even if we

avoid that, the predictions of the forecast delivered by the

Chancellor yesterday were grim, even without a eurozone meltdown.

Yesterday, the Chancellor had to admit growth would be much lower,

just 0.7% next year, and that he would need to borrow �111 billion

more than expected over the next five years. And that the government

won't meet its target of balancing the structural deficit until 2017.

That is two years later than they had hoped. The Chancellor has

blamed this deterioration in the blamed this deterioration in the

public finances on three factors. External inflation caused by it

rises in energy and commodity prices. The eurozone crisis, and

that after the boom years, the bust was deeper than anyone realised,

implicitly blaming Labour for how they had left the economy. Labour

say the Chancellor's plan a has failed colossally, and Britain's

tepid growth and spiralling deficit have been caused by the car -- the

Chancellor cut into deep and too fast. They are warning of a

borrowing bombshell -- cutting too deep. It means a lot more spending

Should we have a moment's silence for the death of plan? Certainly

not. -- Plan A. It is only the media that have got so excited

about plan and Plan B and what Ed Balls wants and all the rest of it.

George Osborne -- George Osborne is entirely right to react about what

is going on in the real economy. To react from the report from the OBR.

He has been responsible and honest with the British people. That is

the best way to be. The alternative which Ed Balls will explain his to

go out and borrow even more money. But that is what you do. We're

going to have to borrow even -- a little bit more money for. A little

bit? -- how much is it. Another �147 billion. You are going to

borrow �110 billion more than you said he would, six months ago.

Whichever way you cut it, adding �110 billion to the borrowing you

intended in March of this year would seem to anybody else to be a

failure of your budget consolidation strategy. Otherwise

you would not be borrowing that amount of money. The figures that

we based the forecast on were independently produced and they

have been independently produced again. What did those people say?

They said that there has been an increase in energy and commodity

prices which has created higher inflation. They said that the boom

in the 2007 was higher than anyone had anticipated and therefore the

bust has been greater and deeper. We have had to adjust our figures

because of these external changes. He has also warned that if the

Eurozone crisis gets worse, then we really are in a pickle. But isn't

it part of the plant that living standards would now stall for 14

years? 14 years? It shows you the depth of the seriousness that we

are now in. How did the markets react to what George Osborne was

saying? Yields on UK bonds actually fell, not by much but I a -- but by

a little bit. That is a better position than our neighbours and

competitors are in. It is early days. Chuka Umunna, are you

criticising the Government for borrowing more than it planned?

we are. If you compare it to the forecasts from last year, they will

be borrowing �158 billion more. Let me explain why. You're criticising

them for borrowing more? Carry on. The reason is that the Government

said that the sole test, and the mainstay of their ambition for

their time in government is deficit-reduction. They said that

by sticking to Plan A, that they would reduce the deficit and bring

down our debt. That is a starting- point for their argument. Our

starting point is jobs and growth. Unless you have jobs and growth,

you are not able to reduce borrowing in the immediate future.

With 2.6 million people out of work, that is people we are having to pay

unemployment benefit to and who are not paying income tax. The best way

to deal with fewer debts is to get people into work and you need

growth. The problem was that in the wake of the Comprehensive Spending

Review this time last year, and Bloomberg presented an interesting

graph on this, sorry to mention another broadcaster. It's all right,

nobody watches this! Confidence nosedived after that. Hold on. All

of that may be right. But explain to me how you can criticise the

Government borrowing more than it plans and yet still say that it

should stay borrowing even more? First of all, the Government set

this test, of saying that it was all about whether they reduce

borrowing or 0. We're just scrutinising what they said they

would do. The Government, let us get this straight. The Government

is about to borrow �111 billion more than it said it would. You

would borrow more than that. necessarily. I am not able... I

would would say to you that we would have done things differently.

The situation we would be in now would be different. If you're

asking me... You do not know that you would have done it differently.

Yes, I do. Can I remind you, by May of 2010, the British economy had

been put on negative watched by the ratings agencies, and can you tell

us what our bond heels were? can't give you a figure. But the

bond yields were falling. They were higher than Italy's. He would not

have been able to continue. You would have to have done something

different. I am slightly puzzled by the logic. That is all. I do not

understand the logical saying that the Government is borrowing more

than it said, and that is wrong that, and by the way, if we were in,

we would borrow even more. logic is the Government said

measure asked, judge what we do against weather are not we are able

to reduce our debt. They are also saying that in the context of

borrowing �158 billion more despite going for her �30 billion more in

cuts and �10 billion more in tax, they are in that situation. They

said we should judge them against bad yardstick. We are not in

government, which is a great shame. But what we're saying is that we

would have done things differently because what we would have done

would not have choked growth. will never know if that is true.

Every other country has had choked growth. In Europe, only Greece,

Portugal and Cyprus have grown slower. But you are talking about

differences of 0.1 or 0.2% compared to the French economy and the

Italian economy. It is so small. The decimal point is irrelevant.

What cuts did the Government announced yesterday? What cuts

would you support and what do you not support? In relation to the

things announced, for example the police cut, that is the obvious one.

The ones they announced yesterday. We are going through the detail. I

have the OBR reports here. You've had time. What can't do you

support? The chief secretary to the Treasury was asked on Newsnight, it

is a BBC put -- it is a BBC programme. We have run out of time.

I want to come back to this. Danny Alexander was not able to say where

the cuts were coming from. Think about it, go through the book while

we are doing it. You have got about 10 minutes! What better use of

taxpayers' money in these austere times? The House of Commons has

spent �37,000 on a work of art to grace the walls of the Speaker's

grace-and-favour apartment in the Palace of Westminster. It is a

portrait of the Speaker himself, Justin Case John Bercow forgets

what he looks like. I would have thought a Mr Woods have done. I'm

sure he has one of those. No portrait would be complete without

an ornate wooden frame featuring the coat of arms of the subject. I

have one just like it in my own home. No, I haven't. Rather

marvellous, isn't it. The latter represents the Speaker's rise from

lowly beginnings. The balls, his love of tennis. Four of them

representing England, Wales, Scotland and Northern Ireland. Very

good. And the rainbow symbol of the quality, as he is a champion of the

rights. Art critic Brian Sewell joins us. Can we start with the

portrait? Would you be happy to have that hanging in your home?

But then, I am not the Speaker. You have a problem here. In northern

Europe particularly, Germany and England, to raise six centuries of

painting portraits of people when they become important. There is

also a tradition of inventing coats of arms and the rest of it for them.

He is doing what has been done many times before. I do not think you

should necessarily criticise him for doing that. There is some

justification for criticising the painting. What do you think of it?

I think it is a pretty poor painting for 37,000 quid. You think

we have been fleeced? 15,000 would have gone the frame.

This in a friends are important. -- gone on the frame. -- they say the

frames are important. The further up the portrait painter's 3 you go,

the more the fee will be. This is a young man climbing, and they have

given him quite a push. If you were writing a headline. I would never

write a headline. How would you title it if you were looking at

that portrait? It reminds me of some of fumbling school master in a

shambles of a public school trying to keep order. In essence, that is

exactly what he is doing. There is a truth in that. It does not

flatter him. I criticise most of all the clothes he is wearing. He

looks as though he is wearing a school masters academic gown. He

has a school masters tie on. He does not look a bit grand. Former

speakers looked like speakers. does not look a park. You do not

think he looks like the Speaker? looks like a bloke that you dug up

from Essex. What is wrong with Essex? What is wrong with Essex?!

Can I look at the coat of arms here? Again, what do you think? We

have had the symbolism of the ladder and these knives are

representative of where he went to university. There is a university

in Essex? Yes, there is. You have learnt something new on the

programme. What do you think of the coat of arms? I think that is

pretty poor stuff. It would be Christmas game you could play, like

Monopoly. You have a coat of arms, what do you think? One should never

criticise someone else's autobahns. That is properly heraldic. Why did

you have won? I have got absolutely no idea. These are very ancient.

They are heraldic symbols, bears heads. His looks more posh than

yours. That is a snob thing. The unforgivable thing is that the

Speaker is perfectly ordinary. He has no lineage going back to 1066

or thereabouts. He is not it sugar, he is not a Yorkshire or a

Lancastrian. He is nothing. He comes from Essex. He is nobody. But

he has the effrontery to say he is going to make himself equal.

going to have to go. Thank you very much. On that note, John Bercow...

You can read the e-mails after that. We have spared no expense on the

Daily Politics. Our graphics department have spent almost all

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# The finger of suspicion points at you. # Every Democrat voted against

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To begin with a chance of winning, send your answers to a special e-

mail address. -- to be in. We're going to go straight over to

I am sure the whole House will wish to join me in paying tribute to

Rifleman Sheldon steal from Fifth Battalion the rivals. He was a

highly respected shoulder who achieved a great deal and showed

much potential during his time with his army -- respected soldiers. Our

thoughts should be with his family, friends and colleagues, his courage

and dedication were never be forgotten by our dedication. This

morning I had meetings with ministerial colleagues and others

and I shall have further such meetings later today. Can I join

the Prime Minister in paying tribute to Braid serviceman who

gave his life for our country. Our thoughts go to his family at this

very, difficult time. My constituency has high unemployment

with great potential, and would benefit greatly from a �200 million

private sector led investment in motor sport. Can I ask him to

provide support for enhanced capital allowances for enterprise

zones in Wales, including Blaenau- Gwent, as well as in England.

thank the honourable gentleman for that question. Can I congratulate

him and the other 37 members who have opted to grow additional

facial hair in this month of November. It is a very good way,

for those who are capable of doing so, of raising the profile of this

important of us, prostrate cancer. We are committed to providing

enhanced allowances, discussions are ongoing with devolved

administrations about enhance allowances within enterprise zones.

We will do what we can in Blaenau- Gwent to help. We are electrifying

the line to Cardiff, we are looking for improvements on the M4. One of

the announcements made by my right honourable friend, the Chancellor,

will have consequences for additional spending on

infrastructure. I am confident that the Prime Minister, like me, would

praised the courage and professionalism of the Portland

search-and-rescue helicopter. I am also confident he will share with

me the alarm, anger and disbelief of my constituents, and many others

in this House, at that it is to be axed. Will he meet with me and the

small delegation from South Dorset to discuss this urgent matter,

before a disastrous mistake is made? I am very happy to meet with

my honourable friend. I know how it is important that we have effective

search-and-rescue services of our coast. The government is looking at

the best way to deliver those services, including how they should

be paid for, and it is important Mr Speaker... Can I join at the

Prime Minister in paying tribute to the riflemen from 5th Battalion the

rifles. He served with huge commitment and courage and our

deepest condolences are with his family and friends. In June at

Prime Minister's Questions, the Prime Minister praised the head

teacher of a first -- the school in Redditch for refusing to strike.

Today she has closed first score. She says, this has been the most

difficult decision of my professional life. The difference

in the summer was that I had faith in the government. I have not seen

any progress so I have decided to strike. Why does the Prime Minister

think so many decent, hard-working public sector workers, many of whom

have never been on strike before, feel the government simply isn't

listening. The reason people are going on strike is because they

object to the reforms that we are making to public sector pensions.

But I believe those reforms are absolutely essential, and as the

former Labour Pensions Secretary Lord Patten said he -- Lord Hutton

said, it is hard to imagine a better deal than this. What I would

say above all to people who are on strike today, is that they are

going on strike at the time when negotiations are still under way.

The right honourable gentleman refers to what was said in June.

Let me remind him what he said on 30th June. "the strikes are wrong,

at the time when negotiations are going on." Why has he changed his

mind? Mr Speaker... Order. I say to people who are engaged in

orchestrated barracking, it is very tedious, from whichever side it

comes. It is very juvenile, the public don't want it here it,

neither do I, the leader of opposition will be heard, as the

Prime Minister will be heard. Workers declared be gauche -- they

declared negotiations at an end four weeks ago, they said they had

made their final offer. And they haven't even met the unions for

four weeks, since November 2nd. And what has the Prime Minister gone

around saying to people? He has gone around saying, he is privately

delighted the unions have walked into this trap. That is the reality,

he has been spoiling for this fight. And the reason people have lost

faith is he is not being straight with people. Will he admits that

800,000 low-paid workers, one �15,000 a year or less, are facing

an immediate tax rise of 3% on his pension plan? -- on 15,000. I know

his entire party is paid for by the unions, but I have to say, it is

extraordinary that what he has just told the House is completely and

utterly untrue. The fact is, there were meetings with the trade unions

yesterday, there will be meetings with the trade unions tomorrow,

there will be meetings on Friday. These discussions, these

negotiations are under way. Let me repeat again what he said in June.

It is wrong to strike when negotiations are going on. And yet

today, he now backs the strikes. Why? Because he is responsible,

left-wing and week. -- he is Mr Speaker, the difference is that

unlike him, I am not going to demonise the dinner lady, a cleaner,

the nurse. People who earn in a week what the Chancellor pays for

Mr Speaker, Mr Speaker... Order. Members on both sides of the House

need to calm down. If there are senior members of the House to

think it is a laughing matter, let me tell them that it isn't. The

public would like to see some decent behaviour and a bit of

leadership on these matters, and so would I. Mr Speaker, he is the one,

and he didn't deny it, who went around saying he is privately

delighted, because they have walked into his trap. And that is the

reality. The truth is, it is not just public sector workers who are

paying for the failure of his plan, it is private sector workers as

well. Can he confirm that as a result of the cuts to tax credits

announced yesterday, a family on the minimum wage, taking home �200

a week, will lose a week and a half's wages? Let me be absolutely

clear. I will answer his question. The Prime Minister's answer,

however long it takes, will be heard. That is the principle of

democracy. The Leader of the Opposition must be heard, and the

Prime Minister must be heard. not welcome these strikes one bit.

I think we have made a very reasonable, very fair offer to

public sector workers, and that is why the former Labour Pensions

Secretary says that it is hard to imagine a better deal. I don't want

to see any strikes. I don't want to see schools closed, I don't want to

see problems at our borders. But this government has to make

responsible decisions. Let me just remind him, and the House, about

the facts about the public sector pensions. Anyone earning less than

�15,000 on a full-time equivalent salary will not see any increase in

the contributions they have the make. In terms of the reforms we

are making, a nurse, retiring on a salary of just over �34,000, today,

she would get �17,000 pension. In future, she will get over �22,000

pension. A teacher retiring on a salary of �37,000 would have got

�19,000. She will now get �25,000. These are fare changes. I will tell

you why. We rejected the idea you should level down public sector

pensions. We think they should be generous. But as people live longer,

it is only right and fair that they should make greater contributions.

What we are seeing today is a party opposite that is in the pocket of

the trade union leaders that have to ask their permission before

crossing a picket line, and that take the irresponsible side of

trade union leaders that have called their people out on strike,

when negotiations are under way. Now let me answer his question

about the low pay. Order! Order! Can I remind the Prime Minister

very gently, there is a very large members -- number of members listed

on the Order Paper, backbenchers who I want to hear. A brief

sentence will suffice. I will wait until his next trade union-

sponsored question and I will give my answer. I am proud that millions

of hard-working people in this country support the Labour Party,

better than millions from Lord Ashcroft. The problem is, he

doesn't understand his own policy. He doesn't understand they are

part-time workers earning less than 21,000, who will be hit. 800,000

low-paid, part-time workers, 90% of whom are women, will be paying more,

and he denies it, but it is true. It is the reality. He sits there

shaking his head, he doesn't understand his own policy. And of

course, he couldn't explain, or justify what he did to everyone on

low pay, with the miserable deal cooked up with the Deputy Prime

Minister to cut �1 billion from tax credits yesterday in the Autumn

Statement. They have no explanation for why they are doing that. Order!

I say to the honourable gentleman, I don't require any assistance from

him. The Leader of the Opposition will come to a question. What will

unemployment be at the time of the next autumn statement on the OBR

If you compare the end of this Parliament with the start of this

pair but -- parliament, on the Office for Budget Responsibility

figures, and let us remember the Office for Budget Responsibility is

independent. When he was sitting in the Treasury the figures were

fiddled by the advisers. That no longer happens. There will be half

a million more people in jobs, 90,000 fewer people on the claimant

count and the unemployment rate will be 7.2%, instead of 8.1. That

is the OBR forecast. That is not fiddled, that is independent, that

is what it shows. Let me answer his question about helping the poorest

people in our country. It is his party, by the way, that got rid of

the 10 p tax, the biggest attack on the working poor. This government

has taken 1.1 million people out of tax, frozen the petrol tax, cut the

council tax, introduced free nursery care for two, three and

four-year-olds, and is putting up the child tax credit by �390 this

year and next. That is a record to be proud of, instead of his

appalling record of attacking the working poor. With child poverty

going up as a result of the autumn statement yesterday. The truth is,

he couldn't answer the question, because he is too embarrassed by

the truth. The Education Secretary should calm down, Mr Speaker. He

tells children to behave, why doesn't he behave himself? He is to

embarrass, Mr Speaker. 2.8 million people out of work -- too

He is another Conservative Prime Minister for whom unemployment is a

price worth paying was an because he is failing on unemployment and

growth, he is failing on borrowing. He told the CBI conference last

year, no ifs or buts, by 2015, we will have balanced the books. Will

he now admits that on the central He complains about the level

borrowing but his answer is to borrow even more. That is the

illiteracy. Let me tell him what we're doing. Because we have a plan

to meet the mandate and to meet the test set out by the Chancellor in

his emergency budget, we have some of lowest interest rates in Europe.

For every percentage point they went up under Labour, that would be

another �1,000 on a family mortgage, another �7 billion out of business

and another �21 billion on to our national debt. That is what you

would get under Labour and that is why it is this government that will

take the country through the storm. Mr Speaker, he is borrowing an

extra �158 billion to pay for his economic failure. The truth theirs,

his plan has failed. -- the truth is. He refuses to change course and

he is making working families pay the price. At the very least, we

now know that he will never, ever be able to say again "We are all in

this together". Billy the of the Labour Party has taken sides today.

He is on the side of the trade union leader but one strikes and

not negotiations. -- that once strikes. He is on the DIS -- he is

on the side of the people want to disrupt our country. And when it

comes to borrowing, he cannot even bring himself to say that we are

welcoming the fact that there are low interest rates. The Shadow

Chancellor... Mr Speaker, they are all shouting in unison, or should

ISA, -- or should I say they are all shouting on behalf of Unison.

I'm not quite share -- quite sure. Let me remind the House of what the

Shadow Chancellor said about lower interest rates. "Long-term interest

rates are the simplest measure of monetary and fiscal policy

credibility". Mr Speaker, we are being tested by these difficult

economic times. We will meet that test by getting on top of our debt

and the deficit. He is being tested, too, and T showing that he is weak,

left-wing and irresponsible. -- and he is showing. I assume government

backbenchers have some interesting listening to Jo Swinson. I would

like to associate myself with the words of condolence from the Leader

of the Opposition. 10 years on from the military intervention, more

than 3 million girls in Afghanistan are now in school. With the

conference on Monday in Germany will the Prime Minister sent a

clear message that the rights of those girls should not be traded

away in a false choice between women's rights and security, when

the evidence shows that women's involvement in post-conflict

resolution is essential for stability? For us of all, can I

wish my Honourable Friend and everyone in Scotland a very happy

St Andrews Day. She is absolutely right to talk about women's rights

in Afghanistan. Too often, we talk about security but without talking

about some of the things that that security is making possible. In

2001, there were less than one million children in school and none

of them were girls. Today, there are 6 million children regularly in

school, 2 million of whom are girls. If those who have been in

Afghanistan and have met women MPs and other leaders in that country

who want to stand up for women's rights know what I incredible job

those people are doing. -- know what an incredible job. Half a

million more people will be on the dole in 2013 than previously

thought. A terrible human cost, but how much more will be lost in tax

and paid out in benefits as a result of the his Chancellor's

economic failure. The OBR shows that by 2015, we will have 500,000

people more or in jobs, and a lower unemployment rate. The figures do

show a sharp decline in public sector employment. That is shown by

the figures. There is a bigger increase in private sector

employment. I would say to the party opposite and everyone in the

House, if you want to reduce the amount of unemployment from the

public sector, you have to reform welfare, which they oppose, you

have to freeze public sector pay, which they oppose, and you have to

reform public sector pensions, where we are on the side of the

irresponsible trade leaders. Is the Prime Minister aware that in the

last financial year, taxpayers paid over �113 million to trade unions

in terms of pay, staff time and direct grants? In the light of the

disruption today to hospitals and schools, is it not time to review

that situation? I think it is time. The idea of full-time trade

unionists working in the public sector on trade union business

rather than serving the public, I do not think that is right and we

will put that to an end. It is absolutely the case. The evidence

today makes that even stronger. Why is the Government raising

working tax credit, which helps the lowest paid workers, including

those whose rages -- those whose wages are too low even to pay tax,

to make work pay? As the honourable lady will know, what we're doing

with child tax credits, if you take this year and next year, there is

going to be a 21 and �55 increase this year, the largest ever

increase. -- �255. There will be a further �255 increase next year,

and they think that is the right increase in terms of tax credits.

In terms of helping families and generally helping people to stay

out of poverty, helping with nursery education and to get low-

paid people out of tax. As the United Kingdom's Borders are being

kept open today by patriotic volunteers, will the Prime Minister

consider imitating the robust action of the late US President

Ronald Reagan in relation to recalcitrant air-traffic

controllers? I want to thank all those people, including a number of

people from Number Ten Downing Street, who were helping to keep

our borders open and to make sure that Heathrow and Gatwick are

working properly. Perhaps I could report to the House that so far,

the evidence suggests that around 40% of schools are open, less than

one-third of the civil service is actually striking. In the borders,

the early signs are that the contingency measures are minimising

the impact. We have full Ambulance Service cover and only 18 out of

900 Jobcentres have closed. Despite the disappointment of the party

opposite, it looks like something of a damp squib.

Can I ask the Prime Minister if he came into politics to sack three

quarters of a million Civil and Public surface -- public sector

workers, most of whom are women and most of whom have family's? I came

into politics to try and improve the welfare of people in our

country. The fact is, at the end of this public sector pension reform,

those people working in the public sector will have far better

pensions than most people in the private sector who are contributing

that money to them. I know you are paid to ask questions, you do not

have to be paid to wave as well. That is the point. Give the money

back to the unions and I will come down. -- come down. Will my

honourable friend join me in condemning the have Ryder's attack

on our embassy in Tehran yesterday and also join me in paying tribute

to our diplomatic staff serving in such difficult environments with

such distinction? I certainly join my honourable friend in doing that.

I'm sure that a whole house would join me in praising the incredible

devotion of our staff in the foreign and diplomatic Service who

often face great dangers, as they did yesterday, in Tehran. I chaired

a meeting of COBRA yesterday and another this morning and spoke to

our ambassador about the safety of his staff. They should be our

number one concern. Making sure safety and security are maintained.

After that, we will consider taking tough action in response to this

appalling and disgraceful behaviour. Closed question, Mr Graham Allen.

lead a committee of Cabinet ministers to look specifically at

family issues including the importance of early intervention.

It is central to what this government is trying to achieve and

we believe that if you change the life chances of the least well-off,

you have a much better chance of genuinely lifting young people out

of poverty and keeping them there. I take a very close interest, as to

my right honourable friends, the Education Secretary and Chancellor,

in the work of the honourable gentleman and the very real

difference he has made in terms of prioritising early intervention in

our country. Can I thank all three party leaders for their consistent

support for early intervention and their generous welcome for my

reports? May ask the Prime Minister to make early intervention with

babies, children and young people if the move for all departments in

the next Comprehensive Spending Review so that not only will all

children be able to make the best of their life chances, but also

government and the taxpayer will be able to reduce the massive costs of

failure, including educational under-achievement, the 120,000

dysfunctional families, summers of discontent and many lifetimes

wasted on benefits. The honourable gentleman makes a

sensible suggestion. I think we can look at that in terms of the next

spending round but, frankly, I do not even want to wait for the next

spending round. That is why the family committee a lead which the

Deputy Prime Minister sits on is looking at how we can make the

intervention on the 120,000 most broken families effective.

Governments spend a lot of money on these families. But we are not

satisfied that money has been spent intervening in those families and

trying to turn them around to solve the very real problems. We have a

programme for doing that and I hope he will continue with his positive

work. The Prime Minister will be aware

that there remains 16 British overseas territories around the

world where the Union Flag still proudly flies. Will the pledge that

Her Majesty's government -- will he pledged that Her Majesty's

government will protect, defend and cherish the loyal subjects of all

those territories? I can happily give my honourable friend that

guarantee. Let me add that the overseas territories will remain

British as long as the people of those territories want to maintain

their special relationship with us and the Union Flag will continue to

fly over the governors residences. We are increasing our assistance to

overseas territories. You will be familiar with what we're doing in

SingTel and a with the airport. Next year, we will have the

anniversary of the liberation of the Falkland Islands.

constituent, Jackie, contacted me to ask how she is going to marriage

-- going to manage with a 3% tax on a pension, no pay increase until

2013 and rocketing fuel Bills. How is she going to feed her family?

Why is the Prime Minister making people like her pay for his

Government's failure? The fact is, of a whole country is having to pay

for the failure of the last government to get on top of the

debt and deficit. What I would say is that we are trying to help.

We're freezing the council tax, we are cutting the petrol tax, we are

taking 1.1 million of the poorest people out of tax altogether. That

is why we are increasing the child tax credit in the way that I said.

And we will continue to take those steps. What I would say to her

constituents, the most dangerous thing we could do right now is lose

control of our debts and see interest rates go up. When this

government came to power, our interest rates were the same level

as Italy. Today, Italy's interest rates are 5% higher. If that was

the case, we would see higher mortgage costs, businesses going

bust, and we would have a real problem. That is the policy of the

party opposite. What message does the Prime Minister have today for

the thousands of people who run and work in small businesses in my

constituency, who worked tremendously hard to keep those

businesses and the local economy going, and who can barely afford in

some cases to make provision for their own pensions? The honourable

lady is entirely right, that this government is squarely on the side

of people who work hard and play by the rules and want to do the right

things for their families. To all those people, I would say to them

today, thank you for what you do to contribute to public sector

pensions that are far more generous than anything you are able to

afford, but for our part, we promise to make sure that public

sector pensions remain strong but are affordable. What is notable

about today is the party opposite has taken the side of trade union

leaders that once you actually disrupt our country. -- that want

to. With attack bears set to pay up to �100 million to BAE Systems to

make workers redundant, is the Prime Minister aware that �100

million would pay for five new Hawk planes to be built for Red Arrows?

Is that not a better use of �100 million. --? I strongly support

British Aerospace. They have the backing of the British Government

and an enormous order book from us in terms of the Strategic Defence

Review. Also, massive backing from us in terms of selling aircraft all

over the world to countries that need them. Clearly, there have been

issues and difficulties and that is why we have put in an enterprise

zone and we will do everything we can to help those people and that

company. Does the Prime Minister share my belief that until recently

-- and, until recently, the belief of the Leader of the Opposition

that now is not the time to strike until negotiations had been

completed? Just in case anyone did not get it the first time, the

strikes are wrong, at a time when the negotiations are going on.

Negotiations are going on so the Leader of the Opposition should

think they are wrong. He does not think they are wrong because he is

in the pocket of trade union leaders. Home-help, carers, nurses

and teachers are on strike for the very first time in their life. Are

these hard-working people... Well, we hear laughter, but it is not

laughter for hard-working families. Are these hard-working people out

of touch, left-wing trade union militants, as demonised by the two

parties opposite, or are they men and women who are saying enough is

enough to the Government? I know people steal strongly about this

but we have a responsibility to deliver an affordable public sector

pension system. We have rejected the idea of levelling down public-

sector pensions. What we will deliver in terms of public sector

pensions is a generous and fair offer which will give public sector

pensioners, unlike others in our country, a defined benefit system.

That is why Lord Hutton says this is an incredibly generous offer.

What a pity that the party opposite has left reality and will not back

The Prime Minister will know I recently held a small business

event in my constituency and many of those small businesses complain

bitterly about the red tape and bureaucracy they have to jump

through to deal with public bodies. What messages can the Prime

Minister sent to these businesses as we look to them to help rebuild

the economy to get rid of some of this obstructive, bureaucratic

nonsense? My honourable friend is right to raise this and that is why

we have introduced the red tape challenge, so these roles are

published online and businesses and individuals can tell us which ones

can be scrapped without harming public safety. We have the one in,

one out well, so that ministers cannot introduce a new regulation

until they have scrapped an existing one. This government is

determined to scrap unnecessary regulation and help small

businesses to employ more people in our country. At the last spending

review, the Prime Minister said the additional rise in child tax

credits could help have an impact on the child poverty. Now he has

taken away that rise and freezing working tax credit, can he say how

many more children will be in poverty in the coming years? What

we are doing in terms of the child tax credit, it will be �390 higher

than at the time of the last election. That is a �255 increase

this year, that is the largest ever increase in the child tax credit,

and we are adding a further �135,000 next year, an increase of

5.2 per cent. That is what is happening in terms of child tax

credits. Let me make this point. If you increase the pension, QC child

poverty figures go up under the definition used by the party

opposite. I think it -- you see a You harm the life chances of

Could I ask the Prime Minister to ensure that this House remains a

free and democratic institution, accountable only to voters? Does he

share my indignation that some members had to ask permission from

the GMB to be here today. Order, order. There is a matter of basic

courtesy here. The question from the honourable lady should be heard.

I think she has completed her question. But it is a lesson for

the future. When questions are being asked, they should be heard

with courtesy, and when the answers are given, whatever members think

of them, they should be heard with courtesy. I think it is genuinely

baffling to people, that somebody who said they wouldn't back strike

action while negotiations were under way, has come to the House of

Commons today to speak on behalf of trade union leaders. I want to say

it is a flashback to Neil Kinnock, Does the Prime Minister think it

fair that the Chancellor yesterday decided to take just 300 million

extra from the banks, and 1.3 billion from working families in

this country. Is that a fair distribution? If you look at what

the Chancellor actually announced, he announced we will be taking �2.5

billion off the banks, not in one year, because of a one-off bonus

tanks, but every single year. -- bonus tax. This government is

putting a tax on the banks and the party opposite year after year gave

night at Steve Fred Goodwin, didn't we get the banks, didn't tax them

properly -- gave knighthoods took While I welcome the reduction in

corporation tax, and I am sure that will encourage those businesses to

expand, 90 per cent of the businesses in my constituency are

not incorporated and will not benefit from a reduction. Will the

Prime Minister ensure that in the spring Budget, these businesses are

given similar tax incentives, so that they can ensure they will grow

to their full potential, both in the economy and the communities

they serve. Can I praise the honourable gentleman for the our

doesn't specimen looking under his nose, and the efforts he has made.

We are not going to wait for the Budget, in order to help these

small businesses. We have already extended the rate relief freeze for

small businesses, and the National Loan guarantee Scheme will help

small businesses get access to credit, that will be up and running

A Minister's Questions has only just finished, the Speaker

obviously enjoying himself, ticking off the House every three minutes.

If he had kept in his seat, he would have kept in his -- on time.

Bump -- predictably it was dominated by the strike going on in

the public sector, with Mr Miliband saying he was proud for his party

to be back and financed by working trade union members. And Mr Cameron

saying he was, "are responsible, left wing and weak." is said that

prize, so there is a chancy they believe it -- irresponsible. He

Mark from London said, the Prime Minister was rattled today and the

Speaker was right, the organised barracking from Tory backbenchers

has become tedious. Bernard says, people are struggling to make ends

meet, people are worried about a dignified old age, what a

ridiculous performance from both leaders. This one says, what is to

gain from calling Miliband irresponsible, left wing and wick?

Jack Mason says, crocodile tears from Ed Miliband, does anyone

remember the attack on private sector pensions when Gordon Brown

took 5 billion out of their pensions? And this one says, is

this not the worst-ever performance from the Speaker?

We will leave that hanging in the air. I have had a tweet from

someone who has a Latin phrase for I don't know what it means, my

Latin is a little rusty, but I don't think it is nice! I shall

check my dictionary later. Nick Robinson is with us, we did not

have time to welcome me before, because we have a run as usual.

was the celebration of meritocracy that kept me off air. What do you

make of it all? There was a lot of noise. Let me just say this, there

is a lot more noise when you are in the chamber than we ever here on

the television. Those microphones are designed to be direction of,

there is a guy in the television gallery to make sure that only one

microphone is on, it is much more noisy when you are there. When I am

in the press gallery, I have to lean backwards. There is a speaker

in my head rest, in order to hear. It is worth remembering that when

you get irritated with the Speaker sometimes. That nice tells us

something, both sides in the House of Commons knew this was a defining

week. Both sides knew that the disaster for the government, of

having to reveal how much more borrowing it was planned, could set

the image of the government and the opposition. The Conservative

backbenchers have set out to tribally defend their guy yesterday,

they were very noisy against Ed Balls and they are trying to define

Ed Miliband, in the words of that phrase that David Cameron used, as

left wing and so on. That is what is going on, because they know

these are moments, and there are not many at the moment, whether

public engages with politics. A lot of the time, there is too much

going on in people's lives for them to care very much. That is why

Labour desperately needed to get the image in the public's minds of

economic failure yesterday, and today the Tories are desperate to

convince the public that Labour is a friend of the strikers in the

pockets of the unions. Is it the government's expectation that today

is just the start... Maybe not of a winter of discontent, but the start

of a series of set-piece industrial action days, and if it is, do they

think... Is it their calculation that it will rebound to the

government's benefit? The answer is no and yes. No to the winter of

discontent. They would insist, and I think they are right, you cannot

get workers on strike, day after day, losing a day's pay, over a

potential future loss of earnings. If you are about to lose your job,

of course you are prepared to go on strike every day. If you are losing

your pay, you are willing to sacrifice a day's pay. If this is a

potential future loss, important though it is, people are very

unlikely. The model the trade unions are looking at is much more

targeted, region by region, sector by sector in future. The model is

the dispute that has happened in Southampton City Council, which has

been going on for weeks. For example, they take out the traffic

wardens because it denies the council some cash. Other union

members pulled together and compensate those traffic wardens

for the money they have lost in earnings. Yes to the idea of a

long-term dispute, but no to the idea of a series of mass walkouts.

Do you agree with that? I agree with a lot of what Nick has said.,

from the relative calm of the House of Lords, it always strikes me as

extraordinary, the volume of the noise and the aggression between

both sides in the House of Commons. Some of it no doubt artificial, saw

it clearly well-meant and deeply felt. Agree that this is a decisive

week, about different messages that the opposition and the government

are trying to push out. I think David Cameron is right to try to

talk about Ed Miliband being irresponsible. I think it is a

theme that we will see more of over the next few weeks. It was part of

this, his C supporting strikes or not? In June he said one thing,

then he said another. -- easy supporting. Now they have said they

don't support the strikes -- easy supporting. If they said that a few

weeks ago, we might not be having the strikes were having today.

think it is nonsense and we have to remember what we are talking about.

The Prime Minister was to make this about unions and entities and

particular leaders, but we are talking about real people. I think

he tops -- he makes a catastrophic misjudgment in seeking to dismiss

the things that Ed has been saying as irresponsible and left wing and

what have you. If you look at the demographics of people who go on --

are going on strike, they do not usually go on strike. These are

people in different parts of public service to keep our communities

going. To dismiss them as if they are somehow the other, I think is

going to be, particularly now but in the long term, a catastrophic

misjudgment. He is saying actually, you are not really relevant to us,

you are this extreme lot over there, you can't really be complaining

about your situation. As I said earlier, if you look at the

drawings for a public service pensioner right now, it is about

�5,500. I think he has to be very careful. As a Prime Minister, you

are expected to be a bit of the father of the nation, a consensus

builder. The language he is using, I would argue, is a big misjudgment.

Let me ask you a more fundamental question, almost trying to get away

from the party... A lot of people after yesterday's Autumn Statement

are actually quite scared. I really think they are worried.

constituents say, I feel insecure. Can I ask the question? I am a bit

scared about what will happen to this economy because we are on a

knife-edge. The eurozone could tilt us over, and it would be like that,

it would just go down like that. In the circumstances, don't we all

have to rethink our positions and begin to say that the old party

argument was kind of for the good times, when the Tories were talking

about sharing the proceeds of growth, what happened to that? When

Gordon Brown said, there will be no In many respects, the reaction has

been in anticipation of what people think the effects of austerity will

be. Many of these cuts have not come through yet. The Eurozone has

not fed through. That is worrying. I think one thing, in terms of the

tone of debate. I share the commands that people make. I am

probably unique in that I sit in the House of Commons, and we have

got to change PMQs. In fairness to Ed Miliband and the Prime Minister,

they have both said publicly that they think the thing needs to be

changed. The problem we have got is, how do you do that? I often think

what we have these debates and you see the shouting, people feel very

frightened about what is going on and insecure. I had a constituent

visit me who confessed that he had wept, he lost his job. He is a

qualified accountant and he got to the stage the other week where he

was just crying because he did not know what to do. I often stop and

reflect and think, what would he think when he watches the debates?

It is difficult because it is emotional. Partly when people going

to the chamber, and you're bringing the views of your constituents and

you have had somebody crying when they visited her surgery, you feel

a sense of emotion, that you have to get the tone right. -- visited

your surgery. Two things, you and I did the live Budget show yesterday,

and one is that the living standards, which had been in

decline, may continue to decline from start to finish, for a total

of 14 years. The other figure that caught my eye on the OBR was that

we are now expecting the economy to be 13% smaller by 2016 than we

thought three years ago. And it will be a long while before it even

gets as big as it was before the financial crash. We already

declining economy overall. I wonder if these quite dramatic things that

are happening to our country, if the political discourse will have

to change to match the fact. Absolutely. 13% is hard to grasp.

That is �1 in every �8, more than that actually, going from the

national cake. Are we having a political debate about which

pounded should be? -- pound it should be. This is the politics of

distribution. When the cake is getting smaller, there is a natural

fight. People say, well, they should pay and not me. We will see

more of that. The argument about taxing and spending. It seems we

are not seeing more fundamental questions. Each party has made

promises and commitments that look extraordinarily generous, if not

lunatic. The Conservatives, much to the frustration of the civil

servants, and the wrong partners in the Liberal Democrats, promised to

keep under pressure from the Labour Party, the �3 billion of spending

on the winter fuel payment, on free bus passes, that go to the likes of

Ken clerk, for example. You could argue that it is good and that it

is a good thing, and that if you knew what you knew then, the Labour

Party has made commitments. But when will this be questioned?

Forgive me, if you have to find �8 billion of savings, after the next

election, �8 billion of unspecified savings and another 15 on top of

that. This is why the long term matters. We have been saying that

we need a new economy. We need to restructure the economy to produce

better and fairer outcomes. That recognises that we're not going to,

if we do win the general election, have the same amount of money

available. We have seen crises before and we will get through this

one. Politicians need to be honest and realistic about what has

happened. Tonight, 9 o'clock, BBC Two, a serious programme. If you do

not like politicians shouting at each other, you will see former

Chancellor's share analysis about this question. -- Chancellors. The

main interesting thing about this, I did not know they could talk that

civilly. 9pm, BBC Two. TV gold. Forget the plug! The money is

already making its way to my bank account. He got his wallet out, and

two moths just flew over. Keep your cash! Shall we continue.

On the subject of redistribution of wealth, as the depth of the

economic crisis becomes clearer, it is beginning to feel more like the

1930s. Then, as now, the economic woes were blamed on speculators. As

now, politicians have struggled to keep pace with growing public anger.

Here is Danny Gowling on why we need to do something about the gap

between the super rich and A few years ago, politicians did

not want talk about inequality. Peter Mandelson said he did not

care what the rich earned as long as they paid their taxes. Now

everybody is talking about fairness. Inequality is hard to stomach when

In all of the OECD, there is only one other country that spends more

on a smaller proportion of women's -- children's secondary education

as we do, and that is chilly. In many countries, they spend more on

those children who are left behind at school, not those who pass exams

to go here, Westminster, Nick Clegg's old school. Profit is

rising in Britain. At the same time, the 1000 richest people in this

country saw their wealth caught up by an average of �60 million each

last year. Are we allowing this to continue because we cannot do the

maths? Over one million people aged under 25 are unemployed. At the

same time, we are spending �200 billion a year on our salaries

compared to 1970. That is in real terms. If the best-of people were

still best-of but not paid five or �10 -- five or 10 times more than

their parents, that extra money could employ one million people on

the minimum wage 15 times over. 80 years ago, we faced a similar

dilemma to today. There had been an economic crash and the country got

poorer. It took our politicians four years to work out that we

needed to share more. Let us see how long it takes this time.

And Danny joins us. Picking up on that last point, governments have

found it very difficult to redistribute wealth through

legislation. What will change now? The question is, are we at the

moment, like that moment at the end of 1929, where it took us about

four years, to finally realise that we could not carry on having the

rich having more and more. Conservative and Liberal

administrations mainly made their gap between the rich and poor fall.

There was increased taxation at the top but it fell in the Forties,

Fifties, Sixties and Seventies. The last time we were as unequal as we

are now was around that time. you're saying that the rich are

getting paid too much, too many people with high salaries, and you

could actually help you are on employment, how would you do that?

Just tax the Ritz -- just tax the rich? It is more complicated and

slower. The key thing that changed was attitudes as to what was decent

and acceptable. Salaries stock rising and people stopped asking

for more. That saved a lot of money. You think that might happen again?

I look back at 2007, at some of the ways that people behaved. Bankers

buying a drink for �10,000 to celebrate the deal. The super-rich,

some of them are saying they would like to pay more tax. It is hardly

a mass movement of people saying that they want to earn less. And it

was hardly a mass movement at the end of that 20 Mac and '30s. -- at

the end of the '20s. There was a generation of mass unemployment

then. That is how it happened before, changing attitudes.

Taxation matters but you have to say, it is wrong to have a few

people paid enormous salaries and have one million people who are

very young out of work. On Matt, is it wrong that a few people earn

very high salaries and so many people do not? I agree with very

little of what he has said, particularly the characterisation

of the 1930s compared to today. We are infinitely wealthier than we

were in the 1930s. We have a welfare system and pensions. We do

not have people living in the streets on nothing. This is the

brilliance of capitalism over the course of the last 80 years.

everybody would accept... It has provided so much to us. Why have we

gone back to the gaps of the Thirties? It is 20 years since the

depths of communism. We have forgotten what happens in societies

build on entirely -- built entirely on equality. Why is this debate

about inequality or was about trying to make rich people poorer

rather than poorer people richer? These other directions. I think he

completely missed the point. It is because I have completely got the

point. You are talking about the merits of capitalism and we're

talking about distribution. We will end up with a more equal society,

that is what you're saying but it is not the case. Why should the top

people have to give up their salaries? That will not be the

whole answer. I think there are two problems. We have a system where

productivity increases have not fed through into wages and that is why

we have had the squeeze on living standards. Secondly, we have had a

development in highly paid jobs at the top and an insecure economy

with low wages at the bottom. There is a hollow ring out of jobs in the

middle. That is why we have to restructure the economy. Very

quickly. If we tax people at the top, that would not sort out the

problem. We have to work towards sorting out the middle. We need to

do a whole problem on this -- programme on this!

Let us see it live pictures than on the strikers. -- live pictures now

of the strikers. This is central London, live pictures from our

helicopter. Yesterday, it got lost on the way. Not huge numbers. The

main demonstration will coincide with the strike in Birmingham.

London, being London, there will always be something happening. A

hospital. A schools may be closed, but don't think that our

parliamentarians are not sharing your pain. Some of the catering

facilities and House of Commons have been closed because of the

strike. We do not want our guests to go hungry so we have brought

them an austerity packed lunch. Here you are. There is just one

catch, do you know how much it costs.

If they shared... The sandwich costs? Probably about

150. �1 and 53p. Not bad. The answer to guess the year, Bannister

breaking the four-minute mile. We do not have time to pick the winner.

The year was 1954. We will give you there were no tomorrow. That is it

for today. Thank you to her guests and special thanks to Tam and Chuka

Umunna for being our guests of the day.