13/03/2012 Newsnight

Take a leap into the future with Newsnight. The budget next week

will be firefighting today's problems, but we are facing a

monumental change in our society in the next 20 years, with a black

hole looming which is deeper than we ever imagined. So tonight,

saying the unsayable, on health, welfare, pensions, entitlements,

personal responsibility, can we get ourselves out of trouble before the

crisis hits. We know our children will probably

grow up to be poorer than us, what we probably didn't realise is they

could be living in a state that's gone bankrupt.

Do our politicians really know how bad it might get? Would any of them

dare admit it? Four economic brains, including a

former Chancellor, and a leading trade unionist, explore how we can

address the bigger black hole. Former News of the World editor,

Rebekah Brooks, is arrested again, this time along with her husband.

How can an inquiry into press freedom and a criminal

investigation run at the same time. Also tonight:

The first broadcast interview with the wunder kind, who became the

youngest-ever principal dancer at the Royal Ballet aged 19 and then

suddenly quit, why? I felt like the artist of me was dying a bit. If

you don't explore these things the artist dies, if you don't give him

a freedom. The coalition is apparently bickering over next

week's budget, that is rather like fiddling while Rome burns, even the

Government's own figures say Britain is in danger of

disappearing down a bigger black hole than we ever imagined. So out

of kilter are the revenue and spending projections, that by 2050

we could be well and truly bust, more people living longer, fewer

people paying for them, resources dwindling, the welfare bill half of

public spending, and it goes on, worried yet? You should be. In the

last half hour the Government has come up with one money-making

wheeze, 100-year bonds. First theic about pure with Paul

Mason. This is the graph that has defined

British politics for the past three years and will go on defining it

for years to come. The size of the national debt, versus GDP. Until

the Lehman crisis it was relatively stable and projected to remain

there, below 50% of GDP well into the future, with the financial

crisis, the debt started to rocket, only the austerity measures

announced first by Labour, and then by the coalition, make this

projection possible. That debt peeks around 2015 and, because of

the biggest austerity programme since the war, right at the

beginning there, begins to fall back, getting to, if we want it to

be, zero around 2050. Now the risks to that projection are large. It

relies on growth recovering, and the cuts actually working, but here

is the hard part, the projection does not take account of population

change. The impact of ageing on spending, on the tax base, and on

pension costs. Now here is what happens when you do factor in the

costs of an ageing population. The debt does not fall back, like we

saw, but it actually just dips after 2016 down to 60% of GDP and

rockets up to above 100% of GDP by the 2050s, this is a Government

graph showing what happens, even if George Osborne's austerity package,

agreed until 2017 actually happens. Why? The Government's experts point

to spending as the main problem. Ageing will increase the demand for

healthcare to 10% of GDP, adding a third to the cost of state pensions,

and the costs of social care will nearly double. By now you will be

asking what can we do about it. For economists the answers lie not at

the level of detail, but four basic directions, there could be a lot

more austerity, so shrink the state, or a lot more growth. In its

Keynsian form, this remedy might mean a switch to protectionism, or

more state intervention. With the Government floating the idea of a

100-year bond, so you lend your money forever to the Government,

minds are folk uss caned on using inflation to erode the value --

focused on using inflation to erode the value of savings, and you look

at where people could save their money, that is called financial

repression. As we are always reminded by the newspapers, there

is plain old default like Greece just did. It is unlikely any of

these options will be acceptable to the political mainstream now. But

the strategic debate should be starting somewhere, soon, shouldn't

it, Kirsty? We will discuss that tonight, it

seems pretty stark. But why aren't our politicians even really talking

about it? Where are their big ideas. Here is our political editor.

Politics likes dramatic metaphors, a Government budget has a black

hole, except in a dictionary definition it is usually nothing of

the sort. A black hole is a void that sucks stuff in, there is no

return. Look toe the future of the UK's

public finance -- look to the future of the UK's public finances

and this becomes more true. The official forecastsers show on the

horizon the cost of the state goes right up, and the means to pay

shrinks, money gets sucked in. Now that is a black hole. When we talk

about the debt and deficit right now, we are only in the foot hills

of a much larger debate about the public finances. The Institute for

Fiscal Studies thinks on current costs the amount we will be

spending on health and pensions will go up by as much as 5% of

national income. In other calculation they have done, they

think, all in, we will be looking to find an extra �100 billion, per

year, for a generation. Everything we see today is the biggest

challenge any Government has faced, which is our deficit, any progress

we make today is completely overridden by this problem.

It is very hard always to cut out services. Because if the politician

says to you, what can you cut out, you can always show that it is very

difficult to cut anything out. Government's own Office for Budget

Responsibility shows that by 2060 the cost of social care for the

elderly, state pensions and the NHS will go up by 5.4%, some streams of

revenue will have been turned off. North Sea oil will be much

diminished, so too fuel duty, as cars get more efficient, we will

all be drinking and smoking less. The tax base will be up to 2% lower

over the next 20 years, a small number, but a massive loss of

Government revenue. There will be, of course, be

different ideas for eradicating the black hole, from opposite ends of

the political spectrum. Labour also have to think about

which public services to prioritise, making difficult choices about

which things first, and have a debate about the tax base,

stragically thinking how do you get a broad resilient tax base in the

future. For the Conservatives it is much easier, the predill Lynx will

be to shrink where they can, and cut it to the core, stop cutting

things the market will provide. They will say we will tax you less

and you use your money to spend on services. Pensions are one part of

the problem. In 2011, 17% of the population were over the age of 65,

and pensions cost the state 5.5% of The Treasury didn't support a

recent reinstatement of a link between earnings and pensions

because of this. What can be done about this? You start again on

pensions, you accept that your policy to increase the state

pension in line with earnings is going to blow all of your deficit

plans out of the water in years to come. You look again at that.

Pensions are the big part of it, but others will go much further,

taking away benefits for this group as well. The grey vote tends to

vote Conservative more than Labour, and there will come a point when

these generational injustices can no longer be defended, the older

people keep everything and younger people don't get anything like as

much. Then the bulk of the problem, put to side the cost of ageing and

in 2015 health spending will be 7% of national income. But by 2060 it

could be as much as 15%. Many think this will force change. I love the

NHS, I want to protect and defend the NHS, but it will have to wash

its face. This frames very nicely this debate we are having about the

Health and Social Care Bill, which says we are facing enormous upward

pressure on these incredible national assets, in terms of

additional cost, we have to make sure money is being spent and

delivered to the frontline. In the face of this kind of support for

the NHS from Conservatives, it is some in the Labour Party who are

thinking of going further. They wonder whether the entire funding

of the welfare state on all services, not just the NHS, needs

to change. I think you have to bring in a form of extra charging

for people who use and benefit from the services. In most cases both

the society as a whole, and the individual user benefit from a

service. But the question is, if the user isn't paying, then the

state can't afford to keep going at the full level. Take the example of

motorway tolls, for example, many countries charge tolls to go on

motorways, because the state benefits from having a good

motorway system, so do the lorry drivers and cars who use it. So, we

have been talking about spending, there are those who want to talk

about tax rises too? You look at VAT, and you say you won't accept

�40 billion lost a year because of the exemptions in VAT like food, so

you look at that. You also say that this problem does not get smaller,

if you put it off, it gets bigger. There is, of course, the

possibility that the black hole forecast is wrong, if the

Government can get the economy going again, the problem recedes.

Politicians get elected for five- year terms, but are increasingly

facing 50-year problems. They may want to set a course and stick to

it, but at the next election, unpopular ideas get tested.

Politicians are always understandably wanting to get a

quart out of a pintpot, they want better public services, the public

want better public service, but they don't want to pay any more tax,

Governments want to keep the tax down. There is always this pressure,

and it takes the form of wanting the Civil Service, in particular,

to become more and more efficient. That is the pressure for better

management in the Civil Service. At the same time regulation increases,

and so it is always very difficult to get all these things reconciled.

Of course, the difference geen the mystical laws of the universe --

between the fiscal laws of the universe, is we can better manage

the from whom and who it is divided up, the debate will hone how we

will do it. We will hear more later to discuss the growing black hole.

I'm joined bit former Chancellor, Lord Lawson, Lord Skidelsky, the

head of the Economic and Social Affairs of the Trades Union

Congress, Nicola Smith, and Ruth Porter of the Institute for

Economic affairs. Lord Lawson, is this the moment for the Government

to re-think what it can do for us, and for us to think what the

Government should do for us? Your disaster scenario may or may not

prove the case, nobody knows. It is impossible to do these sorts of

predictions. Nevertheless it is right to be cautious. It could

happen like that, and so I do think that the Government is absolutely

right now to be engaged in major fiscal consolidation, reducing the

deficit, because in addition to the immediate crisis, which they

inherited, there is this long-term problem. It is the long-term

problem that we are addressing. How much you want might to alleviate

problems today, the fact is, that demographics will rule out a lot of

options, won't they? Whatever the crisis is, in the long-term, in the

long-term structure of these services we have been talking about,

it will be much easier to manage if we get some growth in the economy.

It won't solve all of them, you will still need reforms, but growth

is an essential, necessary condition. And my criticism of

what's happening now, is that there is no growth policy. The debt

versus growth scenario isn't playing out well at the moment?

wouldn't say it was debt versus growth, I would say growth is a way

of reducing the debt in the long- term. We need to look at the

context here, what is interesting about the current situation is we

are already in an unsustainable area, so the Government's spending

more than 50% of GDP, and more than half of that is going on welfare at

the moment. If you then factor in the demographic changes, and you

fast forward, by the time you get to say, if you take 2030, you know,

for the average girl, who is born that year, her life expectancy,

will be 95, and you factor in the additional costs and the strains

which that is going to put on our health spending and state pensions,

and it is unsustainable. There will be radical welfare reform, that is

what it is needed, actuarillay that is what is needed? I disagree with

the way the situation was presented, there will be challenges for the

public finances, but as you said, this is by no means a zero sum game.

We have huge up certainties forecast, based on firstly how many

people we have moving into work, and how productive our economy is,

and we know how much revenue we choose to raise. The money from

North Sea oil will run out, people are living longer who will need

more social care, who will make more demands on the state pension,

and we are not going to be able to pay? There is clearly big

demographic challenges, growth is by no means a zero sum game. There

are huge opportunities going forward. Over the last 30 years the

UK's investment into the economy has been the lowest in the G7, if

we turn it around we have real opportunities to grow the economy

going forward. The Government should accrue debt, that is the

only way to do it? The only way to get sustainable public finances in

the long-term is to secure stronger growth for the long-term going

forward. We need to be ambitious about becoming the strongest

competitor in green economies across the world The realities is

slower growth? This is a well known road to disaster, to assume you

will get greater growth. We would all like to see it. But to assume

you will get greater growth and allow public expenditure plans to

be based on that, and then of course, if you don't get the growth,

and you might not, then the disaster comes. There is plenty to

been to. The ageing of the population, you have focused on

that particularly, rightly, the age of retirement has got to go

substantially higher, I'm 80 and still working. How old are you?

You are both still working. still working. I'm very active.

are both still working, do you claim your winter fuel allowance?

Of course. Do you claim your winter fuel allowance? Yes, I think I do.

But I don't claim my old age pension. But anyhow, the age of the

Government retirement is cien he ised but not nearly -- increased

but nearly enough. In erpls it of health, because obviously -- in

terms of health, obvious low, increasingly a an older population

makes more demands, you have to have more charging.

On this question of retirement, Nicola, the idea that people are

going to retire successively at 66, 68.5, that is just tinkering,

people are healthy, they are able to contribute to society, we should

be retiring at 70? The idea of removing the state pension from

people, at a higher age than they have at the moment is fundamentally

unfair and misguided. Why? When we are talking about retirement age,

thats not attached to the state pension. When you move the state

pension higher, you deny people on the lowest incomes all their life

and a lower life expectancy, a larger proportion of their state

pension. It is burying our heads in the sand, what we need to be

actually doing, even looking at far more radical solutions, which are

more long-term, and saying we need flexibility. Different people will

want to retire at different ages, we could look at as an alternative,

fadesing out the state pension and introducing compulsory saving.

should make it financially possible for people to choose their age of

retirement and not to be penaliseded if they go on working.

We have all been assuming that there is a simple tax limit, which

is roughly what we have got. In fact, people now want to reduce the

top rate. We can increase taxes. That is an option. I'm not saying

it is a politically acceptable option, but an economic option.

want to talk about tax, but if you look at health, social care, state

pension, half public spending goes on all these, universal ity of

contributions, we need to end it, perhaps you could opt out of some

if you are not using the state provision? The level of spending on

social security has remained pretty much constant as a proportion of

GDP since the formation of the modern welfare state. It is not

rising more quickly than it has been. The period where it was

rising more slowly was when we had higher employment growth which was

when the social security went down. �50 more has been spent on social

security, the way to get social security spending down is to get

more people into work. Obviously there is that relationship, I mean,

the fuller the employment of the economy, on the whole, the smaller

the bills for unemployment benefit and other kinds of benefit. That

doesn't affect the main spending items for economic growth, which

are health, education. Let's talk about health particularly. The

exponential rise of that, because there are new treatments, and

people are living longer, people are also attracting at the moment,

there are definite issues at the moment about whether people should

be taking care of their own health and penalised if they don't. Will

we move to a situation where diabetes will rise by 50%, that

there will be an onus on people to marshall their own health? If we

want access to good quality healthcare and other services we

need to move in all these areas, to allowing people to take more

responsibility. So we do need to look at things like reducing demand

by introing, for example, small charges when you go to A&E --

introducing, for example, small charges when you go to A&E and the

GP. What about different doctors and motorway tolls, that people

will have to take responsibility for paying for the things they want

to have? Charging, there has to be more. There is now less proportion

for finance through charges, than when Nye Bevan first set the health

service up. It is absolutely absurd. There has to be charges. Charging,

and of course the poorest will not have to pay the charges, there will

always be a safety net for the poorest. What happens is you will

also reduce, to some extent, the demand, if you have charging. You

have a double benefit. That will have to come. There is charging or

rationing? We know what charging means t means reducing services for

people across the economy. People across the UK don't want poor

people not able to access healthcare. We don't want the

situation in America, people can't move from welfare into work,

because they can't afford to lose the free healthcare they get.

choices are going to have to be made to save the central elements

of the NHS. We will have to move to a different model? We can raise

taxes, have charges or better control over people's lifestyles,

encourage them to lead healthier lives. Somewhere between those

three we are going to find a solution. I don't know in what

proportions. What about taxation, coming on to wholesale reform of

taxation. We have heard everything from a tycoon tax, a land tax, a

mansion tax, that is just tinkering isn't it? We need to look overall

at, the point that was made about economic growth, we will not see

growth in the economy until we cut the public sector down. Why not?

Because we need space for the private sector. We need the room

for tax cuts, at the moment we don't have that. Looking at the

demographics of it, the Government should be really aim to go get the

size of the state down to 30%, that would allow massive tax cuts across

the board. Then we would see savings, savings is the key. What

happens while you are doing it? can phase it in. Unless we build a

savings culture, we won't be able to tackle these problems. The idea

of the public sector squeezing out the private sector is ridiculous,

the public sector is losing jobs at a higher rate than the private

sector is creating them. One private sector is created for every

13 public sector jobs lost, and Britain is sitting on surplus of

50% of GDP. I don't want to hark back, but we have been through this

before. During my time as Chancellor I cut tax rates, I

was not a sovereign wealth fund, that would have given us a piggy

back? I had tough policy on public spending, we had growth and budget

surplus, you can do it. Looking back do you think you would like a

sovereign wealth fund like Norway? Norway has a massive North Sea oil

and gas industry, which is a huge proportion of its economy. For us

it was never more than 5% of the peak. To finish off, on the news

tonight that is on the front of the FT? I have a comment on that.

are out of time, on the news tonight from one of the planes

travelling to America with the Chancellor and the Prime Minister,

is they have dreamt up the idea of a 100-year bond, good idea?

people are prepared to buy it, why not. Are they prepared to buy it,

will they put their faith into it? I don't know if it will happen, we

shall see, you test the market. There is a lot of nonsense to be

cut out of public spending, if we don't go ahead with high-speed rail,

that would be a good start. 100- year bond? We will have to see, it

is an attempt to get the yield up of Government debt, but I don't

know. I only heard about it a minute ago.

Thank you very much, we have been listening to that debate. Any sense

of a possible direction of travel, Paul? To recap, the headline news

out of the Government's report last year, buried at the back of it,

fair enough, is that ageing completely changes the direction of

travel, on the debt, even if we do austerity. We end up going bankrupt,

some time in the 21st century. What I think if you can get politicians

to look five years ahead you are lucky. If you look 50 years ahead,

there is a lot of individual policy remedies, and they are not

important. What is important is the big levers you can pull. One not

explored is migration. The OBR which dreamt up the original graph

we showed, that assumed that migration falls back to half its

current rate. There are people who would like it to, and believe it

will maintain its current rate and even grow. That would solve things

for about a century. So because you then get a young population, paying

for us all. Skilled? Old codgers, if they can find jobs, and doing

some of that work. I think what we are finally coming to, three or

four years after the Lehman crises, is a debate about a kind of

Conservatism, that is small state, or high-tax, unusual, or a form of

social democracy that is very low welfare. That might be the future

of politics. In fact you have actually Labour, look at Charles

Clarke, saying the unsayable, which actually won't let the

Conservatives say at the moment? Charles Clarke is an outlayer at

the moment. Following on from your point. Where he had politics on the

centre ground, that is what we are used to. You heard Lord Lawson

talking about user charges. More and more Tory MPs talking about

user charges, they are not bashful talking about what many people will

call privatisation. On the one hand you have a new generation happy to

talk about it, on the other hand a generation of Labour politicians

talking about a greater role for the state. Let's just take the

major sucker up of money, the health service. Lord Lawson said it

is the nearest thing we have to national religion, the NHS. By the

locks of the rows in the coalition and the position David Cameron is

taking, it is sacrosanct, how long is that for? Rationing is starting,

on the near term political horizon. If you go back to the Government's

projections, this projection of going bust by the mid-century, only

happens if we don't spend more per head on health as people get sicker

and older. All the Ricks are on the upside. -- risks are on the upside.

A way of getting health spending as a proportion of GDP, with or

without rising public spending is there. I think consensus is

withering, this is not a future debate, we have a debate now on

social care, how do we pay for the costs of looking after ourselves

when we get older. It is in aspect, the Treasury can't come up with a

way that doesn't involve public money up front. You have members of

the coalition saying they are not happy to use the lower paid to look

after those with lots of assets who should be able to look after

themselves. This is not very far away, it is going on now.

Rebekah Brooks, the former chief executive of News International,

spent the day in the salubrious surroundings of a Police Station in

Oxfordshire, with her husband in one in Buckinghamshire, helping

police with their investigations on the phone hacking cover-ups. At the

Leveson Inquiry, the head of Scotland Yard had to deny

allegation that is he lent Mrs Brooks a retired police horse so

gain work experience for his son at the News of the World.

Racing tips are notorious low unwry liable, but race horse trainer

Charley Brooks statement in a Not this year, three hours before

the first race, instead of talking tack and tactics over a pint in the

Gloucestershire sunshine, Charley Brooks was in police custody,

having been arrested in a 5.00am raid on his house. Rebekah Brooks

was also arrested, his wife, former News of the World editor, and

normer News International chief executive. They spent the day being

questioned on suspicion of conspiracy to pervert the course of

justice. This is an amazing turn of events. Obvious low Rebekah Brooks

had been previously arrested -- obviously Rebekah Brooks had been

previously arrested for conspiracy to intercept voicemails, this is a

much more serious charge. There is a big contrast with Rebekah Brooks

previous arrest last July, then, rather than the dawn raid, she was

invited to attend a Police Station. Evidence, according to some, of an

all too cosy relationship with the police, who, we learned last month,

loaned her a retired police horse, to be kept at the Brooks stables in

the constituency of the Prime Minister.

Charley Brooks is an old school friend of Mr Cameron. One of the

more comical elements of the story was the effort Downing Street put

in trying not to confirm that Mr Cameron had actually ridden the

retired Metropolitan Police police horse, while visiting the --

Metropolitan Police horse while visiting the Brooks property, until

the story could be resisted no longer. Before the election I did

go riding with him, he has a um in of horses, one of the horses was a

former police force Razor, that I did ride. I'm sorry to hear Razor

is no longer with us. I don't think I will be getting back into the

saddle soon. David Cameron has shown a woeful lack of judgment in

his relations with senior News International executives. Remember

he hired Andy Coulson, after he had to stop being editor of the News of

the World, because phone hacking had been going on when he was

editor, despite the warnings, he took him right into the heart of

Downing Street. David Cameron, of course, isn't the

first Prime Minister to have close relationships with News

International executives. Tony Blair was, on kissing terms,

although his minders didn't want it filmed, and Gordon Brown's wife

hosted a slumber party for Rebekah Brooks at Chequers.

Partly in an effort to defuse political heat, David Cameron set

up the Leveson Inquiry, but could this inquiry now be jeopardising

any chance of a fair trial, if charges are brought.

In a newspaper article, Rebekah Last month Deputy Assistant

Commissioner, Sue Akers, leading the police investigation into

hacking and corrupt payments to police and other officials, gave

evidence to the inquiry. She said: MPs are also investigating hacking,

and have made strenuous efforts not to prejudice the police

investigation. One of the MPs on the Culture, Media and Sport

Commitee says the Leveson Inquiry is on tricky ground. I think you

need to look at the set-up and conduct of the Leveson Inquiry,

there is a point to be made that Mrs Brooks should have been given

core participant status in the Leveson Inquiry. It is quite right

that things are being said about people to which they apparently

have no right of response. Things are out there in the media that

which are no doubt prejudicial. I fully support the Leveson Inquiry,

it is a very important inquiry, we had to have it, but at the same

time we have to be sure that in Leveson trying to get to fairness

in the media, that we also have fairness to people who may be

charged with criminal offences. That is an important part of our

system as well. As a racing man Charley Brooks understands odds,

his and the other suspects' chances of being charged is not as yet

clear. Tonight five of the six people arrested today were released

on police bail. No-one, however, would bet that this is the end of

the matter. With me are Tim Luckhurst Professor

of Journal at Kent university, and Charlotte Harris, a lawyer who has

represented phone hacking victims. First of all, 44 arrests so far, no

charges, and Stephen Parkinson, Rebekah Brooks lawyer has said, she

was released today, without charge, that in the end if there are trials,

they could be a problem. I think there could be a problem. I think

what we are seeing is the Leveson Inquiry was a panicked response by

politicians, to a genuine crisis but a crisis that largely involved

criminality at one newspaper group. What the newspaper inquiry has done

is to conflate criminality with a press regulation. That is raising a

risk, that witnesses are being allowed to say things that could

prejudice criminal trials. Do you accept that argument that it could

prejudice criminal trials? Having taken part in the trial, very

careful work done by the barristers and Lord Leveson in terms of trying

to protect information that might be prejudicial to trials. We are in

a very difficult situation at the moment. What should have happened

in the normal set of events, it should have been that when the

police found out that criminal activity took place, arrested

should have been made there and a proper investigation. Everything is

out of time. The public inquiry might be a spops, but without it we

might -- response, but without it? But with prejudice, is that a risk

you have to take? I hope it won't with prejudice it, I hope it will

be dealt with properly within the inquiry. They are very careful

about what is said? Do you think News International are more likely

to co-operate with the police because of Leveson? They may well

be, I'm not here to defend news interle that. If there is serious

criminal wrongdoing, it should be prosecuted. The thing is, there was

no need to have the public inquiry into the standards and practice and

ethics of the press at the same time of the criminal investigation.

Do you think the criminal investigation has been undermined?

Yes, I think the value for public inquiry has been diluted. You have

the sight of people coming to a public inquiry and not being able

to say anything? There is also the civil situation. That when you have

got the civil claimants, who are forcing News International and

others to come to the table, having not been investigated by the police,

News International didn't want to go to trial, clearly. All the cases

in the first SETIle. Within the civil actions, what we find out is

there are efpd and evidential problems then -- evidence and

evidential problems. The police could have f they wanted to, they

started making arrested some time ago, tried to call a halt to the

civil action. They didn't. The horse has bolted. In terms of the

public inquiry, it is all a bit late to worry about it. I don't

agree, I think it is very important that we have a public inquiry into

the standards and ethics of the police, or at least into the

standards and ethics of the red top tabloid press. What we are having

as a comigs that of the two events is an Anne -- comcation of the two

events is a red top inquiry. It is, in fact, a very dangerous high bred,

which is risks damage to criminal cases and free press in this

country. Conflating tabloid newspapers with those of a broad

range of newspapers not engaging in those activities. I feel that is

very resistant to what the inquiry is about. It is very easy to come

into this at this stage, having not seen the resistance that we had, as

lawyers do. Getting anything other than this is a one rogue defence.

When you say that the inquiry is conflating two issues. It is

actually dealing with different issues. When you have criminality

springing from the press, and not just the red tops. We were looking

for criminality in terms of the police and so on. You were saying

earlier you were not sure it will prejudice cases? I don't think it

will. To characterise the inquiry as only being there to have a go at

the red tops isn't right. Was it politically expedient to have a

public inquiry? Yes, that is precisely right. Charlotte, it

wasn't the intention of the inquiry, it is not Lord justice Leveson's

fault, but the conflation of these two issues has turned the Leveson

Inquiry as essentially an inquiry into one newspaper group, News

International. I think we need generally better than that, we need

an inquiry that looks at the standards, ethics and practices of

the British press, we are not having that. Is it having an impact

on the press and the way things are reported at the moment? It is

having an additional minor chilling effect. The biggest chilling effect

comes as a result of privacy rulings and defamation and so on.

One of the great things about the inquiry has been that it has given

the public an opportunity to hear the victims' stories. And to allow

them time, not by selling their story to a newspaper, or giving an

interview, in a forum which seemed appropriate, and they weren't being

paid, or nobody could accuse them of that, to simply answer questions

about how they feel. And I think that's been very useful. I think it

has changed attitudes as to what the public want. They can see the

story and the effect and the emotion behind it. Thank you very

much. He's the young dancer many compared

to Nureyev and Baryshnikov. The prodigy who at 19 became the

youngest ever principal dancer with the Royal Ballet. But Sergei

Polunin shocked the dance world in January, when he walked out of the

role. The dancer, who likes to be likened to James Dean, and has a

tattoo parlour, returned to the stage at Sadler's Wells. He spoke

about why he walked out on his dream.

Rehearsing in a Top Gun T-shirt, the tattoo-sporting ballet star,

who had the world at his highly- prized feet, only to turn his back

on it. Sergei Polunin, whom we found rehearsing for a new show,

sensationally quit the Royal Ballet, where he was the youngest-ever

principal dancer at the tender age of 19. In his first television

interview since that dramatic exit, Polunin, flunked by his friend and

collaborator, Ivan Putrov, began by discussing whether he still has an

appetite for dance. Sergei, how was that for you, you're not the

keenest on rehearsing, is that right? It is not my favourite thing

to do, no. I have been working quite hard for this. Learning new

pieces. Is it like athletes, you read about, footballers, they hate

training, they can only really get involved when it is the big

occasion? That is the only time I would enjoy professionally in that

way. It is communicating with people. It is quite like you

learned a lot and you practice a lot, so for months, maybe, you

sometimes argue, you sometimes, it is like nine hours a day. So when

you final low are on stage, especially when it is finished, you

have so much adrenaline and so much Polunin said it had been his dream

to become principal dancer with the Royal Ballet. So what went wrong?

In a way, I did feel like the artist in me was dying a little bit.

And I wasn't giving the best of myself, and to put creativity in it

as I should and as I I have in me. So I do agree, if you don't explore

these things and the artist just dies, if you don't give him a

freedom. Was that the issue, it sounds as if you have more freedom

now, you are happier now, perhaps you didn't have sufficient before?

I can't say like I'm happy now. I'm still finding my way, what I'm

going to do, what is the thing to do. I'm going to explore different

directions. I did feel so comfortable that I

stopped being involved as a person and an artist, that is what I want.

I don't want to be comfort, I don't want to have family, so I destroyed

in a way everything I had. You felt you had to destroy everything you

had, that you worked so hard for, before you could move on and find

ourself again? It is basically, yes, it is almost like a delete button,

you just want to start fresh. feels good? It did, in a way,

because you just throw everything you had, you just clean yourself,

in a way. The only thing I didn't do was change the country. Were you

surprised by the reaction to it? I was, because I never thought, I

just wanted to go quietly. But it is amazing, it is, in a way,

supported me, because if you come back home and you destroyed

everything you had, it feels really weird. I have built something for

seven years and now it is gone. Now I gather you quite like a

tattoo? One on the wrist. They are all random, I just do them on the

day. I don't plan them. I have maybe 11. Have you? Quite a lot.

What I like about tattoo is the atmosphere. It is like a lot of

friends, a lot of normal people there. It is just fun. Do you think

that you will still be dancing in four, five years time? At the

moment I don't think I wouldn't, not in six years. I would love to

achieve something else in a different profession. Because once

you achieve something, you just Sergei Polunin, tomorrow morning's

front pages, that 100-year bond, Osborne bond to lock in low

interest rates. Rebekah Brooks and her husband on the right hand side.

Osborne to issue Great War bonds to raise cash. There is Michelle Obama

and Samantha Cameron on the other and Samantha Cameron on the other

side. The Independent has Russia saying

they are happy to sell arms to That's all from Newsnight tonight.

Emily is back tomorrow with more good cheer. From all of us tomorrow,

Low cloud, mist and fog a problem tonight and tomorrow morning. A

gloomy start to the day, light rain or drizzle in the south west, most

will have a dry day and a lightning of the skies. Struggling to the

North West of England. A bit of brightness, the east of the Pennine,

it may be up to 13 or 14. Parts of East Midlands could be best

favoured for holding on to the grey, misty low cloud. To the south west,

after that foggy start, bestens cha of sunshine across Wales. With

winds light, 14, 15, with one or two spots holding on to the cloud.

Maybe around the coast, probably most likely it will only be eight

or nine degrees. In Northern Ireland a brighter day than recent

low, the cloud thinning and breaking. So too to the north-east

of Scotland, a pleasant day. The Moray firth, the cloud thick enough

for one or two showers. A bit more cloud across the south

west of Ireland and Northern Ireland, elsewhere reasonably dry

and bright. For southern parts of England and Wales, increasing

amounts of sunshine once again. That is boasting the temperatures.

The south-east seeing longest spells of sunshine through the day.