06/10/2013 Sunday Politics South

Morning, folks, welcome to the Sunday Politics. And in-out EU

referendum before the general election? We talk to the Tory rebel

demanding one next year, that is our top story. As government ministers

prepare to decide how the press should be regulated, what will be

the impact of this week's row should be regulated, what will be

between the Daily Mail and Ed Miliband?

In the south, should we be more like peoples faces?!

In the south, should we be more like the Germans and have local banks

only lending to local people? He will try to force a vote in the

October. Home Secretary Theresa He will try to force a vote in the

was asked about his plans on the BBC earlier this morning. I think he has

got it wrong, I think what we need to do is to negotiate the settlement

with the European Union and then put that to the people me to decide

whether to be in or out. Is this a flea bite or a real threat? I think

the next election, a Conservative Party that will be offering people

that renegotiation, a new settlement with Europe, looking to the future

and putting that to the British people in and in or out referendum.

And what the amendment possibly could do, as James Wharton, who

And what the amendment possibly putting the Referendum Bill through

Parliament has said, is it could jeopardise that bill. Adam Afriyie

joins us now from Millbank studio. Good morning. If the referendum

would be held next October, it would have to be an in-out question based

the status quo? There wouldn't be time for a full renegotiation. I

disagree. By having a referendum in 2014, it gives us 12 months to

renegotiate, but it kick-started negotiations, because the European

Union, if they wish us to remain members, would need to accommodate

and make changes so that they would members, would need to accommodate

and make changes so that they would persuade the British public to stay,

strengthens the Prime Minister's hand, and 12 months is ample time

for that kind of negotiation. You might think that, but Germany has

not even got a government at the moment, why should they meet our

timetable? This is going to be incredibly, located renegotiation. I

think, basically, 80% of people incredibly, located renegotiation. I

a referendum. More than 50% what a election. British businesses need

certainty, and we could carry on taking a scan down the road for

ever, but I have struggled with taking a scan down the road for

conscience over this one. I do not want to cause trouble, but it is

essential that Parliament and MPs have the opportunity to search their

souls and give people a referendum this side of the election. That

would also bring certainty and clarity for the future, and like I

said, it strengthens the Prime Minister's hand if it is successful.

You right in the Mail on Sunday Minister's hand if it is successful.

the people are not convinced there even will be a referendum, so they

don't trust David Cameron? I think the headline was not the headline I

wrote for that piece. What I am You are saying that the British

people are not convinced. Look, there are too many uncertainties

here - they may not be convinced the Conservatives will win the election,

I hope we will, they may not be convinced the renegotiation will be

good enough, that there will be convinced the renegotiation will be

referendum. Do you trust David That is why we need to bring the

referendum forward, there is time to negotiate, and we tidy up the issue

that has been hanging around for too long. Do you trust David Cameron to

deliver a referendum in 2017? I Minister, and of course I trust

deliver a referendum in 2017? I referendum? There as only variables

in between. What I am doing with referendum? There as only variables

this amendment, is to try to be referendum? There as only variables

is that Parliament and every MP referendum? There as only variables

the opportunity decide whether they want to be sure of a referendum

within this parliament, or maybe leave it to the vagaries of what may

within this parliament, or maybe happen in 2015. Supposing you got

your way, how would you vote? Like Michael Gove, I would vote for us to

leave as of today, but there will be Michael Gove, I would vote for us to

an enormous amount of pressure on European Union leaders to come

forward with proposals. If they European Union leaders to come

to say, the mandate is not ever closer political union, it is ever

closer trading harmony, giving us closer trading harmony, giving us

more border control and control closer trading harmony, giving us

our legal system, I might change my mind. But this is what needs to

happen - if we have a referendum in happen - if we have a referendum in

negotiations to be kick-started happen - if we have a referendum in

people to argue in or out, and the end result is a stronger Prime

Minister. Is it true that you have end result is a stronger Prime

Minister. Is it true that you have got about 80 MPs supporting this? It

certain, and I think we will see it on hold over the next three or five

weeks. He will have to ask each individual MP. I am asking you,

is your motion! There will be other motions coming forward, and I know

cross-party, for people who want the British public to have a say in

2014. You know it is not going to get through, the whips will stop

this from happening. One of the successes, apparently, of your

party's Manchester conference was that you were not divided over

Europe anymore, the Europe issue was settled. Here you are bringing it

Europe anymore, the Europe issue was back to life and pouring petrol

Europe anymore, the Europe issue was unlicensed troublemaker of the

Tories? The only struggle I have had is not a fight with my party but

Tories? The only struggle I have had with my conscience as to whether or

not I would give Parliament and with my conscience as to whether or

British people an opportunity to have a say in 2014. I wrestled with

it, and I decided I wanted people to have that opportunity. It is for

each individual MP to search their soul, speak to constituents and

decide whether they want that. You decided it would get you in the

headlines again. Oh, you are so cynical, Andrew! I have no ambition

publicity seeker. All I seek is cynical, Andrew! I have no ambition

would not be able to sleep at night if I did not bring forward this

opportunity for Britain to have if I did not bring forward this

say. We have left it far too long. Nobody under the age of 56 has had a

say. Thanks for joining us, good luck with this continuing struggle

with your conscience! I will move the seat around and addressed the

panel, what do you make of it? The party managers must be furious with

him. I think what this confirms party managers must be furious with

that David Cameron is incredibly lucky in his enemies. His most

prolific critics, Nadine Dorries, Peter Bone, Adam Afriyie, even if

you are very anti-Cameron, you will not think, man, if only they were in

charge of the party! I think the party managers are not too alarmed.

They do not take him seriously? No, is not as if the James Wharton bill

is a work of genius, it is riddled with flaws, anomalies and loopholes.

It purports to guarantee that a referendum will take place in the

next Parliament. My understanding of theoretically impossible and that

all the future government would theoretically impossible and that

is cancel out that bill with another bill. He does have a point that

Cameron's plan for a referendum bill. He does have a point that

nothing like as likely to happen... dangerous. The problem for David

Cameron is twofold. One, if Ed Miliband says he's going to support

Adam Afriyie, it will go through. Unlikely that Ed Miliband would

Adam Afriyie, it will go through. that, but what he might do is say to

his MPs, ignore this. It may well be significant number of Labour MPs do

not turn up, and then what you have Conservative backbenchers, and in

that war you might well find that through, and then the Prime Minister

has real trouble, because Adam Afriyie says, the Prime Minister

membership, up what basis and with which mandate? He would not be able

to get agreement with Nick Clegg or Ed Miliband, so you would be looking

think he is a Labour mole, that Ed Miliband, so you would be looking

what I have come to, a Daily Mail style conspiracy theory, it could

not be more perfect. The prospect of style conspiracy theory, it could

a referendum on the EU at the same time as Scottish independence is

has told us he could not sleep at conscience. We could send him some

pills, I suppose. We know he's going to sack all those lieutenants were

going around and saying he is the great future and the next leader of

the Conservative Party. He denied doing that! He would be amazed to

hear you say that, this is a crisis conversations in corridors, quite an

operation to get letters into Graham Brady, he said to have letters,

operation to get letters into Graham 46, but at the moment this campaign

is being run by Lieutenant of Adam They are disaffected and not happy

under David Cameron's leadership. There is a whole army of them! I am

pleased he has outmanoeuvred the awkward squad, and now James Wharton

is saying, you're going to kill awkward squad, and now James Wharton

bill. I do not think they are very competence lieutenants. The main

episode is it will unify a large Conservative Party behind David

Cameron. On what they hope is a settled position. We still hope

Cameron. On what they hope is a be talking to John Prescott, who is

in hole, if you see him, pointing in the direction of the BBC studios! Do

you want to buy a house? Can you afford the mortgage repayments but

not the 20% or 30% deposit the mortgage provider is demanding from

you? The Government says it has mortgage provider is demanding from

scheme designed for you which is in launching next week, help to buy,

re-emergence of 95% mortgages, remember them?! But is the policy

really good for home-buyers or the British economy? Here is Giles.

Never mind who lives in a house British economy? Here is Giles.

this, who can afford to buy a house these days? The Government would

this, who can afford to buy a house like many more people to be able to

without putting down a crippling like many more people to be able to

without putting down a crippling amount of money as a deposit, and in

the spirit of rights to buy, the government has launched help to

the spirit of rights to buy, the confusingly it is the name for two

been running since April. Help to government are bringing it in early.

Let's get in on the inside and take a good look around at what this

scheme actually has to offer. And why the Government thinks it really

works. Help to Buy 1 was an equity loan scheme. The idea, nice, is

works. Help to Buy 1 was an equity it was for new build only, up to a

value of £600,000. But it is Help to value of £600,000. But it is Help to

Buy 2 that everyone is looking into right now. It is for any property up

to a value, again, of £600,000. right now. It is for any property up

time the Government is guaranteeing that it will take on the first

losses should the home owner in that it will take on the first

future failed to make their mortgage payments. Don't worry about that, if

you are a buyer, you are going to be concerned about coming up with the

5% deposit and 95% mortgages will be available again in participating

banks and building societies. And a housing prime mover. You cannot

get training to 5% mortgage anymore, 90% even, so there are couples in

our country who have good jobs, decent incomes, they could afford

the mortgage payments but they failure in our banking market. So

Jonathan, but I guess for you this is not Homes Under The Hammer, but a

main impact of this scheme will is not Homes Under The Hammer, but a

to push up prices, who does that benefit? Mostly rich and all the

people who own their houses. Plus the banks, of course, because it is

a subsidy for them. Who loses? People who want to buy a house in

the future. Moreover, it is a bit odd that the Government says it

the future. Moreover, it is a bit not OK to borrow to finance schools

or roads, but it is fine for the effectively, in order to guarantee

housing market. 2.3 million? I do not think Help to Buy covers that.

But enter a would-be buyer, will they now be seeing a plethora of

help to buy mortgages? In a word, no. David Cameron has brought the

months, and banks were not ready at that stage. Two banks have committed

to fund the scheme, the Lloyds group and the RBS group, so lenders like

Halifax, RBS and NatWest. They will be doing the scheme, but even once

the scheme is up and running you are probably find 95% mortgages on the

high street because of the guarantee the government is offering. People

might say this is how we got into a mess in the first place. Why would

the government want to make those products available then now? It

the government want to make those more what investment banks were

doing in the background that caused performed extremely well through the

depths of the downturn. Is this performed extremely well through the

game changer? Yes, I have done my best to save over the last few years

but this has enabled me to make best to save over the last few years

first purchase. How frustrating best to save over the last few years

it just renting? Very frustrating, you are throwing away money hand

over fist, and now I can take that enthusiasm raises a question back at

the flat. If you are looking for a 95% mortgage, you don't really care

economy, you are thinking, great, I can buy a house. Yes, if I was a

house buyer or a bank, I would be pleased, but it will do longer term

economic damage. The tricky steps the government are trying to pull

off is that home-buyers might be so grateful for the opportunity to

off is that home-buyers might be so their own homes that they reward the

Government with the vote, while their own homes that they reward the

the same time the Government tries to sidestep consequences that such a

Now Conservative MP Margot James, and Allister Heath, editor of City

It is said by the critics that this scheme will cause a housing bubble.

Where is the evidence? House prices are more varied. Housing not just in

London remains overvalued and the problem with this scheme is that it

will pump up house prices, it will therefore houses will become even

more overvalued. That is a dangerous territory, last time it ended in

tears, and now the Government is taking on the risk of that policy.

What do you say to that? We have a real problem, it takes people on

average until they are 38 years real problem, it takes people on

property. The problem is not that they cannot afford it, but they

cannot afford the deposit. We have got to do something to allow people

to get their feet on the property ladder and I don't agree it will

cause a boom in house prices. It would if we were not building any

have had a record this year, 12 months to right now, the record

have had a record this year, 12 the last ten years. These are not

the statistics I have seen, but the last ten years. These are not

new supply is coming up. It is starting to creep up. We don't see

enough house building, need to build more houses and that is a solution

to this problem. You are right, people cannot afford to buy homes

and the reason is there are not enough good quality homes in the

deposits are so high is because secondly the Government has passed

laws to make the banking system secondly the Government has passed

prudent, telling them to put more wrong. Now suddenly the Government

is not happy with the outcome of its own rules and is trying to create

these subsidies to circumvent the rules it has put in place. It is not

a subsidy. Don't forget banks have to pay a charge in order to take

part in this loan scheme and that the... You are guaranteeing the

money. Yes, but the fear is worked out on a commercial basis. The

taxpayer is protected. Why? You out on a commercial basis. The

guaranteeing £12 billion worth of mortgages per year. Yes but the

change in the whole mortgage basis has been made a few years ago in

response of the crash. They made the distressed test on people applying

for mortgages much higher and you twice... So it will not be like

these self certification mortgages handed out in America that caused

the sub-prime crisis? Pigment bit like that but the banks are rightly

asking for bigger deposits, they know there is a big chance house

prices could fall if interest rates eventually, so they are demanding

bigger deposits. The Government eventually, so they are demanding

circumventing this is being passed eventually, so they are demanding

on to the taxpayers which is why it is a dangerous policy. Instead they

should be massively accelerating Planning permission is much easier

to get now, we have seen a 49% increase in planning permission

to get now, we have seen a 49% a new building over the last year, a

huge increase. In the figures I a new building over the last year, a

recently, they showed new start a new building over the last year, a

the 12 months to the autumn were only about 110,000 which is the

figure you inherited, which was only about 110,000 which is the

an all-time low in 2010. New house built in the last quarter are third

up on the time last year. You have relaxation of planning laws and

up on the time last year. You have other policies the Government put

into effect last year to take effect and it is coming through now. I

agree, if we weren't building more houses, if the construction sector

advantage of the increased demand, there would be a risk. David Cameron

says you are snob and it is only snobs who dislike Help To Buy. They

don't have the bank of mum and dad, people like that will finally get on

the housing ladder. That is complete nonsense. We need a sustainable

housing market where there is a large amount of construction, like

in the 1930s for example, where large numbers of proper family homes

were being built for people. House prices were pushed down and people

could afford houses. You are now encouraging people to take out a 95%

mortgage, I thought that was a bad idea, so supposing interest rates go

struggle, and supposing house prices fall by more than 5%, I am now faced

with negative equity and soaring interest rates that I cannot afford.

95% mortgage, if you can afford interest rates that I cannot afford.

repayments, you will be fine. What happens when interest rates rise?

They have got to rise a lot before you get into trouble. People are

already affording rent which is you get into trouble. People are

lot higher than mortgage payments. You will not be able to get into

this scheme unless you can afford repayments double what they are

this scheme unless you can afford the moment. The Conservatives should

limelight last week but there was an unwelcome intruder in the shape

limelight last week but there was an row between Ed Miliband and the

Daily Mail. Just over a week ago the claiming that Ed Miliband's Father

Ralph hated Britain. They showed a picture of his father's gravestone

with the caption, grave socialist. They then removed the photo and

with the caption, grave socialist. Ed Miliband the right to reply on

printed an editorial alongside it saying they stood by every word

printed an editorial alongside it published an fair headline. It also

reporter had gate-crashed a private memorial service for Ed Miliband's

uncle in a London hospital, for which the paper has now apologised,

but Ed Miliband has called on the hard look at the way his papers

but Ed Miliband has called on the run. This comes a week before a

but Ed Miliband has called on the Joining us now from Hull, John

Prescott. Does this row between Joining us now from Hull, John

reinforce the case for tough, new certainly influences the opinion

about that but that is more of Paul Dacre's doing. Ed Miliband rang

about that but that is more of Paul while I was in Strasbourg making

sure my complaints were nothing while I was in Strasbourg making

do with press regulation and he while I was in Strasbourg making

right. This argument is not about politicians and media people, it is

about ordinary people that love politicians and media people, it is

and dealt with. All of these cases affected individual people and they

are the ones that need to have justice in this matter. Next week we

will be hearing whether the Privy Council will be reporting on the

proposal to replace it. Are you agreeing then that what the mail did

with its Miliband article was a matter of judgement? Yes, and the

with its Miliband article was a conclusion that the relationship

between the press, the police and politicians should be governed,

between the press, the police and proposal given by half the press

industry that that does not meet the Leveson requirement and I suspect

the Privy Council this week will have to reject that, and I hope

the Privy Council this week will will because it is not consistent

with the Leveson report which the Prime Minister said he supported.

You attacked the mail in your column today but your paper went through

the Cameron family bins to see what nappies they used for their disabled

son. Isn't that far more offensive than what the Daily Mail wrote about

Ralph Miliband? It probably is, than what the Daily Mail wrote about

couldn't defend that. I have had Haven't we all? Yes, but we are

editors who acts unilaterally. Paul Dacre is running this thing in the

judgement and some accountability which the press have accepted the

old PCC is no good. They are playing for time because if they reject

old PCC is no good. They are playing this week there is 12 months until

you can consider a parliamentary alternative and then you are near

the election and you begin to bully the leaders. That is how they have

been successful in putting off recommendations. Maybe my memory is

fading but did you or anybody else in the Labour Party object to the

Sunday Mirror's behaviour? I didn't know about it. I would just say it

is wrong if that is what they did. As you said, you have the same

position when they go through your rubbish bins, I think that is wrong.

We have Leveson set up by the Prime Minister to look at the cultures and

practices and the unilateral action of editors and he came forward with

a proposal that was agreed in Parliament under a compromise of the

Royal Charter. I don't like a Royal Charter, it is not democratic

frankly, but we have agreed to go along with it so why did the

Government set up in charge at the same time rushed through the press

box? It looks like a fix, like they are using the Royal Charter as a

means of delaying everything. They have now said they are going to

introduce their own independent charter. This industry does not want

to face up to any form of accountability. We know Alistair

Campbell and Ed Miliband's officers accountability. We know Alistair

are working closely on the assault of the Mail. What is the endgame for

this? Is it the head of Paul Dacre? He is not an acceptable character to

me, and he needs to be taking account. When Ed Miliband rang me it

was to say, don't let these arguments drift into press

regulation, he wanted the argument of decency. Are you and Ed Miliband

after Paul Dacre's head? No, he can stay there. It is like with Murdoch,

after Paul Dacre's head? No, he can we were not attacking him but what

is papers were doing. To that extent, what they are doing about

ordinary people, not just big politicians who can look after

themselves. We know, with the bad cases he had to deal with, they

might get libel action, which the press say, but they pretty well

destroyed their lives. That is about judgment. If you say, as Paul Dacre

got good judgment? I would say no, he will have to live with it.

Thank you for joining us, he did not even have to go to the BBC studios,

we sent a truck there for him. What is the endgame in this? Whether the

Labour Party is trying to make this an issue press regulation are not,

this is where it is going. We have the criminal trial involving Andy

Coulson coming up, the Privy Council discussing press radiation before

the end of the year, and the question is, what is political

impact? My hunch, it is an unfashionable view, is that the

total at yum elated political impact of the Leveson story over the past

several years, hacking and everything, is close to zero,

because most voters do not care, and those who do care believe that all

parties are roughly complicit in being too close to editors and

proprietors. You said that Adam Afriyie was a Labour mould, with a

smile. Is the Daily Mail also a Labour mole? This has been a dream

for Ed Miliband, I took on Murdoch, I am taking on the energy companies

and now the evil Daily Mail! I think... I should say I used to work

for the Daily Mail, but when they printed the right of reply, they

surrounded it with a big two fingers up at Ed. If they had not done

surrounded it with a big two fingers that, they would not be in this

position. The poll in the Sunday Times this morning shows 72% think

the Daily Mail was wrong and backed Mr Miliband's demand for an apology.

If you come to define and your dad, people are naturally going to do

this, but it took all the coverage away from the Tory conference, the

media loves covering itself, here we are doing it again, this has been a

dream for Mr Miliband. The political significance of this is that David

Cameron said in the House of Commons that he wanted to try to find some

common ground between the three party Royal Charter and the

so-called press industry version. What the Daily Mail has done is

ensured that the Prime Minister is not going to be able to do that.

What is going to happen this week is that the press Royal Charter has to

be considered first, and that will probably be rejected. The Privy

Council will reject it. Then the three party Royal Charter will come

up, but meanwhile the press will set up their own regulatory body because

the Royal Charter is not a proper statutory underpinning, they will be

able to go ahead with that. There statutory underpinning, they will be

will be the legal basis for the oversight of the oversight body, and

it will basically just be an ambassador that will not be

resolved. As you say, no-one much cares about this outside of the

profession and a few media watchers. But this has been great politics for

Ed Miliband. It is only great politics if he scores a great

victory. I take your view that people are cynical about it. But the

narrative is, I am the chap who stands up to vested interests. But

all those vested interests are people that you would expect a

left-wing politician to want to take on. It is also more significant

about who he has stood up for, and the person he has studied for is his

father. Maybe people thought of him as a Marxist, now they think of him

as war hero. He gets to the crux of matters, you know! You are watching

the Sunday Politics. Coming up in just over 20 minutes, I will be

Welcome to Sunday Politics South. My speaking to Godfrey

Welcome to Sunday Politics South. My name is Peter Henley. On today's

show: Local banking for local folk. It's how the Germans do it, and look

how well their economy's going. It's also something the Germans say they

got from us, so could we grab the idea back again? And could local

councils get a piece of the action? First, let's meet the politicians

with us for the next 20 minutes. He said Dodds the Labour candidate in

the South East for the Labour —— for the European elections, and we have

the MP for Bournemouth West. A lot of policies out of the conferences,

more from Labour, the energy capital is the Liberal Democrats, free

school meals, plastic bags tax. The Conservatives, learn or earn, this

idea that if you are under 25, you are not entitled to benefits, why

not? The point the Prime Minister was making was automatic. It should

not be automatic for somebody to leave school and go straight to

benefits and get a flat or house. Because they have not paid into the

pot? It is the wrong thing for them, they should be in training or

education. The government will work with them to make that happen,

creating what apprenticeships than in the history of the country, young

people should aspire to that and not a life in benefits. Finding jobs

would also be important, but the Conservatives, 1.4 million new

private sector jobs. But what quality? A large proportion of

part—time jobs and we have the largest amount of underemployment

ever, people wanting to work more hours. But to take issue, there is

such a pressure on housing in the South East that very few young

people allegedly leave school and go to get a flat or house, that is

cloud cuckoo land! That situation does not exist because there is not

enough housing. For many young people, the situation is to live

with their parents, having no choice, and trying to find work

because we have 1 million young unemployed people. So people who are

working right a disadvantage because they do not get housing benefit.

They do. Majority of people on housing benefit are either retired

people or they are working. Some people get benefits who are

unemployed but a majority who get housing benefit working or they are

pensioners and that is often missed out of this debate. A lot of people

getting housing benefit are on low wages or they cannot get enough

hours at work or they are on zero hours contracts so they do not have

stability to pay the rent. Was taking benefits away part of a

hardline message to win votes rather than something genuine? It is part

of the overall package of Iain Duncan Smith. He is committed to

social justice and opportunity for people in this country. There is a

sense the benefits system has grown too big and compensated. Under

Labour, people were entitled to tax credit who were earning up to

£60,000, that is not what the Balfour —— that is not what the

welfare report intended. We are putting it on the side of

hard—working people. We will get a chance to talk more about that.

If you're of a certain age, you might actually remember the days

when the local bank manager was someone who was someone in their

local community. Nowadays, you're more likely to have a business

relationship with your bank's call centre or computer system. But in

Germany, they have maintained that local connection between banks and

the businesses in their area. And as our business correspondent Alastair

Fee has been finding out, many would argue that is the reason for their

economic success. Celebrating with a litre of good

Bavarian beer! Others in Europe have been crippled by debt and rising

unemployment, but not much has changed here and that is worth

drinking too. And the secret ingredient is not change, it is

about tradition. 48,000 bottles per hour. This man 's family have been

bottling here since the 19th century and employers keep those controlling

flow of money close. So to host a party with the bank manager is not

unusual. You stay in the region you are proud of so you focus on the

region and strengthen it. When we needed money, it was no problem to

ask the bank to get the money quickly. They knew the family, they

knew the security, they knew the character, they are very

Conservative, and that is why we get it without a problem. Almost every

time —— town and village in Germany has at least one local wine with a

remit to support the community. —1 local bank.

This is nothing new here, local banking began in Germany in the 19th

century. But it started in the UK and they were eventually swallowed

up by the big High Street banks. There are now calls to bring local

banking back. This is why, the money is available for everybody, keeping

independent businesses going into of times. Since slashed year, I have

had a lot of money. And you have gone over the road to your local

bank? I go to the local bank, yes. I have a friend on the other side.

They help me. They understand me and it is not a gangster. You do not

want to sell me something I do not need! During the crisis in 2008,

2010, we forced credit in this time and our business customers could

continue to work. They could invest and there was no trouble. No trouble

because bank managers know who they are lending to and make visits to

see customers working locally. With the government and with Sparkasse,

we built a new form. In Germany, there was no credit crunch, the

Sparkasse did each job. Stepping in when High Street banks could not

help. This engineering firm was set up and expand to the downturn. And

how the bash in 2010, he used our loan to start up his business. He

built this whole and set up the —— and set up these machines. His

success is our success. This is banking for life, generations invest

and take out mortgages, and they start young. These children will

soon be customers and today they were on a trip to see the vault. So

it seems the Germans have more reason to celebrate than most. I

value in tradition, money has continued to flow almost as freely

as the beer. As others in Europe have gone under, it is the

traditional banks credited with having kept the economy afloat.

And they all spoke marvellous English except for the bank manager

who I guessed was talking to his local people so he did not need to!

Joining me now is Professor Richard Werner, from the University of

Southampton, who is one of the leading lights in a plan to set up

the Hampshire Community Bank, modelled on those local German

banks. The Germans of use I have a long history, they knew the family.

He was a count, but they knew them going back generations, can you

recreate that model without a good local knowledge? Not without the

local knowledge. But that is in the local community. That means the

local community has to self generate something new, a local bank. The

locals know each other and you need to get the locals to set up their

own local bank. But it is trust, which is easy to save difficult on

both sides. If you are a business owner and you want to be certain you

will be supported and your business is understood, if you are lending

money, people are always optimistic about what they want. Have you

really got the level of expertise in the local community to do this? The

relationship is different to a Dragons' Den situation. The small

lower Bavarian town I grew up in that we have just seen, from

childhood onwards, you know the bank and the bank managers. When the

first loan applications come in, perhaps young people setting up a

firm, a bank manager knows them, they know the bank manager, they

know he knows their parents, not just where they live. This is a

trust relationship. That creates a different situation. People do not

want to take money and run, so lenders know that. Trust goes from

both sides far deeper, and that makes people more able to look at

the business facts. You want to see this recreated in this country which

does not have that history you describe. It does have the history.

It is a British idea. Like many ideas, generated in England and the

UK, and perhaps other countries have run with it and done something

bigger. And we have forgotten it. Other people who could be trusted to

get the money and lend it? The first Sparkasse banks were set up in the

UK in 1810, the early 19th century. And the model was taken to Germany

and it caught on. But the savings banks spread a lot in the UK. And

there is one left from that era in Scotland. I think it is not really a

problem to recreate this. You need is extraordinary. The know—how is

there. —— the need. People are highly qualified in the financial

services, we just need to put these elements together and reunite the

banking experts with their local community and not transfer them away

after three years to another part of the country and allow them to stay

in their local community. It would work very well. The suggestion in

Bill must —— or maths and many other parts of the South is that taxpayers

money could be used to do this. —— in Bournemouth. But Labour like to

see that? Labour has been asking for a regional system for a long time

and had merely bound —— Ed Miliband made that part of our policy. That

is not the same as Sparkasse. Not necessarily, be is regional banks

would have a larger focus. But a work based on many of the same

principles that have just been discussed by the Professor. To be

more open to local projects, but using local knowledge to make key

business decisions. We have a real crisis of lending at the moment and

I am sure Connor is finding this, speaking to small people with good

ideas who cannot expand. That is what we need. The problem is still

here. We have been talking about this in Bournemouth and the council

is doing this, working to create a new bank. The big banks in decades

gone by did behave in this model whether bank model was part of the

community, they knew the community and they lent not on the basis of a

computer calculation but of trust and knowledge. That has gone. I see

every week in my surgery companies who have overdraft facilities with

it the bank which comes up for renewal, they are hit with charges

and massively increased rates of interest. These are decent

businesses, some have been in families for generations, that is

something customer focused banks would help with enormously. The big

banks not going to fight back and say, or we can do this cheaper? We

will lend you cheaper, you do not have to go to these guys who were

wanted to visit your pick from! They welcome to do that but they have

voluntarily decided not to engage. So if as a result of the creation of

local banks the big thanks also change that business model, the

better. But as banks grow large, and they have grown very large in the

UK, over 90% of deposits accounted for by five banks with massive

balance sheet and reams of pounds, —— ballot sheet and billions of

power, —— pounds, so every cost of dismissed deals we make, they do not

want to deal with small customers —— dismissed deals. So banks mainly

deal with hedge funds is and do speculative loans. It has got to

change and the banks spend their whole time trying to sell you

something you do not want in the first place. We hope it is a bit

more focused. And you can see more on that story

throughout the week on South Today at 6:30. Well, the conference season

is over, the lobbyists have packed up their stalls and the party

faithful are back in their constituencies preparing for battle

in the European elections next year. The Conservatives brought down the

curtain earlier in the week, just what sort of fettle were their

activists in after their time in Manchester?

Outside, they were protesting about fat cats, but inside, she would like

to be the apprentice of the Chancellor. Karren Brady was the

warm up to George Osborne who was basking in the glow of an economy on

the up. What we inherited was a record

budget deficit, we got that down by a third. With the policies in place,

there are an extra 1.4 million jobs since the general election in the

private sector. And we are seeing growth returning to the economy.

Manchester 's shiny new trams are driving the local. The argument

David Cameron makes for HS two. But the plan seemed more running out of

steam at the conference. There is opposition to this, we have

thousands of supporters supporting our campaign and the debate is

changing. It has changed. Since last year when nobody knew about this, it

is a current topic, it is in the media, people are talking about it

and we welcome a proper debate. Opposition to the high—speed rail

line could give UKIP their first Westminster seats. Their leader

claimed this week. He said he would be happy with local deals. Could

that happen? This woman defected to UKIP this year and until then, she

had worked closely with the party. A believe UKIP grassroots would not be

happy with this because people in UKIP believe they want to be an

option. They do not want the three main parties, they want a fourth

party and we give them what they want. The businesses exhibiting here

cannot be so sceptical about Europe. The clever photography puts you in

the seat of the new Airbus. This parent company also owns a

Portsmouth satellite company and another based in Oxfordshire. What

is a good conversation with a Minister here? We are a business. We

want to be successful. But it —— but it is not just about the money, we

want people to know what we do. They are on the up and the green shoots

of recovery continue. At this Berks charity making up parcels for people

recovering from illness. Punting a seed, panting manure, standard

stuff! —— planting. Not so much in your spread among the

politicians! Was this a warm up to the general election was to mark

normally, conferences do not matter and they are forgotten in days. This

conference season did matter. We started to seep the differences

between the political parties. When Margaret Thatcher was in 2002 asked

what her greatest achievement was, she said, Tony Blair and new Labour,

we forced our opponents to change. It became safe to vote Labour. Ed

Miliband in Brighton last week was asked a question, are you going to

bring back socialism? His cancer was, that is what we are doing, sir.

They committed to price fixing. —— his answer. There are big

differences in British politics. So the Labour conference was by far the

most important? I do not agree with the analysis but it was important.

What surprised me is that finally, we have a coalition talking about

living standards and it has taken three years where wages have been

falling faster than prices for 38 out of the last 39 months for the

coalition to finally start talking about living standards. So I am

pleased. If Ed Miliband has been talking about this or this time and

that makes him a socialist, I am surprised! He is saying, we will not

stand for this hit on living standards. He is standing up to

energy companies which have been allowed to rip people off for too

long. Is he not saying he is on the side of the people? He is very good

with rhetoric and we need to remember who was the energy

secretary in the last government who set the conditions we are operating

under, Ed Miliband, he did nothing in office. And more humility —— and

mortality about the desperate state of the economy left to the coalition

would be more becoming. Given the economy was growing when Labour left

office, that is a strange claim. 38 out of 39 months, wages have been

falling. It is an economy growing now.

It is, I am not going to talk down the economy, one major problem we

have had is we have had a relentlessly negative rhetoric

coming out which has sought to demand out of the economy. It has

been coming from the government. —— sucked demand. We have 1.4 million

new jobs. If you look at other countries doing better than Britain,

you wonder what is going wrong here. Coalition Britain is doing

better than Labour. That is not true.

Now our regular round—up of the political week in the South in 60

seconds. New laws to prevent stolen scrap

metal sold on came into force this week. All dealers must be licensed.

This project is to make the Isle of Wight self—sufficient in energy went

into liquidation, naming a lack of investment.

They have tried to develop a brilliant idea, there are others who

may be more successful. Major crime scenes in Dorset will be

guarded by private security guards. The former remand trial was

criticised by the Police Federation. Student unions will provide wardens

to curb social —— anti—social behaviour in Bournemouth, visitors

say they dread the start of a new term. We have four young children

who have been woken up every night. It is constant, it starts Tuesday

night and you only get Monday night respite. 80 million journeys are

made on First Great Western trains in the Thames Valley, more than go

through Heathrow Airport, the company has given a two year

extension to its contract. Talking about university students,

you know working in a university, it is difficult for people living

nearby? It is, definitely. Particularly when there is so much

pressure on housing and you find there is a proliferation of houses

in multiple occupation. Eight out of ten in one road, they were saying.

But Labour will build more houses, 200,000? Too little too late, some

would say, you should have done it years ago. I would agree with that

but I would not say it is too little. Labour is also doing locally

in places like Oxford, they are regulating landlords who make so

much money out of this. If help to buy going to help? For others

wanting to move out of home? The warden think you saw is absolutely

fantastic and is helping to bridge the divide between residents and

students. They help to buy scheme will do what it says, it will help

people to buy and the participation in offering the 90% mortgage

products, that should help. We need more houses to be built, Labour did

very little in 13 years on housing but we have to be cautious we do not

end up stoking a housing bubble in the South East and London. Prices

are stagnant in many other parts of the country and there is a lot of

land supply there. That is it, thank you to my guests,

back We are getting into a discussion of

more affordable homes needed, but we We are getting into a discussion of

have no time. Andrew, back to you. Our next guest is no stranger to

controversy, a former UKIP MEP he recently lost his party's whip after

a series of outbursts including receiving aid as 'Bongo Bongo Land'

and joking that a group of UKIP women who didn't clean behind their

fridges were 'sluts'. Now he sits in independent but remains a UKIP party

member. Here's a flavour of recent events in the political life of

Godfrey Bloom. How you can possibly be giving £1 million a month...

Bongo Bongo Land. I got 6000 e-mails within 12 hours, only 47 were not

agreeing with me so you are the within 12 hours, only 47 were not

that is out of touch. Everybody knows me, a bit like the Marmite

joke, they love me or they hate knows me, a bit like the Marmite

but I have always told me like it is. I made a joke and said that

women who did not clean behind the French were sluts and everybody

laughed along, including the women. I have had hundreds of e-mails,

saying, God Almighty, can't you I have had hundreds of e-mails,

a joke any more? I am long in the correctness and I understand UKIP

have moved on and they are doing well, and I wish them well. This,

with no black faces on it. You are picking people out for the colour of

with no black faces on it. You are their skin? You disgust me! Perhaps

the way they are doing things now is disgrace me. We are joined now with

a suitable distance between us by the independent MEP for Yorkshire

and the Humber, Godfrey Bloom. You said this weekend that you have

and the Humber, Godfrey Bloom. You be a complete sociopath to be in

politics, are you a sociopath? No, I am just an ordinary bloke from the

rugby club likes to tell it as it is. I did not come into politics to

rugby club likes to tell it as it save my country from the clutches of

the awful, evil... That is why I am in politics, and that is why I

member, and I will still be voting ability... Do you accept that your

conference? We were both born in ability... Do you accept that your

same year, we are too old to worry about regrets. Let's look forward

and see... Never mind the year I was born, what is the answer to my

country and intent to do the best I independent for my country, and

country and intent to do the best I re-elected. They are the only game

in town, the only party that will get as out. Shouldn't you have been

liability? You hijacked the party conference. That is a matter of

perception. We have heard nothing in the last two years but it is a

one-man band, a Nigel Farage party, and I can make a joke at a fringe

meeting and collapse the whole thing. This doesn't say anything

Andrew. It tells you about your journalism - it is not about UKIP or

me, it was the journalists' reaction to a small joke at a meeting. And

myself, unless I had a commended. Personality, the most unbelievable

force of personality to collapse a party conference. Nigel Farage has

been a friend of mine for 20 years, and may I remind you that in June

and July UK was slipping in the polls, and when I made my statement

about overseas aid, we went back to liability, I never was, I am a vote

getter. As you know, there is a correlation, but let me show you

what Nigel Farage had to say about you on the BBC. Let's blunder clip

of that. We are not here to win friends amongst the liberal elite,

and Godfrey's problem was that he manifesto. Don't you need to reflect

that you are too outrageous, too politically incorrect even for UKIP?

Well, you see, to a certain extent I politically incorrect even for UKIP?

have been gagged on other subjects. I am a libertarian, I wanted to

have been gagged on other subjects. about flat tax. I thought David

Aronowitz wrote a very good piece in the times on drugs, and I have been

gagged to speak about any of these things because they are not part of

it, so I tend to speak about other things. Maybe they have outgrown

machine, and they have to get rid of the Victor Meldrew wing. You might

have a point, but I am speaking the Victor Meldrew wing. You might

you from Hull, and if you look at Barnsley, and very recently in

Scarborough and Whitby in the buy legends, 25%, so how you see things

in the bubble, it is not like how we see it appear in Yorkshire. You

in the bubble, it is not like how we like the one who was sitting in

in the bubble, it is not like how we bubble! Is UKIP unravelling? Of

course it isn't, we are getting bubble! Is UKIP unravelling? Of

of the vote in by-elections, of course it is not. Boy, wouldn't

of the vote in by-elections, of main parties and the establishment

love to see that! But I am sorry, it is not happening. Will you stand as

an independence against UKIP in is not happening. Will you stand as

European elections? Almost certainly elections were next week, I could

do not think I will go that route. Will you stand as a UKIP candidate

again? We do not know, probably Will you stand as a UKIP candidate

but I shall certainly be trying Will you stand as a UKIP candidate

help UKIP as best I can. You both share a flat, I understand, in

Brussels, neither of you clean behind the fridge. Other than the

fact that the place is probably quite murky, you have got a chance

to talk to each other and get back into his good graces, haven't you? I

am sure we will be having a beer before the month is out. So Godfrey

take it? For those of you who were shrugged! Thank you very much for

joining. A great pleasure. I will have to move my own share, you do

not have the sea Jeremy Paxman doing that! Nobody votes for UKIP because

they think they are a smooth, slick, absence of PR polish is the reason

for their popularity, so these are skirmishes are not a problem, and

more than that, Godfrey Bloom does make Nigel Farage look better. Even

in that clip from Andrew Marr, he juxtaposition with someone like

Godfrey Bloom than he has done before. I mean, he did hijacked

Godfrey Bloom than he has done conference, it was a disaster, they

got tonnes of publicity but not conference, it was a disaster, they

kind they wanted. But you have to journalists. I thought he was sexist

long before anyone else, he used to have an incredible page on his

website entitled Godfrey Bloom: Misogynist, and the proof that he

photographed with a girls' rugby characters in politics. He does

photographed with a girls' rugby Nigel Farage look better, but is sin

was to say things you said before but to ruin the party conference. It

sounds like he is coming back. A beer in Brussels and he will be

sounds like he is coming back. A on the UKIP ticket. Sitting having a

beer in that built the Chechen, on the UKIP ticket. Sitting having a

sounds like it may be what the deal is that he comes back into UKIP

sounds like it may be what the deal does not stand as an MEP at the

European Parliamentary elections. -- in that built the kitchen. It is

right to say the electorate are sophisticated and they know what

this party is for, what characters Godfrey Bloom said for people to

electorate know what they go using UKIP four. They are using it as

electorate know what they go using vehicle to beat over the head the

three established parties. They vehicle to beat over the head the

probably do it in the European elections and give them first place.

The big question is what happens in problem that Nigel Farage was making

The big question is what happens in an Andrew Marr this morning is that

he wants to copy the tactics of an Andrew Marr this morning is that

he wants to copy the tactics of Paddy Ashdown, get elected and

councils, build up a Parliamentary base, and to do that you do need

Commons next week, and there is base, and to do that you do need

ministerial reshuffle on the cards, that is the rumour in Westminster.

David Cameron has spoken of the that is the rumour in Westminster.

David Cameron has spoken of the extraordinary talent pool of women

among his ministers, so could he bring more of them into the cabinet?

He was talking about it earlier bring more of them into the cabinet?

week. I think we are getting there in Britain, but we have a long way

businesses in Britain, there are not boardroom. If you look at politics

in Britain, there aren't nearly enough women around the Cabinet

table. So I think, in every walk of life, whether it is the judiciary,

whether it is politics, business, there is a lot further to go. Before

the last election, we only had there is a lot further to go. Before

women Members of Parliament. We there is a lot further to go. Before

have around 50, so we have made there is a lot further to go. Before

big change, but it is still 50 out of 300, not nearly enough. So we

need to do more. My wife likes to say, if you don't have women in

need to do more. My wife likes to places, you're not just missing

need to do more. My wife likes to missing out on a lot more than

need to do more. My wife likes to of the talent, and I think she

need to do more. My wife likes to probably has a point. The prime

need to do more. My wife likes to there going to be a reshuffle? I

think you are right to say there there going to be a reshuffle? I

will be a lot more women, they need to change the ratio of women to

will be a lot more women, they need called Dave who went to maudlin

college. So obviously they are not fishing in the biggest talent pool,

but there are numbers. Esther McVey has been selling a very difficult

brief in work and pensions, you could see people being given bigger

roles. Helen is pretty sure. We could see people being given bigger

told it is not a Cabinet level reshuffle me it is under Secretary

level, so maybe you could put Esther McVey into the Cabinet. Margot

James, who you had here not that long ago, she is very impressive.

What is impressive is that some long ago, she is very impressive.

like Andrea Leadsom, who is really impressive, worked in the City,

like Andrea Leadsom, who is really smart, really big on important

intervention, she should still be in there, but she fell out with George

Osborne when she dared to criticise him a few years ago over Ed Balls

you are doing it on talent, Andrea expectation, if he does not do this

now, a tonne of bricks will fall on him. He has got no excuse not to

promote women, because the 2010 intake was disproportionately female

in terms of talent. The question of the Tories and the struggle with

women voters is a very deep and historic one. You have to remember

that for most of the post-war period they had an advantage electorally

amongst women voters. Many times Conservative government without

amongst women voters. Many times women of this country. This began to

change in the mid-1990s, and the question is, why has that happened?

personalities at the top are now much more hostile to women, or less,

personalities at the top are now Brent doubled to female voters?

personalities at the top are now is such a deep historical trend

personalities at the top are now I do not think one reshuffle will

change it. -- or less competent civil. The English party conference

season is over, do you share the consensus view that Ed Miliband

season is over, do you share the out best of the three party leaders?

I think I probably do, but his overall approval ratings are still

minus 20, whereas Cameron's minus ten. And the more the recovery seems

minus 20, whereas Cameron's minus to take place, and some of the

latest figures are quite amazing, they certainly surprised me, you

wonder whether Labour's tactic is right to put all their eggs into the

living standards basket. I was looking at car sales, which are

booming. If people start to feel better, and they don't yet, but

booming. If people start to feel they were, it is tougher to go on

about living standards. George Osborne's... You have Ed Miliband

making a great thing about living standards, but then they say under

their breath, this is global forces, outstripping wage increases. And

you're absolutely right, as the economy improves, presumably that

will be dealt with, but Miliband's argument will be that there are

people suffering, and even if the economy recovers, they will still

forces, it is difficult to blame the government for that. Body being

noticed now, there is nothing worse for the leader of the opposition

than to be not noticed. -- but he is being noticed now. It seems that he

in many ways has set the political weather. Look at the number of

references to the Labour leader weather. Look at the number of

Mr Cameron's speech. And in Mr Obama's speech on a similar topic,

living standards. Was the mentioning Ed Miliband?! Oh, he was using the

same language, he has not gone that far. If I were Ed Miliband, I would

be more worried now, because Labour through the kitchen sink at their

conference. They came out with the biggest policy announcements they

could, compulsory apprenticeships, the energy freeze on prices, and it

generated a poll boost which has fizzled away within ten days. I

generated a poll boost which has not know where they go from here.

What is significant with Ed Miliband conference beaches, he has set the

one nation Britain, and the problem with those speeches is people say,

they are fine, they are academic, but what does it mean? What you

they are fine, they are academic, now is an intellectual framework

that translates into policies. The polls to watch are not the ones

after the conferences, but at the end of the month when it has also

pulled down. They will tell us where we are going. We will have to go

ourselves now. Thank you to our guests. The Daily Politics will

ourselves now. Thank you to our back tomorrow at noon on BBC Two,

and I will be back on BBC One this time, same time, next week. If it is

Sunday, it is the Sunday Politics.