16/06/2011 BBC News at Ten

The row over cuts versus growth re- erupts. Labour wants emergency

action to jump start the economy. Retail sales fell by twice as much

as expected last month. The Shadow Chancellor says it's time for a VAT

cut to get us spending again. putting more money directly into

people's pockets, it would boost consumer spending for consumers

feeling the squeeze from rising prices and taxes.

David Cameron gave his answer straight to the public. Those who

say you ought to slash taxes, spend money and do more Government

Investment, all that you would be doing if you did that would be

making the problem of your deficit, your overdraft, worse.

We'll be looking at whether tax cuts are the answer.

Also tonight: Bin Laden's number two becomes the

new number one. Ayman Al-Zawahari says he'll continue Al-Qaeda's holy

war. The footage that was probably faked

- the BBC's Panorama is ordered to apologise after its programme on

Primark and child labour. Thousands are waiting longer for

hospital treatment - what the latest figures reveal about NHS

performance. And still no British men's champion

at Wimbledon - millions spent with Coming up in Sportsday on the BBC

News Channel, a rain-affected day at the Rose Bowl, but England get

Good evening. The central political argument over

how best to inject growth into the economy was reignited today with

Labour saying it's time for emergency action. Shadow Chancellor

Ed Balls called for a cut in VAT. His comments come as new figures

show that high street sales have fallen by more than expected, down

by 1.4% last month. Mr Balls accuses the Chancellor, George

Osborne, of taking a gamble with the economy. That's been dismissed

by ministers who say Labour is proposing "a plan for bankruptcy".

Stephanie Flanders reports. Not so long ago, the bunting was

out for the royal wedding and so were consumers. But that was then

and this is now. After a rise of 1.1% in April, today's figures

showed retail sales falling last month by 1.4%. For this independent

department store in York, business is better than it was in the

recession but it is a challenging time. Since the winter sales

finished, it has been aired and flower and it is very promotion led

on the high street. That is certainly now, with prices

increasing on essentials like food, it is biting into disposable income.

In a sense, these numbers tell us something we already knew, that we

are not having the kind of economic recovery we are used to or might

have expected after such a deep recession. But today front and

centre in Westminster there was also the political debate coming

from those gloomy statistics. Is the Government contributing to this

week recovery and is it time to change course? The Shadow

Chancellor to days of the evidence was clear and offered some advice

to his opposite number. But today he said the evidence was clear.

While he will not agree to reverse is mistaken VAT rise permanently,

he should now reverse it temporarily. It would boost

consumer spending for consumers feeling the squeeze from rising

prices and taxes, especially pensioners and those on low and

fixed incomes. In Lincolnshire today, the Prime Minister made his

view clear. Those who say you ought to go out and slash taxes, or spend

more money, or do more Government investment, all that you would be

doing if you did that would be making the problem of your deficit,

your overdraft, worse. Funnily enough, the International Monetary

Fund the other day said temporary tax cuts would be a decent plan B.

But like most City economists, they think a lot of other things would

have to go wrong first. Cutting VAT is expensive, it costs about 1% of

the size of our economy, a significant amount of money. If you

cut VAT, yes, it helps consumers but on the other hand it raises

interest rates in the markets and interest rates faced for mortgage

payments, which is not helpful. Consumer confidence rose last month

but has fallen since last year. That could be linked to the rise in

VAT and talk of budget cuts, but you cannot blame the Chancellor for

rising food and energy prices, nor for the fact that the economy as a

once in a century banking crisis to recover from. In his Mansion House

speech yesterday, the Chancellor said the economy looked pretty good,

if you took the financial sector out of the equation. Unfortunately,

we cannot. Everyone can agree that the recovery is slower than we

would like. The crucial question, for politicians and the country, is

whether it is the best recovery on offer.

John Pienaar is at Westminster. Stephanie has just looked at the

economics, but politically, how important has Ed Balls' speech been

today? Well, there has never been a popular tax increase, so this was

always likely to grab headlines and the tension. Beneath that, Ed Balls

has established himself as one of Labour's very few big political

beasts. Certainly more qualified by experience and training than his

predecessor, Alan Johnson. He does not lack self-belief. There was a

moment when he was arguing that the independence of the Bank of England

and Britain staying out of the Euro were evidence of his strength of

character, which might come as a surprise to Gordon Brown and Tony

Blair, none of which alters the fact that there is still a way to

go for Labour and Ed Balls to win the argument in the country over

economic competence. The hope is that the course of the economy and

the effect of spending cuts, which have not cut in yet, will tip the

argument their way. I would only add that Ed Balls will have to be

wary going forward about appearing to enhance his authority at the

expense of Ed Miliband, because the soap opera about Ed Miliband's

leadership looks like growing through the autumn and into next

year. So I nodded over the economy and plenty more on the Government's

plate. -- an argument over the economy. The Government came in

with the idea of going further and faster down the road of reform than

Tony Blair did in his first term. Since then, they have run into a

combination of issues. Wrangling in the coalition, spending and vested

interests. They have had to slow down and think again. They have to

decide whether they want to be remembered as revolutionary or

pragmatic, picking fights they can win.

The terror group Al-Qaeda has appointed a man Al-Zawahri, a long-

time associate of Osama Bin Laden, as its new leader. He can -- he

vowed to continue the Roly Walker against the United States, Israel

and its allies. But tonight, the United States said Al-Zawahiri

would be hunted down and killed, like his predecessor. Frank Gardner

is here. Al-Qaeda's new leader is already a

familiar figure. He worked hand-in- glove with Osama Bin Laden for many

years and has given Al-Qaeda much of its strategic direction. He has

long been its most visible spokesman. Here he is last week

saying that the war with the West will go on. His appointment has

been largely welcomed on extremist jihadi websites. Bin Laden and Al-

Zawahiri collaborated closely. Both had been fugitives for years,

hiding out in Afghanistan and Pakistan. Al-Zawahiri, the natural

successor to Bin Laden, is now named the FBI's most wanted

terrorist, the leader of Al-Qaeda. It is not a surprise from our

perspective that he has moved into that position. He and his

organisation still threaten us, as we did both seek to capture and

kill and succeed in killing Bin Laden, we will certainly do the

same thing with Al-Zawahiri. What do we know about Ayman Al-Zawahiri?

Well, he is a lifelong Egyptian extremist who will be 60 this

Sunday. He was the one who radicalised Osama Bin Laden back in

the 1990s and got him to think global. He was the Operation Ore

brains behind the 9/11 attacks, and the US has long had a bounty on his

head. Al-Zawahiri was radicalise long ago, imprisoned by the

Egyptian state after President Sadat's assassination. The extreme

violence perpetrated by Al-Qaeda is often attributed to his strategic

direction. His supporters want more such attacks. But, as Arab

populations call for an end to dictatorship, Al-Qaeda's critics

say he will struggle to prove it as anything constructive to offer.

resources are drying up, operational spaces have been

confined, the leadership is being picked off. Al-Zawahri has

inherited an organisation that is struggling to carry out

transnational attacks. And yet this Al-Qaeda operative killed last week

in Somalia was carrying early plans for attacks on London's Ritz Hotel,

and on the Eton College, David Cameron's old school. The plans

were not advanced and it is not known if Al-Qaeda's new leader even

knew anything about them. Al- Zawahri is taking over Al-Qaeda at

a crucial time for the organisation. Critics say it is fragmenting and

getting left behind in the Middle East. Others say that it is down

but not out, still capable of lashing out against the West.

The BBC's Panorama has been ordered to apologise after using footage

that was probably faked as part of a report about child labour and the

fashion store Primark. The BBC Trust, which governs the

corporation on behalf of the public, says there was a serious breach of

accuracy and fairness. A little deeper into the squalor

and another rung down the ladder of exploitation. It was a key part of

Panorama's investigation into claims that Primark's sub

contractors employed child labour in India but today the BBC Trust

concluded that these pictures of boys supposedly working on Primark

garments in a Bangalore slum were probably faked. The Trust has said

it had examined a substantial body of evidence, including Russia's

from the programme, e-mails and witness evidence. It concluded that

although it was not able to say beyond reasonable doubt it was more

likely than not that the Bangalore put it was not genuine. BBC News

today accepted the programme was flawed. Any time we make a big

mistake it is very damaging but the BBC News brand and the Panorama

brand are strong and robust. They are strong and robust because we

know that when we make a mistake we owned up to it and we learn from it.

That is why audiences trust us as much as they do. But the journalist

responsible, Dan McDougall, rejected the findings. He is an

award-winning reporter. In a statement, he said he had rarely

seen a finding so unjust in outcome, Flordon process and deeply damaging

to investigative journalism. BBC said Primark used these three

boys to make these three tops. It was a lie, concocted by this man,

producer Dan McDougall. Primark produced its own video in response

today, detailing the company's investigation into Panorama's

claims. It welcomed what it called the Trust's inescapable decision

that the footage was faked. It said millions had been deceived by

Panorama and viewers and shoppers have been fed a lie. Tonight, the

BBC and Primark are at odds. The BBC Trust said the programme had

evidence that work was out sourced from factories in India against

Primark's ethical guidelines, something Primark accepts. And that

the programme showed young children working on Primark clothing in a

refugee camp. Primark absolutely rejects claims that it uses child

labour. Greece's Prime Minister, George

Papandreou, will tomorrow reshuffle his cabinet in the latest move to

try to deal with the country's financial crisis. He is struggling

to find support for spending cuts and tax rises amounting to �25

billion. Greece has witnessed some of the most violent protests yet

200 of England's worst-performing primary-school will be closed down

and reopened as academies. Headteachers will have more power.

The Education Secretary Michael Gove said he hoped the move would

raise standards. Michael Gove once every English school to shine, and

academies are his key to gold star success. They are independent of

local authorities and they can set their own curriculum. Now Michael

Gove wants academies to take over struggling primary schools. This

one in south-east London used to be known as Merlin primary. The school

was struggling and a successful local group which runs a chain of

schools stepped into takeover. A new name, a new head and a new

uniform have brought about an improvement in performance.

quality of teaching is central, but you also have to transform minds.

You have to transform the mindset of both the children, the parents,

the whole school really. government will close down 200

primaries and force them to become academies run by other schools next

year, focusing on those which have failed consistency to meet targets

for 11 year-olds. These are schools where young people are leaving

without a secure foundation, so we want to make sure that those

schools are taken over by organisations with a track record

of success who can turn those schools around. Michael Gove is

wanting to take on his critics who say his academies Policy is too

focused on schools which are already successful, but getting

good schools to takeover back want is a policy that was started under

the last government and some are asking what is new here. Critics

say Labour provided tens of millions of pounds of additional

funding for its Academy programme, money which the coalition doesn't

have. The notion that academy status is a silver bullet which

will solve problems straight away it is a myth. It is about

developing the school over a period of time and it takes time to work

on the culture, on the teaching and learning. Labour have made much of

news that an error has left many academies receiving too much money

- in Hampshire by as much as �300 per pupil. The government and local

authorities blame each other. The government is determined to use

academies to drive reform but there are clearly glitches en route.

Coming up: as we get ready for Wimbledon fortnight, is investment

in the British game delivering the stars of tomorrow?

The Defence Secretary Liam Fox says the progress NATO forces are making

against the Taliban is far from irreversible. He was speaking

during a visit to Afghanistan, where he has been meeting British

This is what NATO commanders hope is the future. Afghan troops

training Afghan troops. So that one day they can take on the Taliban

for themselves. But the general running at this training base says

he will still need NATO's help once troops have left in 2015.

Afghanistan National Army and forces, they will still need the

support of the coalition forces in Afghanistan to be helping them.

Afghanistan in June, the poppy harvest is in and the fighting

season has begun. NATO commanders say the number of Dan attacks is

down, but as we travelled across Helmand province with the Defence

Secretary, he was cautious, aware of how quickly things can change.

There is no doubt we are making progress, no doubt the security

situation is improving, and there are some hints that the Taliban

might be losing the battle of hearts and minds. There are still a

great deal to be done. He was shown the latest idea to improve security.

Training part-time policeman to use their local knowledge to spot the

Taliban and their drugs. This is where they really are coming into

their own because they can spot an insurgent or someone who is out of

area, and they are sick of having the Taliban fighters coming into

their villages and using their homes and compounds. But for the

signs of progress, commanders here worry that when the US begins

cutting its troop numbers next month, ministers will be tempted to

follow suit, sending home early some of the British forces here.

Not this minister though. None of us want to have our troops in

harm's way at day longer then necessary, but the point of the

mission is to succeed. He would be wrong to leave a vacuum, he said,

for the Taliban to fail. Troops should come home only when

conditions allow. British commanders have told the Defence

Secretary today that they are confident they are finally hitting

the Taliban hard, but they also talk of the huge amount of work to

be done, whether that is training forces or persuading people they

will be OK in regions like this once the forces go home. One day

these walls may come down, but not yet.

New figures show the number of NHS trusts across England breaching

waiting time limits has doubled in the last year. Earlier this month

David Cameron promised to keep an 18-week limit on waiting for

hospital treatment for most patients. Our health correspondent

Branwen Jeffreys is here. I know you have been trying to break down

these figures, what do they show? David Cameron was talking about the

time between your GP deciding you need an operation and having your

treatment in hospital. Patients in England have the right to expect

that within 18 weeks. And if you look at the national picture, 90%

of patients are seen within that limit. But look more closely at the

detail and it's clear a growing number of areas are struggling to

keep waiting times down. In April last year 25 out of 151 primary

care trust areas failed to meet that waiting limit. By April this

year that had gone up to 51, twice as many areas not treating most

patients quickly. In April 2010, 29 out of 196 hospitals or other

treating trusts failed the 18 week test. By April this year that had

gone up to 49. A picture of more areas struggling to keep within the

waiting times. The Government says it wants patients to be able to

compare waiting times. That means they can choose hospitals offering

quicker treatment. And of course that national figure for waiting is

pretty stable, but that's only because some parts of the NHS in

England are doing exceptionally well. This gives a picture of how

difficult it is to keep waiting down when money is tight, and

perhaps also the scale of ambition of David Cameron's promised in

saying he will be able to do that. As public sector cuts begin to bite,

more people need help but there is less money around and charities are

having to step in. In Manchester, soup kitchens are feeding many more

than they were this time last year. Richard Bilton report on how the

city's poorest are coping. These are the desperate, looking for food.

The soup kitchens of Manchester are busier than ever. Jason lost his

home a month ago. If it wasn't for this centre found other ones, I

would be starving and pinching, petty crime, because there is no

alternative. This is a city where �110 million is being cut from

council budgets. There is tension here, and a fight start. These

people have nothing, and more and more are looking for help. Those

who run this place say this year there has been a large rise in

those who come to use it. The average used to be about 60 per

night, and this year sometimes 90 people come every night because

they have nowhere else to go for food. We are not opposed to the

cuts, we understand they need to happen but they are happening far

too quickly. We get people coming in who have not have their benefits,

and starving. Across town, another sign that the very poor are

struggling. This charity is being asked for more food parcels. It is

a charity funded by donations, but they say the cuts are driving more

and more people to their door. have had a sharp intake of people

being referred to us. Can you handle that Spike? No, not at all.

There are plenty of positives here. Janice is a single mother with five

kids, all of her children are either working or in training.

never give up. It was either that or the doll, so they had no choice

but to keep looking. We heard it is a recession but I don't know. We

tighten our belts anyway so I just carried on doing what we was doing.

Across town, Jason prepares for the night. He hasn't got a hostel and

will sleep in a bus shelter. He thinks life is getting harder for

those on the street. They want to get everybody back into work but it

is easier said than done. How can you get a job when you are scruffy

and you smile. Jason is not here because of the cuts, but on the

streets you can feel their impact. Tomorrow, in the last of his series,

Richard looks at how middle Britain is coping in these tough economic

times. We are days away from Wimbledon,

but apart from Andy Murray there are no senior British players in

contention. Within the sport, people are beginning to ask why.

The sport's governing body has had �250 million to spend on

development over the last five years. Our sports editor looks at

where the cash has gone. The supplies are arriving, the weather

has arrived, but despite the money it generates for British tennis,

the long wait for a Wimbledon men's champion goes on. It is 75 years

since Fred Perry last won of the most sought-after prize in sport,

and as each year passes so the pressure builds on the governing

body of the sport to find a new champion. The Lawn Tennis

Association invests millions of pounds each year in centres like

this one in Telford, but critics say far too much money has been

wasted on helping elite players. The man in charge for the last five

years insists his approach will pay off. You have only got to look at

any sport to say you have got to have continuity and stick with your

strategy, whether you are Alex Ferguson or Clive Woodward, you

need time and you need to hold the long-term vision. The vision when

he started in 2006 was to have five men or women in the top 100 within

two years. But today, Britain has just three singles players in the

top 100 and only Andy Murray challenging for Grand Slam titles,

that is despite receiving more than �250 million in revenue. For all

the money spent on developing the game, it is ultimately here on

Centre Court where British tennis is judged. But the challenge in

this country is to break free of the annual obsession with the

Wimbledon fortnight, and instead focus on trying to change the image

of a sport which is still seen as cosy and elitist. For the man who

beat Andy Murray to this year's Australian Open, winning is about

much more than financial support. It all comes down to mental

strength and a desire to succeed, and hunger to become a professional

tennis player. Many believe Andy Murray has that hunger, but even a