20/10/2011 Daily Politics

Afternoon, folks. Welcome to the Daily Politics, live from

Westminster, where the whiff of rebellion is in the air. The Prime

Minister is trying to stave off a rebellion in his own ranks on

Monday's vote in the Commons on a referendum about our relationship

with Europe. Around 60 Tory backbenchers seem ready to mutiny

and vote for such a referendum. Meanwhile, the eurozone crisis

heads to its climax, President Sarkozy rushed to Berlin last night,

missing the birth of his child, as the chances of France stitching

together a comprehensive response to the sovereign debt crisis began

to recede. Compared with that, the Commons vote is a sideshow. But, if

Europe falters, will the eurosceptics be emboldened? We will

be looking at whether or not to get rid of stamp duty. Now the house

price boom is over. Has it become a tax that is putting a brake on the

British economy? And, we'll find out just how close I managed to get

to George Clooney at last night's And joining us for the duration the

Director of the Institute of Fiscal Studies - Paul Johnson. So, the big

story today is Europe - both the economic crisis abroad and the

political rebellion brewing here at home. David Cameron seems

determined to make a show of strength over Monday's vote on

whether to have a referendum on Europe. There would be three

options. Staying in, pulling out or staying in but with a substantial

repatriation of powers from Brussels, which I seem to remember

was the Tory policy at the last Paul Johnson, how much of our taxes

We are spending something like 12 billion a year - gross

contributions to the EU. That is going up over the next few years.

We get a fair chunk of that back. A few years ago, our net contribution

was about 3 billion. That is rising fast over the next few years.

our net contribution is beginning to rise. That is the money that is

going out of the country in net terms. Is that down to the fact

that, unlike France and Italy and Spain, we do not get much out of

the Common Agricultural Policy? get a lot less out of it than other

countries, given the scale of what we put 10. Early in the 1980s we

negotiated that rebate. -- put in. That is because the rebate is going

down. �10 million is a lot of money. The EU budget is only 1% of

national income. We spend 40%. The EU budget is one 40th the size of

an ordinary national budget. Euro-sceptic case is not on the

cost of membership. There are other things they are not happy about.

There are a whole range of other things that being in Europe is

about. There is the cost of membership for the UK. We make

contributions to other countries across the EU. It is the other

stuff. 4 billion would be a rounding error in national accounts.

In terms of money spent, it is relatively small money. This debate

on the referendum was going to be next Thursday but the powers-that-

be moved it forward so David Cameron and William Hague could

attend. Leading Tories say there is a panic. If the Commons did vote to

have a referendum, and it looks highly unlikely that it will do

that, just because of the arithmetic, even if they did, it

would not be binding on the Government. It would ramp up the

pressure on ministers to become much more Euro-sceptic. Just give

us the background. In 1975, but Bay City Rollers were topping the

charts. Jim began fixing it, the Tories chose a woman to lead their

party and Britain embraced Europe in a referendum. That asked whether

we should remain part of the Common Market which we joined a few years

earlier. Back then, 67% of Brit said yes. Jump forward to 2006 and

the Conservative leadership promised a referendum on the Lisbon

Treaty. It change the constitutional framework of the EU.

By 2009, the treaty had been ratified across Europe and the

Tories dropped the pledge. Thereafter, David Cameron promised

a referendum lock - were crying a referendum on any future transfers

of power. -- requiring a referendum. The Lib Dems promised an in are out

referendum on EU membership. Monday's debate motion calls for a

referendum by May, 2013, with three options but the public. Keep the

status quo, leaving the EU on reforming the terms of the UK

membership of the European Union. Joining us now is James Landale.

Support is growing for the summer as Conservative MPs, isn't it?

is. The issue of Europe has been pretty quiescent throughout much of

the leadership of David Cameron. By and large, by trying to keepers of

the front pages and trying to enjoy the fact that many Conservative

Euro-sceptic MPs have had different issues. Some are concerned about

repatriating powers, others are more concerned with issues such as

the Human Rights Act and the European Court of Human Rights.

What this court next Monday does is, it allows the coalescence of all

the Euro-sceptic concern to come together on one issue and one vote,

I think that is why the Government is so concerned about it and that

is why they're trying to head it off as much as they can. Is it wise

for David Cameron to make it a show of strength? That is what he has

been advised not to do. We do not know how hard the Government will

order its MPs to back the Government's position on Monday.

That is quite fluid. They are saying they expect MPs to back the

Government. There is a lot of mainstream Conservative MPs who

think that one option for the Government would be to ease off the

whipping. It is a backbench issue and it was raised through a

backbench procedure. There was a petition asking for a debate. Leave

it in that context and say to ministers and others within

government, if you are concerned about it, just do not turn up on

the day. There is a lot of many of them in -- manoeuvring going on.

What a bad arrangements in the other parties? We know the Labour

Party will oppose the motion. -- about other arrangements in other

parties? There will not be a vote in favour of the whole house of

Commons calling for a vote on membership of the European Union.

The question is, how many Conservative MPs feel they can

oppose the Government on this because they feel so strongly about

it and constituents feel so strongly about it and they feel it

really needs to happen. We are now joined by Emma Reynolds, who speaks

for the Labour Party on Europe and Andrew Rossendale he stood up

yesterday at Prime Minister's Questions, telling that the British

people are crying out for a referendum. About understanding the

Labour position, when it comes to this vote, what will Labour do? Is

there a three-line whip to vote against? There is a three-line whip

to vote against having a referendum on our membership in the European

Union. It was not in our manifesto, nor in the manifesto of the

Conservative Party. It was a new once promised by the Lib Dems.

other kind of Lib Dem promise is there? It is normally sitting on

the fence! We think it is a distraction. The economy is that

lies in, -- flats lining. People should not be concentrating on

theirs. Our front bench will not defy the three-line whip. Some well.

You have some rebels. A small minority of Labour MPs, I think,

will vote for the nation. Andrew Rosenfeld Kite you have lost pretty

heavily. -- the motion. This is a fundamental issue facing our

country. It has gone on for years. The British people deserve the

right to have their say in a referendum. I do not understand why

it keeps whipping politics apart. We should be allowed to had a --

allowed to have a say on this. agree with you but she used -- but

you should not be able to determine that. Have the Lib Dems told to how

they will vote? I have not spoken to the Lib Dems. What a do know is,

however the House of Commons votes, deep people of Britain want to

decide the future of this country. -- the people. I believe that David

Cameron is doing the right thing for Britain. His heart is the same

as the rest of us. He has a three- line whip against you put up his

heart is no Rennie yours. If he pledges at some point the British

people have the chance to vote, he will satisfy many British people.

Is it Labour policy on Europe to repatriate any powers? We have said

our membership of the European Union is a vital matter of national

interest. We need to make sure we have the strong voice in the

European Union to make sure that whatever comes out of this crisis,

our businesses and jobs depend on the eurozone. Whatever comes out of

it, we still have our vital national interest protected in

Europe by further deepening beat single market. Her I understand

that. Where do you go after this? - - I understand that. The interest

will be the size of the rebellion you can muster. The eurozone is

meeting this weekend. Signs do not look good to me for any deal being

done. Otherwise Nicolas Sarkozy would stay and watch the birth of

his child. Where do you go after this? At what point does the

British Parliament allow the British people the right to decide

their own destiny. It has gone on for decades and decades. The House

of Commons needs to allow the British people to make a decision

about our long-term future. It is not just about the crisis at the

moment, it is about the long-term position of the United Kingdom with

regard to the European Union. The option of trade and co-operation is

what the vast majority of people want. I want trade and co-operation

- a sensible relationship that suits Switzerland. As I understand

it, the third option is not a Swiss position. Switzerland is not a

member of the EU. The third option is, we stay in that have a more

arm's-length relationship. Can you clarify that? Be third option has

to be discussed as to what bad exactly means. So, the third option

is not staying in? We have to change our relationship

fundamentally. This is new. I want to get this right. As I had

understood it and BBC has been reporting, the options and his

referendum would be a vote to come out, vote to stay in on the

existing arrangements, Status quo, will vote to stay in or having a

substantial repatriation of powers? If we can achieve that, fantastic.

There is only one other option. That is the problem. Why have a

referendum when you know you cannot deliver? We promised a referendum

on the constitutional treaty. We had negotiations, I was working in

the Foreign Office at the time... If we have the political will to

achieve this, then we can achieve it. We cannot give up before we

start. If we leave, we will need to go through an arrangement of trade

co-operation. That would be no different you a third option. I

want to come back to run important point on Labour policy. -- an

important point. It is now conservative coalition policy to

urge the eurozone to go full fiscal integration - made to transfer of

payments from north to south and fall economic policy to be

controlled from the centre. What is the policy of Labour? George

Osborne has said for the eurozone to be successful, they need some

kind of fiscal integration. That will only be the eurozone 17

members and not the wider European Union. I did not know that but I'm

grateful to find out, as you and your government are urging, that

changes the whole dynamics of Europe. Britain will be on the

wrong side of the block of 17 that will always vote together. That is

why, if our membership is being questioned, that weakens our boys

in the European Union. I am in favour of us still retaining the

relationship we have. You just said you are in favour of the position

of Osborne of the deepening fiscal integration. Of the eurozone 17.

is a 17 Boat block. There are differences on the single market

The crisis is the real news at the moment, there is a real problem

going on and that is where the focus of UK and European attention

should be. If that is not sorted out... The EU is by far and away

our biggest trade June -- trading partner and if they meet real

trouble, our economies won't be far behind.

You don't think there is going to be a solution by Monday?

I think the signs are not good. Mr Sarkozy would not even stay for the

birth of his child, which shows you how bad things are.

Last night saw the premiere of George Clooney's latest film, The

Ides Of March, a dark thriller It says we are going to help people

get an education, create national unity, treat them a trade and get

them out of debt for their college loans. Where does that fail? That

is exactly right, but if you're going to do it, it do it. Make it

mandatory, not voluntary. Mandatory. Everybody who turns 18 or graduates

high school gives two years of service to his or her country, and

for that your college education is paid for. The beauty of it is that

everybody over the age of 18, or pass the age of eligibility will be

for it. And all of the others? Can't vote. Too young. For proof

policy, there. The man who wrote the film with George Clooney is

Beau Willimon, he is in the studio. I saw the film, it was great. It

was also really dark, politically, showing what happens behind the

scenes. Is it really like that, or was this a more cynical take?

really is like that. We are keeping our focus on the darker side of it,

but I have worked on a number of campaigns over the years, going

back to a Senate race in 1998, Bill Bradley in 2000, Hillary Clinton,

Howard Dean. I based my writing of the play and the movie on all of

those experiences and things I saw first hand, or variations of first

hand. I suppose everybody presumes there is a little bit of dirty

tricks that goes on on the campaign trail. That's understandable. This

went a stage further. The moral that I took away is that you cannot

be a nice guy in politics, only the bad boys won. A lot of people would

see that as a cynical attitude but I see it as a realistic one. In

America, we want diametrically opposed things from politicians. We

want them to be bastions of moral integrity but also looked to be

effective -- effective leaders. To be effective leaders, you have do

sometimes be abhorrent. When you have someone who is willing to

break the rules, or the law, to get something accomplished, and we want

to praise them for their ability to get things done, and on the other

hand, we want to destroy them, because they have not projected

that image of moral integrity on to the wild, we are being hypocrites

as an electorate -- onto the world. As much as they are being

hypocrites as people. You are saying that leaders have to be

flawed, if they are prepared to go and stop at nothing to get the big

prize? They are human beings like the rest of us. If you are married

and in a long-term relationship, the statistics are that you have

cheated, or you will. Those are the odds. When a politician does that,

we suddenly find them unfit to lead. One could argue that we should hold

them to a higher standard than we told ourselves, -- hold ourselves,

but we need to see that we are also because, all contradictory. They

have a great deal of power but they are human beings. Those campaigns

you work on, were there different levels of taking that to the nth

degree? Was some of the guys you worked with worse than others when

it became too behaviour in terms of ethical behaviour? -- when it came

to behaviour. It focuses on those behind the scenes, and because they

are not in the public light, they have more latitude to do things

that are wrong, or illegal, or ethically tenuous. Politicians find

themselves in that position all the time. Good politics is about Pope

compromise -- about compromise at the end of the day. Every time you

do that on an ideological landscape, you are redrawing the line in the

sand. That sort of behaviour can pleat into your personal life and

sense of moral integrity -- bleed into. So that the redrawing of the

line becomes a habit. People I have worked for have been great

candidates like Howard Dean, Bill Bradley, Hillary Clinton. They are

great leaders. Do I have first-hand experience of any of them doing

incapacity things, no. I have to interrupt, sorry to do this. We are

getting reports from Libya that Colonel Gaddafi has been wounded

and captured by the rebel forces in Libya itself. This is coming out of

the National Transitional Council. They say they have Colonel Gaddafi

in Libya. These reports are unconfirmed. They are being

reported by a Reuters. We are getting other reports, we have not

yet got it confirmed. We will bring you this as soon as we get it.

He is captured and winded in both legs, taken away by ambulance --

and wounded. But it is not confirmed. But it looks like

something is happening. Sorry to interrupt with that news. If you

were watching, Jo was boasting about how she was going to speak to

George Clooney. I was cut off before I finish that

sentence! This is how close she got. Look at

this. Can't you see me?

The closest she got was, George! I am over here! Thank you very much.

Thank you so much. Our guest of the day is Paul Johnson from the

Institute of Fiscal Studies, which published a report on the number of

areas of taxation it thought right for reform. One of them was stamp

duty, a relic of the 17th century. A bit like us. It was only meant to

be temporary, just like income tax. Damn you, William Pitt. Was it the

younger all the elder? Who brought in income tax. A cash-strapped

Treasury isn't keen on giving up its big earners.

If you are lucky enough to be able to afford one, it is just something

you have to pay when you are buying a house. But have you ever thought,

what the hell is stamp duty? It is a weird one. Like many taxes, it

was brought in to fund the war, in 6094, William and Mary's reign, a

war against the French -- 16 at 94. It was only meant to come in for

four years. All these years later, it is still there, because like

most Chancellors, they think, this is quite nice, we will hang on to

this. Best estimates suggest stamp duty land tax let's the Treasury

hang on to �6 billion a year. But Raised a lot of politicians out

there accept the fact that stamp duty and the way it is levied is

well past its sell-by date. Maybe not get rid of it but they need to

be substantial reforms. The charge is three form. -- threefold. If you

buy a house that is �1 over 250,000, you will pay 3%, not 1%. At �1

could cost you �5,000. That can't be right. What we are saying, there

should not be that slapper approach. It is a disincentive. You should be

looking at it in the same way. -- Regional differences mean half the

stamp duty revenue comes from a quarter of transactions that in --

are in the south-east. And it is an extra financial burden on first-

time buyers, which taken altogether, suggests leading stamp duty as it

is is bad for the housing market. Trouble is, with a cash-strapped

government, it seems now is not the time to cut such a big source of

revenue. The Treasury is raising the tax is and we need those to pay

for public services. If we were looking at anything, it would be

help for small businesses, those parts of the economy that will

create growth. The Treasury's position is that any and every tax

cannot always be under review. And all of them could be up for reform.

In the current economic climate, having spoken to officials and a

Treasury Minister, it is fair to say, stamp duty reform is not, at

the moment, top of their agenda. We are joined by the Tory MP

Is it realistic to get rid of stamp duty in any way, given it has

become a huge money-spinner for the Treasury? No but two reforms are

possible. I have been pushing to see stamp duty paid by people

selling the very expensive houses. If a company is not carrying on

business, if it consists of a single property, when it is sold,

it should be taxed as... That is a London problem. Yes, but it would

bring in a lot of money, and we need to extend capital gains tax to

non-residents. That would make people at the top pay a fair share.

The other issue is the one that you said in your clip, above 250,000.

In my constituency of Rochester and Strood, many family detached homes

are worth 250, 300,000, and it is very difficult to sell those. Many

people have to take a prize at 249995, because of this economic

cliff -- a price at. Do you get the indication that the Treasury is

interested in any of that? Potential it. I think the Treasury

would want to do that in a revenue neutral way, charging a bit about

1% on those immediately below 250,000. I also think the Treasury

appreciates these taxes tend to reduce transactions. When Labour

put in the big increases, the property market was booming. Given

the difficulty of transactions in the property market, if you cut

rates temporarily, it could lead to more transactions and revenue, and

house sales feed into the wider economy. It is a very damaging tax,

it reduces the number of transactions, it increases rather

than reduces volatility in prices. The approach is absurd because it

makes it very difficult to sell. There was a report earlier this

week worrying that too many people occupied houses too big for them.

One reason, it was so expensive to sell the house. The whole housing

tax system needs reforming. It is unfair and regressive and the way

it impacts on people. I don't see tax reform being high up the

Government's agenda, but I live to be surprised. We have depict the

guess the year when a bomb yesterday. -- we have to pick. From

Roger Langley from Ipswich, the mud is yours. That is it, thanks to all

of our guests -- the mark is yours. Thanks to Paul Johnson. I will be