08/11/2011 Daily Politics


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Good afternoon. Welcome to The Daily Politics. The contagion in


the eurozone continues to spread. Italy's cost of borrowing source to


record levels. Prime Minister Silvio Berlusconi faces losing a


vote in the Italian parliament this afternoon. We will bring you the


latest. Back home, is the career of Home


Secretary, Theresa May, in jeopardy. Jed she told the Commons that


immigration officials acted without her authority when they lifted


controls for non-European nationals. Today she is grilled by the select


commity. The Government's ambitious plans


for a �32 billion high-speed rail link between London and Birmingham


are dammed with faint praise in a report published today. We will


debate the pros and the cons of these ambitious plans.


Our Trade Minister, Lord Digby Jones is with us.


The yield on Italian bonds reach the 6.6% yesterday. Not a good omen.


The mark of Berlusconi. This yield is the interest they pay on money


that they borrow, called the yield, it reached today, I think, this


morning, 6.74%, it is the highest level that these yields have been


at since Italy joined the euro. Italy has debts of, let me get it


right, 1.9 trillion euro, almost 2 trillion euros. As a huge economy,


that dwarfs Greece, and it has more bonds that any country in the world,


other than America and Japan. That is a lot of dent to service. It is


thought to be too big for the other eurocountries to bail out if it


goes pear-shaped. If Italy goes down it could be catastrophic. The


Chancellor, George Osborne, called on colleagues to be clear about


their intention at the next big meeting. The eurozone needs to show


the world it can stand behind its currency. We can't wait upon


developments in Athens and Rome. We have to make progress here in


Brussels. If we don't, that will continue to have a very damaging


effect on the entire European economy, including the British


economy, and certainly speaking as the British Finance Minister, the


best possible boost the British economy could have this autumn


would be a resolution of the eurozone crisis. That was the


Chancellor, George Osborne, the political situation in Italy is


also deteriorating. The future of Italian Prime Minister, Silvio


Berlusconi, looks in doubt, with support ebbing away at home. He


faces losing a vote in the Italian parliament this afternoon, bringing


yet more political uncertainty to the eurozone. Let's get the latest


from our correspondent in Rome. Is it inevitable now that


Berlusconi will go? Not if you listen to Mr Berlusconi himself.


He's all over the Italian media this morning, talking about


fighting on. All weekend he says that he has the number, he has a


majority, he is going forward, he's not going anywhere. There is


speculation that there have been just two many defections from his


side of the House, and that he really maybe in trouble. What we


will see in the afternoon is a vote on a budget measure, important that


it goes ahead. The opposition may not try to vote it down, the


opposition may abstain. We should get a good sense of whether Mr


Berlusconi is right, whether he really does have the numbers he


needs to continue to govern Italy. If doesn't, then you might expect a


confidence motion within days from the opposition, and then it would


seem possible that Mr Berlusconi would go down to humiliating defeat,


if he didn't resign beforehand. It is all to be played for in the


hours ahead. Economically, is it hitting home that actually Italy's


detects are so big, that the rest of Europe wouldn't be able to bail


them out any way? I think the analysts, the thinkers, the


politicians, and many people of that ilk are acutely aware, and


desperately worried when you speak to any politician about the way


ahead for Italy at the moment, on the streets people aren't just


quite as wired into the intricacies of the bond markets. Ordinary


people on the street feel the economy is seizing up, there are


fewer opportunities, life is getting harder. If you say to them,


do you believe this country is on course for something like Greece,


they tend to think, surely not. This country is rich, just two big


to be badly managed into that - too big to be badly managed into that


sort of situation. Digby Jones, I put it to you, getting rid of Mr


Berlusconi, it may be a necessary condition for moving forward, but


it is anything but a sufficient condition? Absolutely right. It


will kick the can down the road. But at the end of the day, the


western democracies have got to understand that for years we have


all paid ourselves money we have never earned. And if you stop a guy


on the street, in Italy or outside St Paul's, they will all blame the


bankers. This is different to that. The 2008 recession you can blame


the bankers for that, you could, a lot of other reasons too, this is


about actually the other way round, the bankers have plugged the gap


for years, so democratic politicians can say to people, you


can have lots and lots of prizes and we are not making the money.


Italy has its private savings profile fine, it is not a prove lig


gate nation personally, people save, what it is, is they have paid


themselves money they have never earned as a nation. Only Zimbabwe


has had a lower growth profile, on an average over ten years, than


Italy. It has not grown. At home f the income coming in isn't


sufficient for your credit card, your overdraft and mortgage, you go


bust. In business, if you are not selling enough, and you have lots


of debt, you go bust. Countries are no different. What you have is


Italy's growth over ten years has been very, very poor, their debt,


their public spending, their pensions, health, education, their


roads, has been high, gap, plug it with debt. Suddenly, everybody


around Europe is going, can't afford all this, and there is no


growth profile to get them out of it. No politician, elected instead


of Berlusconi will give them an answer other tharpbgs pay your tax,


because payment of tax is a voluntary event in Italy. So pay


your tax, and sorry, you can't retire at 55, you will have to pay


more in all you do, and you will have less. Same in Greece, same in


France. I have to say, same in Britain. That is your issue.


problem I suggest in Italy, before Berlusconi, in 50 years Italy had


49 different prime ministers, that is hardly a recipe for financial


stability. And they are now talking of putting in, not an elected


politician, but Mr Monti, a technocrat, a euopean commissioner,


he will have no democratic legitimacy, there will be


demonstrations on the street. Isn't it heading at some stage for a


default? Historically, that is why Italy has said we will join the


euro in the morning, we don't mind taking rules and regulations from


Brussels, we don't intend to comply. Why? Deep in their souls, they know


they don't have prime ministers who have ever led their nation. Having


a technocrat, I would submit, is going to make no difference, at the


end of the day they will go on the street and stop it happening.


Therefore, whether you manage it within the euro, or whether you


come out of the euro, there will, and I think you are right, there


will be a form of default. You can't afford it pay the debt back.


The fundamental problem, given the sums of money we are talking about,


next year the Italians have 300 billion of their euros of debt


comes to maturity, they can only pay that back by borrowing another


300 billion. It is a bit like a popbzcy scheme the Italian


Government - popbz did I scheme the Italian Government, and there is -


Ponzi scheme the Italian Government, and no nation or group of nations


can pay them out? No European leader will say, vote for me, I


will close your libraries, and give the money to Italy. Turkeys don't


vote for Christmas, that is why there will be a default, because


there isn't enough money to bail them out. The IMF has been sent to


Rome to monitor Mr Berlusconi's behaviour, I'm told a few women's


groups will have to monitor his behaviour too.


They will take their place in the queue. It is the daily quiz,


sticking with yuerpbgs the question for today is which basic food stuff


has the EU announced must have the ingredients listed on the packaging.


Peanut, eggs, honey or potatoes. At the end of the show, Digby will


give us the right answer. What is the ingredient of an egg,


but an egg, how many committees him, it might have been a trick


question. There is a joke on the Internet at the expense of Theresa


May, it is knock, knock. Who's there? Come in.


Miss May is under fire after it was revealed that border controls were


waved on non-nationals. Yesterday she revealed they were acting


without her knowledge, then we extended a scheme that was only


intended to apply to non-EU passport holders. I didn't given my


authorisation to any of these decision, indeed, I told officials


explicitly that the pilot was to go no further than we agreed. As a


result of these unauthorised actions, we will never know how


many people entered the country who should have been prevented from


doing so after being flagged by the warnings index. That was May, in


just under half an hour, the Home Secretary will face another


grilling. This time from MPs on the Home Affairs Select Committee. I'm


joined now by our correspondent. How hard a time will she get?


would be Home Secretary, first you have to go through that in the


House of Commons. There was one moment where she simply didn't seem


sure where her pilot was being applied across the country. You


look at your diary for the next day and think things can only get


better, and you see you have the Home Affairs Select Committee with


Keith Vaz, that will be a joy. No, of course it won't be eezy, the


opposition are looking at this - easy, the opposition are looking at


the simple response, it was the officials that done it, I didn't


know. The obvious response from the opposition is why didn't you know.


We can accept you were ignorant, how can you be ignorant and


competent at the same time. To prove it doesn't rain but pour on


the Home Office tower, the UK borders agency are facing legal


action from a kpwroup of language schools who said they were wrongly


included on a list of groups banned from bringing people into the


country. She will come under political pressure today, I have


been shown a memo sent by the head of UK BA, last week it was sent, I


got to see it this morning. It says any relaxation from the rules will


need his personal authority, his personal authorisation. I can tell


you this, she is in trouble now for relaxations, if come Christmas time


we have queues of two, three, four hours time at immigration control,


she will be in trouble for that. Just briefly, adding to her woe, in


political terms, how dangerous is it for her? As long as she can


stick to this line, that actually it wasn't something she knew about,


that cannot be eroded. Frankly, as long as she puts up a little bit


more of a tough and convincing performance in the select committee


than maybe she did at points yesterday. Maybe if she can take a


more substantive look at the questions and not engage wholly in


the Labour bashing, which certainly didn't get the hackles up, but the


confidence of some Labour backbenchers yesterday, she should


be fine. She has the Prime Minister's backing. We need more


fact before we have a dead duck Home Secretary on our hands. There


will be plenty of people in journalism and the opposition


trying to find out damaging things. We are joined by Alp Mehmet, a


former British ambassador, before that an immigration official


himself. He's now the vice chairman of Migration Watch. Welcome to the


programme. There seem to be rather big basic contradictions in what


Theresa May has said, and then what seems to have come out of leaked


document from the border agency. She said that this was a pilot


scheme, except it applied to every single port and airport, she then


said that there was strict instruction that is the pilot was


to go no further in terms of relaxation than European passport


holders, but the document says that actually senior managers could give


further measures at local ports and airports, they could go further


than she actually said. It was done for more risk-based assessments on


security, but the instruction on the document says it is to prevent


the excessive queuing to beat the summer traffic. What will people


make, it is hugely embarrassing? is hugely embarrassing for Theresa


May, shy will be the first to be the first to acknowledge. That I


was an immigration officer 30 years ago. Queues at ports is nothing UN


the pressure to get people through the ports quickly was happening in


the 1970s and 1980s, that is something always going on. I


personally would not exaggerate the problem here. Which problem?


problem of the fact that a lot of people may have got in who didn't


get in. The fact is, we're not interested in children, we're not


interested in groups, we are not interested in a lot of people that


take up time. Now, I'm not suggesting we should do away with


controls, on the contrary, controls should remain there, if that means


people going through the controls more slowly, then so be it. But,


I'm not sure that this is as much of a problem as is being made out.


Except, as our correspondent said there, this is about what she knew


in her competence, isn't it. It seems to me she didn't know how


widespread the pilot was, sheer she herself in the Commons said, I


don't know - she herself in the Commons said I don't know how many


terrorist suspects and illegal immigrants have entered the public.


That won't reassure the public? won't. What I'm saying is whatever


the instructions were, and whatever the civil servants took upon


themselves to do, common sense should have prevailed. Those, they


had suspicions about, should not have been allowed to go through it.


I'm pretty sure that didn't happen, frankly. Really, just based on


experience? Based on experience, no immigration official would let


people through that they had serious concerns about. Would they


be able to tell if they weren't even looking at the passports of


some of these people? Well, of course you can tell, experience


tells you the sort of people that you will be interested in from


their movements, from the answers that they give. But you are blaming


staff a little bit like May and border officials and saying it is


down to them and they should have discretion, and no political


message was coming through. These leaked documents seem to suggest


that there was an instruction from on high, that not only said it


should apply to European passport holders, that it shouldn't just be


limited, but people should make up their own minds, and they could


take the measures themselves, if that was a political instruction,


surely they were carrying them out? What I'm saying is whatever


instructions went out, the actual controls should not have been


compromised, I don't believe it is compromised to the extent it is


suggested. In terms of business, we have been told it is drag on


business, lots of business people don't like Heathrow, they would


like to come through quicker than they do. You can see the competing


priorities here, if they were trying to reduce queue the over


summer months? I wouldn't put the business issue that high in terms


of want ago more efficient Heathrow, any more than a tourist or you and


I. With business it is the granting of visas beforehand, it is the all


security check that is take ages to get somebody from India into your


business in Britain. That's the issue for business. The issue at


Heathrow is a much wider issue from letting people in and looking at


the passport. The problem with Heathrow is it is not fit for


purpose in the 21st century. much danger do you believe she's


in? I'm with these two gentlemen. I reckon if nobody points the finger


at the fact she knew, and if we see heads roll at the top of the Civil


Service, for want of a better word, I think she's fine. I do worry when


I heard the words, "she has the complete backing of the Prime


Minister", that's like confidence in a football manager. I believe


she's doing a good job in many areas, she can't have the causal


link. Do civil servants always listen to their ministers? No.


I see, so we're all agreed on that! I was the minister and I say no. He


have the civil servant and he says yes. Who is telling the truth?


remember one civil servant saying to me, you go in and say that, and


you're on your own. The Home Office has a pretty terrible reputation,


all home secretaries fear what is going on. Going back to the UK


Border Agency, they have been pill lorryed and knocked about over the


last few years, we ought to look at what is happened to them under the


previous administration, mostly that does take and need a close


look. Will it make it more difficult for cuts to be carried


out at the border agencies? Definitely. I wish politicians


would talk about cuts meaning fewer people. They don't mean work hard


with fewer people, they mean work more cleverly. Use your existing or


less resource, think about how you use it and work for cleverly. Don't


just cut money, that means fewer people, but we're going to try to


do the same thing in the same way. The result is what you have seen


today. I vouch that was what he was telling us when he was a minister.


I used to constantly say, work more cleverly. Don't just try to put


people there. That will be the mantra.


Try getting through JFK without an American passport!


To some it is a white elephant which will spoil the countryside


and eat up tax-payers' money, to others it is the green alternative


to air travel, which will cat plult our antiquated public transport


system into the 21st century and provide an economic bust. It will


still eat up a lot of tax-payers' money. This morning plans for a new


high-speed network between London and Birmingham, have won the


lukewarm support of the transport committee. Tell us more.


All aboard, because the Transport Select Committee says there is a


good case for the line known as HS2, the �32 billion scheme, which will


link London and the Midlands on a new network, with speeds of up to


250 miles an hour, with plans to extend it to the north. The group


of MPs said it is obvious the economic impacts of high-speed rail


can vary and are not easily predicted, and HS2 could be the


catalyst for these benefits. They accepted the proposed route is


likely to have substantial impacts on those living along it, and it is


unfortunate, it crosses the Chilterns, the Tory heartland and


an area of outstanding national beauty. There could be adverse


consequences for local communities. It is very necessary to consider


those as well. It is wrong to cast gate as nimbus people who are


simply expressing legitimate concerns about their local areas.


The committee says the Government should commit to extending it to


Leeds and Manchester before firmly committing the route. And building


a network between north to south should be a priority.


I'm joined by Andrea Leadsom, her constituently will be affected by


the proposed route. Welcome. This is a pretty milk and water


endorsement from these MPs. Yes. And I think rightly too. Where I am


on this is that I think it is an excellent thing to have it built. I


think it should be committed to leads and Manchester and glass go,


and go to the country, and go to parliamently people on the plan.


Make sure people will understand you will cut out slots at airports


and cut out air pollution and grow economies on the route. Three big


problems, it is not cost, firstly, let no-one in Birmingham think this


will really bust the Birmingham economy. It will make Birmingham


the most northern suburb of London. Why is that a big thing? It is not.


Why do you want to spend all that moneyen to? You have to get more


money and structure into the nation than we have. If you go on to Leeds


and Manchester and grow a high- speed network network you will take


people off motorways and aircraft. It is �32 billion, that only gets


you to Birmingham? Right, second point, this is where this lady and


I might find common ground. I cannot understand why, if you have


a pollution corridor already there, called the M40 and the Chiltern


line, why don't you build this, and yes, if someone says it costs more


money to iron out the curves and put the tunnels in, so be it, spend


the money. Don't go and rape a load of virgin countryside to do this,


that is the important thing. Hold on, I don't want a monolougue. I


would like to bring in our other guest. You are against it whatever


the route is? I am. If it went via Wales would you be in favour of it?


No, when you look at what the transport select committee is


saying, they are concluding it is a good thing, but all the points


suggest the conclusion should be a bad thing. They said the business


space is spurious because it is based on time-saving on a train,


they said there is no environmental case. They said the length of time


it will take to build the thing is a non-starter, 20 years, there is


no commitment beyond the Midlands at this point in time. The


conclusion I draw from the report is they shouldn't be supporting it.


If you have your way we will end up the only major European country of


any size without a high-speed network? It is not true, our Inter


City 125s are high-speed. Not if you travel in Spain and France?


you look at their situation if you go off the high-speed network, you


are on to slow train services. In the UK, our Inter City 125s, when


you bear in mind the small geographic area we have, they


servant purpose of getting us between cities very fast. We are


talking �32 billion, that exclude the spur to Heathrow, and having to


build a new underground. If you are bringing in 2,000 more people into


Euston, the Victorian line can't cope now, led alone those


increasing numbers. The costs are a tiny proportion of the reality of


building this thing. I did a trip to Birmingham a couple


of weeks ago, it took an hour and 20 minutes. People knock British


trains, it was a perfect trip, an hour and 20 minutes, it was


relaxing, I had Wi-Fi, somebody brought me a cup of coffee, I got


some work done. I do it a lot. don't we, instead of spending �32


billion, which you and I know will be �60 billion at the end of the


day, just to get to Birmingham. Take a fraction of that money and


improve the existing line? I think. Make it an hour instead of an hour


and 20 minutes. There is only so much you can do an engineer would


tell us, with existing lines, and you can only get it down to a


certain speed, or up to a certain speed because of the he can listing


line. What I'm saying, for a fraction of the money, you could


actually do so much by building something in the same corridor.


That is something that they don't seem to have thought about. They


haven't, they have rejected it? Quite. Why? Because they think it


will cost more in the end, because it is not a corridor to city and a


high-speed line. They say costs are tie tight. Nobody flies to


Birmingham already, the only real gains are if Manchester and Leeds


and up to Scotland. But you don't save anything on pollution in that,


every slot that Heathrow gives up for Glasgow and Edinburgh, there


are few domestic flights out of Heathrow now, will go to new lines,


to Shanghai, and quango dong, and Rio, there is no - Qandong, Rio.


Nobody pretends there is an environmental argument now. There


is a key point, if you are determined to go high-speed, the


environmental impact is far greater than if you did to 160-180mph,


which is faster than we already V if you lock at a combination of


sorting out pinch points and improving speed on existing trains,


and potentially adding another line part of the way, perhaps as far as


the Midlands, so you can then free up the existing West Coast Mainline,


to go to the northern cities, with a much better service there, it


would be a far cheaper thing. The key thing is, if you go with high-


speed rail you are not sorting out anything in 2026, we can't wait


until then. I broke the story in the Sunday Times about CrossRail in


1986, it is now 2011, they are still trying to build it. In your


heart of hearts, do you think the high-speed rail network will ever


be built? Do you want to phone a friend. We haven't got time?


think it will. Do you, what about you? Funnily enough, given where we


both come from, I don't think it won't. I'm beginning to think that


too, and I always thought it would. I'm more in favour too.


Thank you for being with us. There is time to find out the


answer to the quiz, the answer was which basic food stuff has the EU


announced might have the ingredients listed on the package,


is the peanuts, eggs, honey or potatoes. I didn't know about this


until I sat down. I opened a packet of peanuts the other day, on the


back of t I said on the back of it, it says the ingredients, may


contain nuts, on that basis nuts. You're wrong, it is honey. What


else is there. They have pollen on their feet, and it may be GM pollen,


that is the problem. That is exactly right.


sovereign debt crisis and this is what Europe has to worry about. All


right, thanks to all our guests, especially to Digby Jones for being


our guest of the day. We will be here tomorrow with all the big


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