:00:27. > :00:29.And good afternoon. Welcome to the Daily Politics here at Westminster,
:00:29. > :00:33.where the stage is set for the mother of all family arguments in
:00:33. > :00:37.the Commons this afternoon. He says he was right to veto a new European
:00:37. > :00:41.treaty that would have seen the Eurozone countries forming a new
:00:41. > :00:45.fiscal union. The Prime Minister insists that it would not have been
:00:45. > :00:49.in Britain's interest. But he says he is bitterly disappointed. The
:00:50. > :00:56.Deputy PM says it will be bad for jobs, bad for growth and leave this
:00:56. > :00:59.country a pygmy on the world stage. And what about him? It is back to
:00:59. > :01:03."I agree with Nick".. Remember that phrase from the election last year?
:01:03. > :01:06.The Labour leader is accusing the Tories of failing the country and
:01:06. > :01:10.mishandling negotiations. All three will be in the Commons
:01:10. > :01:14.this afternoon in what promises to be a highly charged parliamentary
:01:14. > :01:22.occasion, with the future of Europe at stake and the Westminster
:01:22. > :01:26.coalition under extraordinary pressure.
:01:26. > :01:30.That parliamentary statement will be at around 3:30pm this afternoon.
:01:30. > :01:34.We will be taking the political pulse of members of all three main
:01:34. > :01:38.parties in the next half-hour. With me throughout the programme is the
:01:38. > :01:45.businessman Sir Martin Sorrell. If you have any thoughts or comment on
:01:45. > :01:49.anything we are discussing, send them to us. But first, the economy
:01:49. > :01:53.itself. More dire predictions this morning, this one from the Standard
:01:53. > :01:56.Chartered Bank, which says the British economy is already
:01:56. > :02:00.shrinking and will continue to stagnate until at least halfway
:02:00. > :02:05.through next year. Martin, do you see the UK economy returning to
:02:05. > :02:08.recession? No, actually. I have seen the numbers through to
:02:08. > :02:13.November. We have just finished doing our budgets in New York over
:02:13. > :02:19.the last couple of weeks. While the UK has been vibrant this year, we
:02:20. > :02:24.are up about 10% against five to 6% for the company as a whole, we have
:02:24. > :02:29.added 10% to the number of people in the country, so it is at about
:02:29. > :02:36.14,000. A but growth is flatlining. Generally, but our business has
:02:36. > :02:40.done well. It is certainly not flatlining. That is your view, but
:02:40. > :02:45.you do not think the country as a whole will be back into recession?
:02:45. > :02:49.No, I think it will be low levels of growth. That is subject to
:02:49. > :02:53.nothing catastrophic happening. If an Italian or Spanish bank went
:02:53. > :02:57.down, which some say is a possibility, less so a French or
:02:57. > :03:01.German bank, because they would be bailed out. But if that happened,
:03:01. > :03:09.all bets would be offered. I was asked last week whether we would we
:03:09. > :03:13.do our budgets -- whether we would redo our budgets, and if that sort
:03:13. > :03:17.of thing happened, you would be back to a layman's scenario, or the
:03:17. > :03:22.business back budgets are in much better shape than they were.
:03:22. > :03:26.that is a potential event, that the Eurozone fails or that a major bank
:03:26. > :03:30.in one of the Eurozone countries fails. The bank failure is much
:03:30. > :03:36.more short-term. The Eurozone failure is something, given the
:03:36. > :03:39.decision the Prime Minister made, is more in the air. But is the
:03:39. > :03:45.crisis in the Eurozone or anything connected to it the main reason for
:03:45. > :03:49.lack of British growth? It is partly to do with the Eurozone. The
:03:49. > :03:55.Government has reduced the rate of increase in spending. It has not
:03:55. > :03:59.cut spending is. It has addressed the issue of getting the deficit
:03:59. > :04:03.under control, which the Americans have not done. The Americans will
:04:03. > :04:08.face the same issue after their election in mid- November next year.
:04:08. > :04:13.Should Britain consider slowing the deficit reduction programme? In my
:04:13. > :04:17.view, no. It is a bit like turning around the company. You have to
:04:17. > :04:23.deal with the revenue and cost side, and then put in place a growth
:04:23. > :04:29.policy. The statement from the Chancellor was a plan being put
:04:29. > :04:32.together. It is not fully fledged doubt. I would like to see a more
:04:32. > :04:36.robust, visionary plan for the next three and a half years of this
:04:36. > :04:40.government. They have to get it together, otherwise they will go to
:04:40. > :04:43.the nation with the country in the same condition of slow growth. It
:04:44. > :04:48.will not be a pretty picture electorally. The deputy prime
:04:48. > :04:53.minister Nick Clegg has said some increases in executive pay, which
:04:53. > :04:59.has become an even bigger issue, are irresponsible. I do not know
:04:59. > :05:02.which ones he is referring to, but if you look at WPP on its own, you
:05:02. > :05:07.have to look at it in the competitive environment in which we
:05:07. > :05:12.operate. We still work in an international and highly mobile
:05:12. > :05:22.workplace. Is that less of an argument these days, particularly
:05:22. > :05:24.
:05:24. > :05:28.in the Times now? No. You will probably have a record year that
:05:28. > :05:31.WPP. We have to look at that in relation to what is happening
:05:31. > :05:41.competitively. We still have to compete against private equity
:05:41. > :05:41.
:05:41. > :05:45.companies. The UK, we have 40,000 people here. Our total workforce is
:05:45. > :05:48.150,000 worldwide. His Nick Clegg referring to companies based in the
:05:48. > :05:53.UK or operating in the UK that are working on a worldwide stage, or is
:05:53. > :06:01.he just referring to UK-based businesses? It might be true in the
:06:02. > :06:06.context of UK-based businesses, but not for us in 2011, or 2012.
:06:06. > :06:10.Now, after David Cameron will do his veto at the EU summit on Friday,
:06:10. > :06:13.the coalition pre-Christmas cheer has descended into open warfare.
:06:13. > :06:18.David Cameron will face MPs later to explain why he did not put his
:06:18. > :06:22.signature to a new European back to try to stem the euro crisis. Deputy
:06:22. > :06:25.prime minister Nick Clegg has angered many Tories by saying David
:06:25. > :06:28.Cameron's decision threatened to turn Britain into a pygmy on the
:06:28. > :06:32.world stage. All is not well around the
:06:32. > :06:39.coalition Christmas table. Peace and goodwill are nowhere to be seen.
:06:39. > :06:42.Following the summit, David Cameron said: however, the deputy prime
:06:42. > :06:46.minister Nick Clegg spoke out yesterday, saying it was bad for
:06:46. > :06:51.Britain. It now looks as though the 26 other members of the EU will
:06:51. > :06:54.sign the so-called new fiscal compact for the Eurozone. What was
:06:54. > :07:00.on the table was a plan to stop Eurozone countries allowing their
:07:00. > :07:03.annual structural deficits to exceed 0.5% of GDP. There will be
:07:03. > :07:07.automatic penalties for countries to break the rules. Euro countries
:07:07. > :07:11.will have to submit their budget plans to the European Commission
:07:11. > :07:14.for approval. David Cameron wanted legal protection for the City of
:07:14. > :07:19.London from excessive EU regulations, but his European
:07:19. > :07:23.colleagues rejected his demands and he refused to sign. So can the
:07:23. > :07:27.coalition survive this spot of pre- Christmas indigestion? Let's speak
:07:27. > :07:30.to our deputy political editor. There will be many Tory Euro-
:07:30. > :07:34.sceptic MPs who will be delighted by what they see as David Cameron's
:07:34. > :07:38.bulldog spirit. Will there be a sense of euphoria in the House of
:07:38. > :07:43.Commons this afternoon? Among some, there will be cheering and applause.
:07:43. > :07:47.But the question is what they say beyond that. How far do they ask
:07:47. > :07:53.for more? Do they say, this is just the start, let's look for
:07:53. > :07:57.repatriation of powers and have a referendum? Or do they say this is
:07:58. > :08:05.enough for now? Dealing with the Euro-sceptic wing of the
:08:05. > :08:08.Conservative Party, David Cameron has managed expectations. What
:08:08. > :08:14.about the Liberal Democrats - how difficult will it be for Nick
:08:14. > :08:19.Clegg? It will be difficult for Nick Clegg and David Cameron. Both
:08:19. > :08:23.of them need to manage the coalition. It will be under a huge
:08:23. > :08:29.amount of strain as a result of this. For many Liberal Democrats,
:08:29. > :08:32.their position on Europe is something fundamental. There will
:08:32. > :08:36.be a fair expression of anguish over what has happened from the
:08:36. > :08:41.Liberal Democrat benches this afternoon, when the Prime Minister
:08:41. > :08:45.gives his statement. The question is how much the Conservatives are
:08:45. > :08:49.prepared to allow the Liberal Democrat to express that view
:08:49. > :08:53.almost to let off steam, and how much it develops into a fundamental
:08:53. > :08:58.fissure. The problem with Europe is that it is not a one-off issue like
:08:58. > :09:03.electoral reform or specific policy like tuition fees. Europe is
:09:03. > :09:10.something that is with us day in, day out. It involves constant
:09:10. > :09:14.decision-making. If it becomes a Fisher, you could potentially have
:09:14. > :09:17.rows further down the line. With us now is the former Foreign
:09:17. > :09:21.Secretary Sir Malcolm Rifkind. From the Lib Dems, their former leader
:09:21. > :09:25.Sir Menzies Campbell. And joining Sir Martin, Sir Menzies and Sir
:09:25. > :09:30.Malcolm is the no doubt future Sir Douglas Alexander, the shadow
:09:30. > :09:34.Foreign Secretary. Before we get carried away, Menzies Campbell, how
:09:34. > :09:36.is a bitterly disappointed Nick Clegg going to sit in the Commons
:09:37. > :09:40.this afternoon as part of a coalition government after David
:09:41. > :09:44.Cameron vetoed a deal that he said his bat for Britain? Because the
:09:44. > :09:51.coalition government is essential in the economic interests of this
:09:51. > :09:55.country. So you will give up any other Liberal Democrat plan?
:09:55. > :10:00.overwhelming need is to restore economic stability in the UK. That
:10:00. > :10:03.is why we entered into the coalition agreement. The coalition
:10:03. > :10:06.agreement also provides clearly that there should only be a
:10:06. > :10:11.referendum is an -- if there is any transfer of powers from Westminster
:10:11. > :10:15.to Brussels. What happened on Friday is disappointing. There is
:10:15. > :10:21.no point in hiding that, but it does not reflect a transfer of
:10:21. > :10:24.powers, so no referendum is required. It is of course a setback,
:10:24. > :10:28.but I am not willing to allow it to become a source of permanent
:10:28. > :10:32.division. What made Nick Clegg changed his mind in his response
:10:32. > :10:40.from what he said immediately after the summit and Sunday? The benefit
:10:40. > :10:44.of hindsight. It is not surprising that after a few days, when the
:10:44. > :10:48.full facts and implications begin to be known, that people's emphasis
:10:48. > :10:51.would change. Look what happens when we have a Budget in this
:10:51. > :10:56.country. On the Tuesday, it is hailed as the best thing since
:10:56. > :11:03.sliced bread. By Sunday, people reach different conclusions.
:11:03. > :11:06.that what you would expect from the deputy prime minister? One of the
:11:06. > :11:15.problems of 24 hours-a-day news is that people are expected to make
:11:15. > :11:18.instantaneous response has. David Cameron was in Brussels and
:11:18. > :11:21.Nick Clegg is in his flat in Sheffield being called up at 4
:11:21. > :11:30.o'clock in the morning. Apparently without a clue of what was going
:11:30. > :11:35.on? No, there was a common position. Nick Clegg agreed to proposals
:11:35. > :11:40.which he described as being reasonable, which I believe to be
:11:40. > :11:44.reasonable as well. And that broke down. There was an inevitability
:11:44. > :11:49.about the position in which David Cameron found himself. If you are a
:11:49. > :11:54.student of European history, which all three of us are, for the last
:11:54. > :11:59.25 years, we have found ourselves often at odds with Europe.
:12:00. > :12:03.Therefore, we have few obvious and immediate allies. We have not got a
:12:03. > :12:08.history of co-operation. That was the background against which David
:12:08. > :12:12.Cameron found himself operating. Malcolm Rifkind, what does David
:12:12. > :12:15.Cameron need to do this afternoon? Does he need to stop a sense of
:12:15. > :12:21.euphoria to make it even more difficult for Nick Clegg and the
:12:21. > :12:24.Liberal Democrats? There will not be euphoria as a whole. The crucial
:12:24. > :12:28.point is to establish what has happened and what has not happened.
:12:28. > :12:35.You have had a lot of comment over the last 48 hours about Britain
:12:35. > :12:42.being isolated and not being at the table when important decisions are
:12:42. > :12:46.made. Actually it's, ever since the single currency was created some
:12:46. > :12:50.years ago, there has been an empty seat at the table because the UK,
:12:50. > :12:54.by said -- deciding not to join the single currency, has not been
:12:55. > :12:58.involved in discussions amongst Eurozone members. All that will
:12:58. > :13:03.happen now is that the subject being discussed by Eurozone members
:13:03. > :13:07.will also cover the issues agreed inter-governmental the last Friday
:13:07. > :13:10.on fiscal union and tax harmonisation and so forth. Either
:13:10. > :13:15.we took the right decision not to join the single currency or we
:13:15. > :13:18.didn't. Are you saying that there is no isolation when Britain will
:13:18. > :13:23.be one country among 26 that could make decisions ahead of European
:13:23. > :13:27.summits, and Britain will find it difficult to undo or negotiate a
:13:27. > :13:30.position from that standpoint? has been true for ten years.
:13:30. > :13:38.there are countries outside the Eurozone that have signed up to the
:13:38. > :13:42.treaty. They will not necessarily be around the table either. It will
:13:42. > :13:46.not make much difference what Slovenia, Bulgaria or Romania think
:13:47. > :13:51.on issues that affect the City of London. We have a situation where
:13:51. > :13:55.for ten years, since the single car as he was created, the UK, rightly,
:13:56. > :14:03.by deciding not to join that single currency, cannot expect to be
:14:03. > :14:08.involved in discussions about it. So the Liberal Democrats are wrong?
:14:09. > :14:11.We will be no more isolated than we have been for ten years.
:14:11. > :14:15.Immigration, environment of foreign policy, defence - these are issues
:14:15. > :14:20.in which Europe has a fundamental interests. They are all issues in
:14:20. > :14:24.which the UK has a important contribution to make. If you want
:14:24. > :14:27.an illustration of that, the co- operation between Great Britain and
:14:27. > :14:33.France in respect of Libya, one of the most successful operations of
:14:33. > :14:37.its kind in recent history, that capacity will not go as a result of
:14:37. > :14:41.what happened on Friday. What would you have done on Friday? There was
:14:41. > :14:51.a deal to be done, and we would have got a better deal. You would
:14:51. > :14:54.
:14:54. > :14:58.With the benefit of hindsight, what has emerged was that actually,
:14:58. > :15:04.there was a leader who was motivated by a party interests,
:15:04. > :15:09.rather than national interests, the words of Nick Clegg. And a leader
:15:09. > :15:15.that got a bad outcome for Britain, again, the words of Nick Clegg.
:15:15. > :15:20.That is where we have ended up. The fact that we went into these
:15:20. > :15:26.negotiations without Denmark, Poland, Sweden, it was not a
:15:26. > :15:30.coincidence, it was a conscious choice by David Cameron to walkout
:15:30. > :15:36.of the grouping in order to get the Conservative Party leadership. That
:15:36. > :15:40.is a terrible indictment of British diplomacy. I think that's a
:15:40. > :15:44.ridiculous charge, that he walked into negotiations deliberately
:15:44. > :15:49.without a friend. You have to ask yourself, what would Gordon Brown
:15:49. > :15:54.have done in similar circumstances? Because he was by no means an
:15:54. > :15:59.enthusiast for Europe. The fact is, we paid the price for 20 years when
:15:59. > :16:02.we have not appeared to be fully engaged, and it was an inevitable
:16:02. > :16:07.conclusion, that when David Cameron put forward what he did, that he
:16:07. > :16:12.was going to be knocked back. was not fate, this was choice. What
:16:12. > :16:15.would Gordon Brown have done differently? I travelled with
:16:15. > :16:21.Gordon Brown to Brazil, literally to each corner of the globe, in
:16:21. > :16:25.order to get the support of the G20 in the face of the crisis in 2008.
:16:25. > :16:30.But you need to answer the question on behalf of Labour, would you have
:16:30. > :16:35.signed up? First of all, we would have had a different approach, by
:16:35. > :16:40.talking to other countries. And you would have signed up? We would say,
:16:40. > :16:46.why was he not in a position to ask for a seat at the table, when the
:16:46. > :16:49.reality is that when 26 countries now sit down on a monthly basis,
:16:49. > :16:54.Malcolm knows that those issues will have a profound impact on
:16:54. > :16:58.Britain. We would have asked for different protections in relation
:16:58. > :17:02.to the single market, and the terrible truth is that David
:17:03. > :17:07.Cameron came away with a position where 26 countries now, if they so
:17:07. > :17:12.choose, have the capacity to defeat Britain on qualified majority
:17:12. > :17:17.voting and financial the donation. It was not a veto, it was a defeat.
:17:17. > :17:20.There is the question, what exactly did you veto? There was nothing
:17:20. > :17:25.actually in the communique which was going to directly damage the
:17:25. > :17:29.City of London at that point. suggestion is being made that this
:17:29. > :17:35.was all done because of party pressure and so forth. What the
:17:35. > :17:38.Euro-sceptics, of which I am not one, were asking for, was to demand
:17:39. > :17:42.repatriation regarding fisheries, working-time directives, things
:17:42. > :17:47.that were nothing to do with the eurozone or the financial problems.
:17:47. > :17:51.He refused to do that. What he concentrated on was something
:17:51. > :17:54.absolutely crucial to the economic and financial future of the country,
:17:54. > :18:00.which is the City of London, rather similar to what Angela Merkel has
:18:00. > :18:04.been doing, refusing to allow the European Central Bank to be used as
:18:04. > :18:08.a bank of last resort. So each country has its own perception.
:18:08. > :18:12.are you saying that the City of London has now actually been
:18:12. > :18:18.safeguarded? What about all of this qualified majority voting, with
:18:18. > :18:22.Britain excluded? That has always been a threat. It would have been
:18:22. > :18:27.much more of a threat if these new powers, which these countries were
:18:27. > :18:31.seeking, had been sanctified as being European Union treaties. When
:18:31. > :18:36.they are European treaties, not only do you have the risk of
:18:36. > :18:39.qualified majority voting, the European Court of Justice can try
:18:39. > :18:43.and enforce it, the European Commission - but in fact none of
:18:43. > :18:49.that will be possible now. They would be enforceable by law, that's
:18:49. > :18:53.the difference. This is a faire point. What the European Court of
:18:53. > :18:56.Justice would have had the ability to enforce were the rules of the
:18:57. > :19:01.eurozone, in relation to the eurozone. In relation to the City,
:19:01. > :19:05.we are still as vulnerable as we were last week, we are even more
:19:05. > :19:13.vulnerable, because the way you win in these matters is by having
:19:13. > :19:22.allies. Was he right, David Cameron, and in this discussion, have our
:19:22. > :19:26.interests been safeguarded? instant response which Menzies
:19:26. > :19:32.Campbell referred to is a difficult one. My instinct is that it is
:19:32. > :19:38.better to be inside than outside. The Google response to China was to
:19:38. > :19:42.withdraw. I think that was a mistake. This is similar in essence
:19:42. > :19:47.to me. It is much better to be inside, working with the powers
:19:47. > :19:51.that be, rather than outside. I think the issue about... Whatever
:19:51. > :19:54.the rights or wrongs of it, the perception will be, and I have been
:19:54. > :19:59.speaking to an Indian businessman this morning about where he would
:19:59. > :20:03.locate, given what has happened in the last 72 hours, the perception
:20:03. > :20:07.will be that the UK is outside western Europe, and this is a
:20:07. > :20:11.problem. This was exactly the argument when we declined to join
:20:11. > :20:20.that currency in the first place. People said it is better be deep
:20:20. > :20:25.inside, but sometimes you have got to make a judgment. We have two
:20:25. > :20:30.strikes against us, and it is three strikes and you're out. How worried
:20:30. > :20:36.are you about further calls for repatriation of powers? The
:20:36. > :20:40.Europeans will feel emboldened, won't they? No, David Cameron has
:20:40. > :20:44.already shown, by refusing to raise the issue of repay tuition last
:20:44. > :20:49.Friday, he concentrated on the issues which were being discussed
:20:49. > :20:52.at the summit, and he was right to do so. The attitude today for David
:20:52. > :20:58.Cameron is not to be too affected by the congratulations from the
:20:58. > :21:01.backbenches, but to stand up to the Euro-sceptics, who, as Malcolm
:21:01. > :21:05.Rifkind rightly says, want to take Britain out of Europe altogether.
:21:05. > :21:09.That would be deeply, deeply damaging. From business, the
:21:09. > :21:14.perception is that this was a political decision, not an economic
:21:14. > :21:18.decision, and that's the problem. The perception, rightly or wrongly,
:21:18. > :21:22.is that it was made because of the pressures being put on the Prime
:21:22. > :21:27.Minister and the coalition. It is our duty to overturn those
:21:27. > :21:31.perceptions. We will all be watching this afternoon. So, the
:21:31. > :21:35.Government is divided over Europe, and everyone is waiting for a
:21:35. > :21:39.crucial Commons statement from the Prime Minister. What does that
:21:39. > :21:43.remind you of? The 1990s, when the Tory party nearly tore itself apart
:21:43. > :21:48.over the Maastricht treaty, laying the foundations for the EU we know
:21:48. > :21:51.today? Up to a point, maybe. But there are some crucial differences.
:21:51. > :21:56.Adam has been looking back in his history book to find out how much
:21:56. > :22:01.all of that is relevant to today. Here's a coincidence, the day David
:22:01. > :22:04.Cameron vetoed the decision was the 20th anniversary of John Major
:22:04. > :22:12.agreeing to the Maastricht treaty. I think it was a very good result
:22:12. > :22:15.for Britain. In 1991, he kept the UK out of the chapter on social
:22:15. > :22:21.policies and the early stages of the euro. But it sparked a war in
:22:21. > :22:25.his own party. The idea that we're going to be able to control the
:22:25. > :22:29.European Community, in imposing these regulations on employers in
:22:29. > :22:34.this country, is pie in the sky, and a triumph of hope over
:22:34. > :22:38.experience. Parliament must put this stalemate over Europe behind
:22:38. > :22:44.it. I am not prepared to let it poison the political atmosphere any
:22:44. > :22:51.longer. I have tracked down two of those foot soldiers, Sir Teddy
:22:51. > :22:55.Taylor, now happily retired by the seaside, and Rupert Allison, also
:22:55. > :23:02.known as espionage author Nigel West, to find out if any of this is
:23:02. > :23:05.still relevant today. Maastricht was the general principle of ever
:23:05. > :23:12.closer union. Whenever we mentioned that, we were told, this is
:23:12. > :23:18.nonsense, political union will only go to a certain point, the idea of
:23:18. > :23:22.a United States of Europe is absolutely Darfur. -- absolutely
:23:22. > :23:30.laughable. Well, that's exactly where we are heading now. It was
:23:31. > :23:35.absolutely obvious, why didn't people see it? It couldn't work.
:23:35. > :23:39.The treaty got through Parliament, but a year later, eight Tory rebels
:23:39. > :23:43.lost the whip, and effectively formed a kind of party within a
:23:43. > :23:52.party, which held John Major's government to ransom, because he
:23:52. > :23:57.had such a tiny majority. It meant every single vote mattered. It was
:23:57. > :24:04.very sad, the Chief Whip was banging on a toilet door, trying to
:24:04. > :24:12.get him out! Yet new lows reports at the time portrayed them as
:24:12. > :24:17.heroes. -- portrayed them less as heroes, more like weirdos. My own
:24:17. > :24:22.view is that we were right. My own parliamentary constituency had the
:24:22. > :24:32.opportunity to ditch me when I lost the whip, and to my gratitude, the
:24:32. > :24:37.whole of the constituencies supported me. There's no euro
:24:37. > :24:41.enthusiasts at all, apart from Ken Clarke. As the new crop of Euro-
:24:41. > :24:46.sceptics gather to hear the current Prime Minister in the Commons today,
:24:46. > :24:52.they view this period with mixed feelings. Some cringe, others say
:24:52. > :24:56.this is when their political views were forged. The Conservative MP
:24:56. > :25:03.Richard Shepherd was one of those so-called Maastricht rebels - do
:25:03. > :25:07.you feel vindicated now? I have no doubt that what we did was right.
:25:08. > :25:11.And this was the Maastricht treaty, it made us citizens of the European
:25:11. > :25:16.Union, but predicated all the mess that we are in now, and it
:25:16. > :25:21.challenges the very central themes of British history. For instance,
:25:21. > :25:25.our constitution - who is the master, who governs, who is
:25:25. > :25:30.accountable to anyone in this international morass? You were
:25:30. > :25:38.painted there, along with some of your colleagues, as outcasts - did
:25:38. > :25:46.you feel you were very much on the fringes of the party? No, I didn't,
:25:46. > :25:50.and I don't think it is true to say that of the rebels. The change, the
:25:50. > :25:55.seismic shock to the party, was the removal of the whip. In fact, what
:25:55. > :26:00.you heard was a 22 person committee, and as you know, the Government had
:26:00. > :26:04.to send us in the post membership of the party again within six weeks.
:26:04. > :26:09.So it wasn't a big deal. They were on the back foot. But the themes
:26:09. > :26:13.that I am talking about, Angela Merkel said exactly what we said
:26:14. > :26:18.all of those years ago - this is a political project. And yet we are
:26:18. > :26:22.looking at an economic catastrophe, possibly. And when you hear people
:26:22. > :26:28.say, this is political, when it is economic, you know you're in real
:26:28. > :26:32.trouble. And last weekend, Friday, that's what you saw. They're going
:26:32. > :26:41.on a political project, and knock attacking it as if it were an
:26:41. > :26:46.economic project. Sir Martin Sorrell, those same arguments are
:26:46. > :26:50.still what we will be hearing this afternoon? Yes, the argument is
:26:50. > :26:56.about who has political power. It reminds me about what you see
:26:56. > :27:02.inside agencies. In the old days, the country managers would object
:27:02. > :27:06.to the European headquarters having control over their budgets. So, it
:27:06. > :27:11.is a political decision which was taken, and really, the fundamental
:27:11. > :27:15.problem is an economic one. terms of the mainstay of the
:27:15. > :27:25.Conservative Party now, do you feel your views are being shared and
:27:25. > :27:25.
:27:25. > :27:30.held by a significant number? you're seeing the new generation
:27:30. > :27:34.coming up, who will just find this incomprehensible, why are we still
:27:34. > :27:37.struggling on such profound issues? Do you think there will be a push
:27:37. > :27:45.for further repatriation of powers from Brussels and possibly a
:27:45. > :27:50.referendum? This is like a huge smokescreen has gone up since
:27:50. > :27:53.Friday's decision, it takes time for the cloud to you're. And there
:27:53. > :27:58.will be come backs on this. After all you have now got non-
:27:58. > :28:02.functioning democratic governments in Italy and Greece. These will all
:28:02. > :28:10.create their own momentum, I think. And so I would like to see how it
:28:10. > :28:13.settles down, but I think the drift is, I have to say, irrevocably, to
:28:13. > :28:16.use a word from the Maastricht treaty, because that is what this
:28:16. > :28:22.currency is supposed to become irreversible - words from the
:28:22. > :28:28.treaty... Very briefly, you say that is the drift, so would it be
:28:28. > :28:35.impossible for the coalition to continue? The division is clearly a
:28:35. > :28:38.very deep and important one. And you have made the point that this
:28:39. > :28:42.is a very difficult moment for the Liberal Party, too. Because to have
:28:42. > :28:47.a general election at this time would not be helpful. Thank you
:28:47. > :28:52.very much. That's all for today. Thanks to our guests, and