13/06/2013 Daily Politics


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Daily Politics. The Chief Inspector of Schools says


comprehensives systematically fail Britain's brightest kids. He put


them in the mixed ability classes, they fail to teach them properly,


don't set them challenging homework or don't have the know-how to get


them into a good university. We'll be asking why it's all such a mess.


The House of Commons committee has effectively accused Google of


dodging its fair share of taxes. It insists it operates within the law.


Who is right? We'll have the latest on the


stand-off between the government and protesters in Turkey and get some


international reaction to the two weeks of running battles.


And, Gyles meets Maggie's old driver and talks about how ministers come


to rely on the man old holds open the car door.


So, in the next hour, with us for the duration, Tom or Tam Grey. He's


the second baron of Strathclyde no less as the Laird of Paisley, I


welcome you to the Daily Politics. Thank you very much. Good to be


here. He sat in the Cabinet until a year ago as leader of the House of


Lords. Google is in the news again. Today's scathing House of Commons


report into the tax affairs has given it headlines. The Public


Accounts Committee, one run by Margaret Hodge, laid into the


Internet giant, dismissing the argument that all the salesmen and


women are based in Ireland as "brazen and unconvincing". Google,


according to a press release, earn something like $1. 3 in the UK in


the first quarter of this year and paid only 0. 1% of that in taxes.


That last bit wasn't on the press release.


The committee chairman, Margaret Hodge, isn't impressed? I think the


fact that over six years they have had a turnover of $18 billion here


in the UK, yet paid only �16 million in corporation tax is evidence that


they are not paying enough. Corporation tax during that period


was running in 27, 26, 25%, that's the figure we should be seeing on


the profits made here in the UK from the sales.


Now, we asked Google if they wanted to come on and talk about their tax


affairs but they didn't. They September us a few words. As we have


said, Google complies with all the tax rules in the UK, and it's the


politicians who make the rules. They sent us a few words. The public


accounts comity wants to see companies pay more tax where


customers are locate bud that's not how the rules operate today. We


welcome the call to make the current system simpler and more transparent.


That was Google. Now, obviously, major corporations


will use the tax rules to mitigate their tax, most of them do that.


They claim everything they do is legal. But there is an arguen't


about something that might not be legal. That is, where are the


advertising revenues generated for Google? They are saying we do really


all the selling in Ireland, that's therefore where we pay tax. The


committees of the law of evidence suggest they sell a lot of


advertising in Britain? It's a very timely and interesting report. Most


interesting because it comes the week before this great G8 meeting


taking place in Northern Ireland next week and David Cameron's said


one of the issues he particularly wants to discuss is the role of


multinational taxation. Google make one very good defence


which is they stick to the law, they are not breaking the law, they stick


to the rules that have been applied by the politicians for many, many


years now, and if politicians change the rules, they should do so, then


they'll comply with them 4. I have some sympathy. I understand that


too. I'm sure the rules are very complicated so if you hire expensive


accountants, you can find ways around them. But this issue of where


the advertising revenues are generated, in a sense, is nothing to


do with sticking to the rules at all. This is a potentially criminal


mat matter because you have an obligation in your tax return to


tell the truth. Of course.And if you are paying commission to people


who are selling advertising in Britain, but you are booking that


advertising in Ireland, that should be looked at by HMRC? I'm sure HMRC


if they haven't already thought of it will have now had the idea


watching you on this programme. With everything we know about HMRC, they


are very capable of dealing with large companies. But again, you


think you made a good point about the over complication some the


rules. Nobody understands the rules and it comes to a matter of judgment


between the tax authorities and various companies.


I think a greater clarity in this area, trying to pay tax where


revenue is raised, would be a very good direction to go down. But


almost more importantly than that, George Osborne has had a policy


since 2010 of trying to reduce taxation for corporations and what


we know from all the experience in the last 40 years is that when you


reduce the overall level of taxation, companies are happier to


pay what they have to do and don't go through all the hoops that many


organisations and individuals do. He's kept the hoops. When you were


in opposition, you pointed out that Gordon Brown doubled the size of the


tax guide when he was Chancellor. True. Doubled it. It's now so big


you can't even carry it around. What has your Government done? Added


another several hundred pages to Gordon Brown's pages? And this is an


error. We should not over complicate taxation. That's why this meeting


next week is an important next milestone. People have been


discussing it for a long time about how to deal with it. It's important.


We all need to pay the tax that is due, but not to pay the tax that is


not due. OK. Time four our daily quiz. The speaker's wife is called


Sally Bercow, if you hadn't heard. Strathclyde will give us the correct


answer. You will you think? I hope to discover what it is before then!


He hasn't a clue. I'll have to tell him!


Are comprehensives failing Britain's brainier kids? The report by the


watchdog says they are. The Chief Inspector of Schools says it's an


issue of national concern. Looking at 2012, the Ofsted report


found 65% of pew piles at non-selective schools who achieve


level five or above, quite a high level of attainment, in English and


maths, at the end of primary school, they went on to fail to get an A* or


A grades in both subjects at GCSE. A quarter of students who gained


this prestigious level five in English at the end of primary school


failed to gain a B grade at GCSE, corresponding to over 40,000 high


attaining students, or at least they were at the end of primary school,


not making the expected progress. Looking ahead to university


applications, in 20% of non--selective secondary schools, no


student achieved two As and a B at A-level in at least two of the key


subjects. That is the minimum offer required by the minimum universities


called the Russell Group. I'm joined by Ofsted's Chief Inspector, Michael


Wilshaw. Were you surprised by the findings or did you suspect them?


was shocked by them. Really?Yes, I come from the comprehensive system,


I was a teacher in Inner London for many years and a teacher in London's


comprehensives for many years. I was very certain rised at the under


performance about the most achievable kids. Why? If you talk


the results, you would think, these kids are good, that's a key to a


whole range ofpingcational opportunities. What then goes wrong?


Well, we have pointed to a number of important things. First of all, the


transfer, the transition between primary school and secondary school


is not good in many of our schools. So bright youngsters, bright eye and


bushy tailed doing well at the end of year six in primary schools,


transfer to secondary school and not enough is done, particular


particularly at Key Stage 3 and in year seven at Key Stage 3. They are


given the work they eve already done in primary school so they get bored


and they lose interest, it then becomes much harder at Key Stage 4


to catch up at age 14-16. You also raised the issue that a lot of kids


have been taught in mixed ability classes; they are not being set in


classes related to their ability. Upping that's a problem because you


say, or the report says, that if in mixed ability classes, the teachers


tend to teach towards the middle range? We are not prescriptive, we


are saying you make the judgment about the school organisation and


the classroom organisation you want. But, if you are going to use mixed


ability classes, you have got to make sure that you have people and


teachers who know how to teach in a mixed ability way. That's tough, is


it not? That is tough. That's why I, as a head, rarely used mixed


ability. We'll be looking in the next round of inspections at what's


happening in these mixed ability classes which may be holding back


our brightest children. The most disturbing thing, or one of them, is


inspectors found in a number of schools that teachers didn't know


who their most able children were in the class.


They can't kept tabs on them? hadn't kept tabs on them or tracked


their progress. And they didn't intervene to find out why? That's


right. You are in favour of setting them? I am. That's my view.You are


not being prescriptive, but if you had your way, you would have setting


in the comprehensive system? That's up to heads but I did and I would.


What we want to say is that if heads are going to pursue this line of


mixed ability, classroom organisation, they have got to


deliver the outcomes of our brighter children. Let me raise an issue


about the Association of schools and colleges who've been on behalf of


the union leading this report, they say it's not appropriate to use this


primary scleefl five asker to predict future GCSE successes, they


say you have taken the wrong benchmark? I've been a head and, if


I 'ed met a youngster at the end of year six who'd achieved a level 5 in


English and ale level 5 in maths, and got a good report from the


primary, I would have expected that child to be an able child. In nine


cases out of ten they were. And yet, as you said in your report, 65,000


of these children are not getting the top grades at GCSE. What do you


make of this? I think all parents will be deeply concerned and worried


and and interested by this report and the schools have got to react.


I think there's this point, this line between young children leaving


primary schools doing very well and, then a few years later, not doing


very well, is a clear indication that something's happening in those


three or four years that they are getting to their secondary schools.


Now, there may be a myriad of reasons between league tables about


what schools have been doing in order to get people to pass, but the


fact is, they are letting down these able students because if they are


not getting the right GCSEs, they are not taking the right A-levels


and not getting the opportunity to go to the top universities. There


are serious consequences for our country. We want the brightest


children, the majority of who go to non-selective secondary schools,


three million go to non-selective secondary schools, only 150,000 go


to grammars, so it's really important for the future of the UK


that the youngsters do really well. All right. Listening to all that is


Brian Lightman, the General Secretary of the Association of


School and College Leaders. He has a bit of a sound problem, as you can


see there in Birmingham. Let us see if he can hear us. Can you hear me


here in London? Yes, I'm afraid I didn'the hear the beginning of what


has been said, sorry about that. understand. Let me come to you then.


Two thirds of kids who seem to be bright at the age of 11 because they


get these great results in level 5 in English and mathematics then fail


to get either an A or A* in the subjects at GCSE. That's a national


scandal, is it not? Well, I think the first thing I want to say is,


this is a serious subject that we need to have a reasoned discussion


about. I'm very concerned about the sort of sensationalist head Lymes


that we are hearing about, a culture of low expectations and so on. We


need to be clear what a level 5 actually means. When a pupil gets a


level 5 at kinder Key Stage 2, this is a high stakes accountability test


and schools are understandably teaching children to the test and


preparing for that. Level 5 has a very wide range of performance. Now,


a child who has just scraped level 5 after a lot of tuition and coaching


to get through it is in a very different place from a child who is


at the top level of level 5 and therefore one of the highest


achievers. The fact they have got a level 5 doesn't automatically mean


that they are going to be getting As and A*s at GCSE. Most schools assess


children on entry, they use standardised tests and other key


things. The thing is to identify the brightest children when they come


through to secondary school and that we do everything we possibly can to


stretch them and challenge them. These kids are leaving primary


school in pretty good shape and you would expect them to do well in


secondary school and they don't. Something is going badly wrong.


don't all do badly at secondary school. This is the point. Many of


those children, I think 84% of those children were getting A stars and


Bs. You know, you have to look at the data properly. There's no point


- Not on the subjects that the Russell Group of universities, our


top universities want. Hang on here. This is a misinterpretation of data.


Those Russell Group facilitating subjects are a number of subjects


which the Government has highlighted and I don't have a problem with them


highlighting those subjects, but there are other rigorous A-levels


that those students will have done and that's not shown in the data.


You may say that, hold on, you may say that, but the Russell Group are


the top group of universities. We all want to see bright kids, more


bright kids from poorer backgrounds getting to our top universities.


course we do. Zblt Russell Group has set what it thinks you need to get


to get into their universities. Let me say the point I was trying to


make, if there are many students who go to Russell Group verse toys who


do not have those -- universities, who do not have those subjects, but


they have other subjects, such as philosophy. We cannot draw sweeping


conclusions based on a performance indicator that has been invented


recently and was not something that was there when the children came


through and you know, we need to look at the data properly, otherwise


we're making generalisations. We're talking about a failing system and


we're not talking about the good practice. That report describes a


lot of good practice as well. We need to build on that. You seem to


be very defensive on this. Not at all. The bottom line is that a lot


of kids who leave primary school with good results are not then doing


well in secondary school and not getting into the Russell Group of


universities. Answer me this: If these kids doing well on the level


five, if they go to grammar school, 60% of them then get A or A star in


English and maths. Why do two thirds of them not in the comprehensives?


The children who go to grammar schools have been selected on


different assessments. These level five kids, who are going to


comprehensives are some of the brightest kids out of the primary


schools. Yes, some of them are.They have gone to grammar schools 30 or


40 years ago. Some of those children are but not all of them. Level five


is not the admissions criteria for grammar schools. I understand that.


The data is not being used properly. It's being misinterpreted, rather


than saying what more can we do. I don't represent head teachers would


want to dumb down the system and have people failing. We are


absolutely resolute in our wish for those children to do their best.


You're not doing very well, are you? I disagree. You have an opinion and


you're not using the data correctly. % of non-selective secondary


schools, 20% are places where no student achiefs two As and a B at


A-level in key subjects. In those subjects. Yeah. Not in the other


subjects. Now if those subjects are priority that the Government is now


doing, then we will have to constrain people. I have to tell


you, there are very well known politicians who don't have A-levels


in those subjects. We need to have a look at the sorts of people...


You have a look... Which politician doesn't have an A-level in English


or maths? I don't know. You look at things like economics and so on.


Look at what the Prime Minister has got. The Prime Minister has a first


class degree. Yes, that's right. But they don't need to have those


subjects in order to get into a top-class degree. It is part of the


measure, but it's not the only measure. What you're saying is that


the whole system is failing because of data that is very, very


selective. The other point here is that Ofsted do not routinely inspect


the most outstanding schools. This is a small sample and you need to


look at the whole picture. What I'm not here to say there isn't more we


could do. We should be doing more, but I'm certainly not prepared to


accept evidence that is unreliable. Evidence is unreliable. That's


nonsense. We visited 41 schools. These were average comprehensive


schools which took a fair spread of ability. We also looked at the


evidence from 2,000 subject inspections in something like 150


school inspections. We looked not just at those 41 average


comprehensive schools, but we looked at what was coming through in


inspections of schools over the last year. So, the evidence is there. We


really must, as a country, stop making excuses. We know that too


many of our youngsters from the state system are not doing as well


as they should. The universities say that. The Russell Group universities


say that. We have to deal with this issue and not make excuses about it.


I would expect head teachers up and down the land to have high


expectations of their students coming to them. Ofsted says you're


making excuses. We're not. We're saying let's look at the data


properly. Let's look at exactly what we're hearing here and what the


sample is and what questions were asked in the schools and let's talk


about what we can do together rather than having this confrontational


situation where all the time we're told we're failing to do this,


failing to do, that when at the same time, more and more students are


going to university and getting good first-class degrees, more than ever.


They're not all from the, these comprehensives. More students all


round are going, proportionate. A hugely disproportionate number of


our kids who are going to the Russell group of universities are


coming from the private and grammar schools. What this Ofsted report


seems to suggest is the reason is we're failing the brighter kids when


they enter secondary school. That's a simplistic conclusion. There are


lots of other reasons why children from independent schools and from


selective schools have very, very good chances to go, they're given a


lot of help an tuition and so on. We should support the children in the


non-selective schools to ensure that they have those opportunities that


are afforded them in the privileged environments. , we've overrun


because I wanted you both to have a good say. It's a very important


subject. I thank you both. There were more protests in Turkey


last night with riot police firing tear gas to disperse protesters. The


country's governing party says it's prepared to hold a referendum on the


issue which sparked the riots. It started as a dispute about a park


but the way the police treated campaigners triggered rioting. The


government says it's confident that the new "gesture of goodwill" would


clear the area but warned those who remained but they would "face the


police". Our correspondent Quentin Sommerville is in Istanbul. It looks


like this mass use of police power has diminished, if not destroyed the


protest, is that right? Well, if you look behind me, I'll step back and


you can see, that's the square down there, and it's largely cleared of


protesters much they've been pushed back into Gezi Park. They're


remaining there and rejecting that offerer from the Prime Minister.


They say it's a ploy. They don't accept. It within the last couple of


hours he's said to them it's that or the redevelopment of the park. This


is your final warning. But we're now into the stage where we've had in


the last 36 hours, two ultimatums that he was going to clear the park


of protesters. But they're not ready to accept that. It's still a relaxed


atmosphere in the park at the moment, certainly during the day.


But it's a very defiant atmosphere. Have seen terrible pictures of what


the riot police have been prepared to do to the protesters. In the end,


would I be right in think thinking that if they don't get out of that


park, he will send in the riot police? I think that there's a very


real likelihood of that. It's worth remember remembering, this is about


much more than just that punch of trees behind me. It's about -- bunch


of trees behind me. It's about a large minority who believe the


government is too authoritarian, that it doesn't listen to them. The


government has said we are listening to you, we've given you this


opportunity. Istanbul can have a referendum over the future of the


park. The protesters aren't buying that. Do you get a feeling there


that you're at a kind of for good or ill, you are at a kind of turning


point in modern Turkey? I don't feel that, no. To be honest, it fields


quite -- feels quite localised. Last week when the protests were at the


fiercest, we travelled across the country. We went to the coast and


there was an energy and it felt almost like a momentum. Coming back


a week later, that seems to have dissipated.


on this story. We go straight to our very own Jo Coburn in Strasbourg.


Andrew, the protests and unrest in Istanbul and other Turkish cities


have caused concern for politicians here at the European Parliament.


They debated the situation in Turkey earlier this week. They came up with


a resolution calling for the Prime Minister's government to be more


democratic and less heavy handed with the protesters. The question is


will Turkey take any notice? To discuss that my two guests, a


British conservative MEP and also a representative from Germany's SDP


party and of Turkish heritage. Why should the Prime Minister listen to


anything that's said here, Turkey's not part of the EU. That's a good


question. I would say, there is a mixture of different things for the


time being. For example, I guess the prime minister is very emotional. I


would say surrounding him, all the advisor are hard liners, I would


assume. So with a mixture of this, Mr Erdman with his emotional ilt, he


is saying, European Union is not what they say is not valid for us. I


think there's a mixture of all these things. Does Turkey still want to


join the EU? Accession talks have been going on for years. Is there a


feeling now that after years of frustration perhaps they're going


off the idea? Official Officially they say yes. It's one of our first,


important issues or things in the next time. But if you look to the


poll toy, or to the politics, you can see there is, you know, Turkey


has multiple options. In the last few years, they grew up with the


economy and so from that perspective Turkey has multiple options and they


are not ready to bow to the European Union. What's your response to


what's been going on, the political unrest? Do you have sympathy with


the protesters or the government? I'm concerned. I have sympathy with


the protesters. They have a democratic right to protest and


that's part of living in a democracy. You asked the question


about Turkey joining the EU, Turkey has much to offer the EU -


economically, it's a very, it's develop developing. Security, NATO,


they are a good friend to the United Kingdom. They fight against


terrorism. But there's been such hostility in the European Union


about Turkey joining up. There are certain boxes that Turkey has to


tick. Democracy and human rights are the top of the list. I work on the


women's rights committee and I know the area women's rights in Turkey


still needs to be addressed. For example, they have forced marriages.


They have honour killings still. you think those are the real issues


at stake here, that Turkey will never be able to join the EU unless


it becomes less socially conservative? No, I don't think so.


I think the young population in Turkey, for example, is totally


oryen tented to the European Union. They are modern. They tried to get


into the European Union but we all know that the visa regulation is not


ready for that. I think that the prime minister, maybe he has another


agenda. He sees he is a big star in the near east countries and northern


African countries. So I think he is trying to go into both directions


and finally, he will decide. Significant is this unrest? Our


correspondent, we just spoke to, said actually he feels it's more


localised. It's not a major turning point for Turkey. Do you agree?


don't think so. I think that this is a mass protest. It starts with the


Gezi Park, we all know. Now it's a protest against the way of


leadership. It's a political issue now. So I think that Mr Erdogan


would be able to overcome the situation in order to give the hand


to the protesters, like the last two days, he has some meetings with the


protesters. I think, but we have to help them. We have to help the


Turkish government with cooling down Turkish government with cooling down


Turkish government with cooling down period. How does the EU help?


How can the EU help? What's happened is, the Prime Minister is in a way a


victim of his own success with his economic liberal reforms. He's a


socialite Conservative by nature. It's almost a new class, middle


class secular population, mainly in the cities, not in the rural areas,


who use the Internet, Facebook, they are nor in touch with European


ideals, and suddenly, he's cutting back now and is introducing things


like a ban, or they tried to introduce a ban on red lipstick on


the Airways, kissing in public, things that are done in normal


European states. Yes no, will Turkey ever join the E Snitch There's a way


to go, we'll see -- the EU? I think it's 100% that sometimes it will


happen. Thank you to both of you and back to you, Australian drew, in


London. -- Andrew in London.


There are certain things you aassociationiate with Germany, good


cars, enthusiastic supporters of the euro, or at least one of them


stereotypes may no longer be true. German politicses in London this


week are arguing that the euro should be abandoned. Professor Bernd


Lucke is a former World Bank economicist, former member of Angela


Merkel's ruling Christian Democrat party and the current leader of a


new euro critical party Alternative for Germany. What would this mean


for Germany, for the European economy and for us? We can ask him


he's with us now. Welcome. Thank you very much.


What is it you want? Do you want to abolish the euro or do you want to


retrench the euro back into a smaller, more sustainable zone?


The latter would be the least we'd like to do. Moving back to national


current sills is an optionism depends on whether it would be


passable, the bailing out. Our prime goal is actually to get rid of the


certain European countries. Get rid of? Let them exit the euro and let


them regain the national currency which also allows them to be


competitive again. Would that not put Germany's economy at a


disadvantage, because if you got rid of certain countries, their


currency, if they went back to the Sasapa and the drachma, and the


Lira, their currency would devalue, and the German euro, or what's left


of it, would soar, all of your exports would be priced out of the


market? That's not quite true. First, it would be fair if the


certain European countries had their chance in European competition.


Currently the German currency is just under valued and the currency


of the European states is under valued. The port thing is that


exports don't only depend on exchange rates, they also depend on


demand and income and these countries are see seerry in a


recession. German exports have dropped by 25%. Because people


haven't got the money? Exactly, yes. If we boost their economies, German


exports will actually Ben from it that. Let me welcome our Scottish


viewers who're joining us on BBC Two. They've BP watching First


Ministers questions in the Scottish Parliament. We are discussing this


new Euro-sceptic party, can I call it that? Of course, yes -- they've


been watching First Ministers questions in the Scottish


Parliament. If Germany simply left the euro


itself, that would be the end of the euro, wouldn't it? That would


probably be the end of the euro and it's not what we recommend. We


recommend a gradual dismantling, starting with the southern European


countries. You will know that at the time when it was Mr Mitterrand in


France and Chancellor Cole in Germany, that many people knew at


the time that including all these countries, Italy, Greece, Spain,


Portugal, that we are nowhere near the Maastricht criteria, many people


now that it would probably end in tears the way it is at the moment.


But Mr Cole and Mr Mitterrand were on a political thing, they wanted


political union. Surely if you allow the eurozone to break up the way you


are suggesting, it kind of holes the whole euro project below the water


line? I mean, many economists have warned


in #19ed 92 and 1999 not to establish a common currency -- 1992.


They ignored it everywhere except in Britain, I suppose. So you were very


wise. Plenty of people are keeping their heads a little lower now.


far as the political dimension of the euro is concerned, that's


exaggerated. The European Union's fared well in terms of which we did


not have a common currency. It's very aren yabling to think about


this and move back to a system which is more flexible. You have got a


German soul mate now, Tam? I think it's very significant. It represents


something I've felt for a very long time. Britain's not isolated in


Europe. There are now many people in Europe, including the Professor


here, saying very much the same things as the Conservative Party's


been saying for many years about Europe, it's over bureaucratic and


over centralised, it creates regulation that people would rather


not stick to. This is the great opportunity that David Cameron's


spotted, not just for Britain to have renegotiation, but for the


whole of Europe to decide what is in our collective interests and to


create a new Europe with less centralisation, less expense, less


bureaucracy. The Single Currency is a key question for Germany. I eve no


idea how this is going to be resolved. Actually, what the


Chancellor in Germany is trying to do is to keep kicking the can along


the road for a bit longer. That's probably the right thing at the


moment, to create a bit of stability within Europe, whether we end with


some countries falling out of the euro, I don't yet know.


Professor, would it be rude of me to suggest you are going to do that


well in the September Federal Elections? Whether we do well or


not, this depends on how much money we can raise for our campaign which


is actually our most severe problem currently. The established parties


get millions of euros in state funds and the newly formed parties do not.


You can tap him for a few euros. Professor Lucke thank you for being


with us. Stephen Hester is to step down as


Chief Executive of the Royal Bank of Scotland before the end of the year


to pave the way for the preprivatisation of the bank. He


said he's "content" with the board's decision. An interesting use of the


word, but the news has provoked anger in the city and among


commentators who say he's been forced out by the Treasury. Before I


came on air, I looked to see that the stock in the bank was falling


this morning. That may have changed since, but the markets didn't react


well. Treasury Minister, Sajid see ya individual made a statement to


the Commons this morning and explained the process that RBS is


undergoing and answered questions on the Government's involvement in the


decision of Mr Hester -- Sajid Javid. Royal Bank of Scotland is


moving from the rescue phase to the next phase, a phase of focussing on


becoming a UK bank that provides greater support to the British


economy and is prepared for its return to the private sector. The


Government has always been clear that we want to see RBS become a


more focussed, retail and commercial bank focussed on supporting the


British economy and with a much smaller international investment


banking arm. Did Stephen Hester go voluntarily or


was he pushed? What role did the Chancellor have in prompting his


departure? When did the Chancellor set out to the chairman and the


board his desire that Stephen Hester should go? And, is there now any


role for UKFI, or have they been circumvented on the discussion of


the Chief Executive role? Chancellor has not been directly


involved in meeting with Stephen Hester. Prior to the announcement,


he's not met with him prior to the announcement of his departure on


this issue. This is a decision for RBS and its board. RBS and its board


have made this decision jointly with Stephen Hester and come to a


voluntary agreement. The chairman of RBS, Sir Philip Hampton, did ask to


meet the Chancellor last week to inform the Chancellor of the board's


decision. That's the official line, but it's


clear as mud what really happened. Let's ask a man who knows, a good


friend of this programme, Alastair Heath. What do you think's happened


here? I think what's happened is, uncreasingly the Government's views


on what should happen to RBS has differed from what Stephen Hester's


views are and also the views of people who want to maximise the


value of RBS's share price. The Government wants to reduce art


officially the size of RBS's investment bank, probably because


they don't like the idea of owning investment banks, they're obsessed


with the idea that the bank needs to be domestically focus and retail


focussed. If you genuinely want to maximise its value, that's probably


not the strategy you should be pursuing. That's why the private


sharehold shareholders are worried about political interference.


are saying there's been a disagreement between the Chief


Executive who had won vision for the future of the bank going forward and


the aims of the Government finally firming up on what it wants to do


with the bank, which was different from Mr Tess Hester? That's the most


plausible explanation. The Government are saying Hester didn't


want to be there too long, they are saying they needed someone else to


deal with the privatisation process. It seems like the Government and him


are no longer agreeing. They are no longer on the same wavelength. We


know there is a consensus for privatising the bank in some form.


But there are various ways of doing that and various time scales for


doing it. Do we have a clear idea yet what Mr Osborne, the Chancellor,


wants to do? I think he wants to first start off with Lloyds Banking


Group, which is a much easier privatisation. We are a small part


of that? The taxpayer opens a part of that and the bank is in a betser


state, the an easier bank to deal with. The share price has risen


quite well? Yes. Apart from that, look at RBS. I suspect the way they


choose to from I vattise Lloyds may give us an idea of how they want to


do Lloyds. He wants to do it before 2015? For political reasons, but it


depends on how the bank is managed, is it being maximised to --


privatised to maximise the share price? The way the Conservatives


have got the previous one sold off chumps of BP when it was owned by a


big chunk of the state and it was sold at a market rate, you went for


the highest price, it was back in the private sector. Should it be a


more British Gas Tell Sid operation in which you try to use state


ownership of RBS to spread the ownership among ordinary British


people? I absolutely think it should be like a Tell Sid-type operation.


Thises a massive one-off opportunity to actual actually redefine


capitalism and increase the amount of shares. It's a major opportunity.


There are a number of good proposals, such as the one from


Policy Worthington Cup exchange for example. It's a great opportunity.


It's also on binding the public back to the City to try and show that the


interest can be aligned again. agree with that. That's the right


way forward. RBS is one of the biggest banks in Britain, the


largest lender I think. It needs to be in a proper shape in the private


sector, and if anything, this row, if that is what it is, just


demonstrates what is a bad -- what a bad owner the Government is, much


better to be in the private sector. Spread the ownership as widely as


possible and if we can get people to become interested in owning shares


again, then we'll all benefit, including the people who become


buyers, because they'll understand that owning shares can be a route to


long-term prosperity. Thank you very much for marking our


card today. Our special guest Tam sprath collide, former leader of the


House of Lords, what red tear peer of the realm, so he has plenty to


say about Lord's reform. There were attempts at an overhaul


of the other place, as they quaintly call it. The Upper House is still


not ready for potential change. The constitutional reform committee are


plugging away trying to bring consensus on how to bring the Lord's


into the 21st century. Teach them how to deal with lobbyists as well,


that would be an idea. The evidence-taking session was taking


part this morning. It was said earlier that there was a


consensus that the House of Lords was too big. Is that consensus


universal across the membership of the House or was it confined to


people, the four people we have here who are regular attenders and


participants? I think the feeling is that we are too big. But where do


you go from there in determining what the size should be. The only


qualification I would make was the one I gave earlier that Lord hill


our leader had interesting figures about the active participation.


Again, I can't speak for Lord Hill. I think you should look at what he


has said about this because it -- in effect he says it isn't total


population, it's trying to find ways of making better use of the


membership. Joining us now the Lib Dem peer and whip, Ben Stoneham.


Welcome. Now Tam Strathclyde when you resigned as leader of the Lord's


you admitted, that the quo ligs "had broken down in the Lord's". What's


the current stated of the coalition in the Lord's. It's extremely good.


I think you took that out of context. Never do that (! )There


was substantial disagreement in the reform in the House of Lords, within


the House of Lords and within the House of Commons. What I love about


this debate and I've been involved in this debate for a long time, is


we look to the Lord's to debate and discuss it, but actually, House of


Lords reform is really about the House of Commons. They will never be


-- there will never be change until the House of Commons agree on what


to do. Last summer, the House of Commons voted in overwhelming


numbers on a plan that I supported, Ben supported and many others, the


Government supported, but when it came to actually deciding how to do


it, the House of Commons decided on an historic fudge. It was ever thus.


They did that in the days of Enoch Powell. The same old story.Did Tam


Strathclyde find is so difficult to work with you? I think you're


misrepresenting it. He spoke to me the following day and apologised. He


said he was completely misquoted. They always say that. I think it's


unfair to say that. The reality is I think Tam Strathclyde had been


pressed by the discipline -- would be impressed by the discipline


showed by the Liberal Democrats in the coalition. I think the


relationships work pretty well. Inevitably there will be areas of


disagreement. Have things got better since he's gone snoo I think they've


just carried on. That's very diplomatic. I believe that. They've


got better. He's difficult. That's unfair as well. This is co-ligs


politics working extremely well. It's sickening. In 2010 relaunched


into an experiment in Parliament and in the House of Lords about how to


make coalition work. None of us had experience. Bits of it were messy.


On some bills I think individual parties played their cards harder


than I think some of us had imagined. But the underlying


strength of the coalition is the Prime Minister, Deputy Prime


Minister, the Chancellor and his number two get on extremely well.


The essential purposes for creating the coalition still exist. We have


local difficulties. Let me give you an example, on the vote on


boundaries. Where I thought the Liberal Democrats got themselves


into a ridiculous position. Ratted on you. Not only that, they promoted


a system which they themselves had said was unfair. The reality was the


Tory backbenchers in the Commons were foolish. They should have


continued on the House of Lords reform. This is something we could


have an argument on. I was going to say is that I think Tam Strathclyde


is a classic person who has spent most of his life sustaining the


coalition and the Conservative Party. He's skilled at running


coalition. What about the coalition in the Lib Dems? All political


parties are coalition. I'm a social Democrat. OK. It's all well for you


to be so cosy here. But we watch this from the outside. The failure


to reform the Lords, you're just this huge dumping ground for the


establishment these days. There's 800 of you. The coalition will add


another 50. I mean, it's a joke. It's very difficult to reform. There


are lots of vested interest. Stop adding to them. If you don't, you


change the age profile. The average age is already about 93. Joot


Liberal Democrats would say should reform the House of Lords.


How is it that the wore's only superpower of 300 million poem --


world's only superpower of 300 million people, its upper house has


100 members and this little island off the coast of France has an upper


House with 800 plus. It's too big. The House of Commons is too big as


well. We tried to reduce that as well. They wouldn't let you do that.


They certainly would not, which was a pity You have to reform the House


of Lords at the same time. There There was a deal done which said


that the House of Commons should reduce to 600 and We Will Rock You


reform to the House of Lords. thought if this lot gave you the


referendum on AV you would give them boundary changes. The fact is that


the gravy train continues. You have a career in politics, it comes to an


end, oh, no, we'll stick you into the House of Lords, �300 a day, nice


title, gets you reservations in restaurants and we're off to the


races. I'm sure you get reservations too. But the serious point...


McDonald's! The difficulty for reformers has always been that the


House of Lords actually does the job it's asked to do remarkably well,


for very little cost. It analyses, scrutinises, revises legislation. It


does the job that a second chamber should do. It just doesn't need 800


of you. I agree. On that amazing consensus, we move


on. Thank you for being with us. Now imagine being sat, if that's the


correct English, in a car with Margaret Thatcher, after she stepped


out of Downing Street for the last time. Or hearing ministers make


crucial decisions as you're driving them to meet heads of state or rock


stars, if you're Tony Blair. Probably not something you'll find


in the job description to join the Government car service, but they are


witnesses to some unique and intimate moments of history. For the


latest in our series on the Westminster village, Giles has taken


to the road with former Government They are privy to secrets, but have


no official role. They drive ministers but not policy. Sometimes


they share a trust and relationship with people at the top that Cabinet


colleagues don't get close to, Government drivers. Thart political


equivalent of what the butter saw. You build up a rapport between you.


Over the years, of course, but initially are you getting to know


one another. Once you get to know a minister, of course, then you become


privy to everything that's going on in the car. Most of them do gel with


their ministers because if they don't, it's best they come off and


another driver goes on there. Sometimes you do get a clash of


personalities. Did you ever have any? There was only one minister


ever in my career that I couldn't get along with too well. That was


earnest Marples. Was Transport Secretary in the early 60s. Here he


is talking about drink driving. People drink and then they have too


much and it's the end of the year and they drive home. I'm all for


drinking. I'm in the a scrooge. I like my drinking, I had a sherry


today. Denis wasn't a fan. I drove him for about six months or so, in


the end, I did a swap. I think it was in both our interests.


Diplomatically put! That's right. I wound up with a wonderful man, Enoch


Powell. It's long been thought that Government drivers' network was a


crucial sounding board for ministers. Every driver has a story


to tell. A lot of them confide in ministers, between each other. It's


a wonderful network there in fact, when we get back to the garage


telling stories. Ghast drivers network, what does that say about my


policy and where I'm going? Very much so. And we used to feed them


little things that possibly, if it wasn't too sensitive of course, we'd


let our ministers know. Always. On one occasion in 1976, Denis knew


something before his minister Harold Hever. I'd known, funnily enough


through some colleagues in work, I knew that Harold Wilson was going to


resign the next day. When they came out of kobt they'd been informed. "


Oh, yes I heard that yesterday." It all went dead in the car. He said, "


You knew yesterday and you never told me? He was quite annoyed.


drove Mrs Thatcher on and off for years and finally ended as her


official Prime Ministerial driver. The strangest journey he had with


her was her last in that role. was the most amazing journey. We got


in the car and for once, there wasn't a word spoken in that car


from the time we left Downing Street until we actually came out of


Buckingham Palace. It was very poignant. In today's money-saving


climate ministers tend not to have their own driver. A bonus possibly


to the Treasury, but perhaps politics and history are poorer as a


result. Now, did you have a Government car


or a driver when you were a minister? I did in the old days, in


the 1980s and 90s. But all that stopped under the new austerity of


2010. I have to say, it was one of those perks that was absolutely


fantastic. You got to know your drivers. You were on very good terms


with them. They were extremely helpful and it was a relief to see


your driver there when you needed to go somewhere. It did change. I think


it was probably right that it changed. Did you have a pool of


cars? You did. You need to get ministers from A to B, using public


transport where that's zrierable. But they need -- desirable. But they


need to be in cars and get to where they need to be effectively. It's


not such a good situation from the minister's point of view, but from


the taxpayers' point of view it's fair enough. The driver ever tell


you things? Very much so. The gossip was extraordinary. They always had a


little tale to tell. They were very discreet about where they got their


information from, a bit like people in your great profession. But they


did know stuff. They didn't brag about what the former minister


they'd had in the car before, so there was also a discretion there.


They were very keen, usually, to tell you what it was. You felt you


could have confidential discussions with another minister in the back of


car? Very much so. I never doubted the security of a driver. On one


occasion I was dealing with something extremely sensitive. After


I said to the driver, " Did you hear any of that? . He said he never


listened to anything. He just switched off and talked about


something different. Probably because it's so boring. Right, now


just before we go. We have to get the answer to quuries. Why is the


Speaker's wife Sally Bercow in the headlines again? A, she's locked her


husband out of the flat? Selling furniture on I bay and inviting


buyers to pick it up. Varietying Nigel Farage for sea or putting an


innocent face on her census form. They're all credible. That's the


clever nature of this quiz! I think she locked him out. If only! She may


have done. That we don't know. She's selling furniture on eBay. It's not


the official furniture, it is her own furniture, innocent face. That's


all for today. Thanks to our guests. The One O'clock News is starting


over on BBC One now. I'll be back tonight at 11.35pm with John


Simpson, Fiona Millar, John Prescott, Michael Portillo, Miranda


Green, and making her first appearance with us will be


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