16/01/2014 Daily Politics


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engaging in a civilised dialogue on immigration. I do not agree, I do


not think it is possible for Conservatives to go back on


modernisation. I don't think those Conservatives to go back on


people committed to it have retreated. Let the welcome our


viewers from Scotland. We've been joined by viewers in Scotland who


have been watching First Minister's Questions from Holyrood. Not only is


it over, that none of these issues are part of the modernisation


agenda, partly the reason is it failed. It failed to get an overall


Tory majority. Your modernisation agenda was essentially about


appealing to the chattering classes within three square miles of here,


and came up with nothing for striving, working class and lower


middle-class voters. I do not think the argument was perfect. I do not


agree. First of all, the Conservative party did succeed in


forming a government in circumstances where its previous


election results were badly hit. The swing to the Conservative party was


massive. But it did poorly in Scotland and the North West. And not


well enough with ethnic minorities. Among the kind of people who elected


Margaret Thatcher and Tony Blair. I am self-critical, there were things


we argued correctly which were important, and other things which


did not get the attention. It became important when the Conservative


party was dealing with such a large deficit. What has posed a big


challenge to the ideas we were developing was it did not -- it


turned out a period of no growth, and cuts. You mentioned the minimum


wage. As if that was part of the modernisation agenda. What is the


equivalent of the modernising agenda this time, compared to vote blue, go


green, big society? First of all, the big society issues raised by


David Cameron, a broken society, that is not over. We have to return


to that. Secondly, it does have to reflect the fact different economic


times mean you have to deal with issues of the incomes of the low


wage in a more competitive way. Which your modernisation agenda had


nothing to stay in 2010. Are we agreed? I had better move on! I


agree it wasn't complete. It was highly politically successful. If


the conservatory had not done what it did, it would not have got close


to winning power. Tell us briefly, it is dead agenda, to fight this


next election. I do not agree. We must not retreat from social liberal


issues. Secondly, it does have to make sure people feel, even on


issues like welfare, it is being fair, as well as being tough. And it


has got to find ways to appeal to people on low incomes and showed as


the country recovers, it will have the interests of everyone. Those are


tough, new challenges. We will see. Now, the NHS. It's been likened to a


national religion, and many joined Hands Off Our Hospital campaigns to


save local services from closure. I am at Saint Thomas 's Hospital,


Parliament is across the River Thames. Let us find out what people


think about the politics of the NHS. There are a lot of things to educate


people. Staying of drink and smoking. The accident and emergency


locally was full of people at new year with injuries from drink. Which


is wasting a lot of money. The friend I am visiting, she is 21,


unexpectedly she caught meningitis. They have treated her for the last


six months for free. She has been an inpatient for ages. To think how


much that is costing? I dread to think. We complain about tax. When


something like that happens, if it wasn't covered... Someone has


recommended the idea of an NHS tax, specifically for the NHS, would that


work? It is good the way it is. You never know when you will need it. I


have been helping all my life but any time and could need an operation


or procedure that costs thousands of pounds. I think it is OK the way it


is. It does get larger and larger. And we have an ageing population. As


health care services get better. That increases the total amount of


people who need to be taken care of. Yes, it is a big, black hole. You


sound it up perfectly. But then you are a medical student.


The government should sort out the NHS. What if it costs more money and


there is no end to it costing more money? I don't know, I can't help


you there. I don't blame him! Danny Finkelstein recently proposed a


complete re-think in our approach to NHS spending. And we're joined by


Vidhya Alakeson, from the Resolution Foundation, to discuss his medicine


for the health service. Danny, what do you think should


happen? It is more I think people do not appreciate how rapidly it is


increasing as a proportion of national income. It is a big


decision, do we want to, in 50 years, be spending ?1 in every ?5 on


health care? What I want to do is to link what we spend on the NHS with


taxation. An NHS tax? If you appeal to someone we are going to spend a


greater proportion of income on health. There are good arguments for


that. You would have to suggest an increase to pay for it. People would


no longer feel the NHS should keep on spending without anybody having a


grip on how much it was costing. On my tax return, I would see so much


money on income tax, and on the NHS tax. You could turn national


insurance tax, as an example, into specifically an NHS tax. A bit of it


does go to the NHS. What you make of that? I question to -- the extent to


which a hypothecated tax would change the state of debate and


fundamentally change what people expect from the NHS. As every


country gets richer and spends more on health care, where do we stop


spending on other aspects, if we want to spend more on health care?


It is what the opposition wants. We should expect to spend more on


health care. Isn't that the problem, wouldn't people say, just take more


of that money from my tax? We were spending more on an army at the


start of the programme, now it is health. The conversation was, should


we be spending more on the army? I am in favour on spending more on


everything. Are you? You are not, really. It depends who is spending


it. I am certainly in favour of spending more on defence, and health


care. I think we are spending too much on the welfare on certain


aspects. Let me come back. It seems to be right, as you say, as we get


wealthier, when the health service was set up, I was part of the


first-generation looked after by the NHS, at our health spending would


fall, it was projected. But the costs of technology and someone is


rising. If that is the one area in public spending which will rise,


doesn't it mean on the left and right you have to look at government


pulling out of other areas? That is one option. You could grow the tax


base by keeping more people in work, so we have to get more of the


ageing population in work for longer. Would you increase taxes?


That is a bigger conversation than just about the NHS. At the moment,


there any conversation is what can be cut? But also, where can we raise


tax revenue? There is potentially a revenue raising agenda in terms of


funding an NHS. We will suddenly have to pay more for the NHS. One


puzzle would be a hypothecated tax. In other areas, you can do more. We


want the best of everything is what I meant. The NHS is no different. We


cannot do that without regard to how much it costs. It is increasing


rapidly as a proportion of public spending. We haven't got the deficit


down because the proportion of money spent on the NHS is rising.


Therefore we haven't got the deficit down as quickly. We need to be


realistic. Where would you get the money from? For a start, new money


to the NHS doesn't necessarily lead to better care. There is a huge


amount of money we need to spend better. Less in hospitals and more


on the community. Ring-fencing the NHS and cutting social care to an


extreme, is that a sensible way forward?


Last month, George Osborne announced the Government's intention to


abolish the cap on student numbers. The Government wants an extra 60,000


students in higher education at an eventual cost to the taxpayer of ?2


billion a year. So we have already spent another ?2 billion. The move


will, in part, be funded by selling off the student loan book. But do


the numbers add up? We can talk now to the blogger and writer Andrew


McGettigan. What is wrong with the government's idea to sell off the


existing student loan book and use it to finance more university


places? There are a number of problems with the Autumn


statement's presentation of figures, but ultimately student loan figures


lose money. You send them out into the world, and you get it back over


30 years, but how much do you estimate you lose on that loan? Back


in the 2010, rents of spending review, we thought we'd only lose


30p in every pound -- comprehensive spending review. But now we expect


to lose 40p in every pound. You have to find that funding therefore from


somewhere else. Selling alone that loses money, and you might not get


what they are worth when you sell them to the provider, especially if


you've you have to compensate the purchase with future subsidies going


the other way because they cannot change the terms, that means you end


up going over the cliff. You have to put some money in from somewhere


else. That is the fundamental question about sustainability. But


if you sell the loan, securing it, whoever buys the loan book, surely


it's their responsibility to get the loans. The government has the money.


It won't happen in this case because they are collected through HM RC, so


that is where the primary collection occurs and that's where it will


continue to come from. The current management process, is it up to


scratch to deal with that sale? I suspect you think not. The National


Audit Office thinks not. It said the current setup was not fit for


purpose and it needs to remodel the repayment collection, so if you


enter a contract with the private sector, where you have a target on


collection performance we might see money going the other way because


the systems in place are not fit to meet the targets. Thank you for


joining us and outlining that. We are joined by David Willetts, the


University Minister, and John Denham. Welcome to you both. What do


you say to Andrew? It's right to have more people going to


university. We don't have a target but it's great to have the


opportunity. It's good for them and the economy and we can finance that


by bringing forward the proceeds of the sale of the student loan book.


The policy is right within its own terms. It's simple. Young people


want to go to university and everybody who has that qualification


has the ability and aptitude to do it should have the opportunity. We


are unusual for a western country where there are tens of thousands


each year who want to go to university and we slam the door in


their face. Most countries don't do that. George's ambition, quite


rightly, is that people have the aptitude and ability should be doing


it. He said that when he looked at the Autumn statement measures, but


one that did the most for the long-term performance of the British


economy was giving more people the chance of getting a university


degree. But is it true that 40% of the loan book will never be repaid?


That is the current estimate, and it changes every time there is a new


estimate. It usually goes up. It has been going up the last few years,


but why is simple. We said you pay back more if you are earning more


than ?21,000 per year, so as earnings have underperformed since


the forecast, every time there is a new set of earnings data, which


shows what we assumed they would be, it effectively makes the ?21,000


threshold more generous. It was generous when we started and it is


more so now. That is a deliberate policy. If you admit, as we stand at


the moment, before the higher loans have really begun to work through,


that 40% of the loans you will never get back, why don't you just cut the


student fees by 40%, which would be less of a deterrent for people to go


and try to make sure that you collect the remaining 60%? The good


news is that fees are not a deterrent. Nobody pays up front. We


have had record numbers of applications, and better than that,


record applications from people from low income backgrounds, so they


understand the system. John, what is your reaction? Let's take the


non-repayment of fees. If you have a child going to university paying


?9,000 per year, there are effectively paying ?6,000 for the


education and ?3000 per fees that will never be paid. If you did not


spend so much on debt cancellation, you could put it into higher


education and the fees could come down. We now see that the course the


government has taken, outside the ideological idea of having high


fees, is wrecking family finances and is very bad for public


investment. If we shifted every penny we could into teaching we


could bring the fees down to about ?10,000 for the average three-year


degree instead of ?25,000 at the moment. What is your response? It's


not wrecking family finances because families are not paying for it. We


cannot predict who will be earning what in later life, but we say if


you earn more than ?21,000, you pay back. If you are less well paid, you


don't pay back. It's a gradual scheme that means nobody need worry.


You only pay back through income tax. You said to me in a


Parliamentary reply that 50% of people never paid the loans off in


full. So you get 40% of the money not paid back, and 50% of people do


not pay back in full. So that means that these people, 9% of everything


they earn over ?21,000, they will pay for 30 years and they still


won't have cleared what they earn. That makes it a terribly bad deal


for them and the taxpayer and the economy. What is saying is they are


paying a 29% rate of income tax. But if people are earning a lot, they


should pay for their education. If you shifted it away from a high fee


policy, nobody would be paying the 29% rate of income tax. Ineffectual


writing of 100%. If someone is earning a lot of money, they should


pay that. All you have to do is reduce the rate of debt


cancellation, spend that on fees, on teaching people and the fees will


come down. More people will have loans that they can pay off, they


will borrow less in total and they will be paying less in total. That


is what we could do. Is it right to take away the cap? Should you leave


that universities? Ideally is you want people to go to higher


education, but the financing system is like raising a mortgage to


financial annual holidays. Sooner or later you hit the buffers. You have


to have real money to do it with. By the way, who is going to buy the


loan book? We are expecting significant interest from within the


city. Financial institutions? It will be a knock-down price, that is


the trick. I just wondered who would buy it. Probably The Royal Bank of


Scotland. If it's cheap enough. The night we see the first ever


Westminster correspondence dinner. Tickets are like gold dust. But


apparently just 50 pairs of tickets have been allocated to members of


the Westminster press pack. The Prime Minister's soiree is set to be


a rather less glamorous affair than that held by our friends across the


pond. Let's see how it goes down in DC. Thank you. How do you like my


new entrance music? My next 100 days will be so successful I'll be able


to complete it in 72 days. And on the 73rd day, I will rest. The first


black president. That's unless you screw up. And then it's been a big,


what's up with the half white guy? I'm continuing to spread our agenda


globally and around the world, as well as internationally. Barack


Obama, he's already a lame duck, so why wait? Picking the right actor to


play him was the challenge. As it turns out, the answer was right in


front of us all. Daniel Day Lewis. Were you nervous about playing him?


Yes, I was. Look, look. Let me be clear about this. You wouldn't


believe how long it takes to put these ears. I want to talk about


some serious issues. OK, here it comes. Nuclear prior inflation --


nuclear proliferation. Nuclear proliferation. Nuclear


proliferation. You can see it is a huge production in America. It takes


days and days beforehand, about 1800 people go, massive parties around it


as well. Not going to be quite the same in London, I think. Two people


who definitely won't be attending are Michael White, of the Guardian,


and Paul Staines, aka Guido Fawkes. I don't think they could get the


tickets. Why are we doing this? It's a revival of an old thing, a bit of


a White House thing, I used to go there, in enormous basements under


the Hilton hotel. A big loving, everybody scratches each other's


back. That is not the British way. It is more the French way, dare I


say it. It's a people, the biggest room they can get in Westminster


security problem -- it's 170 people. Why am I not going? Only 50 tickets


for couples, and I've it all before. Let the young people enjoy


themselves. Do you wish you were there? You have to pay me to go to


some of these events. A good thing if you take your wife, she has


missed you all these evenings, with your mistress if your French, and


you get some brownie points from her for all the things you've done. What


a lovely thing to say. He is softening. I think he's selling out.


I gate-crashed the Downing Street Christmas party, the kids get to see


Santa, some guy called George Osborne and the wife gets a new


hairdo and enjoys immensely and it gets off my back. He goes to all the


parties now. No harm in it. In America it is built around the


president, and we don't have one here. There has been an argument


that the leader of the opposition will not go because he does not get


to speak, only the Prime Minister would. They have all got egos, these


chaps, otherwise they wouldn't ball over the -- volunteer for the job.


He is both Mr Thatcher and Mr Reagan, that is why Francois Holland


got away with it, his estate. It's a different game. Although he might


want to contradict me, we are less deferential here. Is the Prime


Minister sweating over this question on getting the jokes right? They are


quite risky, some of the joke. You saw Barack Obama doing his Daniel


Day Lewis. Just imagine Cameron or Ed Miliband doing that and being


completely slated for it, because we don't have the same reaction here.


It is quite risky, I think. Last time I heard him speak at one of


these events, it was like the monthly lobby lunch at Westminster,


and he made a joke about his European speech and said it was like


Tantric sex, the more you waited, the better the speech would be. And


then the speech was an absolute disaster. He should have stuck to


the Tantric sex. Will you gate-crashed? I don't think so. I


would be writing about all the parties I went to if I did that. It


happens to us all. What an amazing break out of lack of hostility, so


we say thanks to all of our guests. I am back tonight for This Week with


David Ginola, Ross Kemp, Jane Moore, Diane Abbott, Michael Portillo and


Miranda Green at 11:35pm on BBC One. And I will be back here tomorrow as


well, if I wake up in time. Is anyone else working yet? Goodbye.


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