:00:33. > :00:39.Afternoon, folks, welcome to the Daily Politics. George Osborne has
:00:40. > :00:48.gone to Edinburgh and he's playing hardball over Scottish independence.
:00:49. > :00:52.He says if Scotland votes to leave the UK it votes to leave the pound.
:00:53. > :00:56.It's the same message from Labour and the Lib Dems. The SNP says it's
:00:57. > :00:59.bullying. We'll speak to Scotland's deputy first minister, Nicola
:01:00. > :01:02.Sturgeon. The good news is the Bank of England says the economy's
:01:03. > :01:05.storming back to growth. The bad news is, it says it's not
:01:06. > :01:08.sustainable. We'll be reading the economic runes with two leading
:01:09. > :01:13.forecasters. Gordon Brown's back in the Commons today. It's not often we
:01:14. > :01:26.say that. So what's the former Prime Minister been up to since leaving
:01:27. > :01:32.Number Ten? My name is Sarah and I was born in October. My And are the
:01:33. > :01:44.odds stacked against children born in the summer? Name is Celia and I
:01:45. > :01:56.was born in August. IM Andrew and I was born in May. What does that say?
:01:57. > :01:59.All that in the next hour and with us for the whole show today is the
:02:00. > :02:02.deputy first minister of Scotland and deputy SNP leader Nicola
:02:03. > :02:07.Sturgeon. Nice to have you in London for a change, Nicola. It is nice to
:02:08. > :02:13.have you in London and not on a telephone line. And don't panic. For
:02:14. > :02:17.those of you who like a bit of balance on these issues, and we know
:02:18. > :02:21.there are many of you - the Scottish Secretary Alistair Carmichael will
:02:22. > :02:24.be our guest of the day on the show next month. Let's start with the
:02:25. > :02:27.weather. And what weather it's been. Tens of thousands of homes are
:02:28. > :02:30.without power this morning after hurricane-force winds battered the
:02:31. > :02:33.UK yesterday. Forecasters say the stormy weather will subside briefly
:02:34. > :02:36.today before more gales and rain arrive tomorrow. Western parts of
:02:37. > :02:40.Wales and the north west of England have been badly affected and severe
:02:41. > :02:52.flood warnings remain in place in the south and south west of England.
:02:53. > :02:56.The Transport Secretary told the Commons this morning that ?61
:02:57. > :02:59.million would be spent to repair damage to the transport
:03:00. > :03:02.infrastructure. The bad weather has prompted widespread debate about the
:03:03. > :03:06.role played by climate change. Later today, the Energy Secretary Ed Davey
:03:07. > :03:09.- he's a Liberal Democrat - will use a speech to attack some
:03:10. > :03:13.Conservatives who, he says, are undermining efforts to tackle
:03:14. > :03:16.climate change. Mr Davey will say that the political consensus on
:03:17. > :03:18.climate change "is in danger of breaking down". The Deputy Prime
:03:19. > :03:28.Minister Nick Clegg reinforced the message on his regular radio
:03:29. > :03:31.phone-in for LBC this morning: there are prominent conservatives, Lord
:03:32. > :03:36.Lawson and others, who do not accept it. They are entitled to that view
:03:37. > :03:43.and they can argue the case as they do, but given that we have had this
:03:44. > :03:48.recent international report from the largest number of scientists ever,
:03:49. > :03:52.and we have received advice as well, he came to the Cabinet and sat
:03:53. > :04:04.there in front of the cameras and said, "there is no doubt" . Nicola
:04:05. > :04:09.Sturgeon, do you think the extreme weather over the last few years, is
:04:10. > :04:15.it linked to climate change? Undoubtedly. I agree with Nick Clegg
:04:16. > :04:19.and people are entitled to their views but we need to spend our time
:04:20. > :04:24.deciding how to address climate change. What is happening in the
:04:25. > :04:33.south of England is grim and my heart goes out to people. We have
:04:34. > :04:36.got eight relatively lightly in Scotland but there is no doubt that
:04:37. > :04:47.we have to take climate change seriously. Nick Clegg mentioned Lord
:04:48. > :04:53.Lawson and he said again today that they are -- there is no evidence
:04:54. > :04:56.that climate change is causing flooding. He said that the
:04:57. > :05:01.government should stop littering the countryside with solar panels and
:05:02. > :05:11.wind turbines. Does he have a point? No, he does not. I think it is
:05:12. > :05:14.wrong. I think making sure we are investing in renewable energy is
:05:15. > :05:18.important, we are doing that in Scotland. We need a balanced energy
:05:19. > :05:25.policy. There are immediate policies that needs to be dealt with. Loading
:05:26. > :05:28.flood defences, I think that will be a big priority for the government in
:05:29. > :05:37.London as a result of what has happened is in the last few weeks.
:05:38. > :05:47.-- wielding flood defences. Should those views be dismissed out of
:05:48. > :05:52.hand? I do think, I absolutely do think that we should treat this with
:05:53. > :05:59.healthy scepticism and not be diverted into a debate about the
:06:00. > :06:03.rights and wrongs of climate change. People flooding in Somerset
:06:04. > :06:07.will get very little comfort from this debate and want to know what is
:06:08. > :06:13.being done here and now and how as a society we face up to things long
:06:14. > :06:18.term. Some of the scientific community do say it is not always
:06:19. > :06:24.man-made but sometimes it is down to human activity. I am not saying we
:06:25. > :06:28.should not have a debate but I think it is wasted energy having all of it
:06:29. > :06:33.spent on that debate rather than thinking how we address the issues
:06:34. > :06:36.of climate change. You talked about Scotland's leading the way in terms
:06:37. > :06:44.of renewables. Were you disappointed when they failed to reach their
:06:45. > :06:51.climate change targets? Marginally. But that must've been disappointing?
:06:52. > :06:58.I want to see us exceeding our targets. We are confident we will.
:06:59. > :07:01.We passed the climate change legislation and we are stretching
:07:02. > :07:13.ourselves, being ambitious. We fell marginally short but that is a us
:07:14. > :07:17.becoming... Letters leave it there. Now it's time for our daily quiz.
:07:18. > :07:20.The question for today is which of the following has our guest of the
:07:21. > :07:23.day Nicola Sturgeon admitted that she doesn't like? Is it... A) the
:07:24. > :07:26.sound of bagpipes b) being Alex Salmond's deputy c) historical
:07:27. > :07:34.fiction or d) cooking? Later on in the show Nicola will give us the
:07:35. > :07:40.correct answer. I will have to think what the right answer is! What are
:07:41. > :07:46.you suggesting, Andrew? Sorry! An independent Scotland wouldn't be
:07:47. > :07:49.able to keep the pound. That was the stark message from George Osborne
:07:50. > :07:53.this morning as he went to Edinburgh to tell Alex Salmond and the SNP he
:07:54. > :07:56.won't support their plans for a currency union between Scotland and
:07:57. > :07:59.the rest of the UK, if Scotland votes for independence on 18
:08:00. > :08:06.September. And George Osborne isn't alone on this one - over to Jo to
:08:07. > :08:10.explain more. Thanks, Andrew. Yes, George Osborne has told the SNP he
:08:11. > :08:13.won't entertain the idea of a currency union, saying the only way
:08:14. > :08:17.for Scotland to maintain its "economic security" and keep the
:08:18. > :08:20.pound is by staying in the UK. The Treasury's looked at the idea of a
:08:21. > :08:23.formal currency union, and says for it to work both governments would
:08:24. > :08:27.have to underwrite each other's banks - and even allow taxpayers on
:08:28. > :08:31.one side of the border to subsidise each other. The Chancellor says this
:08:32. > :08:35.won't work, and in a rare display of cross-party unity, Ed Balls agrees
:08:36. > :08:39.with him. The shadow Chancellor has also ruled out a currency union,
:08:40. > :08:42.saying it was time for the SNP to join "the real world", and chief
:08:43. > :08:47.secretary to the Treasury Danny Alexander says the Lib Dems are on
:08:48. > :08:49.the same page. This follows the visit to Edinburgh by Bank of
:08:50. > :08:53.England governor Mark Carney last month, when he said a currency union
:08:54. > :09:00.would only work if there was "some ceding of national sovereignty". The
:09:01. > :09:03.SNP has accused the three political parties at Westminster of ganging up
:09:04. > :09:07.to "bully" Scotland, and insist keeping the pound would be in the
:09:08. > :09:15.interests of Scotland and the rest of the UK. Here's what George
:09:16. > :09:20.Osborne had to say earlier. I could not, as Chancellor, recommends that
:09:21. > :09:24.we could share the pound with an independent Scotland. The evidence
:09:25. > :09:31.shows that it would not work, it would cost jobs, and cost money. It
:09:32. > :09:36.would not provide economic security for Scotland or the rest of the UK,
:09:37. > :09:41.I do not think any other Chancellor of the extent would come to a
:09:42. > :09:45.different view. The SNP says that if Scotland becomes independent there
:09:46. > :09:50.would be a currency union and Scotland would share the pound.
:09:51. > :09:56.People need to know that that is not going to happen. Sharing the pound
:09:57. > :10:02.is not in the interests of the people of Scotland or the rest of
:10:03. > :10:15.the UK. That was the Chancellor George Osborne. Nicola Sturgeon is
:10:16. > :10:18.with us. Many have said that if Scotland went independent you do not
:10:19. > :10:24.get a currency union with the rest of the UK. These are all politicians
:10:25. > :10:31.who want Scotland to vote no so it is in their interest to stir up fear
:10:32. > :10:37.and uncertainty. They have just said that if you leave Britain, you leave
:10:38. > :10:44.the pound so what is your plan? I will come onto that in a second the
:10:45. > :10:52.point of fact here, and this is what Mervyn King said, the in reality
:10:53. > :10:57.would be very different... You do not know that! Let's assume they do
:10:58. > :11:02.stick to their guns, we are talking about very important things here.
:11:03. > :11:06.What is the other plan? The fiscal commission which was asked by the
:11:07. > :11:12.government to look at the currency options has laid it all out. The
:11:13. > :11:16.currency of sterling within a currency union... What is in your
:11:17. > :11:22.plan? We want a currency union because it is in the best interest
:11:23. > :11:26.of Scotland and the UK. Forgave me, but if you do not get that and it is
:11:27. > :11:29.important that the people of Scotland and the UK know the answer,
:11:30. > :11:36.if they are true to their word, these three politicians from three
:11:37. > :11:41.different parties, what is the plan? Scotland cannot be prevented from
:11:42. > :11:51.using the pound... It could not be a currency union. I believe George
:11:52. > :11:55.Osborne is bluffing. Can you tell me... I would really like an answer
:11:56. > :12:00.to this question and it is simple. Assuming they are not bluffing, and
:12:01. > :12:08.there are many reasons to believe they are not, what would then be the
:12:09. > :12:11.position on the currency? Scotland cannot be prevented from using the
:12:12. > :12:16.currency but I am not going to be the lead out of a position that is
:12:17. > :12:21.in the best interest of Scotland and the UK. I know that is what George
:12:22. > :12:24.Osborne wants to try and do but I am not going to allow him to do that.
:12:25. > :12:37.Let me tell you why the currency union is in the best interest of the
:12:38. > :12:41.union. Having a separate currency in Scotland would cost English
:12:42. > :12:44.businesses hundreds of millions of pounds in transaction costs. If we
:12:45. > :12:50.do not have a currency union, the balance of payments loses ?30
:12:51. > :12:55.billion of oil and gas. The trade deficit for the UK goes through the
:12:56. > :13:06.roof and impacts on the value of sterling. These are common-sense
:13:07. > :13:12.reasons why... People should not be fooled by it. That may or may not be
:13:13. > :13:16.true but my purpose this morning is not to argue on the merits of the
:13:17. > :13:22.currency union, and I will try one more time. If they do not agree with
:13:23. > :13:26.you and think a currency union without a political union, which is
:13:27. > :13:34.what it will be, if they ring that is not right for the rest of the UK,
:13:35. > :13:37.what do you do? -- if they think. I have already said that the fiscal
:13:38. > :13:45.commission has set out the currency options for Scotland. With the
:13:46. > :13:48.greatest of respect, just because George Osborne tries to intimidate
:13:49. > :13:54.Scotland it does not mean we should forget Scotland. He is laying out a
:13:55. > :14:01.viable case for the rest of the UK to say that if you go independent,
:14:02. > :14:06.we do not want a currency union. It is perfectly respectable. He is
:14:07. > :14:09.entitled to argue that. I am entitled to argue the position that
:14:10. > :14:15.I believe passionately and strongly is the best one for Scotland. Is it
:14:16. > :14:20.true that you said that if they stick to their guns and you do not
:14:21. > :14:26.get a currency union, an independent Scotland would not take its share of
:14:27. > :14:32.national debt? Let me be clear, I want to see an independent
:14:33. > :14:36.Scotland... What about the UK debt? Assets and liabilities go
:14:37. > :14:40.hand-in-hand. You cannot have a position, which I think George
:14:41. > :14:45.Osborne is articulating, that Scotland should be left with a share
:14:46. > :14:51.of liabilities but no assets. I am pointing out the logical conclusion
:14:52. > :14:56.of his position. I want Scotland to take on a fair share of its service.
:14:57. > :15:02.Let me clarify this. It is not a threat to say you cannot hold the
:15:03. > :15:07.currency of the country you have left. If you do not get a currency
:15:08. > :15:15.union, the Scotland grenade on its share of national debt? Does it? As
:15:16. > :15:23.the Treasury said just a couple of weeks ago, the debt is legally the
:15:24. > :15:26.Treasurys. I think it would be right for Scotland to take a share of the
:15:27. > :15:31.national debt, but that goes hand-in-hand with the question of
:15:32. > :15:35.the share of assets. Watt I would say you haven't got a choice,
:15:36. > :15:47.whether you get the pound or not. You cannot get better than that. Who
:15:48. > :15:51.is going to lend to a country... Where its political leader has
:15:52. > :15:58.already said it's going to renege on a substantial proportion of the
:15:59. > :16:01.debt? Never mind the respect, and to the question. Scotland becomes a
:16:02. > :16:08.pariah if you don't take your share of the debt, correct? I want them to
:16:09. > :16:14.take their share of debt. I wasn't disparaging your degree. I was going
:16:15. > :16:22.to quote Sir James early full stop he was quoted by Mark Carney. He is
:16:23. > :16:25.in print in the Scotsman, your former newspaper, today saying
:16:26. > :16:33.exactly why he thinks a currency union is in the best interests of
:16:34. > :16:37.Scotland. That is not the issue I'm asking. I put it to you that if you
:16:38. > :16:43.renege, if you go independent and renege on your share of UK national
:16:44. > :16:48.debt, you will be an international pariah on the money markets. My
:16:49. > :16:53.position is we won't come as you put it, renege on a share of the debt.
:16:54. > :16:57.Once Scotland votes for independence, if that's what the
:16:58. > :17:04.people of Scotland decide, we will have a currency union
:17:05. > :17:11.underpinned... And if you don't? Scotland will have our share of
:17:12. > :17:15.servicing the national debt. You assert that but you cannot prove it
:17:16. > :17:22.and you take Scotland into the unknown by not answering a single
:17:23. > :17:28.question I've asked you date on Plan B. Why are you so in favour of the
:17:29. > :17:34.pound? The SNP called the pound a millstone round the neck of
:17:35. > :17:39.Scotland. We asked our commission, looking at the currency options.
:17:40. > :17:45.There are different options open. So you were wrong? We have looked at
:17:46. > :17:48.the position. Because of the trading relationship, because of our
:17:49. > :17:52.contribution to the balance of payments, because of the integrated
:17:53. > :17:59.financial services market, it makes sense for Scotland to remain within
:18:00. > :18:02.the union that way with sterling. In 2009 when Alex Salmond crowed that
:18:03. > :18:05.sterling was thinking like a stone in the plummeting of the pound
:18:06. > :18:11.Korean first the case for membership of the euro, he was wrong as well?
:18:12. > :18:16.You have to judge these things with the prevailing circumstances at the
:18:17. > :18:19.time. The Liberal Democrats fought the election name manifesto to go
:18:20. > :18:23.into the euro. I don't think Nick Clegg would argue that to date. You
:18:24. > :18:28.base this on proper information and advice. The position we are putting
:18:29. > :18:32.forward now is the one that, in our judgment, is the right one. There
:18:33. > :18:38.are good, hard-headed reasons why it is the right one for the rest of the
:18:39. > :18:43.UK as well. Control of its own currency is a country's most potent
:18:44. > :18:49.economic weapon, do you agree with that? I agree that Scotland should
:18:50. > :18:54.stay within a sterling union. When it was said, there are simply no
:18:55. > :18:58.other methods by which the economy can be finely tuned and geared to
:18:59. > :19:02.meet the ever changing and accelerating challenges of the
:19:03. > :19:06.information age. A country without its own currency is a country
:19:07. > :19:11.without a steering wheel, breaks or accelerator, he was wrong? I don't
:19:12. > :19:15.agree with that. Based on the advice of the Economist I've spoken of,
:19:16. > :19:19.based on what is in the interest of businesses north and south of the
:19:20. > :19:23.border, there was an opinion poll carried out at the turn of the year
:19:24. > :19:27.that asked people in England not whether they thought Scotland should
:19:28. > :19:31.be independent or not, but if Scotland was independent, should we
:19:32. > :19:36.share a currency? 71% of people in England said yes. You want a
:19:37. > :19:42.currency union which would involve the rest of the UK being your lender
:19:43. > :19:47.of last resort, having to bail out the Scottish banks if they get into
:19:48. > :19:52.another mess, as they did only a few years ago. And yet it is also your
:19:53. > :19:56.policy that a loan on the European students, English students would
:19:57. > :20:00.have to pay full fees at Scottish universities. You want that and you
:20:01. > :20:03.want us to agree a currency union as well. Why would the rest of the UK
:20:04. > :20:09.agreed to that when you want to discriminate against English
:20:10. > :20:13.students? I don't want anybody to pay tuition fees. But you would
:20:14. > :20:22.charge English students fees, wouldn't you? You won't be charging
:20:23. > :20:26.German, Irish, French or Italian. England has the highest tuition
:20:27. > :20:30.fees... You want us to be your lender of last resort and yet you
:20:31. > :20:36.want to charge alone among Europeans full fees to the English, why would
:20:37. > :20:40.anyone agree to that? I want a partnership agreement on lender of
:20:41. > :20:47.last resort. England has the highest tuition fees and the whole of
:20:48. > :20:52.Europe. Only 10% of students in England came to study in Scotland,
:20:53. > :20:58.that would take up 80% of places. I wish there weren't tuition fees in
:20:59. > :21:03.England. If the UK moved tuition fees in England, they wouldn't be
:21:04. > :21:07.charged in Scotland either. Let's stay with the subject of the
:21:08. > :21:10.referendum on Scottish independence. So far, attention has perhaps
:21:11. > :21:14.understandably been focused on what might happen to Scotland if it votes
:21:15. > :21:17.yes and decides to go it alone. But that wouldn't just affect people
:21:18. > :21:21.living north of the border, it would be the beginning of the end of a
:21:22. > :21:24.Union which began more than four centuries ago. Inevitably, that
:21:25. > :21:28.would change life for England, Wales and Northern Ireland. So what might
:21:29. > :21:37.the UK minus Scotland be like? Here's David Thompson. Ever wondered
:21:38. > :21:41.why so many pubs are called the red Lion? Apparently, when James the
:21:42. > :21:46.sixth of Scotland became James the first of England in 1603, he
:21:47. > :21:51.insisted his coat of arms, the red Lion, be displayed on all buildings
:21:52. > :21:55.of significance, including pubs. We may have the Union of the Crowns to
:21:56. > :21:59.thank for the red line and and impart the UK, but that was more
:22:00. > :22:03.than 400 years ago. In the future, what would the rest of the UK look
:22:04. > :22:07.like politically, economically and perhaps even socially if Scotland
:22:08. > :22:13.was no longer part of the picture? Well, the electoral map could look
:22:14. > :22:17.very different. Labour would be the biggest sufferer. They would lose
:22:18. > :22:21.the biggest bulk of the 59 seats which currently Scotland retains in
:22:22. > :22:28.Parliament. The impact on the 2010 election would have been dramatic.
:22:29. > :22:31.Instead of being short of a majority in Westminster come without Scotland
:22:32. > :22:35.David Cameron would have had a majority of 21. But what might
:22:36. > :22:39.happen after the vote for independence? We don't know that
:22:40. > :22:43.without Scotland, whether that would have any effect on the internal
:22:44. > :22:47.politics of the rest of the UK that remained. With the dynamic stay the
:22:48. > :22:50.same or would it change somewhat? Certainly on paper it would make it
:22:51. > :22:53.a much more difficult task for Labour to think of winning an
:22:54. > :23:09.election in the future without Scotland. And what about the
:23:10. > :23:13.economic 's? With the debt burden, it would rise. I think that is
:23:14. > :23:18.likely to get the attention of credit rating agencies. That night
:23:19. > :23:21.not make a big impact for the man on the street, but for the government
:23:22. > :23:25.and Treasury finances, that would make a difference. Enough of the dry
:23:26. > :23:30.politics and economics, how would the rest of UK handle a Scottish
:23:31. > :23:34.departure? It's extremely important that we keep the UK as a whole. But
:23:35. > :23:39.if it were to happen we would accommodate it, because that is the
:23:40. > :23:44.way we are and always have been, but with deep regret. Could Scotland
:23:45. > :23:50.stay in, but with increased powers, devo max, actually be politically
:23:51. > :23:53.more traumatic than if it went? It would be completely intolerable to
:23:54. > :23:58.imagine that decisions that were taken in the UK parliament would be
:23:59. > :24:04.decided by Labour MPs in particular, let alone Scottish National 's, who
:24:05. > :24:09.were actually getting more and more devo max. I think we would get to a
:24:10. > :24:14.breaking point on that. Scotland's future will be a question for
:24:15. > :24:18.Scotland. But whatever the answer, the UK may well feel like a very
:24:19. > :24:21.different place afterwards. We're joined now by the chairman of the
:24:22. > :24:24.English Democrats, Robin Tilbrook, and by the Conservative MP, Iain
:24:25. > :24:29.Stewart, who was born and raised in Scotland. The Conservatives have the
:24:30. > :24:34.grand total of one MP in Scotland, Labour have 41. At the last
:24:35. > :24:38.election, David Cameron would have gained an overall majority if
:24:39. > :24:44.Scotland's votes had been excluded. What's not to like for Scottish
:24:45. > :24:47.independence for the Conservatives? My nationality is British. Even
:24:48. > :24:52.though there would be a short-term electoral gain for my party, I do
:24:53. > :24:56.not support the break-up of the United Kingdom, my country. That is
:24:57. > :25:01.far more important than the result of any one particular election. It
:25:02. > :25:05.could be, as some political pundits have predicted, that it could lead
:25:06. > :25:10.to one-party rule if there was Scotland independent and the rest of
:25:11. > :25:15.the UK remaining? I don't think you can extrapolate that. If you look at
:25:16. > :25:19.the majorities that Tony Blair had, he had a majority of the seats in
:25:20. > :25:23.England as well as the UK as a whole. It's very dangerous to
:25:24. > :25:27.extrapolate on one election result. But some of your conservative
:25:28. > :25:32.colleagues must feel that way, knowing they would be much more
:25:33. > :25:36.likely to have electoral victory, a significant majority without
:25:37. > :25:41.Scotland. We are the Conservative and Unionist party. That Unionist
:25:42. > :25:46.strand is very deep in what I and most of my colleagues believe. I
:25:47. > :25:51.would be distraught if my country was broken up. I'm British and I
:25:52. > :25:55.don't want that to happen. Do you think the Unionists are making
:25:56. > :26:00.enough of the emotional connection with Scotland, with the UK remaining
:26:01. > :26:06.as it is? We had a good debate in the Commons last Thursday. I made
:26:07. > :26:10.the point that initially Scotland and England coming together was like
:26:11. > :26:15.a marriage, two families coming together. But over the centuries, we
:26:16. > :26:19.actually built something that is different. You build a shared
:26:20. > :26:23.identity and heritage. That is what is so dear to me and many of my
:26:24. > :26:30.colleagues. That's a very emotional plea for the union to stay together.
:26:31. > :26:35.How do you argue against that? That is quite a minor authority opinion
:26:36. > :26:39.in England generally, I think. The English are becoming more self
:26:40. > :26:43.identifying as being English, as we see from the 2011 Census results.
:26:44. > :26:48.Over 60% of the population in England, more than 32 million
:26:49. > :26:53.people, said in the way they answered that that they were English
:26:54. > :26:58.only and not British. A further 10% said they were English and British.
:26:59. > :27:04.Probably only about another 5% of people who were English said that
:27:05. > :27:09.they were just British. Wouldn't it make England more parochial, a
:27:10. > :27:14.lesser country without Scotland? It's not so much that. The issue is,
:27:15. > :27:19.should nations govern themselves? As far as we are concerned, and as far
:27:20. > :27:25.as the SNP are concerned, nations should govern themselves. In your
:27:26. > :27:30.mind, does England prop up Scotland financially and economically?
:27:31. > :27:34.Certainly. The 2009 report from the House of Lords suggested that was
:27:35. > :27:39.the case. How do you argue against that? If you are looking at the
:27:40. > :27:44.amount of public spending per head, it's about ?1200 higher per head in
:27:45. > :27:48.Scotland, how do you argue that to someone in England who says, let
:27:49. > :27:52.Scotland go? A number of years ago I was a very dry book on this
:27:53. > :27:56.subject. No one knows the true financial relationship between the
:27:57. > :28:03.constituent parts of the UK because we've never allocated exactly tax
:28:04. > :28:07.receipts or spending. People can make assertions or assumptions, but
:28:08. > :28:12.no one actually knows the true relationship. That is something we
:28:13. > :28:18.would need to find out first. So you don't think the English taxpayer
:28:19. > :28:21.props up the Scottish... I'm saying there is no hard and fast evidence
:28:22. > :28:25.to prove the case one way or the other. How would you apportion
:28:26. > :28:30.receipts from the North Sea, for example? There are different schools
:28:31. > :28:44.of thought about how you could do that. Does England prop up Scotland
:28:45. > :28:46.or are you a net contributor? You can argue your case for or against
:28:47. > :28:48.independent, but Scotland is not subsidised. Public spending in
:28:49. > :28:51.Scotland is ?1200 per head higher than the rest of the UK. But tax
:28:52. > :28:54.generated in Scotland in ?1700 per head higher. We contribute more in
:28:55. > :29:00.terms of percentage terms than we get back on spending. Scotland is
:29:01. > :29:04.not subsidised. We pay our way. If Scotland was to be independent, our
:29:05. > :29:09.deficit would be a smaller share of our GDP than the rest of the UK.
:29:10. > :29:14.Absolutely it is not the case that Scotland is propped up in any way.
:29:15. > :29:17.To continue that line of argument, you accept that an independent
:29:18. > :29:22.Scotland would leave the rest of the UK worse off? We've just had a
:29:23. > :29:26.discussion about currency union. I think it's right that we cooperate
:29:27. > :29:30.in many respects, but I believe Scotland should access its own
:29:31. > :29:37.resources, stand on its own feet and take its own decisions. And it would
:29:38. > :29:42.leave the rest of the UK worse off. You are arguing that an independent
:29:43. > :29:47.Scotland would leave the rest of the UK worse off. England is perfectly
:29:48. > :29:51.capable of standing on its own two feet as an independent country. If I
:29:52. > :29:56.can go back to the social union, because some of the links your film
:29:57. > :30:00.talked about, the real bonds that exist between Scotland, England and
:30:01. > :30:04.other parts of the UK, these are strong, they will endure. I've got
:30:05. > :30:08.family in England. These are not things that depend on constitutions
:30:09. > :30:13.or how Scotland is governed, these are about people inhabiting the same
:30:14. > :30:17.island. Do you agree with that? I do think we would still be friends. I
:30:18. > :30:24.would take an issue with one point. The idea of the rest of the UK. It's
:30:25. > :30:29.my view, as a lawyer, that if Scotland goes you've got a repeal of
:30:30. > :30:33.the act of union, and that means you haven't got a continuing UK. There
:30:34. > :30:38.might be some shenanigans in Parliament... What about Wales and
:30:39. > :30:43.Northern Ireland? Wales is a slightly different case. The union
:30:44. > :30:48.with Northern Ireland depends on the union of 1801 originally. That was
:30:49. > :30:51.not with England, that was with the United Kingdom of Great Britain. A
:30:52. > :31:00.Great Britain would cease to exist with Scotland going. All Nicola
:31:01. > :31:03.Sturgeon said the bonds would still be there. Why would you be so
:31:04. > :31:10.distraught if those connections are still there? I do not want dual
:31:11. > :31:18.citizenship, I want my country to stay together. Why take this
:31:19. > :31:22.gamble? Why this one-way ticket? We have something that has insured and
:31:23. > :31:31.worked to stop together, I strongly believe that the strength is better
:31:32. > :31:36.than the individual strength. I do not think the Westminster system of
:31:37. > :31:40.government is working for Scotland. We have a Tory government that most
:31:41. > :31:50.people in Scotland do not one. But you want to keep the Crown? You want
:31:51. > :31:55.to retain so much of it. In all countries of the modern world you
:31:56. > :31:58.cooperate, that makes sense. Why should they implement policies like
:31:59. > :32:06.the Bedroom Tax that we do not agree with? It would be no difference to
:32:07. > :32:15.Canada or Australia. They have the Queen, why should we not have the
:32:16. > :32:17.Queen as well? Thank you. Mark Carney, he's the governor of the
:32:18. > :32:21.Bank of England, delivered the bank's latest inflation report
:32:22. > :32:24.yesterday. You might have missed it because of all the talk about the
:32:25. > :32:28.weather. It contained some pretty good news because the bank raised
:32:29. > :32:32.its estimate of growth this year to 3.4%. That's what's known as a
:32:33. > :32:45.bullish forecast, meaning it's more optimistic than most other
:32:46. > :32:50.economists. The bank is not always right. The bad news is, he says the
:32:51. > :32:57.recovery can't go on as it is. Here's what he had to say: the
:32:58. > :33:02.recovery has gained momentum. Output is growing at its fastest rate since
:33:03. > :33:09.2007, jobs are being created at the fastest pace since records began,
:33:10. > :33:16.and the inflation rate is back at 2%. The recovery is neither balanced
:33:17. > :33:21.or sustainable. A few quarters of growth are a good start but they are
:33:22. > :33:29.not sufficient for sustained momentum. Activity is still below
:33:30. > :33:33.precrisis level. The household saving rate is likely to fall
:33:34. > :33:38.further. The pick-up in business investment is still added earliest
:33:39. > :33:50.stages. The global outlook, although improved, contains downsides in
:33:51. > :33:54.emerging recovery. And we're joined now by two economists who got on so
:33:55. > :33:58.well last time they were on the show, one of them accused the other
:33:59. > :34:01.of trying to nail a blancmange to a wall. I think that means they didn't
:34:02. > :34:08.agree. It's the political economist Will Hutton and the Telegraph
:34:09. > :34:15.columnist Liam Halligan. You both think the recovery is unbalanced at
:34:16. > :34:19.the moment, right? Yes. Yes. Aren't most recovery is unbalanced in early
:34:20. > :34:26.days? The question of whether they are sustainable is if they do become
:34:27. > :34:32.balanced. It is true to say that most recoveries are consumer led. To
:34:33. > :34:36.begin with. The extent of the balance is completely marked in this
:34:37. > :34:44.case. The last GDP figures in the UK showed that the vast majority of
:34:45. > :34:46.growth was in business services and financial services. There is a
:34:47. > :34:55.bubble in that sector. Meanwhile, the construct than -- construction
:34:56. > :35:00.sector was contract thing. We have had a weaker sterling in the last
:35:01. > :35:06.three or four years and huge trade deficits. We are not making stuff,
:35:07. > :35:11.selling it to the rest of the world. We have always had a huge
:35:12. > :35:19.trade deficits. We have always had. If it is unbalanced, what needs to
:35:20. > :35:26.be done? First of all, I think that most institutions that support the
:35:27. > :35:31.kind of growth that is needed, you were sitting with Nicola Sturgeon
:35:32. > :35:38.and I am a supporter of creating a stakeholder capitalist society, we
:35:39. > :35:41.need banks that are more enterprise, we need an innovation system that is
:35:42. > :35:51.more supportive of companies that take risks at the frontier. This
:35:52. > :35:55.recovery will run out quickly! We had an evaluation of the pound that
:35:56. > :36:01.is the second-largest in the last 100 years with negligible uptake in
:36:02. > :36:07.our exports. The biggest market is on its back in Europe! In growing
:36:08. > :36:16.markets we are doing badly. We have an industrial structure, and that is
:36:17. > :36:26.one area which we are unbalanced within. Another area with low
:36:27. > :36:30.productivity, we have a public sector that is intensely squeezed.
:36:31. > :36:36.We have a desperately poor infrastructure. The week of flood
:36:37. > :36:46.defences are tiny part of that. All of that needs attention. What would
:36:47. > :36:50.you do? The consensus looms. I would focus on the banking sector, Andrew.
:36:51. > :36:52.I have been writing about this for many years and we are still in a
:36:53. > :37:01.situation where investment is still at its lowest since the early 1950s.
:37:02. > :37:06.That is largely because a lot of the businesses are worried about another
:37:07. > :37:10.collapse. That is what everybody is talking about. The bank says
:37:11. > :37:16.business investment is going to rise this year. It is at a desperately
:37:17. > :37:24.low level. Business investment is 8% lower than where it was precrisis.
:37:25. > :37:26.Yes, but that is a start. The banking sector is not capable of
:37:27. > :37:32.providing the capital to these businesses because they are massive
:37:33. > :37:44.liabilities. When did you tell us the British economy would you be
:37:45. > :37:50.growing by? Unemployment is hurtling below 17%. I was writing in 2012
:37:51. > :37:54.that we would get a recovery of two or 3% in 12 months' time. I have
:37:55. > :38:00.always said that unless the banking sector is cleaned up... RBS has
:38:01. > :38:07.provisioned another massive 8 billion. Barclays have given a big
:38:08. > :38:11.chunk away in bonuses. The banking sector is a drag on growth rather
:38:12. > :38:18.than an engine on growth. When did you tell us that the economy was
:38:19. > :38:23.going to do so well? I said that I thought growth was going to be 3% or
:38:24. > :38:31.more in 2013. I did! I have been saying that for some months. I have
:38:32. > :38:39.always said that the question is what happens after the snap back. My
:38:40. > :38:44.argument is was that we would get driven back by consumption to where
:38:45. > :38:49.we were, but over and above the points I raised earlier, I think
:38:50. > :38:53.inequality is a huge issue. Inequality between London and
:38:54. > :39:02.Scotland. Inequality between the top 1% and the rest. You cannot have it
:39:03. > :39:05.both ways. The gap between London and the rest of the country
:39:06. > :39:13.everywhere is huge. That is because London almost does not belong to
:39:14. > :39:18.Britain any more. The inequality between London and the rest of the
:39:19. > :39:24.country is one of the highest. No other countries have a London. There
:39:25. > :39:33.is a Berlin, there is a Milan. London is a problem. But it is a
:39:34. > :39:39.success! It is a problem and the strength! It is realistic to assume
:39:40. > :39:44.that we can never rebalance the economy on the successes we have
:39:45. > :39:54.had? We cannot do it with banking or consumption. The trouble is that
:39:55. > :39:59.having an economy that is so unbalanced represents a systemic
:40:00. > :40:08.threat to the system. That is what Mark Carney things as well.
:40:09. > :40:15.Actually, there was a lot of sleight of hand. Viewers want to know about
:40:16. > :40:21.interest rates. For Mark Carney to go from an unemployment target to
:40:22. > :40:28.spare capacity target... That is a really sticky subject. No one can
:40:29. > :40:33.look at the assumptions on this. Mark Carney said that in the future
:40:34. > :40:40.interest rates are going to be materially lower than the 5% that we
:40:41. > :40:47.had before. No central banker can decide this. The Bank of England's
:40:48. > :40:54.base rate is 0.5%. That is not what they are paying on their mortgage.
:40:55. > :41:06.OK, we are running out of time. We have no more time for lectures! Do
:41:07. > :41:12.you fancy these two as economic advisers? Absolutely! I would take
:41:13. > :41:19.both of them! You would? ! After you have heard them? Why would you do
:41:20. > :41:25.that? ! The point about inequality is important. Bank lending and
:41:26. > :41:30.investment are important. We have a strong economy in Scotland but we
:41:31. > :41:36.will discuss terms later on. I have enjoyed listening to them. I am on a
:41:37. > :41:47.commission here! We have run out of time, sadly. Now. I was born in
:41:48. > :41:57.November which explains why I've climbed the greasy pole to the top
:41:58. > :42:07.of the Daily Politics. What year? ! Thank you! Well, nearly to the top.
:42:08. > :42:10.But for children born in the summer there's strong evidence to show
:42:11. > :42:13.they'll perform less well than their classmates. And the gap persists all
:42:14. > :42:16.the way through to university and beyond. The Liberal Democrat MP
:42:17. > :42:30.Annette Brooke has been highlighting the problem, here's her film. Hello,
:42:31. > :42:44.I was born in September. Hello, I was born in October. My name is
:42:45. > :42:47.Celia and I was born in August. These children are getting a good
:42:48. > :42:53.start to their education at nursery school, but when should a child
:42:54. > :43:00.begin their primary education? Well, local authorities provide a
:43:01. > :43:05.full-time place for all four-year-olds in September after
:43:06. > :43:15.their birthday. A child born on the 31st of August 2013 will start in
:43:16. > :43:23.the same year as one born on the 1st of September a year later. Some are
:43:24. > :43:28.born child may not be as ready as its older counterparts to start
:43:29. > :43:33.school at such an early age. This can result in long-term damage to
:43:34. > :43:38.educational achievement. The statutory school starting age is
:43:39. > :43:42.five years old and a parent can choose not to send their child to
:43:43. > :43:49.school until the term in which their child is five. Local authorities are
:43:50. > :43:56.not choosing to start children in reception. A recent study shows that
:43:57. > :44:03.compared to children born in September, a child born in August is
:44:04. > :44:14.6.4% less likely to achieve five GCSEs at grades a to C. It is
:44:15. > :44:24.staggering just how long-term the Fx seem to be. I welcome the recent
:44:25. > :44:32.report published by the Department for Education. In particular, there
:44:33. > :44:35.is no statutory barrier for children being admitted outside their year
:44:36. > :44:40.group and flexibilities exist for parents to start four-year-old
:44:41. > :44:46.children later in the year. Whilst then may not be a statutory barrier
:44:47. > :44:53.for a child being admitted to school in a particularly year group, it is
:44:54. > :45:01.not a statutory right. The Department for Education has got to
:45:02. > :45:06.think again on this issue. How would you change school admissions to take
:45:07. > :45:11.account of this? All we need is flexibility. We were pleased with
:45:12. > :45:18.the advice that the Department for Education published in July, which
:45:19. > :45:22.clearly indicates there is no barrier to a child starting in a
:45:23. > :45:26.different year group. What we are really talking about is a summer
:45:27. > :45:31.born child, rather than starting in reception just after they are four,
:45:32. > :45:36.that they would actually be allowed to start in reception just after
:45:37. > :45:41.they are five. At the moment, if parents exercise their choice not to
:45:42. > :45:44.start their child until the compulsory school starting age,
:45:45. > :45:48.which is the term in which they are five, they actually are almost being
:45:49. > :45:54.forced to go into year one. If you've chosen, do you hold your
:45:55. > :45:59.child back because you think they are not quite ready for school, and
:46:00. > :46:03.that's a perfectly logical thing to do, then parents argue, why should
:46:04. > :46:09.they miss out on reception year? There has to be a cut-off between
:46:10. > :46:13.years. How would that pity really change? There will always be
:46:14. > :46:18.children, whichever way you decide to do it, who will fall close to the
:46:19. > :46:22.cut-off and could be disadvantaged in that sense. Absolutely. Our
:46:23. > :46:30.school starting age was effectively changed when all local authorities
:46:31. > :46:35.were required to provide a place for all four-year-olds in the September
:46:36. > :46:40.from the birthday. That was useful because it addressed one of the
:46:41. > :46:44.issues, that you were even in up the length of schooling. But you have
:46:45. > :46:48.got some children who are not ready to start at that age. If you take
:46:49. > :46:54.the example of a premature baby, a seven-month baby born on the 31st of
:46:55. > :46:57.August, then it's pretty clear they are not ready to start school the
:46:58. > :47:01.September after their fourth birthday. Then maybe parents who
:47:02. > :47:05.find it difficult to start their child at school to terms after
:47:06. > :47:08.everybody else and still be in that same year, and whether that would
:47:09. > :47:12.iron out the disadvantage in subsequent years, we don't know
:47:13. > :47:16.that. But what about the children already in the system? If the
:47:17. > :47:23.figures are showing they are at a disadvantage, what can you do to
:47:24. > :47:25.help them improve during their school years? With some of the
:47:26. > :47:28.excellent teachers we've got, I would hope you've got the right
:47:29. > :47:32.approach in our reception year. But there are examples across the
:47:33. > :47:34.country where a summer born child might be classified as having
:47:35. > :47:42.special educational needs when they are not. In a good reception class
:47:43. > :47:46.you will have teachers looking at each individual child was level of
:47:47. > :47:49.development and making sure that the activities are appropriate. A summer
:47:50. > :47:56.born may be more developed than an older child. It is really important
:47:57. > :48:00.to have a child centred approach. That is why the parents, and there
:48:01. > :48:04.are not large numbers of them because it's a big decision to hold
:48:05. > :48:09.your child back for a year, they are doing it because they don't want
:48:10. > :48:15.their child damaged and failed at school age four. What is the
:48:16. > :48:20.situation in Scotland? Reception year doesn't really apply in
:48:21. > :48:23.Scotland. You have a primary one in Scotland in the August after their
:48:24. > :48:27.fifth birthday. But if they turn fight between August and February,
:48:28. > :48:31.there is the option of starting in August while they are still four,
:48:32. > :48:37.but it's not compulsory. Parents can choose to wait until the following
:48:38. > :48:42.August. Has that worked better? I'm really interested in this research.
:48:43. > :48:44.There is no plans to change that system in Scotland at the moment
:48:45. > :48:51.because we think that flexibility works well. There's a general issue
:48:52. > :48:54.we are focused on, in trying to make sure we are raising attainment and
:48:55. > :48:58.closing the attainment gap between the best and worst performing. We
:48:59. > :49:03.would all be well advised to pay attention to research that. Gordon
:49:04. > :49:08.Brown is speaking in the Commons today. It's not often we say that
:49:09. > :49:11.any more. He's going to be making a short speech arguing for more
:49:12. > :49:14.support for the schooling of Syrian refugees. Since losing the election
:49:15. > :49:17.in 2010, he's remained an MP but he's been criticised for being
:49:18. > :49:20.almost invisible at Westminster. So what's he been up to? The former
:49:21. > :49:24.Prime Minister has taken part in 127 votes out of 980 since he left
:49:25. > :49:30.Number Ten, that's 13%, well below the average amongst MPs. He's spoken
:49:31. > :49:33.in seven debates, raising the proposed closure of Remploy
:49:34. > :49:41.factories in his constituency and Rupert Murdoch's bid to take full
:49:42. > :49:48.control of BskyB. So what's he been doing instead? Well, he's the UN's
:49:49. > :49:52.special envoy for global education, a role that involved a fair bit of
:49:53. > :49:55.globetrotting. He earns money for his speaking engagements. Latest
:49:56. > :50:01.figures show he declared payments totalling ?1.37 million. His office
:50:02. > :50:10.said that all of the money went directly to charity or to fund
:50:11. > :50:13.charitable work. We are not quite sure what then happens to the money
:50:14. > :50:18.after that and what salaries are paid. And of course he's paid a
:50:19. > :50:24.salary as an MP of just over ?65,000. We're joined now by a brace
:50:25. > :50:32.of bloggers. Mark Ferguson, from Labour List, and Harry Cole, from
:50:33. > :50:36.Guido Fawkes. Does it matter how often he speaks in the house? As
:50:37. > :50:41.Prime Minister, he wasn't really in many votes in the house either. Is
:50:42. > :50:46.it really a proper way of judging his contribution? I think the people
:50:47. > :50:53.of Kirkaldy deserves some reputable station. -- representation. He has
:50:54. > :50:57.become the noble cause of Syrian refugees, but it hammers home the
:50:58. > :51:03.point there are 60,000 people in Scotland who don't have an MP. He is
:51:04. > :51:06.on a smattering of written answers and teapots in occasionally. He is
:51:07. > :51:16.collecting his salary, we are paying him to be an MP. Since 2010, he's
:51:17. > :51:21.earned 3.6 million. Only ?900,000 of that has gone to charity, he's
:51:22. > :51:23.declared that on his website. The rest has gone to this mythical thing
:51:24. > 0:44:29called the