27/06/2016 Daily Politics

Good morning and welcome to the Daily Politics.

The fallout from the UK's historic vote to leave

Chancellor George Osborne, still in the job - for

He says there's no need for an emergency budget,

and the country is in a position of strength.

Boris Johnson calls for healing and building bridges as he promises

Britain will still be able to trade freely with the EU.

Is he going to be the next Prime Minister?

And are his assurances enough?

And the referendum upheaval isn't restricted

Jeremy Corbyn remains defiant despite waves of resignations

Can he stay in the job, and for how long?

And we'll be packing all of that into just half an hour today,

as we've got a shorter programme for the next few weeks

And with us for the duration are two political big hitters -

Conservative MP Liam Fox and Labour MP Emma Reynolds.

So, if you thought the dizzying pace of political change following last

week's historic vote to leave the EU would slow down this week to give

you time to watch the tennis, then I'm afraid you can think again.

Chancellor George Osborne, who has been conspicuous

by his absence since losing the referendum, appeared early this

morning at the Treasury in an attempt to calm

During the campaign, he'd promised an emergency budget filled

with spending cuts and tax rises, but today he said

He said the UK economy was facing an "adjustment", but that the

country was ready to face the future from a position of strength.

It is already evident that, as a result of Thursday's decision,

some firms are continuing to pause their decisions

As I said before the referendum, this will have an impact

on the economy and the public finances, and there will need to be

Given the delay in triggering Article 50, and the Prime Minister's

decision to hand over to a successor, it is sensible that

decisions on what that action should consist of wait for

the OBR to assess the economy in the autumn, and for the new

But no one should doubt our resolve to maintain

the fiscal stability we have delivered for this country.

To companies large and small, I would say this: the British

We are highly competitive, and we are open for business.

So, that was Chancellor George Osborne.

Well, have his comments had the desired

effect and eased jittery financial markets?

The BBC's Business Editor, Simon Jack, can tell us more.

What is happening? The markets are down this morning, but not nearly by

as much as we saw at the end of last week. The FTSE 100, the 100 biggest

companies, is down just over 1%. If you look beyond that to the FTSE

250, these are more UK focused businesses. They are down another

4%, added to the ten plus at the end of last week. It's not total

carnage, it's not panic, but in some sectors we are seeing a real

battering, such as Barclays, down over 10% today. House-builders are

also down, Mike Taylor Wimpey. Clearly, people are thinking that

there is going to be less appetite to build, and those banks stocks

down for a combination of reasons, such as an interest rate cut. It

will push back the time they can pay dividends as well. They will also be

in the firing line if there is a downturn in the property markets.

Not carnage, but pockets of real damage. Do the comments from the

Chancellor calm things? The banks I have spoken to and the analysts were

a bit underwhelmed by what the Chancellor had to say. He didn't say

anything unexpected. He said we were coming from a position of strength.

He's been missing in action for a few days,

so he and Mark Carney have realised it falls to them to steady the ship

a bit, because the Prime Minister has resigned. The Chancellor has

come out and said, I am sticking around. It was interesting that he

said there would be no emergency budget yet. He's saying that there

will be no budget cuts and tax increases yet. He's waiting for the

OBR to have a look at the finances and the shape of the economy. He's

saying he's sticking around for now, no emergency budget yet, but one is

coming. What about investor confidence? It's pretty thin at the

moment. Lots of people are going to safe haven assets, things like gold,

things with big US exposure. Pharmaceutical companies are doing

quite well. Diageo has a lot of its earnings overseas and is not very UK

focused. The dollar is doing well. People are going for the usual safe

havens, which means that other than those, things are pretty skittish

out there. The FTSE 250 down another 4% this morning. Liam Fox, Brexit

has caused uncertainty, and certain sectors are really suffering, like

banking and property. It is inevitable there will be some

uncertainty. The Prime Minister has resigned. I was not expecting that.

I am not surprised that we have uncertainty. We have taken a

phenomenally difficult decision. I am not surprised to see this.

Perhaps the fact that the FTSE 100 is death -- is down less than 1% is

an indication of the fact that this is an adjustment and not serious

instability. What about in the weeks to come? It's damaging to the

economy. In the long-term, seeing a reduction in Stirling, the IMF would

say that would be helpful to Britain's exports. We have seen a

bit of the pound coming down. I think you will see stability

re-emerging in the coming days. No total carnage, says Simon Jack. And

that warning from the Chancellor before the referendum, that isn't

going to materialise? I'm glad to hear that, but I do think it was

pretty irresponsible from the Leave campaign to suggest that there would

be no economic impact should the decision be to leave. Liam and I can

agree that now what we need to do is have a plan in place to give the

markets and business more certainty. We want to see the economy come

through this. That's going to be very difficult. Boris Johnson and

others need to come clean with people that this isn't going to be

an easy process. It is going to be tricky. We need to try now to get a

plan in place. I think that the vote Leave campaign, and Boris Johnson

and Michael Gove in particular, should have been thinking about this

before last Thursday. We need to work out what we will do in terms of

adjustments in Whitehall, and re-establish a trade department. We

need to see negotiating unit set up in number ten to get our discussions

under way before we get to the Article 50 part, and for the House

of Commons today, I imagine both sides will want to see what

contingency planning was done in advance by the civil service. After

a Cabinet meeting this morning, David Cameron comes to the Commons

later today to talk about the results of the EU referendum.

It'll be his first appearance since he announced his

He's already made it clear he'll leave the negotiations

on the UK's new relationship with the EU to his successor,

Well, Boris Johnson, who of course led the Leave campaign,

is the favourite to take over and so his first big statement

This morning, we got a glimpse of his thoughts through his weekly

In it, he claimed that the Government would now be able

to "take back democratic control of immigration policy,

with a balanced and humane points based system",

though not how many people would be allowed into the country

But he also says that immigration was not the main reason most

people voted Leave - that actually the main issue

was control and the undermining of British democracy.

He promised that "there will continue to be free trade

and access to the single market", though he didn't say

whether conditions - such as free movement -

And he raised the possibility - but only the possibility -

that "the substantial sum of money" previously sent to Brussels

He dismissed Nicola Sturgeon's call for a second

saying there was "no real apetetite for one soon."

But he acknowledged that the 52-48 referendum win was "not

He said that the winning side much reach out, heal and build bridges.

Earlier this morning, he tried to do exactly that.

There has been a lot of confusion over the weekend about the status of

It is absolutely clear that people from

other European countries, who are living here,

All people want to see is a system that is fair, impartial and

humane to all people coming from around the world.

Also, obviously, people from the UK living abroad,

living in the rest of the EU will also have their rights completely

I just worry there has been a certain amount of confusion

Boris Johnson, sounding conciliatory. Is that because he is

worried? Are you all worried? You didn't think you would win, and

there is no plan? You have to be conciliatory. I argued right through

the referendum that we would continue to be the governing party,

and however many passions were ignited in the referendum, we'd have

to work together afterwards. I'm glad that that tone is coming to the

fore. We do have to get back to business as usual. There is a

political vacuum now, because the Prime Minister has resigned. He will

go in the autumn. What happens next? What is your road map? The 1922

committee will meet and telling a timetable. The choice of that

timetable is a very rapid one, that the Parliamentary element of that is

done by the 21st of July, or a slightly longer one, which was done

in 2005, which takes it beyond the party conference. But what is the

road map now, because there is a political vacuum until that takes

place? We need to look at the issues that are out there on trade, and on

diplomacy. Who should lead that? A range of people. We have a lot of

very good people, such as Peter Lilley, who was part of one of the

global trade rounds. He has great expertise. We need to get people

from politics, people from law, people who understand the European

mechanics, altogether, and it needs to be set up quickly. We need to get

moving on this. It is the stability and control of the agenda that will

give confidence to those watching the process. Are you a bit world by

it all? No. In the House of Commons, we need to see the preparations that

were made. I do not believe that no contingency planning has been done.

I find that absurd. We need to see what work has been done by the civil

service. And is it Labour's role to unite behind the government to make

sure that there is no vacuum that continues on in autumn? I hope that

Labour and the other parties will have a voice in the negotiations. In

the campaign, I stressed that I would like to see the employment and

environmental protection is being kept in place at a national level if

we are not guaranteed them at a European level. I hope there were

some contingency -- contingency plans done by the government. I am

concerned. Liam is striking a different tone, but to hear Boris

say there is no rush... It is not in our interest for these negotiations

to go on for years and years. Let's be under no illusions. Free trade

agreements are difficult. We don't want it to run for years and years,

because that wouldn't be good for the economy? Should we join the

single market? No. If we were to be in the single market, in the

position that Norway is, we would be back to the full and open Kolisi of

free movement of people, which is one of the things people voted

against. You can sell into the single market without being in it,

like the US and Canada. They do not have quite the same access. We need

to have an honest discussion. To have unfettered access to the single

market, we would need to have some sort of arrangement like Norway. In

my constituency, people were worried about immigration, so is it

realistic to suggest that we can have our cake and eat it? I don't

think it is. We need to have an honest discussion with the British

public about what can be achieved. If you want to be in the single

market, there is a price to play, and one of that is in -- is

unfettered migration. We have to look at the options available. We

have to get these talks under way. Before we trigger Article 50, we

need to know exactly what it is we are negotiating. What about what

voters were promised, or what they believed they were promised by the

Leave side? Let's look at immigration. Many voters will be

hoping that immigration will come down quickly. Will that happen in

the short-term? We cannot do that we leave the European Union.

Boris Johnson said immigration was not the main reason why people voted

to leave. Is he right? The issues of identity and controlled by

governments were a big part of that. It is important for people to

understand we are leaving the EU. We're not leaving right away. There

was an idea that we're going to fall off a precipice because we are going

to leave the next day. Many of us on the remaining side did not think we

would come out so quickly. There would always be a process of

negotiation. The question of debate would, -- was, how good would the

terms be? That is still up in the air. The Foreign Secretary said

losing access to the single market would be catastrophic. I do not

believe that. I think losing access to the single market would be

damaging to the economy, not least because banks and insurance

companies which operate out of London to save and can operate

across the EU because they are regulated and can do that. Some of

them now might move their staff to other parts of the EU. Banks are

already doing that? They are moving them to Dublin and Frankfurt. They

are withdrawing from London because they are in part of the EU. They are

rumours. Some jobs have moved from investment banks. The issue of past

sporting as well. What it means is any country that has regulatory

systems which are the same as the European Union can passport and it

will not make a difference to us whether we are in terms of being in

the EU or not. Would you promise that net migration would fall to

tens of thousands? It will. We have to get control of the non-EU. One

question which was addressed in the referendum is, why do we not have

control of the half we should? You're supposed to have control of

that is a government. One failure in government has been inability to

control that part of immigration. EU migrants here now, should they be

worried? No. What about people coming over here now? For the next

two years, migration will continue. We will not change that. People are

still -- we are still part of the European Union. After that, we get

control. The whole point of the referendum is, in the longer term,

we get control over things we do not have control over today. People

cannot have it both ways. They cannot say you're getting migration

of the next two years and we do not want seven break with the EU. If you

want stability, you need that transition. There has been a lot of

rolling back from the cup at a letter vote League campaign. Iain

Duncan-Smith -- Vote Leave campaign. They promised 350 million a week to

the NHS. Lots of people who are swayed by your campaign will be very

disappointed if you keep rolling back on these things. Are you going

to come clean with people I going to deliver on some of these promises? I

kept saying the tempo Maca is not a government. There will be money. --

the Vote Leave. Will it be on the NHS? It will be up to the Government

of the day. The temp macro poster said, let's give the NHS the money.

-- the Vote Leave. The argument was there would be about ?10 billion a

year available to any government, Labour, Conservative, to spend on

the priorities they want. I tried to make the point regularly during the

referendum, including on this programme, these were choices for a

future government. Boris Johnson stood in front of that bus night

after night people saw it on television screens. His running to

be Prime Minister of this country. The tension between Jeremy Corbyn

and many of his MPs has been well-known ever

since he unexpectedly swept to win But following the vote to leave

the EU, and amid accusations that he hadn't done enough

to try to secure a Remain vote, Mr Corbyn has been hit by a wave

of front-bench resignations aimed Yesterday started with the news that

Shadow Foreign Secretary Hilary Benn had been sacked from the front

bench, which led to a flurry of 11 resignations from his Shadow Cabinet

colleagues throughout the day. This morning, three junior

shadow ministers resigned. -- 13 junior shadow ministers have

resigned. Another has announced an intention to go if Jeremy Corbyn

does not step down. But Jeremy Corbyn has

still refused to step down, and today has announced

several replacements They include moving Diane Abbott

from International Development to Health, Emily Thornberry moves

to Shadow Foreign Secretary, and Pat Glass moves from the Europe

brief to Education. Among the new faces,

Corbyn loyalist Clive Lewis comes in as Shadow Defence Secretary,

and Cat Smith becomes the Shadow Secretary

for Voter Engagement This morning, Mr Corbyn met with his

deputy, Tom Watson, telling Labour leaders he had no authority left in

the Parliamentary party and faces a leadership challenge. Both

supporters and opponents of Mr Corbyn have been on the airwaves

this morning, making their position known.

This is not the time for the Labour Party to be

We have to hold our nerve, and we have to think very carefully,

for the sake of the country, as to what happens next.

You need 95 people to put up a proper opposition front bench

There's 15 gone already, and that doesn't include

the Parliamentary Private Secretaries as well,

people like Stephen Kinnock and so on, and I would be

amazed if Jeremy is able to fulfil all of that.

It may well be there's a vote of no confidence

He's the elected Leader of the Labour Party by party members -

So, no, Jeremy shouldn't resign at all.

Well, this battle over the leadership of the party

is really a struggle between many Labour MPs

who voted for Mr Corbyn in such large numbers.

The group, Momentum, set up to support Mr Corbyn,

is holding a demonstration this evening at the same time as MPs meet

to discuss a vote of no confidence in their leader.

And Sam Tarry from Momentum joins us now.

He is going to have to go, isn't he? Pressure is building. We have had

waves of resignation from the Shadow Cabinet. He is struggling to fill

all the positions. His deputy has said he has lost little authority.

It is a difficult situation, absolutely. What we will be facing

in terms of a situation where nearly every single trade union member, the

vast amount of trade union members and the vast amount of the Labour

Party membership, even if there has been some slippage in terms of

support for Corbyn, it will still be an overwhelming win for him in a

leadership contest. What worries me is people in the PLP who have been

resigning also knows that. What is the endgame? The irresponsible mass

of doing this at a time when the Tories are trying to punch

themselves into the face have decided they will do it. This is

crazy. Why is Labour doing this? There is concern that Jeremy did not

communicate with voters. A few weeks ago half voters did not know we were

campaigning to remain for that there is also a concern we do have a

disconnect with working class communities in the Midlands were my

own seat, and also in the north. There is concern that Jeremy does

not have the leadership skills to reach out to those people. I have

had a number of e-mails over the weekend from people who did support

Jeremy last and are now very disappointed with the lack of

passion and can pitch -- he showed join the referendum campaign. We

could lose very many seats. We could lose 30% of the support we had last

check, which was a bad result in itself. If there is a leadership

election, he will win again? We do not know that. I am a councillor in

Dagenham. Jeremy is in a good position, he is Eurosceptic but

remain position. That is where the vast majority of people were. People

talk about Jeremy Corbyn. The rot set in a long time ago. These

communities have felt abandoned because they felt there was an elite

politicians not listening to them and taking in their concerns. There

is a disconnect between the Labour Party in those communities. I agree

that it did start before now I did start before Jeremy. I do not think

Jeremy is in a position to reach out to those people. He is not reaching

out to those people now. You were waiting for an excuse to move on

Jeremy Corbyn? I wanted us to vote to remain in the EU. I slogged my

guts out for days and days and weeks and weeks. I wish we had had that

results on Thursday. Now everything is changed. The results were not as

bad as many would have expected. A more profound question, the

disconnect between the Parliamentary Labour Party and the Labour Party

outside Parliament, to the point where you can end up in a Catch-22

situation, which is not good for politics. There was a real danger of

the Labour Party splitting. They are two very separate movements. A

Blairite Parliamentary party and all socialists -- a more Socialist

Party. There is something about it being responsible to voters as well

as members. They are responsible to voters who voted them in. I think we

will still get the same result. If there is another left candidate on

the ballot paper, they would win as well. Who would you have replaced

Jeremy Corbyn? We are not in that place yet. We are going to have a

discussion tonight at a meeting of Labour MPs about whether we have

this motion of no-confidence. We have to debate that night and I hope

that vote will take place sometime this week. As Tom Watson said to

Jeremy coheres in a very difficult position now than he has lost

authority amongst many in the Parliamentary particles that if you

cannot fill the 95 positions to field a team against the Government

that puts the Labour Party in a very bad position. The party will not

split. If you look at the candidate standing against Jeremy, who would

have had a far, far worse result with some of those candidates

standing. They were clueless about how angry working class people were

in this country. Thank you very much.

resignation on Friday morning - it's hard to keep up

So, will it be Boris or anyone but Boris?

Well, the man we turn to at times like this is Alex Donohue

how are Boris Johnson's to looking? At the moment he is the favourite.

One horse is making rapid headway, Theresa May. Boris is proving

unpopular. He was odds-on and Theresa May was 4/ one foot she is

now 9/ four. Looking like a two horse race. All the momentum is with

Theresa May. We have Stephen Crabb at 10:1. His odds have been creeping

in all the while. Then there is a whole host of familiar faces. Liam

Fox in the studio with us today is 16:1. You are 25:1 on Friday. People

seem to think you are in with a chance. Then we have George Osborne

25:1. We'll be keeping an eye on him, seeing how he performs in his

speech this morning. One name is missing, isn't there? Michael Gove.

He was 5:1. That's it from us. We will be back tomorrow at 11.

Goodbye.