09/11/2011 Newsnight Scotland

it raises questions about how the UK Border Agency is held to account.

Tonight on Newsnight Scotland: Councillors say no to plans for a

new coal-fired power station in Ayrshire. The company behind the

proposals at Hunterston says it will fight on, but with the carbon

capture technology it's promising still to be tested, can its vow to

minimise harmful emissions be taken seriously?

And 50 years ago the gap between rich and poor was closing. Now the

UK has one of the worst rates of income inequality in the developed

world. Are we really all in this together?

Good evening. For the 20,000 people who objected to the plans for a new

power station at Hunterston, today's decision marked a

significant victory. There will now be a public inquiry before the

Scottish Government decides if the plant will go ahead. The company

behind the development has promised that from day one it will reduce

greenhouse gas emissions using carbon capture technology. But that

Carbon capture and stories is a way for power stations to burn fossil

fuels, collect the carbon dioxide emissions, liquified them and pour

them into underground disused Wells. Today, Scotland's carbon capture

situation has focused on three sides. We could not proceed at Long

Gannet because of the problems there, but that does not mean we

are shelving the project. For Alex Salmond, it was disappointing. But

Scottish and Southern Energy have plans. Today they announced that in

partnership with Shell, they would be seeking funding for developing

carbon capture. Scotland has world- leading expertise and some of the

best carbon storage sites in Europe. The third player on to the stage is

Hunterston in Ayrshire. For the local council there was a problem

and the planning application was rejected. We've got a situation

where we are not sure about how the carbon capture technology will be

used. For protesters it was a welcome result. The government is

on track to provide all the energy we need three renewables and this

proposal is very damaging for the environment. It seems the exact

opposite. Scotland is the only country in Europe proposing to

build a coal-fired power station. we do not need any more power

because the power being produced at the moment is more than Scott the

needs because of a were reduced fuel use. And from

environmentalists concerned about the impact on wildlife, the news

was equally satisfying. There would have been some short-term economic

benefit from it, but there would have been a loss of environmental

value on the site. For Ayrshire Power is a setback -- it is a

setback, but they are hoping to overcome it. There should be a

players for carbon capture with Kohl. Carbon capture is attractive

and essential if environmental targets are to be met. In a report

published today by the International Energy Agency, they

warn that whilst carbon capture is an important part of cutting

emissions, it faced a lot of barriers, making its deployment

uncertain. People do not realise that we cannot do without energy.

Nobody can. The relationship between energy and economic growth

is crucial and energy sources to economies is crucial. Ayrshire

Power say that they will take their plans further. We say to the

applicants this is such an unpopular application, you should

just walk away now and cut your losses. So now the SNP

administration at Holyrood have a lot of questions to answer.

I'm joined now by the man in charge of the plans for the new plant at

Hunterston - Mike Claydon from Ayrshire Power. 20,000 people

objected to this. The council has thrown it out. Why are you so

determined to press on with it? Over the next 15 years, about a

quarter of the UK's electricity generating capacity is going to be

close as the existing coal and nuclear power stations come towards

their end of their lives. At the same time, electricity consumption

will increase, despite efforts to be more efficient as we convert to

electric transport. That capacity needs to be in place and we are

proposing a substantial contribution to filling that gap.

One of the problems is you would not be able to capture most of that

carbon emissions at the start. There is no way you can do with

that because it is not technology clean possible? Today, there are

millions of tons up C02 been captured. -- technologically

possible. You cannot meet your target when the plant opens. It is

true that Summerbee but have not been integrated... A new well from

the start be able to stop 25 %, is it? 25 % is the nominal capacity of

the carbon capture plant and that is consistent with the minimum size

specified by the government. And they at his right from the moment

the Prague Opens? That is right. What enables you to make that

claim? The size of the plant... the technology is not available yet.

The component parts have been proved. Scottish Power wanted �1

billion of government money in order to do the integration that

you are talking about. If they cannot do it unless they get over

�1 billion of government subsidy, where would you get the money from?

Be it is an expensive process and unless the technology is supported

through the electricity market reforms that are currently being

discussed, then no investor, and that includes Ayrshire Power, will

be able to obtain funding for such a development. Sorry, I am not

clear. You say you want public funding for the carbon capture

storage plant? Yes, that is right. But hang on a minute, this is a

major problem for you. You have gone through this whole process

saying that you would guarantee as part of your planning application

that you would have at least 25 % carbon capture and storage from the

day the plant opened and now you have just told me that you in no

position -- are in no position to make that claim. Yes up... You put

a planning application in saying that you would provide carbon

capture and storage and now you are saying you cannot do unless you get

a subsidy from the government. have not said that. The carbon

capture and storage plant will need to be publicly supported. The power

station will have to be separately funded, but the two together...

the carbon capture and storage and use to be funded by the government?

It needs to be funded through the carbon capture and storage

competitions. Have you got funding from the government? Not yet.

you got funding from the European Union? Not yet. So your claim, you

do not know whether you will get the funding, you said you would

guarantee 25 % carbon capture and storage is wrong. We will not

developed the plant if we do not win funding for the demonstration

project. Furthermore, unless the electricity market reforms support

not just the development of carbon capture and storage technology at

the demonstration scale, they also support it for full-scale carbon

capture and storage. So you have applied for European Union funding,

which you have now told us, by the way you are not going to build the

plant and less you get it? That is true. You would accept that given

the particular type of funding, they are not going to his side on

that, on who gets the grants, until late next year. -- going to decide

on that. So no-one should allow you planning permission and will you

have actually got the money. That Planning permission is essential

before we can move through to the next stage. Planning permission is

based on the idea that you can have 25% carbon Storage, but you have

explained to me why you're not in a position to say that, unless you

get European Union grants that are not due to be decided until next

year. That is correct. How much do you need? The cost of their carbon

capture storage project is around �1 billion. Right across the

European Union, do Ketty was estimated to be at 4.5 billion

euros. The price of carbon has come down, it is more like 3 billion

euros now. There are 13 projects, of which eight are likely to be

approved. Let us divide that 4 billion euros, and say that you

might get 5 billion -- 500 million euros. That is optimistic. That is

the stated objective, whether that will be the final number remains to

be seen. Whatever they contribute one the to be topped up in a parked

by the funding that both the Scottish and the UK Government had

indicated will be available to fund up to four at carbon capture

storage projects in the UK. Right. A but you have not applied for that

funding. For UK funded competitions have not yet been announced. We

applied for the competition and with the truth. Hang on a second.

We're now at this stage we put in a planning application for power-

station, promising it will have 25% carbon capture technology on the

day of opening. If we have established that you're in no

position to make that claim because you're relying on public money to

build it. The public money might come from the European Union, but

that is a pot that will be spread across Europe. He did not know when

you will get the money and you do not know him which you will get, so

it would have to be topped up a UK government grants which have not

applied for and you do not know whether he would get an even if you

did apply for them. If we have not apply for them because we have not

been made aware of the process of application. What they have said is

by the end of the year, they will be announcing the details of those

competitions and will -- we'll be applying along with others. If you

do not get the money, we cancel the project? If we do not get the

funding, then the fight at -- the project will not proceed. If you

have explained this in detail. In the planning application two yes,

of course. And you have explain that a North Ayrshire Council?

we have. The because the public do not seem to understand the claimed

that you can guarantee carbon capture storage in this point from

A specious claim. It is not spacious. -- specious.

You know, of course, that negotiations broke down between

ScottishPower and the UK Government because Scottish Power decided they

needed more than �1 billion. They had a very detailed proposal, why

are you so sure that you can do it for �1 billion? We very much regret,

as everybody does, that the ScottishPower project is not going

ahead. Their project was to fit technology to an existing coal-

fired power station. Hours is to integrate that technology in to an

all-new, very high-efficiency power station. We will have to leave it

there. "We're all in this together" has

been the UK government's mantra since coming to power. In the 1950s

it may have rung more true. Back then, the gap between the highest

and lowest earners was closing. But from the late 70s, through the

miners strike of the 80s, to the present day, the gap has been

growing, so much so that the UK now has one of the worst rates of

income inequality in the developed world. Here's Ian Hamilton.

After the Second World War, the average UK 1,000 experienced an

increase in the standard of living like never before. -- citizen. In

1957, Harold Macmillan informed the nation that the dead in never had

it so good. -- are that it had never had it so good. Britain will

stage great. However, as the 20th century it rolled on and drew to a

close, the gap between the rich and the poor significantly increased.

In the last 20 years, the increase in inequality in the UK has a white

tent greater than in any period since the 1930s. One of the

standard ways of measuring is comparing their incomes held by the

richest 10%, compared to the incomes of the poorest 10%. The

story of the post-war period is a decreasing inequality until about

1977. That was the year in the UK where inequalities were at their

narrowest point. For 30 years after the war, much of British industry

was under government control, which kept excessive wage rises down.

of the issues in the period after 1945 is that there is extensive

taxation, control and government intervention, so you do not have

the same it's super rich as you do have today. The super-rich were not

growing as fast as they are today. The very wealthy were quite in fear

for their position, believing that taxation, intervention, would

eventually weight away all that inherited well that they had

However, the 80s began anew era, when they rich and the super-rich

sort their earnings increase like never before. Over the same

timescale, the poorest in the country were seeing their standard

of living drop. The incomes of the top 1% in Britain doubled between

1982 to 2008. But by 2008, the top 1% owned 14% of national income in

the UK. The most important factors leading to the increase in

inequality at the top end where a very significant increase in the

income of the highest earners and a decrease in they did top rate of

income tax and other taxes. Life is becoming taxing in other ways for

those at the bottom in the 1980s. Industrial unrest, unemployment, a

squeeze on benefits and low wages good families under pressure. --

put families. Poverty is associated with long-term unemployment and is

confined to a specific group of people and in places that are quite

specific. That really carries on right up to the present, what you

might call sink estates or unemployment blackspot. According

to an economist, the disparity in the UK is among the we distend the

UK. -- the world. Britain is one of the most unequal countries in

Europe. There are only four European countries with a higher

level of income inequality, in fact, Britain is amongst the most unequal

countries in the developed world. One the few countries that other

member of the OCD, have higher levels of inequality, countryside

Brazil, Mexico and the United States. When the banking crisis hit

in mid- 2007, some argue it was the poorest that were the hardest hit.

It was suggested that to help them would involve an injection of cash

from the highest earners. Is this likely?

Another mild night out there. Later on we could see some heavy rain in

the south-east of England, making for some as a bull driving

conditions in parts of Somerset, Devon and Dorset. The rain tracks

its way northwards through the day. The afternoon could be quite damp.

East of the Pennines are generally dry Butterworth -- we knew he said

it will be agree start but size bills coming through. The south-

west of England starts wait, possibly very wet in some places.

By the afternoon, it will be turning drier and brighter. It is

looking like a fine day in Northern Ireland. There are some clay but

there will be some sunshine as well. Across Scotland, it will start dry

back we'll see outbreaks of rain working their way in. As for Friday,

we'll see another band of rain moving in across Northern Ireland,

slowly walking into parts of south- west Scotland. Edinburgh and

Inverness may well see some sunshine. A lot of sun across the