05/07/2011 Newsnight

Tonight, reviled, condemned and now boycotted by advertisers, the

pressure is piling on Rupert Murdoch's News International, as

the police confirm that the parents of the two little girls killed in

the Soham murders have also been contacted by the hacking inquiry.

We have also learned they have been in touch with former police officer

and Crimewatch presenter Jackie Hames, to warn her, she too may

have been hacked. All this blamed on an organisation this country's

politicians have gone out of their way to court. Murdoch veteran,

editors and Tony Blair's spin doctor are all here.

For 160 years it has been the heart of British Rail way engineering,

why has the Government decided to buy new trains, not from derby, but

from a bunch of Germans. It just seems crazy that it could

close, and if it does, Britain will lose its last toe hole in an

industry that we created. Can the transport minister explain why he

thinks this a better way to spend tax-payers' money.

Also tonight. We have been degenerated, not regenerated.

A catastrophically broken promise to the people of Stoke-on-Trent.

How did a Labour pledge to rehouse people end up with things worse

than before. Where are the new houses? We haven't got any.

If it wasn't so nauseating it would be comdal, tonight the News of the

World - comical, the News of the World journalist accused of hacking

Graeme McDowell's phone - Milly Dowler's phone has asked for

privacy for his family. There have been immediate commercial

consequences, the Ford car company is pulling Tuesdaying from News of

the World, others are thinking of doing the same. We have been told

about a major new development tonight in the phone hackinging

story, it centres on two police detective that is appeared on the

BBC Crimewatch programme. Dave Cook, investigating a murder case, and

Jackie Hames, one of the presenters, it is thought the News of the World

believed they were having an affair, and they were married at the time.

There is no question that their phones were accessed. It is the

first stage of investigating exactly what happened and what this

meant. We understand the police investigating hacking at News of

the World have found confidential information on the two detectives

in the miles of Glen Mulcar, the private detective the paper had

employed. We still don't know exactly what happened, we know some

sinister incidents took place, going beyond phone hacking. That

raised issues of personal security that they were both very concerned.

They both had young children at home. It started two years ago with

allegations against celebrities and their representatives. Then

politicians became involved. It was only yesterday with a revelation

that murdered schoolgirl, Milly Dowler's phone had been hacked, the

wave of dues gust threatens to continue, with news today that the

families of the murdered schoolchildren, Holly Wells and

Jessica Chapman have been approached by police. If it turns

out the News of the World hacked into the phones belonging to the

parents of Holly and Jessica, the News of the World will face further

investigation. Any investigation about crimes that were interfered

with, or where hacking took place, adds to the view that there are at

least in parts of the industry, something very rotten. This is

truly immoral what was going on. My wife said to me this morning, this

was sick what was going on, that will be the reaction up and down

the country. It is reasonable to assume that other high-profile

crime cases could have been targets. Another obvious candidate is the

case of missing girl Madeline McCann, who disappeared from the

apartment in Portugal where the family was holidaying in 2007. We

approached the former BBC journalist, who has represented the

McCanns in recent years, he's standing on the right here. He told

us today when he asked his phone company to check the records, they

found several suspicious events in 2008, at the height of reporting

about the Madeline case. Given the concerns that had been

raised, I asked Vodaphone to check my own phone records. Whilst they

prrnt able to go back through every single phone call in and out. They

were able to present me with the customer service records, any time

someone calls to make a payment or renew your plan a note is made by

the operator. Vodaphone themselves flagged up, on at least two

occasions, back in 2008, some suspicious activity on my phone,

which I know had nothing to do with Clarence Mitchell has been

interviewed by the police who have taken this evidence. He says he

can't be sure if News of the World was behind these suspicious calls

or not, he was in daily contact, and says journalists were under

dangerous pressure to deliver new lines. It certainly wasn't me, it

makes no sense. There is no such thing as a CID trial and there

never has been a trial in the McCann case. Rebecca Brook, now

News International's chief executive is coming under intense

pressure to resign. I understand people have been saying that, she's

clear that's what she won't do. It happened in 2002, she's chief

executive of a company in 2011. She's absolutely determined to get

to the bottom of this issue. She has put three senior executives in

charge of it on day-to-day basis, we run this full-time, we make

decision, we report to her, we are under no illusion she's absolutely

determined if things went wrong we will correct them, and justice will

be done. But advertisers are voting with their feet. Ford has pulled

its advertising, pending the outcome of News International's

inquiry. Others, including NPower, Vauxhall, Halifax, Dixon, are

reviewing the accounts. Tesko, one of the biggest advertisers today,

said the latest allegation also cause huge distress. Remember News

International used to tell everyone, including the Press Complaints

Commission, that it was all down to one rogue reporter. I am the

regulator, there is only so much we can do when people are lying to us.

Now we know, we didn't have the evidence then. We know now that I

was not being given the truth by News of the World. New hacking

victims are emerging by the hour, it seems.

Tonight the independent newspaper claips that Rebecca Brooks

personally ordered the hacking of certain phones, and others say that

the victims of 7/7 were also targeted. New developments tonight?

Happening every half an hour. My colleague was reporting earlier

tonight on Twitter that News International passed e-mails to the

police that seemed to show that Andy Coulson, the Prime Minister's

former press secretary, did pass comment, it is thought that new

information has been provided to the police. And News International

has reiterated that full co- operation has been provided. This

is a big issue, it is not just phone hacking, it is about the

payment of police for confidential information. One final thing

reported in the Telegraph tomorrow morning, the paper there. They are

suggesting that some of the survivors from 7/7 may have had

their phones hacked in to too. The former director of

communications for Tony Blair, Alastair Campbell, as is the former

News of the World journalist, Paul McMullan.

Let's start with you, Paul McMullan, Rebecca Brooks said she's staying

because she didn't know what was going on in the cases, could she

not have shown? - known? I have always been quite loyal to her, God

knows why. One slip up was when Hugh Grant came into the bar and we

had a chat over the bar and I said she knew all about it to him, that

was a bit of unguided bar talk. The simple answer is, yes, of course

she did. She, of course denies that? I see. Right, well that is an

interesting position to take. And one that when they first said it

was a rogue reporter, I thought what about the legitimate

investigations we have done that we have had to go into the grey areas

and do these things, surely you should protect us and take the

point that sometimes we have to do these things, not it is just one

person, we never knew anything about it. What was it like to work

there at the time. Glenn Mulcaire, the private investigator, talks

about a climate of constant pressure to deliver things? It is,

you are only as good as your next story. They used to do a byline

count every year, and if you didn't have enough it was goodbye. Can you

imagine yourself in that sort of environment imagine yourself doing

something like listening to Milly Dowler's phone message or something

like that? I thought about that today, I have always been very

proud to be a News of the World reporter, the biggest circulating

English language newspaper in the world, and suddenly I felt ashamed

because of the parents and what they had gone through. In reality,

I have been thinking about it and taking a step back, it is not such

a big deal. I was talking from someone from Kenya earlier today

who said the journalists might have helped. They knew a bit of extra

information. Are you saying you don't think it was an invasion of

privacy? You don't think it broke the law, or obstructive to the

police inquiry or distress for the parents, all those things are

outweighed? The mistake was made, he was so keen to get new messages

he delighted the old ones. That alerted the family that somebody

was tampering with her phone, and it could have been her. Can you

imagine yourself doing that in those circumstances at that time?

I'm thinking, no I didn't, any way. I'm suggesting did, I'm asking can

you imagine yourself doing it, working at the News of the World at

that time? I have to say when you're investigating something, and

you are really just trying to write the truth about an issue, and you

are looking for an exclusive, and if that is available, then, I have

been thinking to myself, would I have considered taking information

from that, because you have to say it wasn't a staff reporter who did

that, it was a PI, who has done it, and then rung up and said this is

what's happened. Do I put my fingers in my ears and say please

don't tell me. No you don't, you listen. You think that is an

interesting lead. But, no, I shouldn't be trying to defend the

indefensible, because it is not going to be a very popular position.

Let me turn to Alastair Campbell here, how big a deal is this?

has become a very big deal T would have been less of a deal if News

International from the word go had taken the approach that Paul has

taken the whole way through this, which is basically to say, we did

terrible things, we accept they are against the law, here we are going

to clear it all up. Instead of which, what has happened is the

truth has been dragged kicking and screaming, lines have changed every

stage of the story. You have had the business willing if away, and

the police and the Government willing it away. Some stories have

a tipping point, and the Milly Dowler revelations last night is

the tipping point. The reason we are sitting talking about it and

the newspapers keeping it going and a debate in the Commons tomorrow,

is we have reached a tipping point, it is not just about the News of

the World, it is about what sort of press, culture it is, and what sort

of practices they have indulged in. Considering themselves above the

law for some time. You know News International, do you think Rebecca

Brooks can survive? It will be difficult, I think in many of the

car crash interviews Alan Greenburg did today, he said the difference

between Andy Coul so, n and this is the allegations were substantiated,

it seems to say if the allegations are substantiated Rebecca will go.

It was broadcast earlier this evening that there was no doubt at

News International that the story has been substantiated and there

may be worse to come. I this from Rebecca's perspective, I will take

her at her word she didn't know anything about it. Paul was saying

the same thing when Andy Coulson knew nothing about it, and Paul

said the whole way along, he sat in the newsroom and saw what went on,

and it was industrial, endemic phone hackinging throughout the

newsroom. I estimate at least 10% of the population hacked into a

phone, your girld friend might have done the same thing. A mother might

do that to see what her son has been up to. That has been made

illegal, it used to be fair game. We used to sit outside Buckingham

Palace listening to Prince Charles talk about ridiculous ideas. It is

not just about phone hacking. This debate in the Commons, I hope they

talk about the Information Commissioner's report about this

relationship between newspapers and private detectives, where there was

one report, the Mail made 60 different journalists make

different payments to the same private detective. The Observer was

on there, we are not just talking about the News of the World. We are

talking about a culture, even Paul would accept has got to change.

The House of Commons is to hold an emergency debate on the scandal

tomorrow, while both main party lead verse wrung their hands today

and expressed their horror at what the News of the World is said to

have done. The acid test is how far politicians are willing to distance

themselves from the paper and the parent company. It is perceived

wisdom in politics that you don't win elections without cosying up to

Rupert Murdoch's publications. Plenty of politicians clear that

not getting up close enough to the sun could cause them to crash and

burn. Mrs Thatcher was bathed in a warm appreciative glow, Tony Blair

made good relations an absolute priority. Losing the endorsement

made Gordon Brown's departure more spectacular. David Cameron, the man

he chose to run his press operation was a former News International

editor. Want to see this influence in

action? Here are some pictures of Tony Blair visiting News

International in 1999. Look what happens when he comes across

Rebecca Brooks, he gives her a friendly wave, before his minders

want to get the cameras to film something else. No, no filming just

for a bit. Patrick Diamond was an adviser in

Tony Blair's Downing Street. It is inevitable, any Government in the

modern age will pay heed to what the media thinks and writes, there

will always be a concern with presentation. What matters is

policy decisions are taken for the right reasons and the best

interests of the country, and not because it seems to be popular with

one newspaper or another. There are sensitive policy decisions around

the issue of immigration, around the issue of the criminal justice

system, and around issues to do with taxation were there has been a

feeling that perhaps some newspapers have been too

influential n terms of skewing the public debate in particular

directions. A generation of Labour MPs were scarred by the way Sun

duffed up Neil Kinnock. When Gordon Brown lost the Sun's endorsement in

2009, they turned on him. Among other stories they ran a damaging

account of his scrawled letter to a mother who lost her son in

Afghanistan. For a politician, it is hard to shine when the Sun isn't

shining. David Cameron learned the lesson too, the man he appointed to

the job of handling his communications was Andy Coulson the

editor of the News of the World, who resigned over the phone hacking

allegation, while maintaining he was ignorant of the practice. David

Cameron is very friendly with News International's chief executive,

Rebecca Brooks, sharing a family meal over Christmas last year.

Today Mr Cameron said he was appalled by the recent hacking

allegations. If they are true, this is a truly dreadful act and a truly

dreadful situation. What I have read in the papers is quite

shocking. When the new Labour leader, Ed Miliband, was picking a

communicatoins chief, he turned from someone from News

International, Tom Baldwin, a former Times journalist. According

to leaked memo in January, he told Labour MPs not to pick on News

It's not just primes and leaders of the opposition - prime ministers

and leaders of the opposition that come into the gravitational pull of

News International. Backbench MPs looking to investigate the phone

hacking allegations report being gently warned against pushing their

inquiries too far. Meanwhile other MPs appear to be on very good terms

with the organisation. The Commons culture, media and

Sport Select Committee has the job of skrutising the activities of the

broadcast - scrutinising the activities of broadcast and media

operations. BSkyB sent one politician a check for the Cricket

Clbu he supports. It was said this was one of many grants made to

grassroots cricket. More than one member of the committee recalls the

chairman using their power to stop Rebecca Brooks giving evidence.

chair said we have to as a committee to think very carefully

before going down that particular road, because there could be

consequences for us personally. And all kinds of revelations could be

dredged up in terms of our personal life. Almost as revenge for telling

Rebecca Brooks to appear against her will. Mr Whitting Dale told

Newsnight he was neither warning or passing on a message, just

recounting what another MP had told him. He said the severity of the

committee's criticism of News International, testifys to his and

its independence. Plenty of other news organisations have plenty of

links with politician, they wouldn't be doing their job if they

didn't. But, the question is, when does contact become pressure, and

when does pressure become sinister. With us knew Chris Blackhurst the

new editor. And my other guests. Something you want to clear up

first? Your reporter at the top of the story got it slightly wrong. We

have a very good story in the Independent tomorrow saying that

Rebecca Brooks actually commissioned one of the private

detectives herself on a personal matter. Nothing to do with the

story. He was the private detective who then went on to provide the

paper with the ex-directory number of Milly Dowler's family. What that

shows is her claims not to know these people and to be distant from

them, really can't stand up. She did contact this bloke, she asked

him to look for, something to do with a phone number, he did the job

for her. It was something to do with her private life. He then went

on later to provide this phone number.

How does it strike you as a visitor to these lands a frequent advise to

but this whole affair? Well, in many ways it is a universal problem.

Because there is a deep mistrust a growing mistrust of the media.

Across the Atlantic, as well as here. But the specific problem of

actually paying private investigators, to collect

information, which is something illegal, to hack, which is

something illegal. That is very specific to here. Yes, the National

Enquiryer may do it, the Star may do it, but mainstream press should

not be able to get away with that. The fact it is going on year, after

year, after year, is very significant. What Alastair said is

the key, this has reached a tipping point, our splash tomorrow in our

inaugural edition will be the back stabs with Rebecca Brooks. These

guys have been able to behave in this way because people like you

and political parties of the kind you belong to and are still

associated with, and indeed the present Government, like to cosy up

to them, because they believe they are important, do you accept a

degree of blame in this? I accept a degree, but it is overstated. I

always think the Sun's influence is overstated. In 1997, the Sun came

out for us because they knew we would win. You flew Tony Blair to

Australia to speak to Murdoch? To get them on side? Partly about that.

Our aim in opposition was to get into Government. That was about

reaching through to the public. So an event like that was a bit of a

no-brainer for to us do. Where you have a point, Patrick Diamond made

a great point in that package. He said, you can have all sorts of

relationships with all sorts of people, providing you are making

policy judgment ace cord to go what you genuinely believe - according

to what you genuinely believe. Tony Blair would sit with Rupert and say

that you are mad about Europe. I think the relationship is skewed if

they are moving half way across to their ideas. You have the note from

Tony Blair after the victory, "thank you for your wonderful

support which really did make all the difference"? Tony is a polite

kind of chap. The Sun likes winners, the reason they really went for

Gordon Brown is because they were desperate for Cameron to win,

because that's who they backed, in the end Cameron didn't get the

majority. That is the other point, politicians worry far too much

about newspapers. That is me saying it, having worried about them in

the past, partly because of the changes that the on-line revolution

represents, newspapers are becoming less influential.

This is an apology for a wasted life, in your case? Not at all, my

life was dedicated towards helping the Labour Party get into power,

and then staying there. worrying about what the press was

saying! Part of the job as press spokesman was to manage the press.

Tony Blair's job was to get on and lead the Labour Party. The media

thinks everybody sits there only thinking about the media. If you

let the media define your reality, you are always making a mistake.

What is given different now is managing the press is no longer

possible, it is no longer five or six newspaper that is you manage.

It is social media everywhere. It is Twitter, it is the Huffington

Post. Stop uing ping your - plugging your paper please.

What do you make of your relationship? What agree with

Alastair is, when he mentioned the Sun, the perception in this country

is that the Sun delivered the election,, they had the poster

front page the day of Neil Kinnock, I would argue that they had already

lost and the clincher was the Sheffield rally the night before.

The Sun did not win that election for Labour, sorry, for the Tories.

Unfortunately, it has been allowed to grow in the Westminster village

and the media village. It is good marketing by the Murdoch people.

this a tipping point as far as people's attitudes to the press

generally, and to the News International papers in had

particular? First of all, I would like to say on behalf of everybody.

Don't plug your newspaper, please? All journalists, in the same way

not all MPs fiddle their expenses, not all journalists got up to this.

On the other hand it is a tipping point. The Milly Dowler thing today,

I have never seen anger and fury, and my own wife said, she didn't

care too much about Sienna Miller having her phone hacked, but she

was livid about Milly Dowler. There is something very profound there.

It is this point on the extent of it, the Information Commissioner I

mentioned before, he did a report earlier this year, one detective

employed by 31 different newspapers, right across the spectrum. Selling

them illegally obtained information. That is why this debate tomorrow

mustn't just be about News of the World and Rebecca Brooks. Isn't it

the extent to which commercial pressures could get the media

straight. Once you get organisations like Ford withdrawing

their advertising from News of the World, organisations like Tesco,

Virgin and various others, thinking about doing so, it is a significant

pressure, from ununexpecting source. The reason they are considering

withdrawing advertise something partly because of the public

outrage. While the public might have been willing to put up

celebrities, even the Royal Family, politicians having their phones

hacked, they are absolutely outraged it happened to an ordinary

family. It means it could happen to them. Also this revolving door that

we see here between the News of the World and Number Ten. That is

outrageous, have they run out of spin miser, do they have to go to

the News of the World. Tonight on Twitter, the spokesman, Greenburg,

he was trending, Rebecca Brooks was trending, Glenn Mulcaire was

trending, even Rebecca Wade is trending. It is a strand of the

public having their say and forcing it and keeping it on the agenda, at

that time when the police, the media and the politicians want it

to go away. I think the first thing the Prime Minister should say is

there will be a full judicial inquiry into the practice. We live

in strange age, one of the clinchers today was to hear Mumsnet

was up in arms, that is much bigger than Tesco and Ford, Mumsnet.

as big as the Huffington Post though! That's enough. Getting on

for half the work force at Britain's last remaining train

manufacturer will lose their jobs. It follow as Government decision to

give the contract to make 1,200 new train carriages to the German firm,

Seimens. It is an odd way to show their commitment to manufacturing

in Britain. The business secretary said it was vital that Britain

retains train making skills. I will be talking to the Transport

Secretary in a moment. Just look at this beauty, she's one of thousands

of mighty locomotives designed and built at the Derby Work a centre of

railway innovation since 1840, the very dawn of the industrial era.

Frank Leeming, now a local councillor, became an apresent tis

in 1948, aged 15. - an apprentice in 1948, aged 15. I feel extremely

proud and think I was part of this at one time, this is my heritage,

and I intend to keep it. Machines like this one are a mighty

symbol of Britain's once great manufacturing industry. But, as we

all know, British manufacturing is not what it used to be.

Or at least, that's the conventional wisdom. But the plant

here in derby has been at the forefront of innovation in the

railway industry. First in the age of steam, then in the diesel

revolution and now with high-speed trains. I took Frank back to see

how the place has changed since his day. I'm so pleased to see the

standard that we are still producing. This is a superb

standard, second to none anywhere in the world. Not for much longer,

according to the Unite union. Unfortunately this vast engineering

work could soon close, Bombardier lost a contract to a German company,

Seimens, for a major Government contract to supply trains for the

London Thameslink network. It leaves this unique British

factory's future uncertain. The company says the loss of the

�1.4 billion contract to Seimens, has led to the 1,400 job losses

announced today. It says by September just one of its five

production lines will be operating. Of course, resuscitating Britain's

manufacturing industry has been a key goal of the coalition

Government. Remember when Cameron shipped the entire cabinet up to,

that's right, Derby. Why? The point of the cabinet today is to ask one

fundamental question, what is it that we can do, in Government, to

help the economy to rebalance, to grow, and for businesses to start

up, to invest and employ people. Here is the Prime Minister in

London. My approach is clear, British business should have no

more vocal champion than the British Government itself.

again. Our economy has become more and more unbalanced, with our

fortunes hitched to a few industries in one corner of the

country, while we let other sectors, like manufacturing, slide.

The Government says that European rules mean it is forced to choose

the best value option for tax- payers, regardless of where

companies are based. Christian Wolmar is a railway historian and

transport export. Most trains for Germany are made in Germany, most

trains in France are made in France. Here we follow the rule. How much

flexibility does the Government have under European law, could the

coalition have awarded the Thameslink contract to this British

factory if it wanted. The UK and the authorities that award public

authorities in the UK are obsessed with the lowest price, with purely

economic criteria for the award of public contracts. In the continent,

in Germany, France and other continental countries, they have a

more relaxed and flexible opportunity to incorporate

socioeconomic criteria, taking into influence how public service

contracts are award. The decision has angered workers

here. These workers have a century- long commitment to the plant.

was a massive disappointment, for the town it was horrendous. This

plant is Britain's last toe hold in the railway industry. If it goes,

the chances are this country will never build another train.

With us now is the Transport Secretary, Philip Hammond. How much

money was saved by giving the contract to Germany rather han

having it made at the Bombardier plant - than having it made at the

Bombardier plant? It is not about money saved, it is complying with

the legal requirements under. there any money saved? The Seimens

proposal represented better value for money. By how much? When

measured in terms that were set out in the original procurement. By how

much? I can't tell you that. Do you know? Of course I know, it is

commercially confidential, and under the terms of the procurement

I can't sit on the programme and talk about the terms of the two

bids. Have you considered the cost of the unemployment? The terms of

the procurement were set out by the previous Government in 2008Er

Passing the buck? I'm explaining how the system works. What the guy

said on there is perfectly true, it is OK to add in socioeconomic

factors, but it has to be at the time you have the procurement.

Labour didn't do that in 2008. If we had decided, as some people have

urged us, to simply ignore the terms of the procurement that

Labour set out, and to award the contract to an underbidder, first

of all, we would face legal action from the successful bidder.

Secondly, under terms of the EU remedies directive, we would very

likely be prevented by legal intervention from signing a

contract any way. Why is it that the German and French Governments

are able to ensure that their trains are made largely in their

own country, and you appear to be incapable of doing so? It is a very

good question, and Vince Cable and I wrote to the Prime Minister the

week before last. That is after the event? Following the announcement

on Bombardier, wrote to the Prime Minister. After the event? And said,

that we need now to look at how we operate within...Did You say, I'm

sorry Prime Minister, we made a mistake? We followed the rules.

have just admitted you made a mistake? I'm talking about any new

procurements that we specify, we need to look very carefully at how

our competitors in Europe, also operating within the same EU

procurement law, can manage to achieve the outcomes they do.

question is how can they do it so much better than you can?

answer is, right up front, when they set out the rirms of the

contract, they set out how - requirements of the contract, they

set out how it will be evaluated, they include the socioeconomic

factors that the expert just talked about. And we don't? In this

particular contract there was no reference to the socioeconomic

issues, so we couldn't. So it is a bunch of civil servants that

doesn't give a dam about the consequences, someone is

responsible? It is about the culture around Civil Service

procurement in Britain, we have to look at it. Other countries put

much more emphasis on the strategic impact of procurement. What it does

to the long-term supply base in their own domestic economy. We have

suggested to the Prime Minister, that we need to look at how we can

make sure that in future procurements, we also give

appropriate weight to that long- term strategy.

You are a member of the cabinet what do you think of Rupert Murdoch

being able to take over the whole of Sky, given what we have seen

over the News of the World's behaviour? I think the two things

are separate issues. The issues around the BSkyB bid are issues of

plurality in the media. It is about the undertakings being given there.

What has happened in the News of the World, if it is true, as the

Prime Minister said, it is completely inexcusable, that is a

separate issue. To another, once great industrial

city, which has fallen victim to official incompetence and broken

promises, it is Stoke-on-Trent. The issue is not jobs but houses. When

we all lived in Gordon Brown's fantasy Government, the Labour

Government made vast commitments to those living in sub-standard

housing. Then came economic reality and budget cuts from the coalition.

As a consequence, the citizens of Stoke, the promise of improvement

has ruined their lives. Pauline and Barbara live on New Port Lane,

nobody else does. Mark and Sharon's home is falling down, it is the

last one on the block. Natalie lives on a street plaged by crime.

This is Stoke-on-Trent, once an industrial heartland, its heart has

been ripped out. Hundreds of terraces have been

demolished, hundreds more stand derelict, all because of a scheme

called Pathfinder. Doreen lived at the end. Gina. Doreen had only just

spent a load of money on her house. Where are they all now? The answer

is rehoused, for some evicted, the promise was new homes would be

built here. Where is the new houses? We haven't got any. Why?

want to know why. They won't invest. They have no money they say. I know

they have more money, it is for private buyers, they won't invest

anything. We have had things put in the paper who they are going to

build, and it hasn't materialised. House building has stopped,

demolition is delayed, what was supposed to be the planned

regeneration of a community has turned into a nightmare. We have

been degenerated, not regenerated. We used to be a community, right

Pauline. We had our own shops. had a butcher's, a grocer's, we got

the club. We want it back as a community. We

want some life into the place. Instead of rats running all over

the place. Do you think you will live to see this place come back as

a community? No. No. Definitely not. There is no community left. This is

no story of gradual decline. It is a story of a master plan. Of social

engineering, of spending cuts, and a broken promise. Stoke was already

in trouble, thousands of pottery jobs were moved offshore. Property

values had collapsed, even as, in the rest of Britain, a property

boom took off. That made Stoke an ideal candidate for Pathfinder. In

2003, Labour's deputy Prime Minister, John Prescott, launched

the Pathfinder plan, 90,000 terraced house, in seven cities,

would be cleared and replaced with new-build housing, thousands more

would be renovated, property values would rise. But last October, the

coalition, which had always opposed the scheme, cancelled it. The

promised homes will not be built, Pathfinder is over. But not for

those who still have to live in the middle of all this.

It is not nice, it looks dead rough. You look like you are living here

on your own, there is no-one here. This couple have been trying to

move, but are stuck? Crime is through the roof. It is scary to

live here. We have to leave the lights on in the house all the time.

Even throughout the night so people know we're still in here, if you

smell smoke you instantly think next door is on fire, they are

setting fire to every empty house, it is not being dealt with at all.

It is constant fear of what could happen. So nobody lives here?

are people on both sides that live in this. Brendan Nevin is a housing

expert who helped implement the Pathfinder he is scheme. He thinks

it is putting lives at risk. This was sealed up only last week. That

is an arson risk. There is somebody living next door. Somebody lives

there. If they get in, if somebody gets in there and torches that,

these people are in real trouble. Clearance areas are fundamentally

dangerous people and they need to be got down very, very quickly.

Even if we can't rehouse people and rebuild things, why can't we get

the last people out and make it safe. At the moment there is no

money to buy people out, the money was cut off on 1st April, there

used to be money to manage and clean these place, that money is

gone. The scheme was scrapped eight years in to a 15-year agreement.

Those who drew the blueprints assumed even if the coalition

scrapped the scheme existing commitments would be met? We have

no plan or guidance, we have been left to our own devices with the

money pulled at short notice. has now �5 million to put the

scheme to rest. After that it will rely on market forces. There is

always consensus between political parties that you have to finish

things that have been started, even though the policy has to change.

There was a consensus to make sure no place was left to die, and no

place where the market wouldn't work. We have abandoned that now.

There seems to be an explicit policy whereby places will live or

die by the market. This is a massive change in British political

history. Where it was done with foresight, Pathfinder worked, this

council estate used to be one of the roughest in Britain. It was

plaged with vandalism, dodgy pubs and crime. But Maggie Carter sorted

that out, she was part of a community group that helped shape

the Pathfinder group on the ground. There was apathy, but once people

realised they weren't going to be trodden on but they were going to

be talked to and consulted with, they started to come out and get on

board. Here the rebuilding was done within a short time scale. The

result, new and refurbished homes, on the site of previously sub-

standard ones. Was it ever in the back of your mind what happens if

the money runs out? Yes. thought about it? Yes. Why didn't

the people planning Stoke think about it? I don't know.

But, with the money gone, she's worried that even here, progress

could be reversed. I'm not as stupid as to say things couldn't go

back to what they were, because I am aware that we are on a knife

edge. Do you mean socially, in terms of crime and drugs. Yeah.

Even here. Hanly, in Stoke, was where Arnold

Bennett chronicled the life of the potters. They are now a few niche

business, many remember the hey day. At the community centre they are

trying to keep things jolly. But this is the last bingo session. Lee,

the community worker, employed under the Pathfinder scheme, is to

lose his job, the money has run out. Personally I think we should have

taken a section, demolished and rebuilt it. The people who still

lived here could have moved on into those properties and continued in

that way. Build and move, build and move process. Anybody you may speak

to today would say that to you. That's where we feel it has gone

wrong slightly. They have demolished and not built, so people

are stuck. It has split the community.

Pathfinder was supposed to revive places like this, now, in 12 cities

across the Midlands and the north of England, the scheme is winding

up. Communities are left high and dry.

What haepsd here is a disSASer - what's happened here is a disaster,

one charge levied is a Labour Government that refused to listen

to local people. The other is spite, many believe the coalition doesn't

care what happens to the blighted cities of the Midlands and the

north. The council, the Government would they like to live in the mess

we are living in. You feel like a secondhand citizen.

Beyond the distress and poverty, on these streets, what's left of them,

is a deep distrust, never again will the words "rebegin "and

"renewal" mean - "regeneration" and No time for the newspapers tonight,

apparently, we have delighted you long enough, see you tomorrow, time

The last vestiges of heat have now drained away from eastern England,

it is a cooler outlook, with a number of heavy showers around.

Persistent rain across Scotland. Elsewhere, with a chance of saying

something in the way of sunshine. Sharpish showers scattered around.

Rattling around on a stiff breeze in the southern half of the UK.

Cooler than Tuesday. We are stuck in the high teens, probably not

that high across parts of the South-West, where the wind will

freshen up, bringing heavy, squally showers as we end the day across

Devon and Cornwall and the south west. The limited brightness to the

east of the month tains, not a friendly day.

Across Northern Ireland, some sunshine, heavy showers, light

winds here, those showers could linger for a while. Persistently

wet scene across a good chunk of central Scotland where there could

be over an inch of rain. Further showers to come widely across

northern parts of the UK on Wednesday and Thursday. Difficult

to pin down the detail, but very few places staying entirely dry, it

will be cool, further south, some sunshine, but showers never too far

away. Temperatures a lot lower than we saw to start the week. This is