:00:07. > :00:11.You can almost smell the anxiety, on the trading floors, in the banks
:00:11. > :00:14.and in the boardrooms of the international financial
:00:14. > :00:18.institutions, there is a real fear that the economy is about to take
:00:18. > :00:22.another nose dive. Is it just that they have come back
:00:22. > :00:26.from their holidays and seen things look different when you're not on
:00:26. > :00:29.the beach, Paul? Jeremy, no, there is red lights flashing all across
:00:29. > :00:33.the economic data. And the Americans have begun to take their
:00:33. > :00:37.money out of European banks. Chancellor, who had to cope the
:00:37. > :00:43.last night it hit the fan is here, with some advice on cleaning up the
:00:43. > :00:48.mess. Colonel Gaddafi's secret police
:00:48. > :00:54.have fled Tripoli, leaving behind their correspondence with MI6. This
:00:54. > :00:58.British resident was named to the Libyans as a member of an anti-
:00:58. > :01:04.Gaddafi Islamist group, by our own Secret Service. Why?
:01:04. > :01:07.We will have an exclusive interview with the leader of Libya's
:01:07. > :01:13.transitional Government. I will ask Libya's new leader why
:01:13. > :01:17.he hasn't moved to the capital, Tripoli, and why he wants armed
:01:17. > :01:20.militias to stay on the streets. Is the way to revive Conservatism in
:01:20. > :01:24.Scotland to stop calling the party the Scottish Conservatives, the
:01:24. > :01:34.front runner for the leadership thinks so. How on earth can that
:01:34. > :01:37.
:01:37. > :01:40.support the union he claims to Woe, woe, thrice woe, as older
:01:40. > :01:44.viewers may recall Frankie Howard saying on Up Pompeii. The bad news
:01:44. > :01:48.on the state of the economy, just keeps coming. There has now been so
:01:48. > :01:52.much of it, that people who once praised the British Government's
:01:52. > :01:56.strategy for balancing the books, are now begging them to change
:01:56. > :02:02.course. While across the world, stock markets reflect the gloom by
:02:02. > :02:06.plunging lower and lower. The FTSE 100 share index fell 3.5% today.
:02:06. > :02:08.Shares in the Royal Bank of Scotland fell 12%, all to constant
:02:08. > :02:14.background chatter about how the bankrupt economies of southern
:02:14. > :02:18.Europe are going to take down a bank or two. Paul Mason is here,
:02:18. > :02:22.what's causing the panic? Over the last two weeks we have had
:02:22. > :02:27.mounting evidence that the recovery is over in the US a, in the
:02:27. > :02:32.eurozone, also - US, in the eurozone, also here. It may not be
:02:32. > :02:37.a double-dip recession, we may not get to that, but we might be at
:02:37. > :02:40.stall speed, as economists put it, it might be growing too slow to
:02:40. > :02:43.gain momentum. One of the best snapshots you can take of an
:02:43. > :02:47.economy, is by looking at what purchasing managers think, what the
:02:47. > :02:52.people in business, who actually buy things, are doing right now.
:02:52. > :02:57.And we had figures on that both for the eurozone, and here today, and
:02:57. > :03:02.they were both bad. In the eurozone, today, we have had
:03:02. > :03:07.a survey showing a clear fall in manufacturing orders. Here's the
:03:07. > :03:10.long-term trend, and we can see the big dip that took place after
:03:10. > :03:20.Lehman Brothers, well now there's a dip again. And growth is now
:03:20. > :03:24.
:03:24. > :03:29.Earlier this year, everybody was celebrating Germany's growth, 1.3%
:03:29. > :03:38.in a single quarter. Well it now looks like in the second quarter it
:03:38. > :03:42.was just 0.1%. It might already be in a recession. Meanwhile, Greece
:03:42. > :03:49.is definitely in a deep recession, the austerity programme there means
:03:49. > :03:53.the economy is 6.9% smaller than it was a year ago. And, says the state
:03:54. > :03:57.budget office, its debt dynamic is now out of control. Up until now,
:03:57. > :04:01.we have been getting bad news out of southern Europe, but fairly
:04:01. > :04:05.strong news out from northern Europe. The message has been, well,
:04:05. > :04:09.perhaps the German economy can keep the others going. With the latest
:04:09. > :04:14.data showing that German growth has virtually disappeared, with the
:04:14. > :04:19.weakening of the expectations data from EFO particularly, it does
:04:19. > :04:24.looks a if the German economy isn't in a strong state, that make the
:04:24. > :04:28.break up of the euro, increasingly likely. But hold on a minute, how
:04:28. > :04:32.do you get from one bad growth figure to the break up of a whole
:04:33. > :04:37.currency? Well, Greece, Ireland and Portugal have banks being kept
:04:37. > :04:41.alive from state aid from Europe, in July, Italy and Spain started
:04:41. > :04:45.taking money from the centre to keep their banks afloat. That
:04:45. > :04:49.leaves these countries in the north doing the bailing out. And the
:04:49. > :04:53.problem is, how many of their banks would collapse if they had to write
:04:53. > :04:57.down debts from southern Europe. The answer is, a lot of them. And
:04:57. > :05:00.so, you have got American banks now starting to move their money out of
:05:00. > :05:06.the European system, and evidence that even European banks are moving
:05:06. > :05:10.their cash to America. About half a trillion in the last six months.
:05:10. > :05:14.think it is pretty clear that the eurozone economy is slowing down
:05:14. > :05:18.really very sharply. In common with what we are seeing around the world.
:05:18. > :05:22.Evidence from the United States, from parts of Asia, and also the UK,
:05:22. > :05:26.it is all the same thing a very marked slowdown. I think the most
:05:26. > :05:31.worrying thing is this slowdown is happening at a time when it is
:05:31. > :05:35.quite obvious that the banking system remains extremely weak.
:05:35. > :05:40.Market anxiety is gathering about the continued existence, frankly,
:05:40. > :05:44.of the euro, we are facing the prosability of both a banking and
:05:44. > :05:47.financial crisis and an economic crisis at the same time. -
:05:47. > :05:51.possibility of both a banking financial crisis and the economic
:05:51. > :05:56.crisis at the same time. Christine Lagarde said the world should
:05:56. > :06:00.abandon austerity and bring more stimulus, she said the EU banks
:06:00. > :06:03.needed �200 million to bail them out. The boss of the European
:06:03. > :06:08.Central Bank said no thanks to austerity, and said the calculation
:06:08. > :06:13.on the banks were wrong. And it is these public disagreements that
:06:13. > :06:18.give markets the wobbles. So it looks pretty bad globally, how will
:06:18. > :06:23.it impact on us? The purchasing managing index, this is the
:06:24. > :06:28.snapshot, it saw the biggest fall here for a decade. Growth is pretty
:06:28. > :06:33.flat. What to do about it is the thing the Government has to face?
:06:33. > :06:37.Tax cuts have been mooted, both by the opposition on VAT, and by the
:06:37. > :06:40.Conservatives on 50p tax rate. Now, conferences are coming up, and we
:06:40. > :06:45.might expect to see a bit of movement on tax cuts. So there is a
:06:45. > :06:49.question of do you just do a bit more loosening fistically. The
:06:49. > :06:52.other problem that - fiscally, the other problem the British
:06:52. > :06:58.Government have with growth, you still have the problem that our
:06:58. > :07:04.major trading partners, America and Europe, are flattening. There is a
:07:04. > :07:09.public finance issue, the Office for Budget Responsibility basis the
:07:09. > :07:15.whole - bases the whole paying off the debt based on 1.7% of growth,
:07:15. > :07:19.most reckon it will be 1%, that is why you have one of the boasts of
:07:19. > :07:24.the world's biggest fund saying to George Osborne today, change course.
:07:24. > :07:29.How worried should we be about the state of the economy. One for the
:07:29. > :07:34.former Chancellor, Emmanuel Darley? I think we should be - Alastair
:07:34. > :07:38.Darling? If you asked me a year ago if the whole of Europe would have
:07:38. > :07:42.seen their growth snuffed out and stalled, I would say that wouldn't
:07:42. > :07:46.happen. There was momentum in our economy and the bigger European
:07:46. > :07:51.economies, that appears to be stalling, that is worrying. But in
:07:51. > :07:55.2008 you talked about the worst crisis for 60 years, are we looking
:07:55. > :08:01.at the worst crisis in 63 years? don't think the crisis I talked
:08:01. > :08:05.about three years ago has gone away. We were coming through it. Indeed,
:08:05. > :08:08.part of my argument now is, countries together need to show
:08:08. > :08:14.exactly the same determination to act together, now as they did in
:08:14. > :08:18.the end of 2008 and 2009. I think the problem is, we got through the
:08:18. > :08:22.first shock, the problem is we have not capitalised on that, and we are
:08:22. > :08:25.slipping back into a situation where the economy is going to slow
:08:25. > :08:29.down, that means you get all the concern about the state of banks
:08:29. > :08:32.that you are seeing in the markets at the moment. Is it the state of
:08:32. > :08:35.the banks that worries you more than the growth figures or anything
:08:35. > :08:39.else? The two are pretty interrelated. We know we have to
:08:39. > :08:42.get our borrowing down. You will not do that unless you have a
:08:42. > :08:49.credible plan for growth. Because you need the growth to get the
:08:49. > :08:53.revenues and so on. What people are now worried about is some of the
:08:53. > :08:57.peripheral countries are stalling, in Greece's case, completely. Then
:08:57. > :09:02.you ask questions about the Greek banks, then you think who is behind
:09:02. > :09:06.them, the European banks, the ECB itself has an awful lot of Greek
:09:06. > :09:10.bonds. These things feed off each other. Which is why the one thing
:09:10. > :09:16.we should have learned in 2008, if you know there is a problem you
:09:16. > :09:20.need to fix it and decisively. That is not happening. If you were still
:09:20. > :09:24.in Number 11 Downing Street, what would you do now? I think in our
:09:24. > :09:27.own economy, the Government by going so fast in the deficit
:09:27. > :09:32.reduction is now strangling the recovery, I'm worried we will bump
:09:32. > :09:35.along the bottom. You would ease off on the austerity measures?
:09:35. > :09:39.wouldn't have embarked on their plans in the first place. If you
:09:39. > :09:43.don't do anything, you are in deep trouble, if you go too fast you
:09:43. > :09:47.stall the entire thing, you don't get your growth. George Osborne has
:09:47. > :09:50.had a had to announce more borrowing as a result of what's
:09:50. > :09:54.happened. The second critical thing is the G20, the largest economies
:09:54. > :09:59.in the world, need to discuss together how they can ensure that,
:09:59. > :10:03.yes, you get the borrowing down, but you get growth back in the
:10:03. > :10:08.economy. That is an acute problem in Europe and America. That is a
:10:08. > :10:12.global plan B? The two go together in my view. Just as we did in 2008,
:10:12. > :10:17.in that case it was a credible plan for rescuing the banking system,
:10:17. > :10:21.but you can't do that on your own, because all our economies are so
:10:21. > :10:26.interconnected. What about some other measures, like for example, a
:10:26. > :10:30.temporary cut in VAT? Lots of economists have talked about what
:10:30. > :10:35.additional stimulus you might put in place. My own preference, you
:10:35. > :10:39.know, because if you have time to do it is to cut people's income tax
:10:39. > :10:42.allowance, because that puts more money in. There is all sorts of
:10:42. > :10:46.credible arguments. The big argument is how do you get
:10:46. > :10:50.sufficient money flowing through the economy to get growth? You have
:10:50. > :10:53.just used the word "credible", yet you can see at the last election
:10:53. > :11:00.Labour's economic policy wasn't credible? What I said was, the
:11:00. > :11:04.policy of halfing the deficit, over a four-year period, was a credible
:11:04. > :11:07.policy, what damaged us was it was patently obvious there was a
:11:07. > :11:11.disagreement between me and the then Prime Minister as to whether
:11:11. > :11:15.or not that was the right course of action. It is entirely credible,
:11:15. > :11:21.and indeed there is lots of independent of Labour economists
:11:21. > :11:25.who say at the moment that we ought to be reducing the deficit at rate
:11:25. > :11:28.that allows growth to take place. The policy was credible, but the
:11:28. > :11:32.implementation wasn't? We left office before, although I had set
:11:32. > :11:38.our economy on a path that was going to be cutting our borrowing,
:11:38. > :11:42.the plan was announced at the end of 2008, it still had some way to
:11:42. > :11:45.go. The point I make, and have made on a number of occasion, that
:11:45. > :11:48.because people knew there was a disagreement at the top of the
:11:48. > :11:51.Government as to whether or not that was the right thing to do,
:11:51. > :11:55.that was a problem. The actual policy of halving the deficit over
:11:55. > :12:01.a four-year period, that I believe is entirely credible, on the
:12:01. > :12:06.arguments then which are as good as today. Are you sorry you didn't
:12:06. > :12:10.have a Spending Review? No. Our spending plan we fixed in 2007 was
:12:10. > :12:16.due to run to 2010. I was asked dozens of time should we have done
:12:16. > :12:19.another one in 2008/09, my argument then was things were so uncertain
:12:19. > :12:22.it would have been difficult. Another important point, I strongly
:12:23. > :12:25.believe the last Government which I was a member was right to maintain
:12:25. > :12:31.public spending until we could see that they were back into recovery,
:12:31. > :12:35.then you start to cut it. And just a reminder...You Left the economy
:12:35. > :12:38.in the worst shape any in coming Government has had to deal with?
:12:38. > :12:43.Every country in the world had exactly the same problem. The
:12:43. > :12:46.reason we are discussing it tonight is because Germany's, France, Italy,
:12:46. > :12:50.America, we have all had to come through this banking crisis. We all
:12:50. > :12:54.had to spend money. Let me finish this argument, I remind you our
:12:54. > :12:58.economy was actually growing in the quarters after we left office, it
:12:59. > :13:02.was only the present lot have managed to derail that. Do you
:13:02. > :13:07.think we may already be in recession? Now. I would be
:13:07. > :13:11.surprised if we are. People ask me do you see a double-dip, I'm not
:13:11. > :13:15.saying we won't get a statistical negative figure at some stage. My
:13:15. > :13:23.guess is we are simply bumping along the bottom. Just telling you
:13:23. > :13:26.now, so much bad data is coming out, people are right to be fearful
:13:26. > :13:31.about this. When you say we are bumping along the bottom, we can't
:13:31. > :13:35.go through the bottom, so we can't go into a double-dip recession. I'm
:13:35. > :13:38.asking you your hunch? My hunch is we won't go into a double-dip
:13:38. > :13:42.recession, and if we do, that would be a damming indictment on
:13:42. > :13:45.everything the Government has done since it was elected 18 months ago.
:13:45. > :13:50.You have already conceded much of it isn't to do with the heyor of
:13:50. > :13:53.this Government, but what is happening in the - behaviour of
:13:53. > :13:57.this Government, but what is happening in the eurozone? This
:13:57. > :14:01.Government is cutting expenditure very fast n the hope that the
:14:01. > :14:06.private sector will take its place. The private sector doesn't have
:14:06. > :14:11.that confidence, it is evidenced at the moment, not helped by the
:14:11. > :14:15.biggest market we have has stalled. You think current Labour economic
:14:15. > :14:20.policy is credible as well? current policy of the Labour front
:14:20. > :14:23.bench is the one I left. It must follow, with all due humility, I
:14:23. > :14:27.think it is credible, yes. You are also part of the Government that
:14:27. > :14:34.set up the arrangement with the Bank of England do you think that
:14:34. > :14:38.is credible? I won't plug my new book too much. Plug away? I don't
:14:38. > :14:41.think the problem was the financial structure, it was the fact of the
:14:41. > :14:44.early stages with New York a lot of disagreement, - Northern Rock,
:14:44. > :14:47.there was a lot of disagreement between me and the governor at that
:14:47. > :14:52.time. If you asked me about the regulatory problem, there is not a
:14:52. > :14:55.regulatory system in the world that saw this coming. The big mistake
:14:55. > :15:00.they made, and this is so obvious from Northern Rock, is that they
:15:00. > :15:03.did not see the interconnections between the banking system. You are
:15:03. > :15:08.even seeing it today. The European authorities have not done stress
:15:08. > :15:11.test that is model the failure of a Government. Greece is pretty near
:15:11. > :15:14.that stage at the present time. Of course there was mistakes made in
:15:14. > :15:19.the regulatory system. I don't think it was the structure, it was
:15:19. > :15:22.judgments that was the problem. That reflected rather badly on the
:15:22. > :15:27.governor of the Bank of England? made some wrong calls in my time. I
:15:27. > :15:32.think my disagreement with the governor is I think we needed to
:15:32. > :15:38.put money into the banking system far earlier than we did. I may say,
:15:38. > :15:43.I made clear that when it came to the big rescue in 2008, Martin
:15:43. > :15:48.Luther King played major and constructive - Mervyn King played
:15:48. > :15:51.major and constructive role in that. What were your wrong calls? We took
:15:51. > :15:55.too long to deal with the Northern Rock situation. Once it was in
:15:55. > :15:58.trouble, if we had the legislation that we now have, we should have
:15:58. > :16:04.dealt with it quickly, probably nationalised it far more quickly
:16:04. > :16:09.than we did. When we actually did nationalise it, at the beginning of
:16:09. > :16:13.2008, it really started to restore confidence for bait, but later in
:16:13. > :16:18.the year we were complete - for a bit, but later in the year we were
:16:18. > :16:24.completely overwhelmed by a banking crisis that had roots in the
:16:24. > :16:28.American sub-prime market. But some of our banks were up to their necks
:16:28. > :16:31.in it. Noble of you to take the blame, but it was Gordon Brown's
:16:31. > :16:34.fault? In our country it was the responsibility of the Government at
:16:34. > :16:38.the time. I was in the cabinet every single day of that Government,
:16:38. > :16:42.it is as much my fault as anybody else. None of this actually helps
:16:42. > :16:45.us, now. What we should be bothered about now is how we make sure we
:16:45. > :16:48.reduce the risk of this happening again. My immediate concern is a
:16:48. > :16:51.combination of what is going on in the wider economy, plus the fact
:16:51. > :16:57.that in Europe they still haven't sorted out some of the problems
:16:57. > :17:02.with the banks, that is why I'm worried, and moreied - more worried
:17:02. > :17:05.than 12 months ago. The House of Commons rang to the sound of our
:17:05. > :17:09.elected representatives congratulating the people of Libya
:17:09. > :17:13.and the Armed Forces dumping Colonel Gaddafi's despottism this
:17:13. > :17:17.afternoon. But documents uncovered in the revolution show how very
:17:18. > :17:23.happy the British intelligence was to help Colonel Gaddafi's regime.
:17:23. > :17:27.They reveal information about Libyan dissidents in this country
:17:27. > :17:33.was fed to Gaddafi's regime. They may also have taken part in the
:17:33. > :17:36.practice of rendition. What is disclosed today? 300 documents were
:17:36. > :17:42.obtained by Human Rights Watch in Tripoli, they were looking for a
:17:42. > :17:46.secret prison, they found this cache of secret documents, sent by
:17:46. > :17:51.British intelligence to the Libyan authorities. It shows that MI6
:17:51. > :17:58.wrote to the Libyan Intel gents about the successful reign - Libyan
:17:58. > :18:08.intelligence about the successful rendition of one man who is on our
:18:08. > :18:20.
:18:20. > :18:25.That letter was signed "M", thought to be a reference to Sir Mark Alan",
:18:25. > :18:29.former intelligence officer at MI6. The context to this is the British
:18:29. > :18:33.was seeking for Gaddafi to relinquish nuclear weapons. The
:18:33. > :18:37.Libyans wanted something in exchange, intelligence information.
:18:37. > :18:41.I spoke to Human Rights Watch about this today, they felt the
:18:41. > :18:45.relationship went too far and it was immoral. Even those of us who
:18:45. > :18:48.follow these issues closely, we have been shocked and surprised by
:18:48. > :18:50.the documentation revealed over the last few days. It is significant
:18:50. > :18:56.and damming. These documents need to be thoroughly investigated. They
:18:56. > :19:00.suggest that MI6, the British intelligence agencies were
:19:00. > :19:08.providing information to Colonel Gaddafi's regime about operatives
:19:08. > :19:10.and their opposition figures and their where abouts. This is a
:19:10. > :19:16.particularly interesting document, it shows that British intelligence
:19:16. > :19:21.was willing to pass on information about Libyans living in the UK,
:19:21. > :19:26.perfectly legally, who were political oppontnents of the
:19:26. > :19:36.Gaddafi regime. They passed an entire intelligence regieme on one
:19:36. > :19:39.
:19:39. > :19:42.He was in the UK legally, but he was later prosecuted here for
:19:42. > :19:46.fundraising for the Libyan Islamic Fighting Group, seeking to
:19:46. > :19:52.overthrow Gaddafi. Another document sent by British intelligence to the
:19:52. > :19:56.Libyans also states, they requested information regarding Mohammed X,
:19:56. > :20:03.not named for legal reasons. He's an Islamic extremist based in
:20:03. > :20:10.Brighton, he's reported to have visited Afghanistan in 2001, and a
:20:10. > :20:14.known contact of the Libyan Islamist fighting group members,
:20:14. > :20:19.and Omar Deghayes, his father was killed by the Libyan regime, he
:20:19. > :20:24.came to Britain and won asylum in 1986 with his family. He spent time
:20:24. > :20:28.in Guantanamo Bay later. A Newsnight investigation in the past
:20:28. > :20:32.has suggested this was case of mistaken identity. Omar Deghayes is
:20:32. > :20:37.here with us now. Did you know that British intelligence was passing
:20:37. > :20:41.information about you to Colonel Gaddafi? No, I didn't. And to know
:20:41. > :20:45.that they did is worrying and concerning and very sad, to know
:20:45. > :20:50.the country who gave us asylum, and the family from Gaddafi, is passing
:20:50. > :20:55.information about details of our lives to Gaddafi. It mentions you
:20:55. > :20:59.as a member of the Libyan Islamic Fighting Group, is that true?
:20:59. > :21:03.not true. You know it is a prescribed organisation in this
:21:03. > :21:07.country, you would be committing an offence, were you a member? No, I
:21:07. > :21:10.was not a member, we were in opposition to Gaddafi, working in
:21:10. > :21:13.opposition to Gaddafi we know many people in opposition to Gaddafi. I
:21:13. > :21:18.was not a member of this organisation. MI6 were passing
:21:18. > :21:21.false information to Gaddafi? think they were passing information.
:21:21. > :21:25.This is the information that came to us, we don't know what other
:21:25. > :21:29.information they passed to Gaddafi, whether it is false or not, MI6
:21:29. > :21:34.should be answerable for that. do you feel about it? As I say,
:21:34. > :21:38.very concerned and very saddened, and deeply shocked. Because we came
:21:38. > :21:41.to this country seeking political asylum, and as refugees, with all
:21:41. > :21:47.the family, because of our treatment with Libya. To know this
:21:47. > :21:53.country is passing information about us to Gaddafi and his regime
:21:53. > :21:58.is very sad and shocking. Does it make you reassess this country's
:21:58. > :22:03.involvement in the overthrow of gad? Not really, we are happy - of
:22:03. > :22:07.Gaddafi? Not really, we are happy with their contribution towards the
:22:07. > :22:10.overthrow of Gaddafi. I'm happy with many other people in this
:22:10. > :22:17.country who are working hard to show all this information and
:22:17. > :22:21.uncover all these cruelties that did happen. This country, the part
:22:21. > :22:25.of the Government worked, but many other people worked differently.
:22:25. > :22:28.There was a bigger game in play here. The bigger game was to make
:22:28. > :22:33.sure Gaddafi abandoned his programme of development of weapons
:22:33. > :22:35.of mass destruction, which we know was active, unlike some other
:22:35. > :22:39.alleged programmes of weapons of mass destruction. In that context,
:22:39. > :22:43.feeding a bit of what you say is false information to Colonel
:22:43. > :22:47.Gaddafi to keep him sweet, is surely a small price to pay? That
:22:47. > :22:50.is the thing, this is the information we spoke about today.
:22:51. > :22:55.We know they were involved in many other things. They were involved in
:22:55. > :23:03.rendering people, passing people to Libya who ended up dead in Libyan
:23:03. > :23:07.prisons. It's not only passing false
:23:07. > :23:15.information to the Libyans. But it is lots of other work that has been
:23:15. > :23:20.done that is immoral and really has to be opposed by everyone who has
:23:20. > :23:28.ability to speak up. Mr Deghayes thank you.
:23:28. > :23:33.Our diplomatic editor joins us now from Washington. What can you tell
:23:33. > :23:42.us about this? It is interesting, just talking to people around the
:23:42. > :23:46.bizarres, as they Baz Tsars as they say about those around the
:23:47. > :23:50.intelligence world. If your relationships with countries like
:23:50. > :23:54.Libya flip many times during the period of his rule, the discovery
:23:54. > :23:58.of documents like this is bound to be messy. Their arguments money
:23:58. > :24:02.along the lines that these contacts, as we understand from an interview
:24:02. > :24:05.given to the BBC by Colonel Gaddafi's lasten Foreign Minister,
:24:05. > :24:14.were continuing right up to the outbreak of the Libyan revolution,
:24:14. > :24:20.and all authorised by the British Government. In that case MI6, SIS,
:24:20. > :24:23.in having officers in Tripoli, and conducted this intelligence liaison,
:24:23. > :24:26.were acting under ministerial direction. The other argument made
:24:26. > :24:31.is the renditions we have learned about from Thailand and Hong Kong,
:24:31. > :24:35.were not of people in British custody. In other words, there was
:24:35. > :24:40.not the same responsibility, they believe, under the European Human
:24:40. > :24:44.Rights Convention and various other laws, on Britain, not to hand these
:24:44. > :24:54.people over for questioning in Lybia, even though we all know what
:24:54. > :24:59.that might involve. You might think this is sof fesry, but they tend to
:24:59. > :25:06.- sophestry, they tend to involve situations where individuals are
:25:06. > :25:15.held by the country. But they handsome to the Americans who
:25:15. > :25:20.rendered them to Bagram, which is far more serious than where third
:25:20. > :25:30.countries did deals with Libya and the Americans played an enabling
:25:30. > :25:30.
:25:30. > :25:34.role. Will this be enough to bring it out? They can probably get their
:25:34. > :25:41.way through it, particularly with reference to ministerial submission,
:25:41. > :25:44.endorsing what they did. I think the difficult area is the handing
:25:44. > :25:48.over of intelligence. If you hand over intelligence on people living
:25:48. > :25:51.in Britain, naming them, telling the Libyans they are involved in
:25:51. > :25:54.militant and anti-Government activity, you then expose their
:25:54. > :25:59.families, their associates, to action by the Libyan regime, or
:25:59. > :26:02.them if they go back there. That seems to run directly counter to an
:26:02. > :26:12.assurance that was given by the chief of MI6 in a speech last
:26:12. > :26:15.
:26:15. > :26:20.October. Torture is illegal and nothing to do with us. If we know
:26:20. > :26:25.acts where torture is taking place, we are advised by European and
:26:25. > :26:29.international law to avoid that action, and we do. Even if allows
:26:29. > :26:32.the tort activity to go ahead. Libya itself the revolutionaries
:26:32. > :26:37.have still not managed to find Colonel Gaddafi and remain poised
:26:37. > :26:41.outside a town, where they believe elements of his regime are holed up.
:26:41. > :26:44.The revolution is not over, and until it is, the National
:26:44. > :26:48.Transitional Council doesn't feel it can move to the capital. So what
:26:48. > :26:54.is the plan of the leaders of the revolution? Our reporter in Libya
:26:55. > :27:00.has got the man who leads the council and so is the country's
:27:00. > :27:05.effective ruler right now. Tim's in Benghazi right now to tell us what
:27:05. > :27:10.he had to say. Yes, Mustafa Abdel-Jalil, now
:27:10. > :27:13.Libya's interim leader. He's a very emegmatic figure, certainly well
:27:13. > :27:17.respected, because when he was Gaddafi's minister of justice, he
:27:17. > :27:23.very much stood up for political prisoners and their rights. At the
:27:23. > :27:28.same time, not very charasmatic, man who has had to tread a very
:27:28. > :27:32.careful line between disparate factions on his own council, the
:27:32. > :27:35.liberal wing, the Islamist wing, the careful line between thanking
:27:35. > :27:39.the west for its support over recent months, and at the same time
:27:39. > :27:43.insisting that the Libyans must own their own revolution. So very
:27:43. > :27:48.interesting talking to him, what I wanted to know first is why he has
:27:48. > :27:51.been so slow in moving to Tripoli. Before that he also had some
:27:51. > :27:58.fascinating news about what has been happening on one of the
:27:58. > :28:02.remaining battle fronts today. The struggle is almost over, they
:28:02. > :28:07.believe, still not quite. Anti- Gaddafi's fighters, south-east of
:28:07. > :28:12.Tripoli, held back today, in the hope negotiations will lead to the
:28:12. > :28:16.surrender of the town, Bani Walid. It is one of just four pockets of
:28:16. > :28:25.resistance, that Libya's revolutionary forces must subdue,
:28:25. > :28:27.before they can turn their attention to other tasks.
:28:27. > :28:32.The head of the National Transitional Council, Mustafa
:28:32. > :28:36.Abdel-Jalil, told Newsnight today, that two of Gaddafi's sons had
:28:37. > :28:45.prevented Bani Walid surrendering. A third son, he said, had been
:28:45. > :28:49.killed there. Tran I must stress that - TRANSLATION: I must stress
:28:49. > :28:54.that they are the ones blocking the city. They are there, and they have
:28:54. > :28:58.had a shelter with some of the tribe there is. As we have heard
:28:58. > :29:02.from some sources that Khamis, the son also of Gaddafi, has been
:29:02. > :29:09.buried there. There were negotiations with these tribes that
:29:10. > :29:13.have sheltered the Gaddafi family, with our rebels. We have principles
:29:13. > :29:18.in the tribes here, if anyone has had shelter with you, you will
:29:18. > :29:24.never be able to make him surrender. We understand this, and have given
:29:24. > :29:31.three days, and amended this to one week. We are still abiding by our
:29:31. > :29:38.words. But, as we say, that negotiation still has time. Once we
:29:38. > :29:47.have ended these negotiations, then there will be another. But we had
:29:47. > :29:50.information that the Gaddafi sons have left the city.
:29:50. > :29:53.Libya's new leaders say it is only after they have announced the
:29:53. > :29:58.liberation of the whole country that they will complete the move
:29:58. > :30:02.from here in Benghazi, the birth place of the revolution, to the
:30:02. > :30:06.capital, Tripoli. Britain, and other western backers have urged
:30:06. > :30:11.them to do so as soon as possible. Bau, according to the council, it
:30:11. > :30:16.is only after - because, according to the council, it is only after
:30:16. > :30:20.the move that a new interim Government will be formed.
:30:20. > :30:25.Something is due to the delay because of security concerns, but
:30:25. > :30:29.the head of the council denies that. TRANSLATION: I'm Muslim that I
:30:29. > :30:33.understand everything has happened by God, I'm not afraid of death at
:30:33. > :30:38.all. The whole issue is an administrative matter. It has
:30:38. > :30:42.nothing to do with security. I can assure you that the security in
:30:42. > :30:48.Tripoli is more secure than Benghazi.
:30:49. > :30:52.Even so, the council admits that Tripoli is in the hands of
:30:52. > :31:02.revolutionary militias it doesn't entirely control, isn't that a
:31:02. > :31:05.
:31:05. > :31:10.problem? TRANSLATION: There is no army for our country. Our
:31:10. > :31:19.revolutionaries with the assistance of our allies and our friends, the
:31:19. > :31:24.NATO, that we started to be able to defend ourselves against the
:31:24. > :31:29.militias populated by the Gaddafi regime. They are not officials,
:31:29. > :31:37.they are volunteers, they are doctors, engineer, students. Even
:31:37. > :31:41.football players. Now, as the war comes to an end, some of the arms
:31:41. > :31:44.those civilian rebels have acquired, are being traded on the black
:31:44. > :31:54.market here in Benghazi and across Libya.
:31:54. > :31:59.
:31:59. > :32:04.Ask him how much that is? What? thinks this is $1400. Around �1,000.
:32:04. > :32:09.Let me feel how heavy that is. That is seriously heavy. I would have
:32:09. > :32:16.difficulty using that. You don't reckon. He says it is a machine
:32:16. > :32:20.begun, it rotates. - Machine gun, it rotates. For me to hold it might
:32:20. > :32:26.be a bit much. He has a lot of ammunition as well. This is a much
:32:26. > :32:31.nigs for Kalashnikovs. He says - ammunition for Kalashnikovs. He
:32:31. > :32:34.says he will have discount for you. This is all being sold completely
:32:34. > :32:38.openly. Arms trade something a sensitive matter, that is why we
:32:38. > :32:42.judged it was safer to film from a distance. Despite the risk of a
:32:42. > :32:49.country awash with weapons, the head of the council believes for
:32:49. > :32:54.now, arms revolutionaries should stay on the streets at least.
:32:54. > :33:01.TRANSLATION: We must stress there is no contradiction whatsoever. The
:33:01. > :33:06.call for disarming and collecting the arm is a policy matter. At the
:33:06. > :33:10.moment the arms remain with the revolutionaries, it will not have a
:33:10. > :33:14.threat to the security. It is on the contrary, it is needed to
:33:14. > :33:19.stablise the security wherever we have any pockets that are still not
:33:19. > :33:24.known to us. Hopefully that by the time we are in full control of
:33:24. > :33:29.every inch of the cities, then we will go to the policies that we
:33:29. > :33:35.have already settled. Until they control every city,
:33:35. > :33:42.feeding the frontline is still a big task. Performed in Benghazi by
:33:42. > :33:47.hundreds of volunteers. The new Libya has few institutions. But the
:33:47. > :33:53.revolution has fuelled a new civic activism, and a determination, as
:33:53. > :33:56.this poster says, to avoid tribal divisions. Libya's new leaders will
:33:56. > :34:00.need to harness all that energy and enthusiasm, if they are to stand a
:34:00. > :34:04.chance of bringing stability, and even democracy to the country in
:34:04. > :34:09.the months ahead. Well, today, Mustafa Abdel-Jalil
:34:09. > :34:12.told me that he would be in Tripoli at the beginning of next week. And
:34:12. > :34:15.that, presumably, is when liberation will be declared.
:34:15. > :34:20.Although, in practice, with the deadline for negotiations only
:34:20. > :34:24.running out on Saturday, it is very hard to see that in these main
:34:24. > :34:28.places where Gaddafi loyalists are still fighting in Bani Walid, in
:34:28. > :34:32.Sirte in the south, it is very hard to see how the battles will really
:34:32. > :34:36.be over by then. When the rest of the council does get to Tripoli, I
:34:36. > :34:42.think one of the big problems they will face, is what to do with
:34:42. > :34:46.former Gaddafi people, who jumped ship right at the very last minute,
:34:46. > :34:50.and now still want prominent positions in the new Libya, already.
:34:50. > :34:53.Already there is a revolt brewing within the ranks of council
:34:53. > :34:57.supporter about one former Gaddafi commander, who has already been
:34:57. > :35:02.given a senior new military role, with the new authorities. I think
:35:02. > :35:07.we expect many more arguments and divisions of this kind as they try
:35:07. > :35:10.to form a new administration over the coming months.
:35:10. > :35:14.I should just mention we did ask the Government for an interview
:35:15. > :35:19.today to talk about Libya generally, and the issue of rendition
:35:19. > :35:24.specifically, our interview with Omar Deghayes as well. But no-one
:35:24. > :35:28.was available, we were told. A vote for me and I will finish off the
:35:28. > :35:33.party, as leadership pitches go it is a bold one. He comes to bury the
:35:33. > :35:40.Conservative Party, not praise it. The deputy leader of the Scottish
:35:40. > :35:44.Conservatives, a man called Murdo Fraser, is running on a platform of
:35:44. > :35:49.disbanding the party and bringing something new and right-wing and
:35:49. > :35:56.Scottish in its place it's not a well known name across the borders,
:35:56. > :36:00.because there are many really known reintroduced beavers than in the UK.
:36:00. > :36:03.You might be for given for thinking the lesser spotted Tory across the
:36:03. > :36:07.border is rare find. But the history of the party in Scotland
:36:08. > :36:12.tells a different story. Their hey day as Scotland's party of choice
:36:12. > :36:16.hit its height around the late 1920s to late 1950, when ideas of
:36:16. > :36:20.God, empire, union and local industry endeared them to the
:36:20. > :36:25.Scottish electorate. Then they were known as Scottish unionists,
:36:25. > :36:32.writing the Labour Party off as alien socialists. The high water
:36:32. > :36:37.mark came in 1955. They won both a majority of the seats and the vote,
:36:37. > :36:44.something no other party in Scotland has achieved before or
:36:44. > :36:54.since. No coincidence it was the same near the Church of Scotland
:36:54. > :36:54.
:36:54. > :36:59.measureship hit its height too. As church attendance fell, and the
:36:59. > :37:03.empire fell away. 1965 saw Edward Heath instigate brand change from
:37:03. > :37:09.the Scottish unionist party, to the modern Scottish Conservative Party.
:37:09. > :37:13.By the time Thatcher imposed the poll tax on the Scottish people,
:37:13. > :37:20.the country's industrial heart, forged in coal and steel, was also
:37:20. > :37:29.in its death throws. The Conservatives were seen as - throes.
:37:29. > :37:33.The Conservatives were seen as not feeling the pain. And Scotland's
:37:33. > :37:38.four major newspapers turned on the Tories. John Major fought a strong
:37:38. > :37:42.unionist campaign in 1992, and gained ground. Five years later,
:37:42. > :37:50.though, Blair's landslide wiped the Tories from the map in Scotland.
:37:50. > :37:54.Not a single MP was left. With that, the resurgence of the SNP began. In
:37:54. > :37:57.2004, Alex Salmond returned as leader of the SNP, it was the start
:37:57. > :38:05.of gains for the nationalists that would leave the once powerful
:38:05. > :38:09.Tories bit part players in the future of Scotland. Well, with us
:38:09. > :38:12.now, live from Dundee, is the man with plan, the deputy leader of the
:38:13. > :38:17.Scottish Conservatives, yes, Murdo Fraser. And with me in the studio
:38:17. > :38:22.is the former Secretary of State for Scotland, Lord Forsyth. Murdo
:38:22. > :38:25.Fraser, same people, same policies, how stupid do you think people are?
:38:25. > :38:29.We are what we are talking about is creating a new political entity. We
:38:29. > :38:33.are not going to dissolve the Scottish Conservative Party, as
:38:33. > :38:37.some have said, we will use it and build on it to create a new
:38:37. > :38:43.progressive centre right party, with a distinct Scottish identity,
:38:43. > :38:47.that will have a relationship with the US Conservative Party, akin to
:38:47. > :38:51.the same as in Bavaria with the Christian Democrats also in Germany.
:38:51. > :38:54.That is a positive move. There are a lot of people in Scotland who
:38:55. > :38:58.share centre right values who believe the things we believe in,
:38:58. > :39:02.in terms of taxation and law and order and support for the family,
:39:02. > :39:07.but can't bring themselves to vote for the Conservative Party, because
:39:07. > :39:13.they think our party allegances lie in London and say we haven't come
:39:13. > :39:19.to terms with post devolution Scotland You haven't a great deal
:39:19. > :39:25.to lose, do you? We lost a great deal. In 1997 we had 97% of the
:39:25. > :39:29.vote, at the last Scottish elections we got 13.5%. Why not
:39:29. > :39:35.reinvent yourselves? We need to be ourselves and get on the front foot
:39:35. > :39:41.and campaign as Conservatives in Scotland. This idea that Murdo has
:39:41. > :39:46.that the party isn't able to make its own policies, we have always
:39:46. > :39:49.had different policies. The poll tax was asked by the Scottish
:39:49. > :39:53.Secretary of Margaret Thatcher because of a specific problem that
:39:53. > :39:58.arose with the Scottish rating system. Let's not get hung up on
:39:58. > :40:01.the question of poll tax, you of all people should not want that!
:40:01. > :40:06.How are you going to explain to the people of Scotland that the union
:40:06. > :40:10.is bad for your party, but good for the country? The irony is, of
:40:10. > :40:15.course, until 1965, as your clip said, there were no Conservatives
:40:15. > :40:17.in Scotland. We had something called the Scottish Unionist Party,
:40:17. > :40:20.ironically that was much more electorally popular than the
:40:20. > :40:23.Conservative Party has been since that time. Nobody said the union
:40:23. > :40:27.was under threat, because we had a distinct Scottish centre right
:40:27. > :40:32.party in those days. I think we will be far better placed to fight
:40:32. > :40:36.the SNP, with a much more vigorous new centre right party with a
:40:36. > :40:39.Scottish identity. I have been deluged in the last 48 hours since
:40:39. > :40:43.I announced this idea, with contacts from people saying this is
:40:43. > :40:49.exactly the right thing to do. We don't want to be in the
:40:49. > :40:53.Conservative Party, but if you set up this new entity we will come and
:40:53. > :40:59.join you and fight the SNP and their plans to break up Britain.
:41:00. > :41:04.There is a real appetite for this to happen. I'm surprised he hasn't
:41:04. > :41:08.been deluged for Conservatives, who have worked very hard for policies
:41:08. > :41:12.for the Conservatives, and must be dismayed to hear them thrashed in
:41:12. > :41:15.this way. The Conservatives get 450,000 votes in Scotland still. We
:41:15. > :41:19.have 10,000 members, our constituencies are in decay, we
:41:19. > :41:23.don't have modern campaigning. The way to take things forward is to
:41:23. > :41:29.fight. It is perfectly possible for the Conservatives to get back to
:41:29. > :41:36.having 27% of the vote. The MoD sl in chaels. Waless had - the model
:41:36. > :41:41.is in Wales, Wales had industrial decline and all the problems
:41:41. > :41:45.experienced under the Conservative Government in the 1980, we have
:41:45. > :41:49.increased our seats by working with the party in England and working on
:41:49. > :41:54.a united front. The seperatist agenda is playing straight into the
:41:54. > :42:01.hand of the SNP. How so, he believes in the union? It is a very
:42:01. > :42:05.funny say to say we need a UK, in order to do so we have to destroy a
:42:05. > :42:10.Scottish party. The Scottish Conservatives are the oldest party
:42:10. > :42:17.in Scotland. There are times when we have had nearly all the sites
:42:17. > :42:22.and then a lack of seats. In 1955 there were two candidates only
:42:23. > :42:28.standing, a liberal Conservative, and Labour. Now we have a four-way
:42:28. > :42:31.split. You are like the Labour Party one more heave slot. Take a
:42:31. > :42:35.radical initiative, create something now, distinctively
:42:35. > :42:39.Scottish and see if people go for it? Because the principles and
:42:39. > :42:42.policies and values for which we stand are capable of attracting
:42:42. > :42:47.votes in Scotland if they are presented. If you are on the back
:42:47. > :42:50.foot all the time. Appeasing the SNP and not prepared to fight for
:42:50. > :42:56.those values, don't be surprised if people wonder why to vote for it.
:42:56. > :42:59.Us that banged to rights, Murdo Fraser? We have tried all these
:42:59. > :43:03.things Michael saying, we have had excellent leaders the Scottish
:43:03. > :43:06.Conservatives, and Annabel Goldie, the leader, about to retire, we
:43:06. > :43:09.have had a Conservative Party leader in Scotland whose personal
:43:09. > :43:14.ratings were higher than the Labour Party.
:43:14. > :43:20.Why don't people vote for you? is an idea of Scottish identity.
:43:20. > :43:25.Voters in Scotland a post-evolution era, want to vote for parties with
:43:25. > :43:29.a Scottish identity. That is why so many centre right voters in
:43:29. > :43:35.Scotland vote for the Scottish National Party, even though they
:43:35. > :43:38.might not believe the policies. If this is such a bad idea, why does
:43:38. > :43:43.his former boss endorse it so massively, why has Norman Tebbit
:43:43. > :43:47.come out to endorse it. These are not nationalist appeasers, they are
:43:47. > :43:53.staunch unionists, that is why we are backing this ban, because they
:43:53. > :43:58.say it is a way to safety union. Everyone is entitled for their
:43:58. > :44:04.opinion. Murdo is standing for the leadership of his party, on
:44:04. > :44:06.platform that says I'm going to wind up your party and it will be
:44:06. > :44:10.something else. It wasn't just the changing of the name, but the
:44:11. > :44:14.notion we did well in the 50s because of our name is fatuous and
:44:14. > :44:19.obscured. You have a situation where the Scottish Conservatives
:44:19. > :44:23.could have a completely different set of policies on key issues to
:44:23. > :44:27.the national policy in London? you look at the Conservatives in
:44:27. > :44:30.London v they developed links with nurses, doctors and teachers, a
:44:30. > :44:35.distinct identity. The manifesto comes up the night before and they
:44:35. > :44:39.try to put a kilt on it, that is not the way to create that idea on
:44:39. > :44:45.it. You don't think they are competent? We are not as well
:44:45. > :44:53.organised as we should be. Is that a pie light way of saying, yes,
:44:53. > :44:58.they have been incompetent. Clearly we have been losing votes at every
:44:59. > :45:03.turn. There is no point in throwing in a the towel and creating a new
:45:03. > :45:08.party. We have seen that before and the results show. Murdo has done a
:45:08. > :45:12.great job, he used to canvas for me, he slept on my floor. I think he
:45:12. > :45:17.just needs to be a little bit more confident, and concentrate on
:45:17. > :45:20.getting across our values and our policies and engaging with the
:45:20. > :45:24.electorate, using modern communication tools, the answer
:45:24. > :45:34.does not lie in changing the name. The electorate are far brighter
:45:34. > :46:13.
:46:13. > :46:16.than to be taken in this by that. That's all we have time for. That's
:46:16. > :46:26.all from Newsnight tonight, hope you will be here tomorrow, I will
:46:26. > :46:49.
:46:49. > :46:52.Plenty of weather coming in our direction over the next few days.
:46:52. > :46:55.Of wet and windy. This is the scene first thing in the morning. A lot
:46:56. > :47:00.of rain around, particularly for England and Wales. Keeping down
:47:00. > :47:02.towards the south-east. Something a bit brighter emerging by the
:47:02. > :47:05.afternoon. Bright and breezy picture across the heart of the
:47:05. > :47:10.Midlands, one or two showers sneaking through. The worst of the
:47:10. > :47:14.rain will be clearing from Kent and East Sussex by mid-afternoon. If
:47:14. > :47:18.you start off with rain things improve later on in the day. Across
:47:18. > :47:24.the more western parts of England and Wales, further showers rattling
:47:24. > :47:28.in during the course of the afternoon on the stiff old westerly
:47:28. > :47:32.wind. Temperatures holding in the mid-teens for the most part. For
:47:32. > :47:37.Northern Ireland the risk of prolonged outbreaks of rain and
:47:37. > :47:41.sunshine limited, same for Scotland. Some real wet weather across the
:47:41. > :47:46.west of Scotlandment brightness further east. More showers to come
:47:46. > :47:50.through the middle of the week. A brisk wind making it feel cool,
:47:50. > :47:54.despite some sunshine. Across southern areas too, it is a similar
:47:54. > :47:59.picture, some sunshine, yes, but also some fairly heavy showers
:47:59. > :48:02.around. So, on Wednesday, probably most of the showers across the more