:00:08. > :00:13.In the next 48 hours, the biggest economic crisis for a generation is
:00:13. > :00:17.supposed to be solved. The Chancellor is calling the eurozone
:00:17. > :00:20.talks critical. Like a rainbow, the nearer a deal gets, the harder it
:00:21. > :00:24.is to touch, no sign yet of a pot of gold. In private Germany and
:00:24. > :00:28.France talk about a solution in the summit after this one. Global
:00:28. > :00:32.markets have rallied, despite what looks like a shambles, now Paul
:00:32. > :00:35.Mason has more bad news. I have seen a European Commission
:00:35. > :00:39.document that says unless the banks lose more than half the money they
:00:39. > :00:44.have lent to Greece, the European taxpayer could be on the hook for
:00:44. > :00:51.half a trillion euros. We will ask if the eventual deal will be dead
:00:51. > :00:54.on arrival. Meanwhile: No, no, no. Deja vu all over again, are the
:00:54. > :00:59.Conservatives really arguing about Europe? A Tory rebellion demanding
:00:59. > :01:04.a referendum on EU membership is growing. This will be the worst
:01:04. > :01:07.time to start having some arcane institutional debate about what
:01:07. > :01:11.might happen in the European Union in many, many years to come. We
:01:11. > :01:21.have a firestorm to deal with right now. Danny Finkelstein tells story
:01:21. > :01:26.
:01:26. > :01:29.MP, Douglas Carswell, why he's Good evening. The euro-authorities
:01:30. > :01:33.have tonight agreed to release eight billion euros to Greece, the
:01:33. > :01:38.latest tranche of their bailout. The bed time reading will be the
:01:38. > :01:43.stuff of nightmares. In a report seen by Newsnight, the European
:01:43. > :01:47.Commission is considering a prososal to impose 60% losses on
:01:47. > :01:53.the banks banks that lent to Greece, and warning that it will take half
:01:53. > :01:56.a trillion euros to bail them out. The The document I have is the
:01:56. > :02:01.European Commission's debt sustainability analysis, going into
:02:01. > :02:04.the summit this weekend. It is dated tonight. What it says is
:02:04. > :02:08.since July Greece has taken a turn for the worst. It says the economy
:02:08. > :02:15.is adjusting in Greece through falling wages and prices rather
:02:15. > :02:21.than structural, reform-driven productivity. Instead of the 21%
:02:21. > :02:26.loss the banks were going to take under Greek debt, they will have to
:02:26. > :02:30.take a hit of 60% of what he lent to Greece. We have a graph - they
:02:30. > :02:33.lent to Greece. We have a graph to show how the European Commission is
:02:33. > :02:38.thinking. That scenario is what they thought would happen to Greek
:02:38. > :02:42.debt. It would peak around 170% of GDP and fall back. There is another
:02:43. > :02:47.little line I hope we can animate that shows, with the haircuts, with
:02:47. > :02:50.the losses of 20% to the banks, it is a little bit better. This is the
:02:50. > :02:55.new baseline, the next line I will show you is the new baseline that
:02:55. > :03:01.the European Commission is thinking, debt peaks at 186% of GDP and falls
:03:01. > :03:05.back, much, much more slowly. There is worse. In this document, because
:03:05. > :03:09.it is a scenario document, they consider something that might
:03:09. > :03:16.happen, that is, that the Greek economy adjusts very rapidly. What
:03:16. > :03:19.I have just said is it is adjusting really slowly. Were they to do
:03:19. > :03:26.wages drivedown, pensions drivedown, growth collapses, they have
:03:26. > :03:29.modelled the impact of that and say that it will cost 551 billion euros.
:03:29. > :03:33.That is a combination of what comes from the banks and the European
:03:33. > :03:37.taxpayer, unless we sort it out. That kind of figure, to be throwing
:03:37. > :03:41.it around in an official document, whatever we think about it, is mind
:03:41. > :03:46.boggling. You keep using the phrase "a scenario", are they trying to
:03:46. > :03:50.scare us with this? I think they are. It is not us they are trying
:03:50. > :03:55.to scare. There is a disagreement. The European Central Bank says it
:03:55. > :03:57.disagrees with concluding scenarios, it doesn't want to scare anybody.
:03:58. > :04:03.But there is an argument going on at the highest level of Europe,
:04:04. > :04:07.what they are saying, it is a clear message, that last most scary
:04:07. > :04:13.shock-doctrine says to the Greek Government, do not kid yourself
:04:13. > :04:16.that you are imposing anything like a sustainable or structural change
:04:16. > :04:22.on your country. All that is happening in your country is you
:04:22. > :04:24.are imposing a kind of death spiral. We need, quite quickly, for the
:04:24. > :04:29.European leaders to decide what they will do about that.
:04:29. > :04:34.We will take that on in a moment. This weekend was meant to be the
:04:34. > :04:36.time it all fell into place, a series of rolling summits ending on
:04:36. > :04:41.Sunday night with a comprehensive agreement on how to solve the
:04:41. > :04:45.crisis. Everyone knows that won't happen. At the centre of this
:04:45. > :04:48.deadlock, France and Germany, the two biggest actors at the table,
:04:48. > :04:53.their indecision sparked by their own domestic baggage has created
:04:53. > :04:59.the impression of a shambles at a time when Europe can ill afford one.
:04:59. > :05:04.We have been exploring how far apart the two sides are. In the
:05:04. > :05:11.famous cartoon of the young Belgian detective, Tin Tin, and his trusted
:05:11. > :05:15.champion Snowy the dog, go in search of a mythical ship called At
:05:15. > :05:20.Unicorn. Just as Angela Merkel and Nicolas Sarkozy are searching for
:05:20. > :05:26.an improbable solution to the euro crisis.
:05:26. > :05:29.So what sort of solutions might be drawn up? With strikes and riots on
:05:30. > :05:37.a weekly basis in Athens, it seems inevitable that Greece simply won't
:05:37. > :05:42.be able to repay all its debts. In July there was talk of a 21%
:05:42. > :05:47.haircut, now there is talk of those who lent money to Greece getting
:05:47. > :05:50.50% or 40% of their money back. If the Greece get a massive write-off,
:05:50. > :05:54.why not the Portuguese or the Irish, who have reformed their ways.
:05:54. > :05:58.Default on one's debt is an enormous disruption to an open
:05:58. > :06:05.trading economy like our's. We believe in rebuilding our economy
:06:05. > :06:11.based on export-led recovery, we do not see default as an approach that
:06:11. > :06:14.would have any relevance to Ireland. In advance of any Greek haircuts,
:06:15. > :06:19.Europe urgently needs to fortify the banks. The IMF has suggested
:06:19. > :06:22.all European banks, including potentially RBS in Britain, need
:06:22. > :06:27.around 200 billion euros of new money to survive a Greek default.
:06:27. > :06:33.But the European banking authority says they may now only need an
:06:33. > :06:40.additional 80 billion euros. The last key element to avert the
:06:40. > :06:48.process is a beefed up fund, the ESSF, there is 440 billion euros in
:06:48. > :06:51.the pot, the idea is to leverage to get larger amount, up to two
:06:51. > :06:56.trillion euros. That sounds a lot, but it isn't, especially since a
:06:56. > :07:02.third has been alloted already to Ireland, Portugal and Greece.
:07:02. > :07:12.Assenor politicians pack their bags for the hotel Switzerland, one
:07:12. > :07:13.
:07:13. > :07:19.senior banker wondered sweeths, and one senior banker wondered who the
:07:19. > :07:24.point was. French banks owe hundred 4000 billion euros in Greek debt.
:07:24. > :07:30.Those banks will need substantially more capital from Paris. The
:07:30. > :07:34.problem facing Mr Sarkozy and the entire eurozone, is recapitalising
:07:34. > :07:38.the banks could jeopardising France's Triple A rating which
:07:38. > :07:46.threatens the ESSF. The French and germs have two different opinions
:07:47. > :07:53.on how the fund should be used. French are looking at the EFSF r as
:07:53. > :07:58.a bank to be used, and the Germans as an insurance policy, to be used
:07:58. > :08:01.in the event of the need. If they can spoof or demonstrate to the
:08:01. > :08:06.markets there is sufficient resource here to deal with any
:08:06. > :08:10.problems, ultimately what they hope is it will be l never be required.
:08:10. > :08:13.- It will never be required. It was purely as an insurance product.
:08:13. > :08:17.They knew they have the balance sheet to do it, but they hope they
:08:17. > :08:22.don't have to do it. Another German dilemma is the tiny matter of
:08:23. > :08:26.democracy, the German electorate is again supporting bailing out
:08:26. > :08:29.profligate nations, and a constitutional court ruling means
:08:30. > :08:34.the Bundestag now has the last say on any eurozone deal. If Germany is
:08:34. > :08:37.to be the lender of last resort for all of the eurozone, it could give
:08:37. > :08:40.the unwanted impression of a greater Germany, created
:08:40. > :08:49.economically this time. But Germany isn't totally on its own in this
:08:49. > :08:53.debate. We understand the Germans 100 persons, and to be very frank,
:08:53. > :09:00.the German situation mirrors the Finnish situation. We think we had
:09:00. > :09:03.a certain deal in the Stability and Growth Pact. Some countries have
:09:03. > :09:08.violated the rules of the euro, it is extremely frustrating. We need
:09:08. > :09:11.to do two things, one, solve the on going crisis Greece, and have much
:09:11. > :09:15.tougher rules for the future, which means more European integration so,
:09:15. > :09:18.this doesn't ever again happen. there is no deal over the next few
:09:18. > :09:21.days, then the least worst case scenario would see markets
:09:21. > :09:25.accepting that Governments would repay all their debts. The voting
:09:25. > :09:29.public accepting a drop in their living standards, banks accepting
:09:29. > :09:33.lower profits and bonuses and Governments accepting the meddling
:09:33. > :09:38.of Brussels and or Frankfurt in their bugetry affairs. For many
:09:38. > :09:42.people that is accepting the unacceptable.
:09:42. > :09:46.The cataclysmic outcome would be a sudden and uncontrolled default,
:09:46. > :09:52.collapse of the eurozone, and instant global recession, which
:09:52. > :09:55.might feel like a depression. But as Tin Tin fans will tell you, the
:09:55. > :10:04.solution to the mystery was eventually found not at sea, but
:10:04. > :10:08.right under their noses. Captain Haddock's, to be precise.
:10:08. > :10:13.With us Holger Schmeiding, chief economist at the German bank,
:10:13. > :10:16.Louise Cooper, the senior financial an cyst at BGC Partners, and from
:10:16. > :10:21.Brussels, the EU correspondent for the economist, Anton La Guardia.
:10:21. > :10:28.Anton, I will start with you. You have come straight from the talks.
:10:28. > :10:32.Give us a sense of the mood there? The mood is rather dejected, I
:10:32. > :10:37.would say. You have a market panic going on. And you also have a
:10:37. > :10:40.political panic, the two don't reconcile very well. So, you have
:10:40. > :10:46.got markets that want to see where the money is, and are they going to
:10:46. > :10:49.get paid back. And you have got Governments that reluctant to show
:10:49. > :10:52.them that much money, because they fear they will be cheated, for
:10:53. > :10:55.example the Germans, and you have the French not able to put up much
:10:55. > :11:04.more money. How would you describe the relationship at the moment
:11:04. > :11:07.between the German and French players? They have been probably at
:11:07. > :11:12.the worst that we have seen in the past year, since they reached a
:11:12. > :11:17.deal that annoyed everybody else in October last year. For the past
:11:17. > :11:20.year or so, Mr Sarkozy has been very careful to be seen to agree
:11:20. > :11:25.with Angela Merkel, and it has come to the point now, or the situation
:11:25. > :11:30.is so bad, that they are at loggerheads, and when officials saw
:11:30. > :11:34.the two of them in Frankfurt for the leaving party of Jean-Claude
:11:34. > :11:37.Trichet, the head of the European Central Bank, they were taken aback
:11:38. > :11:41.by quite how bad things were. Remember only a few days earlier
:11:41. > :11:45.the two had stood side by side, saying how much they agreed with
:11:45. > :11:47.each other, and how they were going to produce this comprehensive
:11:47. > :11:53.solution, this global and durable solution, and all they were doing
:11:53. > :11:57.is masking the disagreement between them. It doesn't seem to be
:11:57. > :12:02.resolved tonight. Holger Schmeiding, how do you get round this, this
:12:02. > :12:05.seems impossible? It seems difficult, but remember we have
:12:05. > :12:08.been through similar situations before. In the end typically
:12:08. > :12:12.Germany and France do agree. Both sides know they don't have any
:12:12. > :12:15.other option in Europe. The two sides have to agree. It is highly
:12:16. > :12:19.likely that by Wednesday, probably not by Sunday, but by Wednesday,
:12:19. > :12:23.they will agree, and if they don't agree which Wednesday, they will
:12:23. > :12:27.agree by the Sunday afterwards, on a joint proposal, how to get Europe
:12:27. > :12:31.out of this. They agree that they have to get Europe out of it. They
:12:31. > :12:34.don't agree with the means. Why should the deadlock suddenly be
:12:34. > :12:38.broken, when they are going in completely different directions?
:12:38. > :12:42.Because they know that markets would otherwise take Europe, the
:12:42. > :12:44.eurozone apart. I'm fairly certain they will agree, probably by
:12:44. > :12:49.Wednesday, the key question will be whether the agreement will be a
:12:49. > :12:54.good one or a bad one. A durable or not. But I'm very certain there
:12:54. > :13:01.will be an agreement, and probably mostly along the German lines,
:13:01. > :13:03.which is the European rescue fund is turned into an insurer and not a
:13:03. > :13:09.bank. Do you think, Louise Cooper, that
:13:09. > :13:12.the Germans must win out on this one? The credibility of the ECB,
:13:12. > :13:22.not least, at stake here? It is interesting that we spend so much
:13:22. > :13:25.
:13:25. > :13:28.time talking about this bailout fund, the ESF - EFSF, a lot of the
:13:28. > :13:32.politicians problem is coping with the crisis not solving the problem.
:13:32. > :13:35.The bailout fund is throwing more debt at the problem in the hope of
:13:35. > :13:41.alleviating short-term pain. It is buying us time, it is not dealing
:13:41. > :13:45.with the three underlying problems. Which is the eurozone is
:13:45. > :13:49.structurally flawed, that there is just too much debt, the eurozone
:13:49. > :13:54.Governments have too much debt, and we're having trouble growing. We
:13:54. > :13:57.need growth to get us out of debt. You can't even get on to the
:13:57. > :14:01.underlying problems until you have sorted out what has happened at the
:14:01. > :14:04.moment, you have seen what is happening in Athens and people are
:14:04. > :14:08.dying? We are not close to dealing with the structural reform, getting
:14:08. > :14:12.on top of the growth, the whole creation of the fiscal union, we
:14:12. > :14:15.are miles away from it. We are having arguments about the
:14:15. > :14:20.temporary solution to alleviate the short-term pain. This is kind of
:14:20. > :14:24.where we are. I want to be optimistic, I think the political
:14:24. > :14:28.class are kind of failing us. that I would love to disagree very
:14:28. > :14:31.much. We have a very serious crisis to deal with. If we look beyond the
:14:31. > :14:35.crisis at the underlying fundamentals, remember the eurozone,
:14:35. > :14:39.so far this year, has been the fastest-growing of the western
:14:39. > :14:45.economies. It has, by far, the lowest fiscal deficit of the
:14:45. > :14:50.western economies. So the eurozone has a very dangerous crisis. But if
:14:50. > :14:54.it can resolve that, the underlying fundamentals are much better. The
:14:54. > :14:58.German fiscal deficit is one 15th of that of the UK. We need markets
:14:58. > :15:03.to focus on fundamentals, structural reforms in the eurozone,
:15:03. > :15:08.and get beyond the current market panic. What do you make of what
:15:08. > :15:13.Paul has heard this evening, Anton La Guardia, he talked about the 60%
:15:13. > :15:17.haircut now, which is slightly more than a haircut, let's be honest, do
:15:17. > :15:22.you think that was a shock document, as he called it? It was more like a
:15:22. > :15:26.scalping, isn't it. I think they are slowly coming to more realistic
:15:26. > :15:29.figures. That assessment took a long time to come out. We think
:15:29. > :15:33.because there was a disagreement between the commission and the IMF,
:15:33. > :15:37.who now seem to have adopted a tougher position, saying you have
:15:37. > :15:43.to get realistic numbers out if you are going to begin to address the
:15:43. > :15:46.problem. Until now they have tried to get some money out of the
:15:46. > :15:50.creditors, in order that the official, that the Governments
:15:50. > :15:55.wouldn't have to pay so much for Greece. It has been done on a
:15:55. > :15:59.voluntary basis so you wouldn't trigger credit default swaps, which
:15:59. > :16:03.is insurance against states' faulting. If you are going to 50-
:16:03. > :16:08.60%, it seems to me it is hard to call that a voluntary contribution
:16:08. > :16:12.from the private sector, you are in different, unchartered territory
:16:12. > :16:14.here. It has happened for the developing world. We have seen lots
:16:14. > :16:19.of defaults, debt restructuring around the world. We haven't really
:16:19. > :16:23.seen it, for a long time, in the western industrialised world.
:16:23. > :16:29.Louise Cooper, isn't this just semantics, at the end of the day
:16:29. > :16:36.this will take two trillion YuriGagarino50 rows and the - euro,
:16:36. > :16:41.and the countries can decide who takes? The trouble is as we heard,
:16:41. > :16:46.is the German taxpayer cannot transfer wealth to Greece or any
:16:46. > :16:49.other countries as yet. German constitutional law prohibits it. If
:16:49. > :16:58.you want a permanent solution to the crisis, we have to change
:16:58. > :17:03.treaties, laws, you have to have 17 countries agree to it together how
:17:03. > :17:08.long does it take the EFSF to be ratified from the summer, months.
:17:08. > :17:12.The bottom line is democracy is getting in the way here. People all
:17:12. > :17:15.over Europe are saying why is taking so long to sort out, and
:17:15. > :17:22.that is because everything has to go through the German people right
:17:22. > :17:25.now? That is one thing, the bigger thing is more important. If the
:17:25. > :17:27.European bank would buy assets on the scale of the Bank of England,
:17:28. > :17:30.then the problem would be solved immediately. If the European
:17:30. > :17:34.Central Bank were to buy Government bonds to the same scale that the
:17:34. > :17:40.Bank of England has done, relative to the size of the British economy,
:17:40. > :17:45.then the ECB could buy 1.5 trillion euros worth of Government bonds.
:17:45. > :17:49.The key difference between the eurozone and Britain, is not the
:17:49. > :17:54.political situation, it is that the Central Bank in the eurozone is
:17:54. > :17:58.much more reluctant to actual step in. That's why the policy makers,
:17:58. > :18:02.what you call democracy, the Parliaments actually have to do
:18:02. > :18:06.much more of the heavy lifting. So I think, in the very end, if over
:18:06. > :18:10.the next five days, there is no final solution from the policy
:18:10. > :18:14.makers on the fiscal side, then it will be up to the European Central
:18:14. > :18:17.Bank to do its duty, just like the Bank of England has done. And the
:18:17. > :18:21.Germans are worried about how the European Central Bank will look and
:18:21. > :18:31.the French are worried about French banks losing their credit rating.
:18:31. > :18:32.
:18:32. > :18:36.You have got this circularity here, the ESSF has been construct - EFSF
:18:36. > :18:43.has been constructed to recapitalise the European central
:18:43. > :18:48.banks, by doing that they have to raise money to give the them money.
:18:48. > :18:52.The two are target. The markets are rallying tonight, it must mean they
:18:52. > :18:57.know there is a deal within reach? There is hope, there is a couple of
:18:57. > :19:03.things to bear in mind, volitility is increasing in markets, how much
:19:03. > :19:06.they swing around. And also co- relation, when all assets move in
:19:06. > :19:10.the same direction together. That is an indicator of fear. There are
:19:10. > :19:15.indicators of fear and stress in the system, I wouldn't get too
:19:15. > :19:18.carried away with today's rally. Thank you very much for joining us.
:19:18. > :19:21.European disharmony is a little closer to home tonight too. There
:19:21. > :19:24.are signs that the Conservative rebellion on matters EU is growing.
:19:24. > :19:30.Downing Street's digging in its heels over a backbench motion
:19:30. > :19:35.calling for a referendum. The Tories can't really afford any sign
:19:35. > :19:41.of dissent on the suggest like Europe again. Is the Government
:19:41. > :19:46.being too heavyhanded at a time when the European project is not in
:19:46. > :19:49.such great shape. Nick Clegg says why he thinks it is a bad idea.
:19:49. > :19:52.is important to step back and ask ourselves what is in Britain's
:19:52. > :19:56.interest. We have this firestorm happening, right on our doorstep at
:19:56. > :20:00.the moment, in the eurozone, which massively effects families,
:20:00. > :20:04.communities and businesses in this country. If you don't have a strong
:20:04. > :20:09.prosperous eurozone you don't have a strong prosperous UK. It is as
:20:09. > :20:14.simple as that. This, it seems to me, would therefore be the worst
:20:14. > :20:17.time to start having some arcane institutional debate about what
:20:17. > :20:23.might happen in the European Union main years to come. We have a
:20:23. > :20:26.firestorm to deal with right now, we should focus on that, not
:20:26. > :20:31.talking about debates which many families will think is academic
:20:31. > :20:37.when people are worried about jobs and prices in the shops and want
:20:37. > :20:42.the economy to be sorted as quickly as possible. Our political
:20:42. > :20:45.correspondent is with me now. They are not totally convinced by Nick
:20:45. > :20:48.Clegg or David Cameron's position either? The irony, for the first
:20:48. > :20:51.time in two decades the Conservative Party are more united
:20:51. > :20:54.on Europe than ever before, and the most sceptical on Europe than ever
:20:54. > :20:57.before. There was a growing gulf between the leadership and many of
:20:57. > :21:03.the backbenchers. Just to give you a sense of this, some of the people
:21:03. > :21:07.I was speaking to today. One MP spoke to me of idiocy in Downing
:21:08. > :21:11.Street. A ministerial aide said the atmosphere is bloody, and
:21:11. > :21:15.backbenchers have been rating the handling of the issue on a scale of
:21:15. > :21:20.starting bad and going up or down to totally appalling. The position
:21:20. > :21:23.is tonight, 66 Conservative MPs are willing to back this rebel motion
:21:23. > :21:28.on EU, the multiple choice referendum on the EU, get in, get
:21:28. > :21:34.out or renegotiate. That number could, I'm told, go up to as many
:21:34. > :21:39.as 0, maybe 100, by the time it is debated on Monday. One of the
:21:39. > :21:43.reasons is Downing Street rejected today a compromise amendment put
:21:43. > :21:46.forward than none other than David Cameron's former press secretary,
:21:46. > :21:49.George Eustice, a sign itself of some of the divisions we are seeing
:21:49. > :21:53.at the moment. 22 Conservative MPs who are backing that amendment are
:21:53. > :21:56.now much more likely to back the rebel amendment. I spoke to one a
:21:56. > :22:02.little earlier this evening, she told me why she was thinking of
:22:02. > :22:09.backing the rebels. I certainlyam thinking about backing with the
:22:09. > :22:13.substantive motion if our amendment isn't called or voted down. The
:22:14. > :22:18.reason is people in Britain voted for a single market in 1976, they
:22:18. > :22:21.haven't been given the chance since then to vote on anything else. They
:22:21. > :22:24.deserve to have their say. If you are right about the numbers, they
:22:24. > :22:28.are pretty substantial and will be after the weekend. Do you think
:22:28. > :22:32.this is a rebellion that can be diffused? There are attempts to do
:22:32. > :22:36.so on both sides. One cabinet minister and many other ministers
:22:36. > :22:41.have been arguing for the the debate on Monday to be turned into
:22:41. > :22:45.a free vote. Or the whips to back off. Downing Street are trying to
:22:45. > :22:52.defuse it in a different way. To underline the determination David
:22:52. > :22:56.Cameron is meeting all the MPs on the lowest rung of the ministerial
:22:56. > :23:01.ladder at lunchtime on Monday and say there will be career-limiting
:23:01. > :23:06.consequences if you don't play ball on this. As things stand, four of
:23:06. > :23:11.those MPs might well resign their positions. Labour is not that
:23:11. > :23:15.united over this either? There is a wider issue, it came about as a
:23:15. > :23:19.result of an attempt to make Parliament more transparent and
:23:19. > :23:23.accessible to the public. 100,000 people signed a petition, the
:23:23. > :23:26.backbenchers scheduled a debate on the issue. And then were surprised
:23:26. > :23:32.the Government got concerned. Some of the concerns are on the Labour
:23:32. > :23:35.side as well. 12 Labour MPs might break their own party line and
:23:35. > :23:38.former Europe minister Keith Vaz, is likely to be one of them.
:23:38. > :23:45.some extent the motion on Monday has been hijacked by the decision
:23:46. > :23:48.of the major parties. Clearly the motion will be defeated. I think
:23:48. > :23:53.that does raise questions as to whether or not we have had an
:23:53. > :23:56.increase in power in Parliament. I think the public will feel rather
:23:57. > :24:02.puzzled at this. I don't think there is any need for high politics
:24:03. > :24:06.in this. It is a straight forward discussion which we ought to have.
:24:06. > :24:10.There might be a slight irritation from Ed Miliband about a mini-
:24:10. > :24:12.rebellion in his own ranks. For David Cameron it looks like a
:24:12. > :24:15.smoldering resentment on the backbenches forsome some time to
:24:15. > :24:21.come. With me now, Danny Finkelstein, the executive editor
:24:21. > :24:24.of the Times, and former advisor to William Hague. And the Conservative
:24:24. > :24:27.MP, Douglas Carswell. Thank you for coming in. Clarify what you are
:24:27. > :24:30.doing on Monday, and how much support you think there is for that,
:24:30. > :24:34.Douglas Carswell? We are trying to give the House of Commons an
:24:34. > :24:39.opportunity to vote on whether there should be an EU referendum.
:24:39. > :24:42.Let's be clear, we are not doing this because people like me
:24:42. > :24:46.triggered this. This was triggered by the people, tens of thousands of
:24:46. > :24:49.ordinary people in Britain, who have insisted, using this new
:24:49. > :24:54.mechanism, that we put this on the parliamentary agenda. All these
:24:54. > :24:58.politicians who say we need to renew democracy, shouldn't complain
:24:58. > :25:03.when people insist we put it on the agenda and debate it. How many
:25:03. > :25:07.others will defy the whip? I'm not here to talk about numbers. If we
:25:07. > :25:11.are talking about 100, is that ball park figure you would go with?
:25:11. > :25:14.will be a genuine parliamentary occasion where some people will
:25:14. > :25:19.make up their minds on the arguments put forward in the
:25:19. > :25:23.chamber. This is about restoring purpose to Parliament, I hope we
:25:23. > :25:26.will see good debate and MPs obey the three-line whip put to them by
:25:26. > :25:29.their constituents. This is about a petition that has come from the
:25:29. > :25:33.people, which is what the new legislation has all been about,
:25:33. > :25:37.asking people what they think? There is a good thing to have a
:25:37. > :25:41.debate. I don't understand in the motion, for the first time you have
:25:41. > :25:46.three proposals on the ballot paper, are you proposing a straight vote
:25:46. > :25:51.between the two or an alternative vote or preferential system. It is
:25:51. > :25:54.not a binding resolution. Is the proposal a straight vote.? This is
:25:54. > :26:01.about making sure that the question of whether or not we should, the
:26:01. > :26:04.detail of the question will be decided by the later date. There
:26:04. > :26:10.are three proposals? The Electoral Commission will decide the precise
:26:10. > :26:14.wording. What is your view? This is about deciding who that Parliament,
:26:14. > :26:17.and the view of Parliament is there should or should not be a
:26:17. > :26:21.referendum. You have a three-part motion, and you haven't decided if
:26:21. > :26:24.it should be preferential, it is obviously critical to this, whether
:26:24. > :26:27.it should be preferential or straight. This is my concern about
:26:27. > :26:32.it. I think you haven't thought through the consequences of this.
:26:32. > :26:36.You are basically going to end up spliting Euro-sceptics n two ways,
:26:36. > :26:41.first of all between the people who want to roe negotiate and those who
:26:41. > :26:46.want to leave. - renegotiate and those who want to leave. Or split
:26:46. > :26:51.between people like me who think we should have prososals on the table
:26:51. > :26:57.rather than some vague notion of renegotiation, and people like
:26:57. > :27:03.yourself who would prefer to leave. You are going to split it, Fernando
:27:03. > :27:07.Torres and misthe goal by two inches, that is what we are like
:27:07. > :27:11.here. Why is David Cameron so scared of the proposal? If Danny
:27:11. > :27:15.and the whips are so concerned about splits on Monday, make it a
:27:15. > :27:18.free vote. I'm talking about the coherence of your proposal. You
:27:18. > :27:22.haven't said if you want a preferential vote or a straight
:27:22. > :27:25.vote? The precise details are up for the Electoral Commission, it is
:27:25. > :27:29.about Parliament in principle should be allowed to decide. Danny
:27:30. > :27:33.says don't trust the people. know we don't know if it will be
:27:33. > :27:36.straight forward, what does the word "renegotiation" mean what if
:27:36. > :27:40.people think we should renegotiate to give the European Union more
:27:40. > :27:44.power? The precise wording is matter for the Electoral Commission,
:27:44. > :27:47.it is about whether we trust the people. Why have you included three
:27:47. > :27:52.questions at all. This isn't about the bubble. I'm talking about your
:27:52. > :27:55.question. The trouble with all this is, exactly what Nick Clegg said,
:27:55. > :27:59.it all sounds academic. We have seen the kind of problems Europe is
:27:59. > :28:03.facing, you are talking about the two or three questions or all the
:28:03. > :28:07.rest of them? It is because of the Dire Straits the economy is in,
:28:08. > :28:17.because of the mess the economy is in, we need to put Europe on the
:28:17. > :28:20.agenda. Until we discuss debt it is not on the agenda. The debt is 12
:28:21. > :28:26.billion, the cost of the EU is enormous, we have to decide whether
:28:26. > :28:32.it is worth paying the money. is fair enough? Danny says we
:28:32. > :28:38.shouldn't, I think we should. concerned about the sloppyness and
:28:38. > :28:42.timing of your proposia. You will ruin the idea of a referendum for a
:28:42. > :28:48.generation and hand the people, who want to carry on with Europe as it
:28:48. > :28:51.is, with a great victory. That is what I'm concerned about. I'm glad
:28:51. > :28:55.the Government is rallying Euro- sceptic to think through what you
:28:55. > :28:58.haven't. Is the Government panicking enough to whip it?
:28:58. > :29:02.glad of the robust stance. Otherwise you get everybody who
:29:02. > :29:05.says there ought to be a referendum, of course there should be. Can I
:29:05. > :29:08.deal with the timing. Danny and others are saying it is the wrong
:29:08. > :29:12.timing, this was put on the political agenda by the people.
:29:12. > :29:17.Danny is saying tens of thousands of British people up and down the
:29:17. > :29:21.country are wrong. I say they are right. He is not saying that?
:29:21. > :29:25.not the right time to discuss it, or have the referendum. Your
:29:25. > :29:30.proposal, is also at the wrong moment, we don't have proposals
:29:30. > :29:33.from anybody as to what renegotiate might mean. People who are voting
:29:33. > :29:36.might not know what they are voting for. You are asking for a
:29:36. > :29:42.referendum on a system you haven't established with a question you
:29:42. > :29:44.don't understand. The details of the question will be decided by the
:29:44. > :29:48.Electoral Commission. Are you worried that it could be perceived
:29:48. > :29:50.as Tories arguing over Europe again, it is an easy headline? There are
:29:50. > :29:54.divisions between the Conservative Party and all three parties about
:29:54. > :29:57.Europe. The divisions over Europe have happened for 20 years, without
:29:57. > :30:02.there being a referendum. Maybe it is time to consider that a
:30:02. > :30:12.referendum is a way to heal the divisions the Conservative Party,
:30:12. > :30:12.
:30:12. > :30:16.by having a referendum we could trust the people. The SNP deputy
:30:16. > :30:20.First Minister, Nicola Sturgeon, told their conference today that
:30:20. > :30:24.she believed Scots would vote for independence when asked. Alling it
:30:24. > :30:31.a once in a generation opportunity. The other parties say they want us
:30:31. > :30:38.to spell out what independence means. So let me spell it out.
:30:38. > :30:42.Independence means so longer having to watch our national wealthered by
:30:42. > :30:47.Westminster Governments. The SNP's Nicola Sturgeon, that is all from