01/11/2011 Newsnight


Presented by Gavin Esler. As the announcement of a Greek referendum on a European Union aid package throws the deal into doubt, Newsnight asks what is next for the eurozone.

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Tonight's recipe, take a debt crisis add a half-baked summit deal,


and a referendum, and there is trouble on the streets. Mix in an


emergency cabinet meeting, that is what is cooking in Greece tonight.


The result, stock markets tumble, a Government on the edge.


In Cannes, at the G20, the most powerful people in the world have


been rendered powerless by a Greek political fiasco.


Is last week's deal on the euro unravelling. The man who negotiated


the bank's 50% haircut joins us live.


Plus, The Italian Jb, who can steer one of Europe's big economies


through austerity. Those Italians who want the best,


who is going to lead them? If you see that politician, please tell


In Britain, the economy is growing, but 75 years after the Jarrow March,


is there a new north-south divide. We will ask a Conservative Treasury


minister. And the controversial law joint enterprise, which means you


can be convicted of a serious crime, even if you are not directly


involved. I didn't stab anyone, you didn't


know the knife was present, but the person died, and under joint


enterprise you have all been convicted. You come out with murder


under your name. Good evening, perhaps it tells you


a lot about the politics of the European Union, that the threat of


voters actually having a direct say in a referendum brought markets


tumbling all around the world today. Tonight the Greek cabinet are in


urgent talks as we speak, the Prime Minister's career on the brink,


with a vote of confidence scheduled this Friday. Before that he will


attend another emergency meeting tomorrow with other EU leaders.


This time in Cannes. Ahead of the G20 Summit. Well, the decision by


the Greek Prime Minister to ask the Greek people, in effect, to back


him or sack him, was a real surprise. The fears now are that


last week's eurozone deal could unravel just a few days after it


was struck. Paul Mason is in Cannes for us tonight.


As far as we know the Greek cabinet is still in session. We hear that


the ministers are going round the table saying what they think, so


far, we hear, you can hear things out of a Greek cabinet, that they


are backing him. But Mr Papandreou really has caused chaos in the last


24 hours. This referendum call puts the whole deal agreed in Brussels


last week back on the table, back into doubt. Certainly the markets


have seen it as possibly signalling the end game, where Greece enters


into chaotic default process, as the people have their say, whether


it is in a referendum or snap election if the Government falls.


Once they have had their say, Greece, inevitably slides towards


leaving the euro, eventhough most of them don't yet want to do that.


The banks in Europe have been hit hard because of this. Most stock


markets as you say fell, but Unii Credit and Sot-Gen, double digit


loss, meanwhile the Dutch have weighed in. The Dutch, the key part


of governance arrangements in that country, saying they think the


referendum Wells muchs on the deal, and that they are not tied to what


they agreed, they might not be the last north European Government to


say that. In Greece there is chaos, the Finance Minister, we hear, knew


nothing about the referendum call before it was announced. He checked


into hospital with stomach patience. They chose the very same day, we -


pains. They chose the very same day, we hope, to sack some general, and


Mr Papandreou has been off the airways all day. In the notes


coming out of the banking fraternity, there is a clear


worrying there will be a chaotic default and exit from the euro.


That, I think would be end game, that is why people are so wore


yeefpltd this report contains tpwhrarb photography.


When the Greek frame - flash photography. When the Greek Prime


Minister announced a referendum and confidence vote on the deal agreed


last week, the word "bombshell", failed to do it justice. The


markets fell, the Finance Minister went into hospital, a flurry of


phone calls happened between world leaders, and one after the other,


Mr Papandreou's MPs went A wol. Then, an - AWOL. Then an emergecy


cabinet meeting. This is how Greeks greeted the deal their Government


did last week, the word they chant "no", and last Friday saw clashes


between people and military conskrupts over the disruption of


cermonial parades. But Greece will get 100 euros of its debt written


off, but faces more austerity, and virtually foreign control of its


ministries. For many Greeks, Mr Papandreou's referendum will be a


straight choice, vote no and effectively default and leave the


euro. The Greek crisis is feeding and


feeding off the simmering Italian crisis. Italy's bond yield, its


cost of borrowing, has shot up above 6% into unsustainable range,


but it is too figure to fail, and needs the best part of a trillion


euros from the EFSF bailout fund, that doesn't yet exist, so the


European Central Bank had to dive in and spend 9 billion euros to


calm things down for a day. For the protestors gathered in Nice


today, there was a sense that amid their ordinary demands and protests,


something extra ordinary is about to unfold, because the Greek


referendum, or a snap election, will see the Greek people suddenly


dial into a situation they have, up to now, had no say in.


A point not lost on Britain's Chancellor.


There is no doubt that the decision of the Greek Prime Minister has


added to the instability and the uncertainty in the eurozone, you


can see that today, and what we're trying to do is create stability


and certainty in the eurozone. Now, ultimately, it is up to the Greek


people and the Greek political system to decide how they make


their decisions. But I would say it is extremely important for the


eurozone to implement the package they agreed last week, that is what


I said was crucial at the time, that is what they all said was


crucial at the time. I think we need to get on with it sooner


rather than later. Tomorrow, here at the G20, they


will there - there will now have to be an emergency meeting, and


discussion about how the Greek people suddenly got dialed in, to a


decision that most people had thought decided at the last


emergency meeting, and what will happen if they are not quickly


dialed out again. The laidback Riviera, even more unreal than


normal under the fairy lights, gets ready for another surreal day,


tomorrow. Tonight, what are the options left


for Greece and the eurozone? If you going go back to last week. The


deal agreed is they would get a third of their debt knocked off,


and the people penalised by that would be the banks. Two thirds, or


half of their debt is held by people like the IMF and ECB, they


wouldn't lose a thing. But in return, Governments would shore up


the banks, so it was a very convenient deal. It was a sort of


buffer zone for the impact of the default, which is effectively what


it is. Now, if the Greeks vote no, then what will then happen is there


will be a much bigger default, up to 90-100%, that will apply to


everybody else who holds the debt. Because it will not be voluntary,


as it currently, this is the fiction, that it is voluntary for


the banks, then if it is not voluntary, these credit default


swaps, these insurance, basically policies, against default, get


triggered and it fires the whole explosive charge into the heart of


the financial system. So those are the options if they don't stick to


what they are supposed to do. You know what I think has caused this.


The Greeks have had foreign civil servants turn up in their


ministries, and most Greek politicians have spent the last 18


months shuttered in private offices with no name plate, terrified of


going out on to the street, they have been shut off from reality,


that hit them this week when those foreign civil servants turned up in


the ministries and said we are now in control. It is very hard for


democratic politicians to accept that. That is what has triggered


this phase of the crisis. Thank you very much, we will come


back shortly to you. In a moment we will also speak to


Vicky Pryce, an economist from FTI Consulting and former head of the


Government's economic service, and a Greek member of parliament. First


we're joined by Charles Dallara, as head of the Institute for


International Finance, was in charge for negotiating for the


banks the terms of the Greek bailout deal, including the 50%


haircut for private investors in Greek Government debt. Does this


prospect of a Greek referendum mean that as far as you are concerned


the deal you negotiated in good faith could be dead? No, not to us


at all. We remain focused, despite the political uncertainties


swirling around Greece and Europe. We remain focused on developing and


agreeing the details of the agreement. And bringing forward the


implementation as soon as practicable. And delivering to


Greece and the Greek people the benefits of this deal. But, presume


below you had no idea this was going to happen, it must have come


as quite a shock? It certainly was a surprise. But we live in


uncertain times, and every day in dealing with the Greek deal it is a


bit like getting on the Coney Island rollercoaster, you take some


sharp turns, they are unexpected and it rattles you a bit, then you


settle down and move forward. That is what we tried to do in the


course of the last 36 hours or so. We remain focused on the deal. We


are engaged with technical discussions with partners in Greece


and Europe on how the deal may be fleshed out. We look forward to


doing that. This is an historic opportunity for Greece to put aside


a substantial burden of debt, which has hung over them throughout this


last two years of adjustment. And with that cloud of debt


substantially removed, we think that the burden on Greece will be


lightened, the hardships associated with reform will be reduced, the


path of reform will be shortened and the opportunities to reap the


benefits of this entire difficult process will be greater than in the


past. That is why I remain focused, as do my investor base, in moving


forward with this deal. That may all be true but the politics of it


are that the Greek people are being asked to vote on something that


could mean years of shrinking living standards. That produces


real uncertainty for the people you represent. We don't even know if


the referendum will be held in January. You could have month of


uncertainty, which presumably nobody you represent wants? You are


right, but it is very important for the Greek people to understand and


to realise what are the real choices before them. Of course we


totally respect the leadership of the Greek Government in its


decision to move forward with a referendum. However, as we see it,


quite frankly, this historic relief of debt, which will create a huge


lessening in the burden, eliminating debt that is currently


equal to 45% of Greece's GDP. And restructuring 45% of the remaining


debt. Will create a tremendous opportunity for Greece, it seems to


me the choices are quite clear. On the one hand they follow through


with the agreement, they seize the opportunity to reap the benefits of


their hard work, and they move out of austerity, into growth and


investment and job creation, within a matter of a few years the


alternative path to me is one not seriously contemplated, because it


is a path of isolation, and a path, I'm afraid, a contracting economy,


for a long, long time. It may not be visible, but it is


possible. It may be that investors round the world looking at Greece


and Italy might conclude that the bond market itself could be wrecked


because debts of these big countries could be virtually


unsurable in the future? I think - Uninsurable in the future? I think


what is happening in Greece is very serious and we should take it very


seriously. However I think the situation in Spain and other


countries is very different. The plan outlined in Brussels last week


to create firewalls and underpin the sovereign efforts in other


countries, such as Italy, is a good plan. It also needs to be fleshed


out. I think European leadership is in the process. Although it might


not seem that way right now, beginning to get ahead of the


sovereign debt problem. I think if the real choices are outlined for


the grok people, the choice between a painful - Greek people, the


choice between a painful but some what shortened period of austerity,


bringing new opportunities for investment and job growth, is


outlined in contrast to a choice of a much longer period of austerity,


and isolation in the markets, that the Greek people will make the


right choice. We bring in a local MP in Greece.


Do you think that Greek people will agree with that analysis in the end,


and say this is the least worst option, it is good for us? I think


that the Greek people are full of anger. We are hearing words, words,


words. I believe I heard from Mr Dallara and the Greek economy is


frozen, the people are without jobs. The best of our young people are


leaving for Canada and Australia. We are a modern colony in Europe.


It was no national independence, and our Prime Minister is not Mr


Papandreou, our real Prime Minister is Mrs M - Mrs Merkel, she decides


what road Greece will follow. Something must change. I think that


for the first time after all these big demonstrations of the people,


there is hope, hope that we are near the beginning of the end of


this very bad era for Greece. you think Mr Alavanos that this is


the end for the Papandreou Government, will he survive the


week, do you think? Yes, I think yes. I think yes because you know


his party is totally reconstructed. There are objections inside the


cabinet this time. Until ten minutes before the cabinet had a


meeting, a member left his party today, the people are totally angry


with this party. I think it is a problem of timing. After two hours,


after four hours, after one day, after three days, I think Mr


Papandreou will show that Mr Sarkozy and Mrs Merkel that it's


finished. Is this the beginning or end of the eurozone? If we end up


with the Greeks voting no we will see the beginning of the end of the


Euro-project. It will spread to the other countries as well. We may not


get to the point. The question of it may be phrased in such way that


in fact the decision may be between asking the Greeks if you want to


leave the euro, and maybe the EU, with the implications that will


have, or do you want something with a hope for future but costs. We are


working hard to ensure that leads you to faster growth in the


foreseeable future. Do you think Mrs Merkel, perhaps the Prime


Minister of Greece, from what we have been hearing, do you think she


has miscalculated and Mr Sarkozy has miscalculated, they have got


this wrong? What they have got wrong is waiting so long to get a


solution. If we had some answers to the Greek problems six month or a


year ago things would have been different. The contagion wouldn't


have spread to other countries. That was a mistake, they realised


they then had to act and they did. It was absolutely right in terms of


the package coming forward. We may see in the future that the 50%


haircut is not enough, and there may be more need. I was hoping


there would be a little bit of time after the last tranche of the eight


billion was paid, to think again about exactly what Greece needed to


do to get out of its problems, which are basically low growth, and


contracting GDP for a number years, which the population doesn't like.


A word from our other two guests, Alekos Alavanos, do you worry there


will be a military coup in Greece? I hope not. Of course the situation


in Greece is very troubled, but there is a hopeful element for


Greece, and for Europe. That the people are people, that they are a


political subject who have the demonstrations of a million people


for some days. So I think we have a road to democracy not a fear for a


coup d'etat. Do you think having accepted the 50% haircut, what


remains of the money of the people you represent is safe. In other


words it all sounds pretty gloomy? Well, I think we have confidence


thra this deal is the right deal, - that this deal is the right deal,


it is balanced deal. It is an historically substantial deal in


terms of sovereign debt restructuring. It is very important,


if I may add, we can all sense the despair and fatigue around Greece


today. I lived there two years as a young novel officer, I have many


friends in Greece - Navy officer, I have many frepbz in Greece. What is


important to articulate is what happened in Greece last week was


designed to alleviate a large part of the burden on the people. The


pace of austerity and reform over the last 18 months was too


aggressive, too demanding and too challenging for many people. We


need a more moderated path of adjustment delivering benefits for


Greece. Let's return to Paul in Cannes, I


think you have some news for us from the Greek cabinet meeting?


we are getting out of Athens, the line that the Greek cabinet has


been told by the Prime Minister that this market turmoil will be


short lived. He has also said, he has stuck to his guns on the


referendum, he said if we have a snap election that would lead to


dae fault. On that cheery note - a default. On that cheery note we


turn to Italy. My colleague has been in Italy for the past few days


assessing the mood there. As he has found in Milan, there is Euro-


sceptic even there, and quite a lot of people very resist sent to


accepting the de- resistent to the degree of austerity they want to


impose. His name is Ambrose, he is 672 years old. But Milan's patron


saint, isn't allowed to rest in peace. The cult of the Roman


governor turned bishop, is being offered up as a sacrifice to help


preserve the security and stability of the eurozone. The people here


have always celebrated St Ambrose. But now under pressure from the


European Central Bank to impose austerity, the Italian Government


has proposed turning local saints' festivals into ordinary working


days. That is causing quite a row here.


The need for urgent reform in Italy is pretty clear. Its economy is


expected to contract next year by 0.2%. Its public debt is 1.trillion


euros. Its borrowing costs rose today to 6.3%. Widely regarded as


unsustain pbl. Durb unsustainable. The church


can't see how that effects Ambrose. TRANSLATION: The Italians are hard-


working people, I don't think abolishing this will solve the


country's economic problems. Yes, you have to work, but you have to


celebrate too. The battle over St Ambrose's day and hundreds of other


local holidays across Italy, is part of the soul searching provoked


by the country's economic crisis. A country that at times over the


century has led Europe, not only in faith and art but also in banking,


in summers and in manufacturing skills s suddenly being told by


northern neighbour, to put its house in order. Being compared to


Greece, a much smaller state with a smaller culture. How much that


rankles, and it does, many Italians of various political complexions


acknowledge that their country has some how lost its way.


Jr Nobody is sure who can set - and nobody is sure who can set it whack


on the right track. Here in Milan I'm meeting one of the few figures


that everyone respects. He's a businessman, not a politician. In


charge of a Milanise icon, more famous even than Ambrose, Pirelli


tyres. A man with no time to be sentimental of the sairpbts.


think it is important that factories they have to stay open, 3


- saipbts. I think it is important that the factories stay open 365


days a week. It is a place of precision, hundreds of laser


cuttings, for each pattern for everyone that is eventually


marketing. Testing each proto-type with an exacting standard that


shows Germans have little to teach Italians. That is how we show being


Italian and our own creativeness. The main problem most of the


production is moving abroad, only 550 people left are based in


ittally. 1234 - Italy. That is not how it


was in the post-war boom, when Pirelli motored ahead along with


the rest of the economy. The economic declined since. It is due


part low to global trends, but also a lack of leadership. In the 1950s,


the ruling class were white people that suffered because of the war


and the dictatorship. They were well aware of the risks and the


opportunities they were facing. And the profit of it. What is the


ruling class today, what is wrong with them? It is much more


complicated today, there are too many people at any level. The


institutional system is creating complexity instead of solving


problems. The number of laws we have in our country, far than in


any other European country. Italy's Labour laws are not complex or


rigid enough to prevent 325 workers at this electronics plant in Milan


from losing their jobs next month, as production goes oversea. Inside


the protest tent they are contemplating a way of life - - the


tent they are contemplating a way of life. Tran When - TRANSLATION:


You came here knowing it was a job for life. Lots of older people only


came to collect their pension. It was like working for the state.


With anti-pasta served on the picket line, you might think life


is too comfortable for protestors. There is the 17-year-old son of one


of the workers, he fears there is no money for him to go to


university if his mother loses her job.


Berlusconi - TRANSLATION: Berlusconi don't make anything easy


for anybody. If there are 35-year- olds and 45-year-olds not finding


work in Italy, how are young people going to find themselves a job.


real reason the factory is closing, the union says, is there is no


market in Italy for the temly comcomponents it makes. - telecom


components it makes. Italy had this many broadband lines, France with a


population only slightly larger had more than 20 million. For many


Italians that is part of a wider failure of leadership. The


country's President hinted today that he was considering the


possibility of a new Government. Acknowledging the growing demand in


society for rulers who will take risks.


1234 but in Milan, heaven for bid, they don't want to take risks with


Ambrose. TRANSLATION: Italian growth won't


be achieved by taking away a bank holiday. Growth requires reform of


work legislation, and the introduction of interance tax.


nobody will expect those in Milan to accept changes in the calendar,


what is the hope they will accept big ones in their lives. Those


Italians, who want the best, who will lead them? If you see that


politician, please tell me. In Ambrose's time, the 4th century,


it was easier, a man who combined intellectual prowess w industryous


and religion, he became bishop by popular axe clammation. There was a


bit of good news today, or less bad news in austerity speak. The


British economy grew by half paerz in the last quarter, better than


expect - half a per cent, in the last quarter, better than expected.


On top of that, one survey claims claims manufacturing fell into


decline last month, suggesting the north of England in particular is


not benefiting from even slim growth.


We have been in the northest auto. This encampment in Newcastle


tonight is not the scale of the one in London, they are mobilising


support for a Jarrow March, which will reach the cap national next


week. Lizzie thinks these growth figures


as justifying her fears for the future. The fact of the last


quarter with a drop because of the royal wedding. No wonder there will


be growth after that happening. are not convinced it is a positive


sign? Not in the slightest. It was 75 years ago this week that the


foot-sore jobless men of Jarrow reached their destination. In the


parts of north-east England struggling the most nowadays,


unemployment is nothing like the 70% it was then. Even in the 190s,


some parts of the country recovered much sooner than others, the north-


east was not among them. I have come to a town not so very far from


the route that the Jarrow Marchers would have taken 75 years ago, to


see how the growth figures really feel. This is Middlesborough who


built its wealth on steel, something commemorated in the giant


sculpture behind me. Middlesborough likes to make bold statement about


its future, how does that future look now. Not just as a result of


today's sluggish figures, but also the cuts to the public sector,


which represents about 60% of the economy in the north-east.


We have a lot of stuff in here. But this year I think we have bought


about half as much as what we normally buy.


You would think as winter looms, insulation would be in demand. But


builders aren't building, the growth figures show construction


contracting by 0.6%. So Ray Ingledew's company is feeling the


chill. What's been happening for you, you


have been in business for 35 years? Earlier on in the year we had six


vans on the road, eight vans last year. Have you had to pay people


off? Yeah, we have put our labour in half this year, and you have


lost good men who you won't get back again. You are a local man,


what would make Middlesborough grow? It is a difficult one,


certainly noing we are helping ourselves at the moment saying cut


the spending. Cut the spending down stops people from working, paying


any tax, they are not spending any money in the local shops or


anything. Gladstone praised industrial


Middlesborough as an infant Hercules, its more mature years see


a flourishing of buildings. But the flow of public money is stopping,


and the town will have to get used to it. That is according to the


mayor. We have to save �450 million in the next two years, the


Government have to deal with the deficit and the growth at the same


time. That is the prerequisite to dealing with the deficit. When


people don't have jobs they have not got spending power and won't


help the economy. Do you think some regions are suffering less than the


north-east of England? We feel in Middlesborough that we have had a


raw deal. But at the end of the day. There is an awful lot of local


authorities across the country that the Government have to deal with. I


have had the debate with them in relation to this, I have repeated


what I said, we are where we are, we are moving forward now. What we


have to do as a town and nation, we have to actually believe in


ourselves. And not be paralysed. 1234 This machine shows some


businesses are taking the hint. Manufacturing is one sector that


boosted today's third quarter significants. BMM Heaters invested


thousand in a precision cutting machine that eliminates waste. It


has had to look outside of the north-east. All our engineers,


every week they are in Wales, London, Scotland, they are used to


working away, we are beginning the work business at the moment.


How much support do you think you have had as a business? Really we


have been on our own over the last few years. We have made things


happen. We have had to get on and make the right decisions moving


forward. I don't think we have had any support from the Government or


anything like that, really. Helping us out financially. We have just


had to make things happen ourselves, really.


Joining me now is the Treasury minister now, David Gauke. You will


be pleased there is some growth in the economy. You must be


disappointed that the plans to rebalance in favour of


manufacturing aren't working? you are right we are pleased the


figures today show growth in the economy of 0.5% over the last


quarter. The point about manufacturing, if you look over the


last 12 months or so, manufacturing has grown by 2%. That compares to


services growing by 1.2%. Actually I'm not sure I agree with that.


There are obviously, always conflicting signals at various


times. There is some indication that manufacturing is doing. There


is not a big house in favour of manufacturing as opposed to


services? You have to look at the context. Over the last few years


over the previous Government, manufacturing as a proportion


portion of the economy almost halved. And actually what we are


seeing is manufacturing growing more quickly than services over the


last 12 months. There are some encouraging signs, we want to do


more, obviously. What do you say to the people in the film, we heard a


businessman, we heard the Mayor of Middlesborough saying it is the


wrong time to cut spending, and if you do cut there is no spending,


and the economy will shrink in their area. There is a north-south


divide there. If we don't have a credible plan to get the deficit


down, we will see our credit rating under risk, and market interest


rates increasing, that will choke off finance for businesses, it will


make it more expensive for mortgage holders. It will have a damaging


effect on the economy across the board.


It was having more damage in the north where they are more reliant


on the manufacturing jobs and theing sector is rather weak. There


are a lot of things we are doing, enterprise zones, a number in the


north-east of England, the Regional Growth Fun, and lots of


announcements about the funding with that. That is in the north of


England. Improving the infrastructure, we are spending


more than the previous Government. Most people say you don't get it,


your centre of gravity is in the south of London rather than the


east. Danny Alexander represents people in the islands of Scotland.


We are a gofment for the whole country. And we - government for


the whole country, we need to take the - we are taking steps, the


Regional Growth Fun, enterprise zones, infrastructure investments.


That has produced a slower recovery than the great depression.


reason why the economy is slow, one we inherited a lot of debts. It is


difficult after a financial crisis everyone accepts recoveries are


slower. We have the eurozone crisis damaging confidence. Is that


worrying, what we are covering tonight. What is happening in


Greece, the fact of the referendum could blow everything off course?


There is no doubt that confidence has been hit in recent months in


the UK because of concerns about what is going on within the Euro-


zon. Glrb eurozone. It is upsetting to see what we are seeing. It is up


to the eurozone to take bold decisive measures to deal with


their areas. In the same way this Government has to deal decisively


with the big issue we face, which is a big deficit. Gang violence


didn't cause the summer riots in England, but it was a factor.


According to the Home Secretary. She announced new measures to deal


with it. It includes earlier intervention to turn lives around,


and tighter firearms laws. But the police in the Met have been using a


tactic of their own, the law of joint enterprise. It allows people


to be convicted of serious offences even if they took no direct part in


a crime. Campaigners say it has caused criminal justice cases and.


Let's look at whether the law is being abused or abused.


Like summer itself, the violence of August was over very quickly in its


wake is a singering bad feeling. Anger towards the looters and


arsonists responsible for such lawlessness. But also anger from


people who feel their grievances are unheard.


No-one at this youth centre in London thinks they have answers.


But they share a concern about a dusty legal law called "joint


enterprise", introduced 300 years ago, which many people feel stirred


up the cities. I know some boys hit with the joint enterprise charge,


having been in the criminal system at the age of 13-14, coming out at


the age of 26, most of their adult life in prison. Coming out I'm not


too sure whether they will be able to change things around. That was


the alienation you think that we saw during the riots? It was part


of t I believe. All around the country, people, some of them very


young, are serving lengthy sentences under joint enterprise.


It means they can be charged with serious offences like murder. Even


if they didn't wield a life or land a punch, I have been told of cases


where they weren't even at the scene of the crime. Here in west


London people have told me, it is causing huge resentment against the


police. But the police say it has led to breakthroughs against gangs


and the sort of violence that has marred some of the lives around


here. The Metropolitan Police see joint


enterprise as a valuable weapon in the fight against knife crime. They


are showing this DVD in schools. Warning youngsters about what can


happen if they get involved with people who carry out violence. If


it is suspected they could have foreseen what happened, they too


can be charged with the same offence.


What I make no apologies about is how we have used this as a


principle to get across what we hope is a positive, constructive,


educative message which is about the most important thing we can do


in these sad events, which is stop someone from being stabbed or


killed. Is there a danger, do you think, that some particular groups


of people, particularly young, often black youths, are going to


feel unfairly targeted? I can understand that and that has been


said to us. We would be foolish not to listen to that. But what, I


think in return to that, we would say this, that this is an


application of a principle of law which actually is very carefully


applied in a very considered and detailed way, and it has a very


high evidential test. But it is long been controversial.


In one of the most notorious cases of joint enterprise, portrayed in


the film Let Him Have It, Derek Bentley, aged 19, was hanged for


the murder of a policeman during a robbery. Let him have it Chris.


These were the words allegedly spoken by Bentley, which helped


convict him of the shooting, eventhough it was carried out by


another teenager. Joint enterprise was also used to convict three


teenagers of the murder of Gary Newlove, whose savage assault by


drunken youths was seen as proof of David Cameron's broken Britain. The


coroner found he died from a single kick, but all three are serving


life for murder. One of them, Jan Cunliffe, was 15 at time. Mr


Newlove's widow says the sentence is justified. If you are saying


Jordan Cunliffe didn't kill my husband, but he stood next to the


body saying you are doing it and you are guilty. But Jordan


Cunliffe's mother says the law is being used to convict those on the


periphery. Jordan had an eye condition, it meant he wouldn't


have been able to see what was going on and predict there was any


violence, therefore he couldn't show withdrawal, and he couldn't


prevent it. Janet Cunliffe shows me new medical evidence which she


wants to use to appeal against her son's conviction. It is a computer


programme which shows the scene of Mr Newlove's murder, and what


Jordan would have allegedly have seen because of his failing


eyesight. That's the evidence that we want to use to prove that he


couldn't possibly have been part of a joint enterprise.


As they tackle knife crime, the Metropolitan Police admit they are


using joint enterprise more often. But Johann Scarlett, a youth worker


from south London, says it is difficult thing. It seems to be


easier to put up a case because you have to prove they are intending to


do it. It goes against the whole innocent until proven guilty. It is


like you are guilty, now prove you are innocent. At a local youth


centre I'm introduced to youth workers and advise to they all


believe young people living on estates are being criminalised.


didn't stab anyone, you didn't know the knife was present, but the


person died. And under joint enterprise you have all been


convicted, you come out with murder under your name. You are never


going to get a job, then what do you do. People have been damaged by


the joint enterprise situation, if they weren't involved, the police


wouldn't take their side for it. you know people this has happened


to? Quite a few people. There are also concerns that the law is being


used too selectively against gang violence, when there are other


contexts where it could apply. the law of joint enterprise were


applied to phone hacking we wouldn't have so much of a concern


about getting precise evidence about who has been involved in


phone hacking or who has been encouraging phone hacking.


problem with investigating joint enterprise is it is very difficult


to find out how widely it is being used. We have looked all over the


place, the Law Commission, the Crown Prosecution Service, the


Ministry of Justice, individual police forces, like the Met, who


were looking into the riots, and so one has anything approaching


complete figures. That is apart from campaigners, who claim that


they are dealing with a surge of miscarriage of justice cases. The


group Here says it is fighting 256 Establishing some facts is the


first priority of an MPs' inquiry into joint enterprise, which is


holding hearings this week. It is a very blunt instrument, it has


appalling consequences if innocent people are found guilty under this


doctrine. I'm concerned about its use at the moment. I stress it is a


personal opinion, the committee has yet to decide on any of it. But we


have had a lot of concern from several corners, and to target


youngsters is doubly inappropriate. But police are confident the law is


helping to keep young people away from trouble, and has even had an


impact on levels of knife crime in London. The number of young people


being killed in knife attacks is going down in London, you think one


reason for that is the use of the joint enterprise law? It is one of


many reasons. It is not the silver bullet. I don't think we have ever


said this is the measure that is going town lock everything. If it


comes across as that, - to unlock everything. If it comes across as


that it is wrong. We need a whole series of tactics and programmes


and messages that actually say don't get involved in violence.


The police say that joint enterprise has at least helped


bring down knife crime. Just saying that because you are going to be


done for joint enterprise will stop kids carrying knives is a lie. If


one of these young boys believed someone had a problem with them,


and had a weapon, what are you most likely do. What would normal boys


do in the arm yar. Start arming themselves with things. Would they


worry about the joint enterprise law. Would they stop? That is the


thing to tackle, the need of weapons as protection. The use and


possible abuse of joint enterprise is not just being investigated by


MPs, potentially more decisive will be a Supreme Court judgment due


later this year, about the way joint enterprise is used to take on


gangs, and is very much on trial. A strengthening breeze breeze


touching gale-force to start the morning. Mist and low cloud across


eastern areas, here we will hold on to the driest and brightist


conditions. There will be cloud around, and sunshine will be on the


hazy side. The breeze strengthening soon, and thicker cloud along the


southern counties of England. Increasing light rain or drizzle.


Southern and western parts of Wales could see some of that light rain


or drizzle during the afternoon. With the south-east breeze, shelter


from the hills, the north coast will see bright or sunny spells.


Northern Ireland, brightness will be limited to the middle of the day,


plenty of cloud and certainly for 3.00pm it turns wetter. Much of


Scotland has a dry and bright day after a chilly start, those spells


of hazy sunshine. A different story into Thursday. Brighter skies, but


you will notice a common theme, not just across the northern half of


the country, but further south will be the frequency of showers. The


day starts with persistent rain across eastern areas, windy as well.


In-depth investigation and analysis of the stories behind the day's headlines with Gavin Esler.

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