01/11/2011 Newsnight

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.