23/11/2011 Newsnight


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Nice and warm? The energy secretary tonight, on going green and


bringing foun bills for fuels. British Gas sheer, promising to


make it easier for us to reduce our energy bills, what has taken him so


long. How will Britain meet its energy bills in the future. Three


people who think they know are here to explain. When they protested in


Bahrain, dissent was met with deadly force. Now an official


inquiry for the Government of Bahrain concludes there was terror


and torture. I will talk to a minister in that Government.


Is greater job insecurity the way to make the economy grow faster?


The Government seems to think so. So, the bad news is that we're all


going to carry on paying for more our energy for years to come, the


good news is by 2020, if we haven't frozen to death by then, bills


could be lower by 7%. This extraordinary prediction by the


energy secretary is based on his faith in things like home


insulation. While we leave the boss of British Gas on a gentle simmer,


we report on what the Government thinks is going to happen. Where we


get our energy from, and how we pay for it is the big issue for the


nation. The basic idea is out with the old


energy infrastructure and in with new cleaner sources. It is


complicated and potentially, politically, toxic.


The price of energy in the future depends on how we prioritise,


reducing carbon emission, and keeping costs down for the most


needy. And how innovative we can be on energy production and efficiency.


Who decides what that balance should be?


Last month, David Cameron and his energy secretary, Chris Huhne, sat


down in a doubleheader, with the energy companies, to try to sort it


all out in a way that consumers will bie. The most important thing


is to try to help people with their bills. Today Chris Huhne said the


cost of energy and climate change policies will add �280 to household


energy bills by 2020, but that he has a plan, including a Green Deal,


that will mean bills come down. Overall be we anticipate that


rising world gas prices will push up bills. But both gas and elect


tristee, but the policies will moderate this rise. By 20 --


electricity, but the policies will moderate the rise. But 2020 we


expect bills to be 20% lower than they would have been without our


policies. This is the kind of technology the Government says we


will need A pilot plant to capture carbon, at London's imperial


college. Essential to stay within Government emissions target,


especially if we depend on gas. we look to the future and do things


on larger scale, a power station, the foings to increase bills


becomes more -- potential to increase bills becoming more


significant. That is why it is hugely important the Government


gets the investment climate right that enables us to do this in a


cost effective way. To bring forward new technologies, to reduce


the costs of the technologies we have got. Those more cautious about


green investment, say it is all happening in a way that costs more


than it should, that is why bills are going up. We know from


calculation in the Department of Energy and Climate Change, that the


Government's own green policies, will, by the end of the decade,


have increased gas prices by a fifth, and electricity prices by a


third. Those are huge increases, they don't need to be as big as


that. We can go greener to lower cost. How much does going green add


to bills. There have been some alarming-sounding estimates of


increases of some �00 a year, aside from the Government's -- �900 a


year, aside from the Government's own figures there is no true


analysis of what that might be. Carbon budgets make sense from an


economic perfective, there will be energy impacts but there is


misconception about what the impact will be. The first misconception is


energy bills are high because of low carbon, and the other is that


we need huge investments and that will result in huge bills over the


next decade. That is a misconception. There are growing


calls for transparency on bills, to show people how much is being used


to pay for what. As energy companies work on how to pass on


the estimated �200 billion, it will cost them to bring out energy


infrastructure up-to-date, clarity will become even more important.


With us now is the energy secretary, Chris Huhne, so energy bills will


be lower by 2020, this is an amazing claim? We are not saying


energy bills will be lower. sounded like you were saying that.


I couldn't have been clearer. could have been more clearer, you


said they will be 70% lower or �94 lower. As a result of our policies,


but that is not the only impact on energy bills. They will be higher


in 2020? I have no control over world oil or gas prices. Why did


you say it, if it is not true? Because I didn't say what is not


true. I said exactly what is true. Which is we are going to have,


according to the forecast from Government economists, a rise in


gas prices from about 61p a thermto 70p. You said you couldn't predict


what would happen to gas prices? have a low and central and high


forecast. This is 70% on the average forecast? Our policies to


save energy and low carbon transition, those policies will


moderate what we anticipate on the central stand to take 70% off bills.


It won't take 70% off bills because they will be higher in 2020?


Compared with what otherwise will happen. Assuming no Government


between now and 2020 did anything? If there was absolute free market,


and you simply had reflecting what was happening in the world in the


gas market, and the world oil market, then you would see a rise


in energy bills over the period of 2020. We don't have a free market,


do we? We have one worldwide. in this country, we don't? If we


have to buy gas from Norway or Qatar, they are not the Salvation


Army. It is an entirely bogus at that time tis snik No. Since you


have admitted you can't predict price, and no Government can do


anything between now and 2020? not saying we can't predict energy


prices, we have three different scenarios. Last month you said you


couldn't predict energy prices? key point is the things that I can


control, that the Government can control, which is our policies, are


going to moderate the impact of energy bills. That is the key point.


But if, in the absence of policies, we're going to see a rise in bills,


the effect of our energy-saving policies and our transition to low


carbon, getting off the fossil fuel hook, away from the vulnerability


to the Middle East, that clut bills by 27%, and indeed our bills


throughout -- cut bills by 27%, and indeed our bills throughout the


parliament. How much do tax-payers have to pay to meet the target?


Tax-payers don't pay anything, it is, in effect, through bills. There


is an increase in the unit cost of gas and electricity, pointed out in


the package. There are also benefit that is flow from that, we consume


less energy and the cost comes down. No increase in green taxes? We have


increased the green -- reed the green taxes. Between now and 2020


and this wonderful day when bills are 70% lower there is no increase


in green taxes? You have two effects going on, you are


increasing the unit cost of gas and electricity, and you are increasing


the charges across the unit. As a result of the savings that you are


making, in the amount. People will have to pay for more their bills?


No. You have just said as much, haven't you? No, because the price


and amount equates to the bill. If the amount comes down more than the


price goes up, the bill comes down. It is quite simple. I have no idea


what you are talking about. When you get your energy bill, it is


made up not just the price of the unit of gas and electricity, but


also the amount you use. If you reduce the amount you use by more


than the price goesp, the impact of that is to reduce the bill. That is


what is going on as a result of policy. That is clear if you don't


use any electricity at all, you don't pay any electricity bill?


That is also true, but that is not what I'm saying. We are


anticipating that we will go on using a very substantial amount of


both gas and electricity, but we will save the amount we will use


compared with at the moment, and we will have a transition so


increasingly, as we move on to non- fossil fuel forms of energy. We


won't get buffeted by the events we have seen in the last year, we have


had a 58% increase in gas prices because of what is happening in the


Middle East and the Fukashima disaster and if we move away from


that thal be good for the British consumer and jobs. Let me ask you a


straight forward question, the �200 million investment in the


infrastructure, who pays for that? That is factored in the base line


of the energy bills. We are assuming the energy companies will


have to make a return on the capital. We are assuming an


increase in world prices, we're also giving a separate calculation,


that is a calculation of the effect of our policies and that is what is


reducing bills by 2020. Despite the �200 billion spent on the


infrastruck tue, paid by consume -- infrastructure paid for by


consumers' bills? Not up front, you do it the same as any other


investment, it is over the life of the investment. If it is �200


billion, it is not straight away, it is over the lifetime of that, in


the same way as a mortgage, and other ways you fund that investment


over the lifetime of the investment. Thank you very much.


Of course, reducing your bill something you can only do if you


understand how the bill is calculated. The energy companies


have produced such a baffling array of different tarrifs that figuring


out which one is best would have beaten the brains of Newton and


Leibniz. Before we talk to the boss of British Gas here is this report.


As we all pay more at home for energy and gas, events far away


seem far away. The earthquake in March in Japan meant shocking gas


prices too as the country shut down nuclear power plants and turbd to


gas, events in Libya, and the price from gas-fired powertations has


risen too. The prices are buffeted by


political turmoil, by natural disasters, but is the price we pay


really beyond the control of politicians and energy companies


here? Or is our energy market simply not working? I think we have


a number of big problems in the energy market, the first is


consumers believe very little the energy companies say. The second is


we are in an environment where prices are going up, that is


causing consumers to be fearful of winter weathers. We still haven't


got the A, B, Cs of a proper market sorted out. The tarrifs are


confusing and people are being driven into energy debt by high


prices, there is a lot to be sorted out. We know customers are


frustrated. British Gas want us to believe that new technology will


help us cut back. These smart metres show you the energy you are


using. Customers will understand their energy ue, pounds and pence,


gas and electricity, it means they have choice about what to do


differently to save money on energy bills. Recent price rises by the


big energy companies have been dramatic, 16-18% for gas, and 10%


for electricity. How closely do energy bills track the wholesale


prices. Until the end of 2008, they tracked pretty closely, but after


that point, when wholesale prices fell, to a low last summer, our


bills stayed relatively flat. That tracking was less obvious. In the


1990s, we had managed to create quite a successful market, which


really did drive down energy prices for everybody. That was a success


that people emulated around the world. Since then Governments have


interfered in markets in all kinds of ways. Growing fury over the


bills has pushed energy companies to say they are changing their ways,


The latest upset has been over profits. Energy companies ds


dispute the figures, but last month Ofgem said margins for an average


household had reached �125 a year, up from �pun 15 in June. Warm words


-- �15 in June. Warm words may not be enough. With us is the managing


director of British Gas, Phil Bentley, why do you think people


have lost trust in you? They definitely v one of the issues is


the number of tarrifs out there. There is 544 tarrifs to choose from.


When millions of people at home are looking at the energy bill, they


don't understand it, and where they can save money, as an industry we


have to put our hands up and say we should be doing more to help.


you wake up one morning and think we have too many tarrifs, what


happened? We are announcing a big change tomorrow. I'm asking when


you realised? It has been building, and for two reasons. You have done


this because you have been told to do it, haven't you? Ofgem have told


you to do it? If I can give you the reasons why. The world is changing,


the world is changing because the UK, today, is importing 50% of the


gas it needs from international markets. I know you don't want to


really hear this point, let me make one point if I could. A tanker


landed in Britain, for the gas for 100 though homes in Britain, it


cost �42 million. That same tanker can sail to Japan and they will pay


�62 million for it. I'm asking about why you developed so many


different tarrifs in your industry, and why you have now decided,


suddenly, you weren't playing fair with the consumers? Consumers are


told us they don't like it. It is right we respond. Which is why, if


I may, we are simplifying tarrifs, and ensuring fixed or variable,


simple. Would you like to apologise for the complexity of the tarrifs?


I would, I would say to all viewers we have not made it easy. Let me


refer you to this graph I will put up on the wall behind me now, I


hope. Would you like to apologise to them for what has happened to


their bills, when you see the wholesale price of energy has gone


down, and bills have not gone down? Again, you have to have this honest


conversation, what's the cost of green, what's the cost of delivery


to your home, and the cost of energy that goes into it. You keep


saying the bills go up, you have just told us, just now, that world


market prices have gone up and that is why bills have gone up. That


graph proves you are not being entirely honest the wholesale cost


has gone down and bills have not? Our margins are 5% a year. 5%, let


me just finish the point. That graph demonstrates, comprehensively,


that is a partial picture? It is a partial picture, because it doesn't


include, all the other things that are in your bill. The cost of green


energy. How much is it in your bill, it will be �50 next year, that is a


policy decision. Transporting it through The Grid, the cost of that


is going up. Within that �200 billion that Chris Huhne is talking


about, we have to reinforce The Grid. That isn't to do with green


measure, that is the wholesale cost of energy. Wholesale costs have


gone down and bills haven't? If you look over a longer period of time,


you will see the wholesale price of gas has gone up. Nobody denies that.


But all I'm trying to say is that the wholesale price of gas is not


the only part of the bill. It is the whole point about simplifying


tarrifs, giving customers choice, giving them transparency, what is


in your bill, how much is the commodity, has it gone up or down.


How much is transportation and green lefies, that is what we are


trying to do for our customers, that will be welcome. In that


process you can lay some of it off on people like Chris Huhne, who has


left the studio. Do you consider, when you look at your company, do


you think you are just like any other company. Utilities, many


people feel, are not like other companies, not like a fashion chain


or a brewery? We offer an essential requirement to living in part of


the world. We are conscious of our -- in any part of the world. We are


conscious of our social responsibility. Our first priority


is to help those who can't afford the heating bills. Then we have to


make sure we have the energy that Britain needs over the next ten


years. We signed a deal this week, �13 billion to bring gas to the UK,


for three-and-a-half million homes for ten years. That is where our 5%


margins go. What is an acceptable profit, do


you think, for a utility company? said 5% is what we believe is right


for the investments that we're having to make. So when it has been


up at%, that has been morally wrong? If you look at that, that is


when it has been very cold. were responsible for that? No, but


we clearly sell more energy when it is cold, and when it's warm, which


it is now, and it is great that it is. Bills are actually lower this


year. You took the margin, didn't you? You took the margin? We have


fixed costs we pass on the benefits to customers. You have told us 5%


is an acceptable profit, and you were taking, by your own admission,


9%? It will be lower in the year we sell less gas. As you have conceded


you don't control the weather it is a meaningless stpaiplt? We don't


control the price of -- Statement? We don't control the price of gas


either. We are in an international market. What is important is


customers understanding the tarrifs. We want to help and simplify, and


the second is, can they use less energy, that is where energy


efficiency can make a difference. We have Ann Robinson from the


consumer group uSwitch, the founder and managing director of Ovo Energy,


Stephen Fitzpatrick is here, and Liz Hutchins from the environmental


charity, Friends of the Earth. Are you reassured by all of this?


completely. The answer to your first question, Jeremy, about trust,


consumers have seen their bills go up by 21% this year. Two increases


in a year. Our last customer survey, which we have just done, shows that


consumers' overall satisfaction has gone down from 70% to just over 60%,


for only four in ten believe they are on the best deal for them. That


is why they are not trusting energy companies. Until we have absolute


transparency and fairness, and we understand what is going on, we're


not in a position to judge whether we have been treated fairly. This


letter that British Gas is sending out. You personally signed it, this


letter to all your customers about a called honest conversation, do


you feel they have behaved honestly? It is very difficult to


make the judgment about whether they behaved honestly or not. The


problem with the energy companies, they have the wholesale and


retailers, one bit is the other bit any way. We haven't absolute


clarity about what they paid for their energy. Most energy companies


buy their energy four or five years in advance. They can't trust you?


agree with that point, that is why we have to do something about it.


Why don't they trust us? Too many tarrifs. Number two, when customers


are paying more than they should, the energy companies haven't


written to them, but we are writing to customers and saying you could


be on a better deal. And thirdly, we will explain your bill, how much


is the energy, how much we paid for it, and how much is the green.


me say right now, right now there are a lot of people out there, a


lot, probably the majority, scared stiff about their energy bills this


winter. 21%. They have seen inflation going up 4-5%. They don't


understand why they are having do this. Secondly, last winter,


eventhough it was a cold winter, 20% of people turned their engeooff


-- energy off, it is a major problem in Britain. People in


Britain should not have to make a choice between heating and some


other essential good. That is why there is winter fuel prime


ministers and warm discount. Nobody should be faced with that decision.


I'm determined that that, Jeremy, and Anne knows this, we helped a


million customers last year with their bills. I want to look at the


specific aspect of competition, the market is dominated by six major


suppliers, you are a very small supplier? Quite small. I don't mean


to insult you! What is stopping you going places faster? We have


doubled in size in the last six months. We are not exactly slow


when it comes to growing, we are punching above our weight and


delivering good value for money for customers. One of the things I find


personally, we have been working with Jeff gem and ministers and


consumer groups to raise the bar in terms of customer expectations is


the level of confusion. We have tacked about it already tonight, it


is so easy. We launched two years ago. These guys shut you out?


getting on to that. Get a move on? The fact of the matter is that we


see not only a huge range of tarrifs, but a huge range of


different prices, from ones that look like the customer has been


overcharged, and other customers who are clearly paying below market


costs as loss leaders. We see it across the industries, and all the


big six to varying degrees have exercised this practice. We agree


with you, we have to stop that, be absolutely transparent about the


tarrif, if there is a better deal we will tell our customers.


want more competition? We welcome it, we have new entrants, we have


smart metres, it keeps us on our toes, we are never shy from xeegt.


We have grown to be the largest supplier -- competing, we have


grown to be the largest splair of energy. You sat there patiently, by


how much are energy bills going to increase with the cost of going


green? The real big cost on energy bills, as has been said, actually


is gas. It is the huge cost that we pay for rocketing gas prices,


internationally, that's the main driver. The other factor is this


monopoly that the big six energy companies have. They are holding us


over a barrel on prices, frankly, yes we should switch between energy


companies, but that won't solve the problem, we need to break open this


monopoly, and stop people like Phil having the superprofit.


dominant companies is not a monopoly, it may be a cartel, but


not a monopoly. The problem is they shut out competition? They do I


think Ofgem, the regulators, the department for climate change, the


ministers in charge, people are starting to see the effects that


loss leaders have on competition. When a commodity with gas and


electricity, there is a tight operation. It is the lowest cost of


service for all the energy companies, where we see larger


energy companies using profits from older customer, 5% of the people


consuesed by the market and not changing. When they subsidise loss


leaders and price us out of the market is takes the spirit of


competition. You agree you are doing that? On-line was sold as a


loss leader. That isn't right. We are not doing that. It will be cost


effective, and it is about being straight with our customers, simple


choices of tarrifs. It is not right if we're charging our loyal


customers more, and they aren't getting the special deal, that


isn't right either. That is why we are writing in the letter saying if


there is a better tarrif for you, we will tell you. Do you really


expect the 85% of people already having switched to take your letter


up and say today's the day I will do it. Shouldn't you just level the


prices so energy customers don't have to. We sat in the room with


Chris Huhne and David Cameron, we tacked about sending eight million


letters to customers to say they could be paying less, the obvious


answer is to charge them less. everyone wants to be on an on-line


tarrif, my mum wants a simple tarrif paid quarterly. It will be


really important to get competition going amongst those 85% who aren't


switching. I'm very much in favour of the market. I think the market's


right. At the moment we are sleepwalking our way to more


regulation. To be honest, if we find that, for example, switching


it drops even further, and it could do over the next year or so because


of what is happening, then it wouldn't surprise me if Ofgem come


and decide to introduce price regulation, that is more


interference in the market. What is best for consumers is an active


market, and us engaging, what we have to do is get the engagment.


You don't believe the market works at all? I think it is a disSAS te,


I think your take home pay of �1.9 million last year, at a time when


one in four households are living in fuel poverty is a disgrace.


People will wonder, when is the Government going to act to break up


this big six dominating the whole situation. We do have competition,


British Gas looks after half the homes in Britain. Ofgem said last


winter British Gas overcharged customers to the tune of �250


million is what Ofgem said you ripped people off. You are saying


you are fair with customers and will give them more choice, we need


to break open this system and completely reform it, to make it


fit for purpose, for the future. The only point I would make is it


is an international market. We have the cheapest gas prices in Europe.


You can't deny that point. We need to move away from gas. If you


believed in competition, wouldn't you sell more of your gas on the


open market? We produce gas and sell it on the open market.


Companies do buy T that is not the issue. We are having to buy. We pay


similar prices for the gas, I'm sure you are paying what I'm paying


for gas. The point is prices are going up, for so long we have heard


energy companies talking about investment, and the requirement for


green investment gas price, going up the global market. It doesn't


take away from the fact that energy companies haven't been treating


customers fairly whatever the prices. Whether prices are going up


we should be simplifying tarrifs and bills. Your move is great step.


That is what we are doing. surprising thing happened today in


the gulf, in par rain, which last been ruled by the same -- Bahrain,


which has been ruled by the same family for many years. An


independent investigation into protests there was read out. It was


said the police used fear and torture against open pen nents, and


special courts set up to deal with people denied them justice.


Contrary to other claims the uprisings were home-grown and not


incited by Iran. Bahrain, just south of the capital, Shia


protestors are on the streets venting their anger. Their cause is


redoubled by the report, commissioned by the king, which


spells out the brutality of the king's own men. There could be no


denying what the world had already seen. The security forces shooting


down demonstrators last spring, but the commission also confirms what


has been happening off camera. Torture in all its awful varieties.


TRANSLATION: Severe beating, use of water pipe and wooden and metal


batons and other forms of torture, and elect cushion. To expose the


detainees to high levels of temperatures. Threats of rape and


humiliation of religious sects. arrived in Bahrain in February, on


the day they were burying of the first of the mourners to die,


protesting at the Government. Within hours security forces had


opened fire on the funeral prosession, killing another man.


Yet the Government, the Royal Family, seemed Blythly ignorant of


the Israel -- blythly ignorant of the threat, they blamed Iran for


stirring up the uprising. The report says that is nonsense. There


was no Iranian hand the trouble lies within Bahrain's own trouble


fault line. Even the police, condemned for excessive force are


Sunni, imported from Yemen. The king has promised Bahrain will open


a new page in history, and he will sack earnt officials. Many are


unconvinced, the Government which says that torture wasn't Government


policy, has, at best, allowed Security Services to run out of


control. Medical staff were treated as traitors to treating the wounded,


and jailed. There will be retrials. But a doctor today told us people


are still dying. They were talking about torture and people in prisons


stopping, but today torture, people beaten in the streets in their


houses and running over them and killing them is still on going.


Today just one person died. deaths, five people tortured to


death, hundreds wounded, 1600 arrested. Bahrain had to come out


with this report, because America, which supplies its arms, demanded a


full account. Bahrain's neighbour, Saudi, will


not be so impressed. They had urged Bahrain to crack down on the Shia,


they won't like any hints of weakening.


I'm joined in the studio by Bahrain's Minister of Cabinet


Affairs. Did you know your security forces


were this brutal? As the report issued today found that there are


mistakes made in the past, and it has been done and we accept the


report. The lesson has been learned, the most important thing is to fix


things and go forward with the country. We need to unite the


people and actually if the report is doing something, it is saying,


it is confirming what we have said at the beginning, we want the truth


even if that means it is against the Government. Blindfolding,


handcuffing, enforced standing for long periods, beating, punching,


hitting with wooden planks, pipes, sleep depravation, elect cushion,


and numerous others, these came as a complete surprise for you?


have to make sure the report is A show of how the imaginationry and


the Government has dealt with the situation. We can't tolerate


violence and the torture. It was clearly systematic? Action has to


be taken. What action will be taken? I think


we have already started the reform. 20 officers have been prosecuted


for mistreatment that led to death, as well as we are working with


allies and the international organisations to change the system


and the process. We need to implement reform to improve the


country and to move forward. you saying you are committed to


becoming a proper democracy? think Bahrain has started the


political reform ten years ago. It was unprecedented at the time. I


have to remind you until recently that Bahrain was viewed by leading


democracies as the poster child for reform. Who gave you your job? The


king gave your job? There was not using that as a model of reform.


Committed to a proper democracy? course, we have laid down a


foundation of a progressive no democracy. By when? The people of


Bahrain should decide how we will progress. Unfortunately they have


to wait on the king's say so, when does he want Bahrain to become a


democracy? We have established the institutional, the institutions. We


need to expedite the reforms and meet the demands of our people.


you now we great inviting the Saudis in to help you put down the


protests? I think the agreement with us, the report confirmed today


that they have not engaged or contacted with the protestors. They


have been located in a critical site away from the protests.


don't regret inviting them?? think Bahrain and the other


countries, we work to enhance our relationships, and integrate


ourselves, and there is agreement to allow us to do this.Would


have published this report had it not been pressure from the


Americans? We did the best because we want the best for our country,


we want to move forward. What happened did not benefit anyone in


Bahrain. Not even the countries that want the stability in the


region. It had nothing to do with an arms deal? We want to move


forward and unite the people in Bahrain. What has happened is we


have a social division today, it has polarised the country. We have


two significant sections in Bahrain, we need to build the trust again.


Unless we start a reconciliation process and reform we will not move


forward. Everybody in Bahrain has to work together for the good of


If you set out to seek a punch-up with the trade unions, you couldn't


have done better than the set of business ideas Vincent Cable came


up with today. In order to breathe life into the economy he wants to


make it easier for employers to get rid of staff, without fear of


facing an employment tribal. He says's -- tribunal, he says he's


chopping away at restriction that is inhibit growth. We will talk


about it in a moment. First this report.


In the office of the business secretary, it is called a radical


reform of employment relations. Vincent Cable says, in future it


will be harder to take your boss to a tribunal.


All claimants will be obliged to submit their complaints at ACAS, so


parties can try to resolve the dispute through reconciliation


before being taken to a tribunal. There will be an alternative, a sor


far undefined rapid resolution scheme, and employers will be able


to have a candid chat of an underperforming employee without it


being used in evidence against them. We are starting a scheme of


protected conversation, it allows employers to raise issues, such as


poor performance, and retirement plans in an open way. You are not


performing as I want you to perform. I'm performing as I want it me to


perform, it is a good performance, let's agree to disagree. Maybe not


like that. Number Ten canvased a venture capitalist, Adrian Beecroft,


for ideas, he said employers should be free to fire at will, Liberal


Democrats shredded that idea. Might it have been a policy aunt Sally,


op pro posed by ministers to be knocked down so what followed would


be looking better. There is a lot of tri-ainglaigs going on, you put


out a -- Triangle laigs going on, you will have to have some sort of


policy mix to see British GDP rising. You need to be radical and


bold and take steps now that perhaps two or three years ago


would have been contemplate. It is not hard to spot the business


secretary's lack of enthusiasm. are seeking views on a proposal to


seek no fault dismissal for microfirms. That is those with ten


or fewer employees, I stress we are seeking evidence on both sides.


That would sour relationships between employers and employees. I


don't think the fundamental right they have at the moment which is no


know why they are being dismissed. Of course we have to wait and see.


I mustn't presuppose what the call for evidence brings. But I will be


surprised if it was found that would be good for business.


You were an employer before you entered parliament, did you find


employment law a barrier to recruiting staff? No. Vincent Cable


made much the same point in his own speech. He prefaced his own


proposals by point to go a survey conducted by his department, in


which those running small and medium-sized businesss were asked,


what is the biggest obstacle to business success. Those citing


business regulation and employment rules was 6%. What is really


stopping businesses hiring is growth or lack of it. Today's


announcement and those between now and next Tuesday, when George


Osborne delivers his autumn statement, are intended to give the


look of an active Government, pushing every lever, pressing every


button to get the engine running. Are these announcements enough.


These employment measures are helpful by very modest. People


won't think that is the decisive thing, it helps, but they want


other things to be true as well. We need a whole range of measures,


people want the promise of more demand. If these workers fear


losing their jobs they are reluctant to spend. If ministers


fail to get the economy growing, there is one group of employers who


can hire and fire at will, the voters. With me now is economist,


Ann Pettifor, and venture capitalist, Jon Moulton S this


salvation? I fear not. It is salvation deferred. It is action in


due course, possibly up to three years forward, it is not a lot,


really. What do you think of it? just think it is looking for


scapegoats, and you know, there is a big elephant in the room, which


is that confidence collapsing, the stock market in free fall. There is


real problems out there. We are talking about fiddling, why the


economy burns. This is completely fatuous? Absolutely. You obviously


both agree for different reasons? So does Vincent Cable. I can have a


modest disagreement, there is some benefit in making it easier to


employ people. It won't solve the economy in one go, at least a few


deserving souls will get jobs and undeserving souls will lose them.


We are the least regulated in the whole of Europe. If we look at


comparators, Germany, Sweden, in terms of regulation. We find in


Germany they have twice as much protection for their work force,


and they don't have the unemployment problems we have. They


don't have the growth problems we have. They have more protection for


their work force. They grow more. You are claiming cause and effect?


I'm saying it is not the point. Vincent Cable is saying the same


too. 1234 why do you mention it? I


mention it because protection there are economies across the EOCD, that


offer the work force more security and protection and grow better. Do


it better than we are doing. We have already got very little


regulation. Why do you want to go further? Essentially, at the moment,


if you have a strong economy you can afford to be very good on


employment law, and employment security. We haven't, we have a


weak economy at the moment. I think anything that makes it easier to


employ people will give rights to the unemployed, as opposed to the


employed. It will take away what is, I think, unproductive bureaucracy.


We have 240,000 tribunals here, it is fundamentally a pretty


unproductive activity. It needs picking away at. The that is


ridiculous, the idea the economy is slumping, that corporates are not


investing, that banks are not lending, that the stock market is


falling, that consumption is collapsing because we have


tribunals is ridiculous. I didn't say that. He didn't say it was


because of it? It doesn't help. Government is refusing to address


the real problem, that makes the economy unbusiness friendly. Look,


the Government has very little it can do about most of these things,


it is dealing with what it can, unfortunately what we are talking


about is not a big deal. We can make a dent in unemployment, we can


make employing people more attractive. That will be helpful to


the economy. Not a lot, but it will do some good. The Government could


do a great deal more to make the environment for business more


attractive. It could really do more about the banks and lending. It


could do more to create investment in the economy which is good for


the private sector. The Government is taking a hands-off approach, it


says the good thing is what 94 small businesses say are not a


problems. Vincent Cable told us this morning, his own department


had done a survey and found 94% found regulation was not a problem


in employing people. That is not a problem, but we know that the


problem is customers are not walking through the door, the


demand has collapsed. The Government could generate economy,


and they refuse. Explain why those 94% of those


small companies are wrong? I think she was saying 94% of businesses


didn't think employment regulation is a problem? I I find it totally


impossible to brief. How big was the sample? It was conducted by his


department. We don't know about the sample? There are plenty of other


samples out there they consistently list. Regulation is on the list of


things that upsets them. It is a real problem in the a small company,


getting rid of a bad employee is a big deal. It costs a lot of time


and effort. I'm not disagreeing with that, and I'm not saying we


can't do something about tribunals, making it easier for workers and


employees. Cuss fom mers are not walking through the door and can't


go to, -- customers are not walking through the door, because the banks


are watching them. Sufficient unto the day is the


discussion there of, tomorrow you are left to the tender mercies of


Not as cold as it was last night, frost-free by and large. Breeze


yiey across the north and west, windy as we go through the day.


Raining pushing across Scotland for a time. The best of the brightness


will be further south and east across the UK. Down through parts


of north and east of England. Bright and breezy. Winds not


excessively strong. A breeze out there. Temperatures doing pretty


well, 13 will be typical. Brightness for the West Country.


Although the far west of Devon and Cornwall probably staying


predominantly cloudy. For west Wales as well, overcast. To the


east of the mountains it is hanging on. A windy day for Northern


Ireland, sunshine for a time in Belfast, rain looming out west as


it will be across western parts of Scotland. Gusts of up to 70mph


across the Outer Hebrides. Squally wind as rain sweeps south-east


wards. That should clear through, and some sunshine will return to


many areas. Blustery showers on Friday. Temperatures fall ago I way,


cold enough with wintry showers across the Scottish markets,


further Southending reasonably dry and bright. That breeze will still


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