Browse content similar to 30/11/2011. Check below for episodes and series from the same categories and more!
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They are frustrated and disappointed and not going to take | :00:07. | :00:11. | |
it any more. Public sector workers close schools and operating | :00:11. | :00:14. | |
theatres today to protest at reforms to their pensions. Even | :00:14. | :00:19. | |
people who wanted to work couldn't get there, disruption, the unions | :00:19. | :00:23. | |
said, was unfortunate, but necessary. We are all getting | :00:23. | :00:27. | |
poorer, can we afford to pay them what they demand. A lot of people | :00:27. | :00:32. | |
in the private sector really don't see any need for what we are doing. | :00:32. | :00:37. | |
You try to justify your situation with their's, it is proving very | :00:37. | :00:40. | |
difficult. The General Secretary of the main union involved, and the | :00:40. | :00:44. | |
minister responsible are both here. Today, more evidence, as if we | :00:45. | :00:48. | |
needed any more, that it's going to be years before incomes recover to | :00:49. | :00:52. | |
the level they were at even nine years ago. | :00:52. | :00:56. | |
As the experts run the numbers on yesterday's announcements, it is | :00:56. | :01:01. | |
clear the poor could suffer heavily, and the pain could last a decade. | :01:01. | :01:11. | |
We are committed to resolving contentious and difficult issues | :01:11. | :01:15. | |
through dialogue. What was the LSE thinking of taking money from | :01:15. | :01:24. | |
Muammar Gaddafi's son, we speak to his examiner. | :01:24. | :01:27. | |
There were teachers, council officials, health workers and even | :01:27. | :01:31. | |
a light dusting of weather forecasters out on strike about | :01:31. | :01:36. | |
their pensions today. The gaze of the media settled on demonstrations, | :01:36. | :01:40. | |
television loves a bit of shouting. Facts are another story, it is | :01:40. | :01:43. | |
claimed that two million people were on strike, it is also claimed | :01:43. | :01:47. | |
that only one in three civil servants went out. The Prime | :01:47. | :01:51. | |
Minister called the protests a damp squib. | :01:51. | :01:56. | |
According to the TUC, this was the biggest day of industrial action in | :01:56. | :02:00. | |
a generation. According to the Prime Minister: It looks like | :02:00. | :02:07. | |
something of a damp squib. At the start of the march in | :02:07. | :02:09. | |
central London, there was competition between the unions to | :02:09. | :02:14. | |
get the most placards into the marchers hands. Get rite of that. | :02:14. | :02:18. | |
Even the police were giving stuff out. Usefully the police have | :02:18. | :02:23. | |
handed out these leaflets so everyone can know what to expected. | :02:23. | :02:27. | |
We will look at what officers will be wearing, you can expect to see | :02:27. | :02:32. | |
officers in yellow jackets and traditional police hats, check! | :02:32. | :02:36. | |
There was no such discernable dress code for the marchers. There was a | :02:36. | :02:45. | |
smattering of performance art radical. But mostly, staff went | :02:45. | :02:49. | |
casual, for whom this was no fun day out, but a regretable and | :02:49. | :02:55. | |
necessary protest. If you are going to get a pension based on average | :02:55. | :03:00. | |
earnings over the years, in the 1970s I used to take home �20 a | :03:00. | :03:03. | |
week, if that was put into an average pension, it is nothing, it | :03:03. | :03:09. | |
is an insult. That part of it would be index-linked, it is still better | :03:09. | :03:13. | |
than most people in the private sector can ever hope to get? | :03:13. | :03:18. | |
wouldn't say so. You wouldn't? That is what the statistics say, isn't | :03:18. | :03:22. | |
it? I wouldn't say so. I would say society needs to look at stopping | :03:22. | :03:26. | |
rich people choosing whether they pay tax, and that those people who | :03:26. | :03:31. | |
make communities function pay the tax to keep the communities | :03:31. | :03:33. | |
functioning. The destination of this march was Westminster. | :03:33. | :03:37. | |
Although the demonstration itself was still about two hours away, the | :03:37. | :03:41. | |
controversy was swifter. Arriving in time for Prime Minister's | :03:41. | :03:46. | |
Questions. Why does the Prime Minister think so many decent, hard | :03:46. | :03:50. | |
working public sector workers, many of whom have never been on strike | :03:50. | :03:56. | |
before, feel the Government simply isn't listening. The reason people | :03:56. | :04:00. | |
are going on strike is because they object to the reforms that we are | :04:01. | :04:06. | |
making to public sector pensions. But I believe those reforms are | :04:06. | :04:10. | |
absolutely essential, and as the former Labour pensions secretary, | :04:10. | :04:17. | |
Lord Hutton said, and he said this, "It is hard to imagine a better | :04:17. | :04:22. | |
deal than this". He is privately delighted the unions have walked | :04:22. | :04:27. | |
into his trap. That is the reality, he's been spoiling for this fight. | :04:27. | :04:32. | |
Today, he now backs the strikes, why? Because he's irresponsible, | :04:32. | :04:37. | |
left-wing and weak. The Prime Minister has dismissed | :04:37. | :04:41. | |
today's action as something of a damp squib. However, the politics | :04:41. | :04:44. | |
of this isn't quite fully formed. That is why the parties are having | :04:45. | :04:48. | |
to rather gingerly find their way around it. The big question is this, | :04:48. | :04:53. | |
where does the average voter put themselves today? Are they, even if | :04:53. | :04:58. | |
they are not here in person, marching alongside these public | :04:58. | :05:02. | |
sector workers, angry at what they think is a deal that has been | :05:02. | :05:08. | |
imposed on them. Or are they at home, looking at their own finances, | :05:08. | :05:13. | |
feeling the pinch of these austere times, feeling these people have it | :05:13. | :05:17. | |
easy. In the battle of public opinion, affordability and fairness | :05:17. | :05:22. | |
are two key measures. This graph from the Hutton Report into pension, | :05:22. | :05:25. | |
show seen before most of the changes made, the cost of public | :05:25. | :05:28. | |
sector pensions as a proportion of GDP is coming down and will | :05:28. | :05:32. | |
continue to do so well into the future. Affordability, then, is not | :05:32. | :05:36. | |
the most compelling argument. cost of public service pensions is | :05:36. | :05:39. | |
forecast, by the Government, to decline as a share of national | :05:39. | :05:43. | |
income going forwards. We can afford that, if we want to. But a | :05:43. | :05:48. | |
far smarter question, is it the best use of our money, or should we | :05:48. | :05:54. | |
be making less generous promises to public sector workers, freeing up | :05:54. | :05:58. | |
resources to spend elsewhere, lower taxes or higher spending elsewhere, | :05:58. | :06:03. | |
you make the choice. Was it a mistake to introduce the question | :06:03. | :06:06. | |
of affordability as being one of the factors here in this debate. | :06:06. | :06:10. | |
Afterall, you will be aware of the graph, the graph that everyone | :06:10. | :06:14. | |
keeps showing us of declining proportion of GDP going to public | :06:14. | :06:18. | |
sector pensions in the future? that graph is one where they have | :06:18. | :06:22. | |
already factored in the reforms that the Government have made. What | :06:22. | :06:28. | |
Lord Hutton is saying...Some them, only the change to the | :06:28. | :06:31. | |
inflation uprating, the other changes aren't in that graph? | :06:31. | :06:34. | |
graph that Lord Hutton produced, after we had already announced | :06:34. | :06:38. | |
changes that affected the contribution rates, that is one of | :06:38. | :06:42. | |
the biggest reforms we are making, they are baked into that graph. | :06:42. | :06:45. | |
Lord Hutton has said the deal we are putting forward is necessary, | :06:45. | :06:49. | |
right and generous. Affordability, sustainability, the different sides | :06:49. | :06:55. | |
of the same coin. So, that's it, we have reached the | :06:55. | :06:58. | |
end of the march. Big Ben is over there, the question is, what | :06:58. | :07:03. | |
happens now, where does this wave of public sector anger go next? | :07:03. | :07:07. | |
With us now is the cabinet office minister, Francis Maude. Do you | :07:07. | :07:11. | |
understand why so many people are angry? I understand that they are | :07:11. | :07:15. | |
concerned about what their pensions are going to look like, and what | :07:15. | :07:19. | |
they are going to be. We're steadily explaining that actually | :07:20. | :07:24. | |
the cost of public sector pensions has risen by a third, by �10 | :07:24. | :07:29. | |
billion in the last ten years, and actually, the costs has fallen on | :07:29. | :07:33. | |
the general taxpayer. People are living much longer, so we need to | :07:34. | :07:38. | |
expect people, generally, to work longer. These people already have a | :07:38. | :07:42. | |
pay freeze, they learned yesterday if they get a pay rise at the end | :07:42. | :07:48. | |
of that freeze it will be 1%, they have learned also that 700,000 | :07:48. | :07:53. | |
posts in their fields are going to disappear. You can't be surprised | :07:53. | :07:56. | |
if they come to the conclusion that there is an agenda going on here | :07:56. | :08:01. | |
that is not about the public finances? The agenda is completely | :08:01. | :08:06. | |
about having, on pensions, about having sustainable and good public | :08:06. | :08:12. | |
sector pensions for the future. But they have to be sustainable and on | :08:12. | :08:17. | |
a basis that is fair to public sector workers and fair to the tax- | :08:17. | :08:20. | |
payers whose taxes support these pensions. Since there is a | :08:20. | :08:27. | |
proportion of GDP, the burden of these pensions is falling. It is | :08:27. | :08:30. | |
clearly not just about money, it is about politics too isn't it? | :08:30. | :08:35. | |
burden is falling, because of the reforms. There were a number of our | :08:35. | :08:41. | |
reforms which were already factored into that graph. And there were | :08:41. | :08:44. | |
other reforms which were projected under the last Government, and | :08:44. | :08:47. | |
hadn't been implemented, and the detail hadn't been worked out and | :08:48. | :08:52. | |
put in. The Institute of Fiscal studies says it is all affordable? | :08:52. | :08:57. | |
Anything is affordable if you are willing to sacrifice other things. | :08:57. | :09:01. | |
The office of budget responsibility projected that without reform the | :09:01. | :09:10. | |
cost to the taxpayer would be an additional several thousand pounds | :09:10. | :09:14. | |
individually. You want to take this money and spent it on something | :09:14. | :09:20. | |
else, to penalise them? We are not penalising them. For those wanting | :09:20. | :09:25. | |
reforms, we need to know what will we cut �7 billion from. At the end | :09:25. | :09:29. | |
of these reforms, public sector workers on lower and middle incomes | :09:29. | :09:34. | |
will be able to retire on a pension at least as good, in many cases | :09:34. | :09:37. | |
they expect, many will be expected to work longer. Because they are | :09:37. | :09:41. | |
long to live longer. They will be asked to pay more towards it, so | :09:41. | :09:45. | |
there is a fairer balance to what they put towards their pensions and | :09:45. | :09:50. | |
the employer, the taxpayer puts towards them. Is there a question | :09:50. | :09:58. | |
of 3.2%, is that negotiable at all for you? We said that there f there | :09:58. | :10:01. | |
are ways the unions can put forward delivering those pension schemes | :10:01. | :10:04. | |
delivering those savings, we are willing to listen. I have to tell | :10:04. | :10:07. | |
you, no suggestions have been put forward. | :10:07. | :10:10. | |
The baseline for everything that you are saying, both in this and | :10:10. | :10:13. | |
yesterday, is that we have all got to accept that life is going to get | :10:13. | :10:19. | |
a lot worse, isn't it? Life will be tough. We inherited a massive | :10:19. | :10:22. | |
budget deficit. The office of budget responsibility concluded in | :10:22. | :10:26. | |
its analysis that the size of the boom was greater than we envisaged, | :10:26. | :10:30. | |
and the deep depth of the crash, of the bust, was greater. Actually the | :10:30. | :10:33. | |
consequences of that, we will have to live with and we will have to | :10:33. | :10:37. | |
work our way through. I want at the end of this, there could be really | :10:37. | :10:42. | |
good public sector pensions, for decent public servants, who make | :10:42. | :10:47. | |
their lives devoted to this important calling of public service. | :10:47. | :10:51. | |
Wouldn't you also say one of the consequences has been for you to | :10:51. | :10:55. | |
abandon some of the principles you laid out at the time you were | :10:55. | :10:58. | |
elected. For example, the idea that work must always pay. When you look | :10:58. | :11:02. | |
at what you did to Working Tax Credits yesterday, and what you did | :11:02. | :11:07. | |
to benefits, one of them being frozen and benefits rising by 5.2%. | :11:07. | :11:10. | |
Don't you conclude that you have abandoned that principle? I don't | :11:10. | :11:15. | |
accept that for a second. What I'm concerned with here today is with | :11:15. | :11:19. | |
the reforms to public sector pensions. Just to focus on this. | :11:19. | :11:26. | |
be clear about this, you wanted the job seekers allowance to go up by | :11:26. | :11:29. | |
5.2%? If you want to talk about the Autumn Statement, that is fine, I'm | :11:29. | :11:37. | |
here to talk about this industrial relations dispute, and the case for | :11:37. | :11:43. | |
public sector pensions reform. you want the jobseeker's allowance | :11:43. | :11:47. | |
to go up by that much? I'm here to talk about the strikes today and | :11:47. | :11:51. | |
the case for reform of public sector pensions. It is worth making | :11:51. | :11:57. | |
the point that there are negotiations going on a daily basis | :11:57. | :12:00. | |
here. You said your final offer was on November 2nd, this whole thing | :12:00. | :12:06. | |
is in the context of your attitude to work. I ask you again, did you | :12:06. | :12:10. | |
want the jobseeker's allowance to go up by 5.2%? I'm not getting into | :12:10. | :12:19. | |
all of that. The fact is...That what the Lib Dems got out of the | :12:19. | :12:22. | |
Autumn Statement, wasn't it? have had a tough set of decisions | :12:22. | :12:25. | |
to make in the Autumn Statement. As a Government we work together very | :12:25. | :12:29. | |
closely this is a Government that has come together, two parties | :12:29. | :12:31. | |
coming together, to work in the national interest, to clear up the | :12:31. | :12:35. | |
mess left by the last Government. Actually, putting all of this | :12:35. | :12:39. | |
together, in a way that has delivered a credible plan for | :12:39. | :12:42. | |
reducing the deficit, which gives us the lowest interest rates. We | :12:42. | :12:48. | |
were able to actually have a lower interest rates, even than Germany, | :12:48. | :12:52. | |
that takes quite a lot of determination and loadership and a | :12:52. | :12:55. | |
long-term view of what's -- leadingship and a long-term view of | :12:55. | :12:59. | |
what's going to work. We will go back to negotiate public sector | :12:59. | :13:02. | |
pensions. I thought you made your final offer? There are discussions | :13:02. | :13:06. | |
all the time. It wasn't the final offer? There were negotiations with | :13:06. | :13:10. | |
the civil ser service. I hope you will ask Mark Serwotka when he | :13:10. | :13:14. | |
comes on, why he wasn't on those discussions yesterday. Bear with us, | :13:14. | :13:18. | |
and we will come to that. Reform of public sector pensions necessary, | :13:18. | :13:22. | |
the Government says, because of the dismal state of the country's | :13:22. | :13:25. | |
finances. Between a fifth-and-a- quarter of people with a job work | :13:25. | :13:31. | |
for the state. Although in some warts of the -- parts of the | :13:31. | :13:34. | |
country it is a higher proportion. Many of those who work in the | :13:34. | :13:40. | |
private sector and contribute to the taxes that fund private sector | :13:40. | :13:44. | |
workers' pensions say they don't know they are born. We have been | :13:44. | :13:48. | |
finding out who is really better off, public or private. A show of | :13:48. | :13:51. | |
strength on the streets of Birmingham. Several thousand | :13:51. | :13:56. | |
workers from the public sector foregoing a day's wages, in the | :13:56. | :14:03. | |
hope of, as they see it, protecting years of their pension. Meet | :14:03. | :14:08. | |
Theresa Footes, husband Tom and daughter Kyra. She's a primary | :14:08. | :14:12. | |
school teacher aged 36, because of the increase in the pension age, | :14:12. | :14:22. | |
:14:22. | :14:23. | ||
she will retire on �12,000 on the age of 68, she had been expecting | :14:23. | :14:26. | |
�18,000. I paid into the pension, I knew what I was getting out of it. | :14:26. | :14:32. | |
Now it is taken away from us. Now it is not Martin McGuinness what we | :14:32. | :14:36. | |
pay in, pay more and work longer. As her husband acknowledges, that | :14:36. | :14:44. | |
argument -- Now it doesn't matter what you pay in, pay more and work | :14:44. | :14:50. | |
longer. Her house acknowledges that argument is difficult to accept. | :14:50. | :14:52. | |
is difficult because of the situation people find themselves in, | :14:52. | :14:56. | |
you try to justify your situation with their's, it is really very | :14:56. | :15:00. | |
difficult. At this cash and carry in the city centre, strike day | :15:00. | :15:03. | |
means more people shopping but fewer to serve them. About a fifth | :15:03. | :15:06. | |
of staff are parents who have stayed home because schools have | :15:06. | :15:11. | |
closed. For a worker in the private sector, it can be hard to feel much | :15:11. | :15:16. | |
sympathy for those on strike. Sumeet Chadha is marketing manager, | :15:16. | :15:19. | |
a-year-older than Teresa, his salary is about the same as her's. | :15:19. | :15:23. | |
He has made no pension provision, eventhough he could have paid into | :15:23. | :15:28. | |
a company scheme. I do feel that most people are to blame for their | :15:28. | :15:32. | |
own situations. I can understand the people going on strike, on the | :15:32. | :15:36. | |
one side of things, and the other side I can understand why the | :15:36. | :15:42. | |
Government is doing this. Should that have been in place in the firs | :15:42. | :15:46. | |
understand stand, were there too many -- first instance, were there | :15:46. | :15:50. | |
too many benefits paid out? There is a deficit, to get the economy | :15:50. | :15:54. | |
back on track something needs to be done. The other big benefit is | :15:55. | :15:57. | |
wages, do public sector workers get a better deal there. It is | :15:57. | :16:00. | |
difficult to measure. But the Institute for Fiscal Studies has | :16:00. | :16:05. | |
had a go. Above the horizontal line is where public sector wages | :16:05. | :16:09. | |
exceeded those in the private sector. Women have consistently | :16:09. | :16:16. | |
done better. Throughout the 1990s, for both sexes, the public sector | :16:16. | :16:20. | |
gap narrowed. Men with private sector jobs were made more than | :16:20. | :16:25. | |
those in the public sector. The difference has grown again, | :16:25. | :16:27. | |
accelerating dramatically in the time of the financial crisis, that | :16:27. | :16:32. | |
cut private sector wages more than the public sector. The IFS thinks | :16:32. | :16:39. | |
that won't last. In recent years public sector pay has moved ahead | :16:39. | :16:44. | |
of private sector pay. Not by design, it is just private sector | :16:44. | :16:48. | |
pay growth has been subdued in the recession. There is two years of | :16:48. | :16:55. | |
pay squeeze with another two years coming. By 2014/15, comparing a | :16:55. | :16:59. | |
like-for-like basis, this would be sufficient to erode away the public | :16:59. | :17:03. | |
sector premium for men that we currently believe exists. They have | :17:03. | :17:10. | |
put on quite a display today, and a pretty noisy one at that, once all | :17:10. | :17:14. | |
the shouting has faded away. The question for the future is whether | :17:14. | :17:18. | |
the unions will be able to capitalise on that, and expand | :17:18. | :17:21. | |
support on voters, many not benefiting from the pensions they | :17:21. | :17:26. | |
would like to protect for the future, or whether this disruption | :17:26. | :17:29. | |
will alienate precisely the people whose support they so desperately | :17:29. | :17:33. | |
need. The Government wants to cut the bill to the taxpayer, but if | :17:33. | :17:37. | |
public sector workers won't make the higher contributions ministers | :17:37. | :17:40. | |
expect, and join the millions in the private sector who don't save | :17:40. | :17:44. | |
at all for their old age, then the next generation may be facing a | :17:44. | :17:47. | |
much bigger bill. Mark Serwotka, the General | :17:47. | :17:50. | |
Secretary of the Public and Commercial Services Nuion, is with | :17:50. | :17:55. | |
us now. And Francis Maude is still here. Let me speak to you for a few | :17:55. | :18:01. | |
minutes first. Are you embarrassed that so many of your members | :18:01. | :18:04. | |
protesting today have better conditions and pensions to look | :18:05. | :18:09. | |
forward to than many people in the private sector? I'm not embarrassed | :18:09. | :18:13. | |
about that at all. It makes me determined to make the case that | :18:13. | :18:16. | |
there should be fair pensions for all, and the problems in the | :18:16. | :18:20. | |
private sector won't be solved by slashing the hard-earned public | :18:20. | :18:23. | |
sector pensions of which people were promised for decades. Where do | :18:23. | :18:28. | |
you think all the tax income will come from? As you have just seen in | :18:28. | :18:32. | |
your report, the cost of public sector pensions, as a proportion of | :18:32. | :18:36. | |
GDP is falling. We have made the changes, five years ago, that | :18:37. | :18:40. | |
modernised the scheme, took account of people working longer. And the | :18:41. | :18:48. | |
result of that is they fall from 1.9% to 1.4% of GDP. You don't deny | :18:48. | :18:52. | |
people are living longer, you presumably accept there is a need | :18:52. | :18:55. | |
for change occasionally? There was a need for change five years ago, | :18:56. | :19:00. | |
we did a deal with the then Labour Government. We were told it would | :19:00. | :19:04. | |
last for 50 years. I don't accept the premise that because everybody | :19:04. | :19:08. | |
supposedly lives longer we have to work lot longer. Many people will | :19:08. | :19:12. | |
never live to 68 and see the pension that many of them have | :19:12. | :19:17. | |
worked so hard for. I don't buy into the notion that in the sixth | :19:17. | :19:20. | |
biggest economy in the world that if you live longer you work until | :19:20. | :19:25. | |
you drop. If the case was so transparent, why did so much of the | :19:25. | :19:30. | |
Civil Service come out on strike today -- fail to come out on strike | :19:30. | :19:33. | |
today? It was somewhere between a quarter and a third of the Civil | :19:33. | :19:38. | |
Service, the majority were working. He has had a good go, let me make | :19:38. | :19:42. | |
the point. The Government's behaviour has been extraordinary? | :19:42. | :19:45. | |
We are not talking about that, I'm asking you why so many people | :19:45. | :19:49. | |
failed to come out today? saying two million people were on | :19:49. | :19:55. | |
strike. Nonsense. 90% of the PCS members. They weren't u know | :19:55. | :20:02. | |
perfectly well it is not true. will be able to analyse that in the | :20:02. | :20:05. | |
future. It is the latest example of a Government who is either | :20:05. | :20:09. | |
deliberately misleading people or doesn't understand what the issues | :20:09. | :20:14. | |
are. Anybody who left parliament. Check the methodology. Did you get | :20:14. | :20:18. | |
people to count how many people weren't at work today? It is | :20:18. | :20:25. | |
146,000, I have it down to the last number. You claim it is 146,246, | :20:25. | :20:29. | |
even if everyone was at work, the idea they could get that figure | :20:29. | :20:33. | |
within five hours is laughable. We know this is paysically an attempt | :20:33. | :20:37. | |
to try and see. The Civil Service doesn't work that fast? They are | :20:37. | :20:40. | |
not there. Senior Civil Service members on | :20:40. | :20:45. | |
strike. Are you accusing the minister of making it up? | :20:45. | :20:49. | |
accusing the minister of misleading and potentially lying to people | :20:49. | :20:53. | |
about a number of questions. That is a serious accusation to make. | :20:53. | :20:57. | |
will back it up. Mr Maude says what he knows to be untrue, that people | :20:57. | :21:01. | |
will get better pensions if they are lower or middle incomes, proved | :21:01. | :21:08. | |
to be put to him earlier. Mr Maude also said. Let me say what I said. | :21:08. | :21:13. | |
Just hear what he said. Quickly put him right? You are putting up an | :21:13. | :21:17. | |
aunt Sally to knock it down. I have said explicitly that people on | :21:17. | :21:22. | |
lower and middle incomes will retire on a pension which is as | :21:22. | :21:26. | |
good, and in many cases better, than what they currently expect to | :21:26. | :21:31. | |
retire on. They may work longer and they will pay more towards it. | :21:31. | :21:36. | |
your researchers go on the pensions calculator, it shows that is | :21:36. | :21:42. | |
nonsense. It is also nonsense. are not comparing like with like. | :21:42. | :21:45. | |
It is your calculator. It is nonsense that the Hutton graph | :21:45. | :21:52. | |
assumed the reforms, do your homework, three major reforms, it | :21:52. | :21:57. | |
dopbl factored one. The national saud dit office accept the changes | :21:57. | :22:03. | |
a few years ago cut the contributions by 14%. We have an | :22:03. | :22:07. | |
extraordinary case of minutes tears hurling insults like school boys, | :22:07. | :22:13. | |
making up fantasy figures and refusing to talk about the issues. | :22:13. | :22:19. | |
Not a pen of the money. Why don't they enter discussions, the other | :22:20. | :22:23. | |
union leaders were there and engaging in a serious way with the | :22:23. | :22:28. | |
issues which matter to your members, you weren't there. You haven't | :22:28. | :22:32. | |
negotiated. Let me finish. haven't answered the question yet, | :22:32. | :22:36. | |
why didn't you go? They weren't negotiations. You chose not to go, | :22:36. | :22:41. | |
how do you know? My General Secretary goes, and all they are is | :22:41. | :22:47. | |
exchanges of information between officials. Nonsense, utter nonsense. | :22:47. | :22:50. | |
Let me finish, the negotiations are with Government officials, what | :22:50. | :22:54. | |
they have said to us is, that is our final offer, as you correctly | :22:54. | :22:58. | |
put, now we want our officials to talk to you about how to share out | :22:58. | :23:01. | |
the pain. We are saying we're not interested in sharing out the pain. | :23:01. | :23:05. | |
You need to make concessions on the big question of forcing people to | :23:05. | :23:10. | |
work longer, forcing them to pay more money in. Not a penny of which | :23:10. | :23:15. | |
goes into any pension fund, it all goes to George Osborne's coffers. | :23:15. | :23:20. | |
You want them then to get tens of thousands left. It is daylight | :23:20. | :23:23. | |
robbery, that is why you will not debate the issues, there is smoke | :23:23. | :23:31. | |
screens all over the place. If it is so wrong to move to CPI rating, | :23:31. | :23:36. | |
why is in the own pension scheme for your own staff members, you | :23:36. | :23:44. | |
have moved from RPI uprate to go CPI. You have increased your | :23:44. | :23:50. | |
pension contributions for your own staff, not the modest 3.2%, but 10%, | :23:50. | :23:55. | |
why? Moralise, come down to union headquarters, we haven't increased | :23:55. | :23:58. | |
the contributions, we don't have any. We are consulting and | :23:58. | :24:01. | |
negotiating with our staff union about changes to a scheme, which | :24:01. | :24:06. | |
has had a valuation. Unlike the Civil Service scheme which hasn't | :24:06. | :24:10. | |
had a valuation. It is only because you are making those changes. J | :24:10. | :24:16. | |
where we are trying to see if the scheme can be stablised and giving | :24:16. | :24:20. | |
people fairly generous pay offers, you are giving us a cut over four | :24:21. | :24:26. | |
years, and asking public sector workers to pay more and it all goes | :24:26. | :24:30. | |
to George Osborne. Not to George Osborne personally, that is absurd. | :24:30. | :24:36. | |
To his coffers in the Treasury. Is it into pensions. I want to give | :24:36. | :24:40. | |
Francis Maude a very quick opportunity to respond to this | :24:40. | :24:49. | |
accusation that you lied? It is not a new one from Mark. What I would | :24:50. | :24:54. | |
just say is come, put your pride aside, come to the negotiating | :24:54. | :25:00. | |
table, engage as all the other union General Secretarys engaging, | :25:00. | :25:04. | |
come and talk, you may find there might be something to the benefit | :25:04. | :25:08. | |
of union members. If you wear your blinkers and refuse to engage you | :25:09. | :25:14. | |
are letting down your members. up Lionel Barber's offer, get your | :25:14. | :25:17. | |
ministers into negotiations with us tomorrow, we will all about there. | :25:17. | :25:21. | |
We are not talking to official about difficultying up the pain. | :25:22. | :25:29. | |
You must negotiate about stop -- difficult -- divvying up the pain. | :25:29. | :25:34. | |
J Get off your high horse and come. You get off your high horse when | :25:34. | :25:37. | |
you have millions in the bank and low paid workers suffer. | :25:37. | :25:46. | |
All this discussion takes place in the murky gloom cast by yesterday's | :25:46. | :25:50. | |
resitation of the awful mess we are in by the economy. | :25:50. | :25:54. | |
Now the words to describe Britain is the lost decade. Comparisons | :25:54. | :25:59. | |
with Japan in the 1990s, the only straw to be grasped at, and an | :25:59. | :26:02. | |
imaginary one, is the decade might have begun a few years ago, then it | :26:03. | :26:07. | |
may not be a decade at all. It could be much longer. Our economics | :26:07. | :26:16. | |
editor, Paul Mason, takes a mosh bid interest in this sort of thing. | :26:16. | :26:20. | |
-- morbid interest in these sorts of things. Good news today? | :26:20. | :26:23. | |
thing happening on the global front is the equivalent of the doctor | :26:23. | :26:27. | |
walking into the waiting room and saying hey, everybody, it is great | :26:28. | :26:34. | |
we have a whole new supply of vaccine against but Bonnic plague, | :26:34. | :26:37. | |
and the patients go why do we need it? The central banks today have | :26:37. | :26:41. | |
come out and pumped a lot of dollars into the global system. The | :26:41. | :26:46. | |
reason is, that the European banking system is short of dollars, | :26:46. | :26:50. | |
this is like filling up the ATMs in case there is a run on the banks. | :26:50. | :26:55. | |
It is a big gesture, it sent the markets wild for a few hours, | :26:55. | :26:59. | |
really, the reason they have done it is because we are entering a | :26:59. | :27:03. | |
period of sisters now and the European Summit on the 9th of | :27:03. | :27:08. | |
December. They want to make sure no accidents take place. Going back to | :27:08. | :27:17. | |
yesterday's news, which was really, really bad. Does it look like a | :27:17. | :27:20. | |
lost decade? The Institute of Fiscal studies, which tries to rake | :27:20. | :27:23. | |
through the figures and find out what they really mean, has been | :27:23. | :27:28. | |
delivering its verdict today. We have some of the graphs to show you. | :27:28. | :27:32. | |
This is one. I don't know what year you were born in. I was born in | :27:32. | :27:41. | |
1960. This graph here shows the shape of debt in our lifetime. The | :27:41. | :27:45. | |
changing shape of public spending over the years. As you can see, in | :27:45. | :27:50. | |
the last 10-15 years, we have this Labour period when it generally | :27:51. | :27:55. | |
rose every year. If you look at the general historical trend it has | :27:55. | :28:00. | |
been patchy. Now, what the IFS has said, is look, we are going into | :28:00. | :28:03. | |
seven years where it always falls. If you compare it to the historic | :28:03. | :28:10. | |
trend, we have never had a period like it. This is by way of | :28:10. | :28:12. | |
explanation to the rancour we are now hearing. We are going into a | :28:12. | :28:17. | |
period of toughness. Here is another graph. This is departmental | :28:17. | :28:22. | |
spending, it looks a bit like a mountain, since 1998, it is | :28:22. | :28:28. | |
generally gone up as a pro-portion of GDP. Now it is set to generally | :28:28. | :28:33. | |
go down. Back to below where it was in the late 1990s. It is a big sea | :28:33. | :28:36. | |
change in almost every figure we look at. | :28:36. | :28:40. | |
How does this relate to what it feels lick? You can feel the | :28:40. | :28:47. | |
rancour there. Let's look at one thing. We are talking here about | :28:47. | :28:52. | |
much of yesterday being dominated by public sector workers. The | :28:52. | :28:56. | |
Institute for Fiscal Studies has done calculation on how badly it | :28:56. | :29:01. | |
will affect general workers standard of living. What we see, a | :29:01. | :29:08. | |
7.5% in real incomes for households. Between 2009 and next year. That is | :29:08. | :29:18. | |
:29:18. | :29:22. | ||
why it feels so bad pltd. -- so bad. That is why it is feeling rancour | :29:22. | :29:32. | |
:29:32. | :29:36. | ||
ous on the streets. When will it come back? It comes back in 20 26. | :29:36. | :29:43. | |
We have an adviser to George Osborne, and the Professor of | :29:43. | :29:47. | |
political economy at the University of Warwick, and written several buy | :29:48. | :29:57. | |
oing fees of John Ke ynes. Does it feel like a lost decade to you? | :29:57. | :30:03. | |
does, if you look behind all the clatter and clamour of the last few | :30:03. | :30:08. | |
days, and as you have just had, the real story is this time it is | :30:08. | :30:13. | |
really different. You and I have lived through a lot of booms and | :30:13. | :30:18. | |
busts, Barber, Lawson and the rest. They have been like hangovers from | :30:18. | :30:22. | |
a wild party, people have taken the pay, and life has continued as | :30:22. | :30:28. | |
usual. I think what has crystalised this week is it will not be like | :30:28. | :30:33. | |
that. We will lose through this a large chunk of our national income, | :30:33. | :30:41. | |
and people's earnings and standard of living will not shift over two | :30:41. | :30:46. | |
years. Have you ever seen anything like this? It is compared to the | :30:46. | :30:51. | |
great depression of 1929-1932. It is not as deep, but lasting a bit | :30:51. | :30:57. | |
longer. I think there is a great chance there will be a lost decade, | :30:57. | :31:01. | |
a miserable decade. It is sometimes called the new realisim, it need | :31:01. | :31:07. | |
not be. It is a consequence of policy. You mean to say we need not | :31:07. | :31:17. | |
have a lost decade. The solution is keepbsian? It is. I believe - | :31:17. | :31:21. | |
Keynesian. It is, I believe you need to build up not cut down. If | :31:21. | :31:24. | |
you cut down you will not cure your deficit, and the income of the | :31:24. | :31:28. | |
economy, the economy will shrink. The country is bankrupt? No it is | :31:28. | :31:36. | |
not. When you have lots of, that is talking in money terms, that is | :31:36. | :31:40. | |
just money. If you have a lot of long-term resources that are idle, | :31:40. | :31:44. | |
20% of capacity isn't being used, how can you talk about being | :31:44. | :31:50. | |
bankrupt. Are you looking forward to a lost decade? Based on the | :31:50. | :31:56. | |
numbers, the decade starred five years ago. We have the biggest boom | :31:56. | :32:06. | |
:32:06. | :32:06. | ||
and bust in history. I'm with two clever economists here. In the real | :32:06. | :32:15. | |
world, I think the idea that we have a problem based on borrowing, | :32:15. | :32:20. | |
and the solution is to have more borrowing to get the borrowing down, | :32:20. | :32:23. | |
and in the process sacrificing interest rates, as of yesterday | :32:23. | :32:28. | |
lower than Germans, doesn't stack up. You don't believe that will | :32:28. | :32:33. | |
last? It has lasts for over a year now. This is the Government line. | :32:33. | :32:37. | |
It isn't. If you look at what has happened to interest rates, Britain | :32:37. | :32:41. | |
has been a safe haven, rates have come down, that is worth �10 | :32:41. | :32:46. | |
billion, a pretty big fiscal stimulus to mortgage holders across | :32:46. | :32:51. | |
the country. You save on interest rates by having interest rates very | :32:51. | :32:55. | |
interest rate interests, �28 billion from the Chancellor. If, in | :32:55. | :33:01. | |
order to get that, you are reducing your revenues by �50 billion, you | :33:01. | :33:07. | |
have a negative number. That is the consequence of cutting down. Other | :33:07. | :33:12. | |
economists do disagree with you on this point, Sir. Economists never | :33:12. | :33:21. | |
agree on anything. The collective noun should be disagreement. We | :33:21. | :33:25. | |
have a debt problem, we need to grow our way out of it. Yesterday | :33:25. | :33:29. | |
the business leaders welcomed what was said, against very little | :33:29. | :33:33. | |
fiscal head room. I don't think in my constituency this feels like a | :33:33. | :33:39. | |
lost decade, but a difficult deck taid. I wonder if it is not just a | :33:39. | :33:43. | |
decade, are we not getting to the point of reckoning, which is the | :33:43. | :33:48. | |
consequence of decade of post-war spend anything this country. | :33:48. | :33:52. | |
not going to intrude on the economics argument, except to say | :33:52. | :33:58. | |
we have lost a big chunk of our national wealth, already. | :33:58. | :34:03. | |
That means, when we come out the other side of this, even if we grow | :34:03. | :34:06. | |
strongly from now on, Britain will be another country, a different | :34:06. | :34:14. | |
place. What sort of place will it be? We will have a smaller economy, | :34:14. | :34:19. | |
and a smaller rather more select Comic Relief welfare state. I'm not | :34:19. | :34:24. | |
advocating this as policy, this is the facts of life. We will have a | :34:24. | :34:29. | |
smaller international footprint, no more Afghanistans, no more Iraqs, | :34:29. | :34:33. | |
no more aircraft carriers or fancy planes to fly off them. We will | :34:33. | :34:38. | |
have to own up, as a still pretty wealthy, middle-ranking country, | :34:38. | :34:48. | |
with a lotless in terms of pretensions. You don't still think | :34:48. | :34:54. | |
we will sit at the top table? a delve fulfiling prophesy, of | :34:54. | :34:59. | |
course we will have a smaller economy if we declare a quarters of | :34:59. | :35:02. | |
the population is redundant. By definition we have a smaller | :35:02. | :35:05. | |
economy. What is happening at the moment is their skills and spirit | :35:05. | :35:09. | |
is simply being rusted away by them not being employed. I agree | :35:09. | :35:13. | |
entirely with you when you said you need growth. I'm glad you said that. | :35:13. | :35:19. | |
You have to grow your way out of debt, not cut your way out of debt. | :35:19. | :35:22. | |
Is there an argument for quality of growth. You mentioned skills, a | :35:22. | :35:26. | |
very important point. One of the things I see as a governor of two | :35:26. | :35:30. | |
schools in my constituency, is a complete sea change in the way | :35:30. | :35:33. | |
people think of basic qualifications, no more gaming the | :35:33. | :35:38. | |
league tables that only a civil servant in Whitehall reads. Let's | :35:38. | :35:44. | |
make sure every child gets at least a C in GCSE mathematics. We have | :35:44. | :35:48. | |
let a generation down by not doing that. | :35:48. | :35:57. | |
A slightly separate point. Can I ask your economist friend here. How | :35:57. | :36:01. | |
much do you think of the pretence being maintained of our position in | :36:01. | :36:11. | |
:36:11. | :36:12. | ||
the world, is if based on an illusion for the last 20 years. | :36:13. | :36:18. | |
With respect the two are absolutely linked. Stature in the world, it | :36:18. | :36:22. | |
was Admiral Mike mull lan, the head of the American Armed Forces, who | :36:22. | :36:24. | |
said the biggest threat to our security and position in the world | :36:24. | :36:33. | |
is the state of our economy. The two are linked. If our economy was | :36:33. | :36:40. | |
based, as it was, I think, on, if you like, a rather fraudulent | :36:41. | :36:47. | |
belief had a -- that the financial sector would produce vast amounts | :36:47. | :36:51. | |
of tax revenue forever and ever. It is now clear it is not going to. We | :36:51. | :36:55. | |
have to make that adjustment and adjust our view of ourself in the | :36:55. | :37:00. | |
world as well. The figures are against you. I was very struck by | :37:00. | :37:07. | |
the graph we had of a huge boom in spending, from 2002 on wards that | :37:07. | :37:10. | |
was fuelled by borrowing. The Government spent more than it took | :37:10. | :37:16. | |
in taxes every year, whether we agree to do that going forward, and | :37:16. | :37:18. | |
an expectation of continuing financial services taxation. These | :37:18. | :37:23. | |
are choices to make. For me, the choices are about getting back to | :37:23. | :37:28. | |
an economy that is built on private sector growth. Where Government is | :37:28. | :37:33. | |
on the side of businesses rather than meaningless regulation in | :37:33. | :37:39. | |
their way, giving our young people the best skills they could get, and | :37:39. | :37:42. | |
building infrastructure, creaking in this country. These are all | :37:42. | :37:46. | |
things the Government is saying is critical choices we want to make | :37:46. | :37:51. | |
with limited monetary head room. We could be in a better position after | :37:51. | :37:59. | |
the last five years, and a more sustainable position. First of all, | :37:59. | :38:04. | |
the deficit was extremely small in the years of the Labour Government | :38:04. | :38:08. | |
Not oh aye what's that then cording to the IFS, they called it a drift, | :38:08. | :38:15. | |
every year from 2005. A very small drift, and people confuse the issue | :38:15. | :38:18. | |
by talking about structural deficits. I don't think you will | :38:18. | :38:23. | |
want to have a big discussion on what is a structural deficit. | :38:23. | :38:27. | |
come another night with a lot of time. You need a lot of time and it | :38:27. | :38:32. | |
is all based on dubious figures of one kind and another. The gap | :38:32. | :38:35. | |
between what you take in taxes and you spend. In the real world people | :38:35. | :38:40. | |
understand what that is. Robert seeps to think, I don't think we | :38:40. | :38:45. | |
should be in total thrall to the bond markets. But he seems to think | :38:45. | :38:48. | |
we can have Keynesianism in one country, that we can do what we | :38:48. | :38:52. | |
like in terms of borrowing and spending. And our interest rates | :38:52. | :38:56. | |
will stay at Germany levels. think both Ed Balls and George | :38:56. | :39:06. | |
:39:06. | :39:07. | ||
Osborne have a point. Oh dear. I think we have to be realistic, | :39:07. | :39:11. | |
you can't ignore what used to be known as the zur Rick, now spread | :39:11. | :39:19. | |
more evenly throughout the world. Two quick points, firgs of all -- | :39:19. | :39:24. | |
first of all, our success rates were not entirely an illusion, and | :39:24. | :39:29. | |
depended on fictional money. They were unsustainable. They were | :39:30. | :39:33. | |
unsustainable because they weren't sustained. Everything's | :39:33. | :39:39. | |
unsustainable that collapses in retrospect. That doesn't mean it | :39:39. | :39:42. | |
wasn't sustainable at the time. have the highest level of public | :39:42. | :39:46. | |
and private debt all through that period. The argument that we have | :39:46. | :39:50. | |
low interest rates because everyone has enormous confidence in the | :39:50. | :39:53. | |
Government's fiscal policy. We have very low interest rates, partly | :39:53. | :39:57. | |
because people don't know where else to put their money, partly | :39:57. | :40:00. | |
because the Bank of England has been printing money. Thank you very | :40:00. | :40:05. | |
much. One of Britain's most prestigious | :40:05. | :40:09. | |
universities, took something of a pasting today. It learned what an | :40:09. | :40:13. | |
independent inquiry had to say about its decision to take money | :40:13. | :40:18. | |
from Colonel Gaddafi's son, only weeks after giving him a doctorate. | :40:18. | :40:21. | |
The London School of Economics boasts of 16 Nobel Prize winners, | :40:21. | :40:26. | |
there was no danger of the Libyan dictator's son joining them. There | :40:27. | :40:32. | |
was some uncertainty whether he was entitled to his PhD. | :40:32. | :40:37. | |
1234 The Gaddafi Foundation devotes itself to humanitarian work, | :40:37. | :40:41. | |
especially in the social, economic, and culturally, and the human | :40:41. | :40:45. | |
rights field. The human rights field under | :40:45. | :40:51. | |
Gaddafi. Saif is committed to resolving | :40:51. | :40:54. | |
contentious international and domestic issues, through dialogue, | :40:54. | :41:01. | |
debate and peaceful negotiations. Dialogue and negotiations, under | :41:01. | :41:06. | |
Saif and his family. I have come to know Saif as someone who looks to | :41:06. | :41:15. | |
democracy, civil society, and deep liberal values. The Professor was a | :41:15. | :41:20. | |
big fan of Saif Gaddafi, he was his mentor and securing the �1.5 | :41:20. | :41:26. | |
million donation. This all makes him as the Pearsonification and | :41:26. | :41:33. | |
naivity of the LSE. There was a chapter of failures in the report | :41:33. | :41:38. | |
identified. Saying the LSE allowing links between it and Libya to | :41:38. | :41:41. | |
become overwhelming, affecting judgments across the board. | :41:41. | :41:45. | |
Although three departments refused to teach him on the grounds he | :41:45. | :41:49. | |
wasn't up to it. The fourth, philosophy, accepted him, they | :41:49. | :41:53. | |
wanted to believe Saif Gaddafi was a good guy, representing hope. He | :41:53. | :42:02. | |
was charm itself, addressing an LSE audience last year, his tongue | :42:02. | :42:11. | |
Albanian chic over his father's ways. In theory, Libya is the most | :42:11. | :42:18. | |
democratic place in the world. APPLAUSE | :42:18. | :42:24. | |
Because, in theory, in theory. And then months later, back in | :42:24. | :42:28. | |
Tripoli, there was Saif, on TV, threatening rivers of blood if the | :42:28. | :42:33. | |
protests didn't stop. It is not as though they weren't warned. Lord | :42:33. | :42:38. | |
Woolf wolf noted that a Professor here spoke of the risky gamble of | :42:38. | :42:44. | |
tying the LSE's reputation so close to Saif Gaddafi. What he turned out | :42:44. | :42:53. | |
not to be a reform at all. It came to pass, Lord Woolf wolf says the | :42:53. | :42:58. | |
London School of Economics goes under known name, the Libyan School | :42:58. | :43:02. | |
of Economics. For students at the LSE, the Gaddafi affair can be | :43:02. | :43:06. | |
regarded as an object lesson in ethics and economics, a course they | :43:06. | :43:13. | |
may have not signed up to, but are learning fast. At the student | :43:13. | :43:19. | |
newspaper, they see money as the root of the problem. The LSE has | :43:19. | :43:25. | |
the reputation as an institute that drives for money. This was another | :43:25. | :43:31. | |
project to desperately to up what we have. The young Gaddafi was no | :43:31. | :43:37. | |
genius, he duped his supervisors by using the works of others. Another | :43:37. | :43:46. | |
suggested Saif purchased his degree. The �1.5 million was pledged weeks | :43:46. | :43:54. | |
after his PhD. The leadership denies the claims. There was no | :43:54. | :43:59. | |
evidence in the report that we sold a doctorate. We deny that | :43:59. | :44:02. | |
completely. I'm sure you are aware from the report, that, in fact, we | :44:02. | :44:06. | |
reduced to take any money, while he was a student, that is a very, very | :44:06. | :44:15. | |
strict policy. He was, in some senses, the LSE's star student, and | :44:15. | :44:19. | |
now Saif Gaddafi stands indicted for war crimes. They must wish they | :44:19. | :44:29. | |
:44:29. | :44:29. | ||
kept the doors locked. With us is Lord Desai, one of Saif Gaddafi's | :44:29. | :44:38. | |
PhD examiners at the LSE? Was he a talented student? Yes. At that | :44:38. | :44:43. | |
what? Talented as an LSE student. Did you know his essays had been | :44:43. | :44:47. | |
written by somebody else? Not that, I wasn't involved in t I was only | :44:47. | :44:53. | |
involved with his PhD, I examined his PhD. Which also was written by | :44:53. | :44:58. | |
someone else, wasn't it? I went through the oral examination, for | :44:58. | :45:02. | |
two-and-a-half hours, with myself and fellow examiner, from | :45:02. | :45:09. | |
Southampton. And he did all right, we were able to question him, and | :45:09. | :45:16. | |
he answered the questions, then we asked him to do more work, because | :45:16. | :45:19. | |
we were not happy with the thesis as it was, and it was submitted. | :45:19. | :45:23. | |
Are you sure he wrote the bit he submitted to you? You can't be | :45:23. | :45:30. | |
subjected to that rigorous, oral examination, on top of what you | :45:30. | :45:34. | |
have written. What do you think about the fact that while he was | :45:34. | :45:38. | |
rewriting it, he was actually asked for a large dop lol of cash for the | :45:38. | :45:47. | |
LSE? -- dollop of cash for the LSE? I was not aware of it until I read | :45:47. | :45:51. | |
the report. We were, as an exampler, I was absolutely following the | :45:51. | :45:56. | |
rules. -- examiner I was following the rules. In your judgment he was | :45:56. | :46:00. | |
entitled to the PhD? He was entitled or I wouldn't have signed | :46:00. | :46:03. | |
the form. There is no shadow of doubt in your mind that he might | :46:03. | :46:09. | |
have been admitted to the LSE because he was the son of a filthy | :46:09. | :46:13. | |
rich dictator? Originally there was a debate he shouldn't be admitted | :46:13. | :46:20. | |
because he was the son of a filthy rich David Kelly Tateor, I would | :46:20. | :46:24. | |
suggest if you admit someone you don't look at who their mother or | :46:24. | :46:28. | |
father is. This is enormously damaging for the LSE? It is a huge | :46:28. | :46:34. | |
damage to the brand. As the report shows, it was, when confronted with | :46:34. | :46:39. | |
power and money, we let our standards go. Why doesn't the LSE | :46:39. | :46:49. | |
:46:49. | :46:50. | ||
withdraw his PhD, at least? It is not up to the LSE to withdraw a PhD | :46:50. | :46:55. | |
after it is given, because just the LSE didn't do due diligence on | :46:55. | :46:59. |