21/06/2012 Newsnight


In-depth investigation and analysis of the stories behind the day's headlines with Gavin Esler, including the Education Secretary's plan to scrap GCSEs.

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Tonight, the biggest shake up for England's schools in decades,


splits the coalition. The Government is considering the


return of O-level, and the scrapping of GCSEs, plans which


have already been condemned as devisive, and taking England back


to the 1950s. This is self- evidently not policy that has been


discussed or agreed within the coalition Government. Will this


tackle the culture of competitive dumbing down, as the Education


Secretary claims. We will hear from the politician, a leading education


campaigner, and a former headteacher. The comedian Jimmy


Carr gets serious over his tax avoidance scheme, but why did the


Prime Minister single him out for criticism. Why not some prominent


Conservative supporting tax avoiders. I'm not going to give a


running commentry on different people's tax affairs, that would be


right, I made an exception yesterday. We will here from guests,


including a fellow comedian. Is this what Egyptians struggled for


in Tahrir Square, no President, no parliament, and perhaps a creeping


military takeover. Two leading Egyptian writers and thinkers


ponder the future of the Arab Spring. As the eurocrisis deepens,


British banks have been downgraded. We will have the latest.


Good evening, if there's anyone close to you tonight, who has


worked at school for several years, for the privilege of sitting this


summer's GCSE, then perhaps now is not a good time to tell them the


examines represent what the Education Secretary -- exams


represent what the he had case secretary called the culture of


competitive dumbing down. Michael Gove wants to scrap GCSEs in


England, it is the most thorough overhaul in decades. His coalition


partners are in deep shock over the prospect. It was only over


breakfast reading the Daily Mail that they first heard of it. Frbgts


what I want is facts, -- What I want is facts, nothing but facts.


Facts alone are what is wanted in life. Dickens gave us the obsession


with facts and facts alone, but when it comes to schooling, there


are infinate schools of thought, all contentious. 100 years after


Hard Times, the politicians made the running, Butler's Education Act


gave us the 11-Plus gram matter schools. In Kenneth Baker, the O-


level was out and GCSE in. Now under Gove t looks like the GCSE


goes and the E level returns. It is Mr Gove -- O-level returns. It is


Mr Gove big idea, and a lot of people want to kill T I think there


is more negative than positive and that is unfortunate. The problem is


he has too many strong view, he expresses them too readily, and he


doesn't do enough thinking before he blurts it out. The Mail called


Michael Gove the cabinet's one true Tory. They got today's leak, in


which he regards as GCSEs as far too easy, they cite questions just


as how do you view the moon, through a microscope, or telescope,


as a prime example. They will have no place in Mr Gove's reborn,


rigorous O-levels. What are termed less intelligent pupils there will


be exams on how to read a railway timetable. Mr Gof's - Gove's


explanations were not discussed with anyone. Mr Gove was called to


the Commons at 11.00am this morning, to explain exactly what was going


on. We want to tackle the culture competitive dumbing down, by making


your exam boards cannot compete with each other on the basis of how


easy their exams are. And we want a curriculum that prepares all


students for success, at 16 and beyond, by broadening what is


taught in our schools, and then improving how it is assessed.


may well need improving, but a two- teir exam system that divides


children into winners and losers at 14 is not the answer. Nick Clegg


was left stuck up a Gumtree by the whole negotiation, after touring


the rainforest for the Earth Summit in Rio, he said no-one had


consulted his side of the coalition about O-levels. This is self-


evidently not policy that has either been discussed or agreed


with the coalition Government. I would simply say this on the exam


system, of course we need to make sure we constantly improve the exam


system so it is rigorous and stretching, but we need to design


an exam system for the future, not turn the clock back to the past.


Michael Gove is a Renaissance Man, who wrote leaders for the Times,


and worked on political programmes for the BBC. He also takes a keen


interest in the arts. He was a regular on Newsnight review. As a


critic he was inseesive and impressive. Reviews of his own


performances as a sat teirist, are rather more mixed. The Chancellor,


Norman Lamont, through a party for his 50th birthday, he clocked up


the half century two week ago, but he waited until half the event to


celebrate, that is a change to the policy he has adopted to the


economic recovery, he left that for months and there is no sign of it


happening. Michael Gove's seven years in


parliament have seen him produce an abundance of ideas, and it has


increased during his time in office. Michael Gove is an idealist, and


there are few of those operate anything politics nowadays. The


advantage of being an idealist is you know where you are going, and


Michael Gove clearly has a vision, which he is striving to achieve. So


far that has been extremely successful. He hasn't been held up


by the business of being in coalition. This week alone, Michael


Gove's drawn the ire of Lord Leveson, after complaining his


inquiry into the media is threatening freedom. Now he has


thrown the education department, his coalition partners, and the


Tory chairman of the education select committee, into a fit over


O-levels. How will a two-teir system benefit those who are


currently being left behind, how will increase social mobility, a


central aim of this Government, quite rightly the education


department has two main goals, raise standards for all, and close


the gap between rich and poor. that from his own side, it is no


surprise there is no love lost for Mr Gove among the teaching unions.


It's yet another blurt from Michael Gove, which I think has not been


thought through. What do you mean by that? He blurts out policies,


and then he has to start retracting and retrenching, because people are


saying this hasn't been discussed or thought through. On Monday


Michael Gove left the House of Commons bemused with this.


Robert Burns, that great poet once fact, facts are chill that is won a


ding. Facts are facts, and facts don't lie, even Dickens would agree.


Who only live by fact. Marsha Carey-Elms is a recently


retired headteacher, both of a high-achieving grammar school and


comprehensive. Sir George Young is parent who has campaigned big --


Toby Young is a parent who has campaigned for changes, Hinds is a


Conservative MP who supports Michael Gove, and Tom Brake, Lib


Dem, is also with us. What is wrong with GCSEs? They are just not


intellectually demanding enough. We can see that from England's,


Britain's fall in its league table position in the PISA OECD league


stables You see it you don't get very much at the top? They fail at


the top and the bottom W the complaints we have heard today, if


you reintroduce O-levels and GCSEs you will leave lots alienated. If


you look at Singapore were they do O-level, 80% of children do it. The


problem with the present system is 40% of children don't get a passing


grade T fails 40% of children at present. A lot of people have been


saying there is a problem with the GCSE, there is no point ducking it,


there is a problem here? We need one system for all young people.


need one that works, don't we? was Margaret Thatcher who brought


in the GCSE. We need to see it does work for young people. If there is


an issue about standards at the top, that needs to be addressed. What


you shouldn't do is separate 14- year-olds into sheep and goats,


first-class and second-class, and write off a whole generation of


young people who will not be able to get the essential qualifications


they need to succeed. The thing about GCSE standards, we are


talking about standards for 16- year-olds at basic standards, we


are not talking about a level at grade C should be attainable for


every young person, we need all young people to get to that


standard and we shouldn't write them sof. This is like the grammar


schools debate, some people want them back, it is not about the


secondary modern back? We asked people to do a lot with GCSE and


the breath they cover. There has been grade inflation in the last


few years, leading to an erosion in confidence in exams. Today's


discussion is not just about the exams themselves, but it is also


about that competition in the system, between Exam Boards, it is


about the pressures on schools at the C-D borderline, and some of the


crazy incentives that involves. As Toby was saying, we have a two-teir


system today in terms of the children and young people who are


left behind. Do you accept that, a, there is a problem, and b, this


might be the way to fix it? accept we need to look at the


system. I don't think there is an enormous problem. I'm not sure this


is the answer. I think that from the point of view of the most


academic child, right through to the most challenging, the GCSE can


and does work. If you have inspired and good teachers and good planning,


you can differentiate lessons such that you can stretch the most able


and you can engage the most challenging child. So I definitely


don't like the idea of the devisiveness of writing some


children off, because there are many young children who are late


developers, and who, indeed, can cope, and want to achieve well.


I'm puzzled by this phrase, the "two-teir system", surely there is


one already. There are some children who do maths and sciences


and Latin, and employers understand that, and there are other children


who do media studies and leisure, and so on, and employers also


understand that. They are probably not going to go to the best


universities? I think what this would do, with O-level, and CSEs,


or something equivalent t would entrench it further. It was


interesting that the detail of what's been reported in terms of


the leak, there is an awful lot in there about O-levels and the


tougher exams, and actually very little about what the 25% who


wouldn't be expected do this higher level exam would actually be able


to do. Isn't that the point, you were saying it is not


intellectually challenging enough at the top end, what is in it for


the people at the bottom end. They are told at age 14 you are too dim


to sit a proper exam, you will get a second-grade exam? You are


talking like it would be an irreparable blow to these


children's self-esteem. This may shock you, I sat C se.s in several


subject, half in O-levels and half in CSEs, it didn't do irreparable


damage to my self-esteem, I recovered, I retook the other exams,


I took three A-levels and went on to Oxford. It is possible to have a


two-teir system and retain your self-esteem. Some people fail and


we have to get used to it? If all the people were like Toby Young we


wouldn't have a problem and people would know how to get on. In my


school in the 1970 half of those who entered for O-level and those


to CSE, the CSEs had the worst teachers, the lowest aspiration, no


expectation to stay on after 16, or going on to do higher level


qualifications over the age of 16. We do not want to go back to that


world. Margaret Thatcher brought in the GCSE in the 1980s. If this is


such a great idea, why was it not in the Conservative manifesto and


the coalition document. Is it just worth in straight forward political


terms for having a great big row with the Liberal Democrats over


something you never promised and didn't put down. To go with Lord


Adonis's point, nobody wants to go back to that world that he outlined.


It is about exams with the right depth and brept to make them useful


for young people what has changed is school or college going up to 18


for all young people. You can do the core skills in English and


mathematics, equipping you for life and work, and then doing a higher


exam at 18 and beyond. You didn't think of mentioning it at any point


until now during the coalition agreement and so on? The timing of


today's leak is not ideal. Sometimes these things happen, now


there is going to be a debate, that is a good and healthy thing. It was


a deliberate leak, wasn't it? have no reason to believe it was.


Presumably you choked on your cornflakes when you read it this


morning? I did, but as I understand it, so did Number Ten, so did the


Deputy Prime Minister, and at least one Education Minister. This is


something I think Michael Gove has floated as an idea. You see it as a


blurt, do you, as the lady said in the film? That is an accurate way


of decribing it. Now it has to go back in house, and the broad


conversation that Michael Gove said he wanted to have, that has to


happen within the coalition Government. Would it be a deal-


breaker for the coalition Government, I understand from The


People's Podium who think this wouldn't need primary lepblgs --


people, who think this wouldn't need primary legislation, it could


just go through? The first thing with schools is we have to tackle


inequality I have to ask the supporters of this proposal, how


would it tackle inequality. shouldn't lose sight of the fact


you can do O-levels in the present system, they are called IGCSE, and


regarded as good as the old O-level. You can only do them at independent


schools, since the change of Government they have begun to be


taken up in state schools. Before 2010 you could only do them in


independent schools. That means only the children of the well off


have access to the intellectually rigorous exams. Under the new two-


teir system, at least if you take the intellectually challenging exam


will be down to intellectual merit? That is not true, there are lots of


things like IGCSE that is we can look. To let's not forget the


children in this debate. There are hundreds of thousands of children


take their GCSEs as we speak, it is rotten for them to be subject to


the idea that what they are doing is going to be rubbished and not


rigorous enough. Secondly those young people we say we don't think


you are quite bright enough at the moment to take on something further,


that is really knocking their confidence, and we don't want that


in young people. Isn't it also a fact, unfortunately for some young


people, that you are not going to go to university, or get A-levels,


perhaps levelling at some point, it is going to happen in life some


time? Twof keep people's expectations high. We have to build


people's confidence. That is really a very negative thing, and we


mustn't be giving that message to young people. Any child to who gets


a decent education should be able to get a grade C in GCSE in English,


maths and other subjects, that should be regarded as basic


standard. If you don't regard it as a basic standard for all young


people, then you are cutting the ladder of social mobility, you are


moving back to a two-teir society, that is nowhere we need to be in


the century. You are saying if our system worked better and 100% of


children got a C in maths and two others in GCSE, it might be a


preferable system. You have poured resources into t it has been tried


for many years, since the Conservative Government introduced


GCSE, the evidence s if you look at the league table, the evidence is


it is not working, it is failing 40% of the children. That is why


the Government, quite rightly, this is something we can agree on, are


focusing on pupils who need the support the most through the pupil


premium, that is providing very large sums of additional money,


that is used very specifically to support the children who need it


most. Troll make sure that they benefit -- really to make sure that


they benefit from the system the way the majority do. The answer is


not to give up on those, but to have more schools, he's pioneering


a school that will be of high quality, schools to get to that


high standard, than this fatalism that writes off large part of


society, saying they are not capable of get to go basic


educational standards. That is what those of us who have been involved


in educational reform have been seeking to overcome. The system is


biased against t there is so much focus on the five plus, C plus


method, if you are a young person with no prospect of getting to a


grade C in GCSE, the incentives are not in the system to do the best


you can. The same goes to children at the top of the ability spectrum.


You might look at making sure everybody at 16 goes away with


qualification that is are relative and they can still build at 16 and


18 beyond. We have to be optimistic, being a young person in 2012 is a


difficult place to be there are lots of choice, there is rigour in


the system. The young people have to cope with so much more, you


can't make useful comparisons with the O-levels and today's exams. It


was fact and learning by route, today you have to apply your droe,


today you have to apply your knowledge and work things out, they


have to do masses more than in the past. It is very difficult, it


needs a measured debate, not kneejerk reactions, it needs a lot


more discussion. Do you not see the merit in having one exam for


everybody, a common standard for everybody, do you not see that as a


good principle for education? problem with that is, the exam has


to be too broad in order to encompass the entire broad range of


the ability spectrum, which means that people at the top aren't going


to be challenged enough by it, and people who least able will struggle


to do it, what is wrong with having two. Can you see a coalition


actually pushing this through? think that would be very difficult.


I think what there is agreement on within the coalition is we need to


raise standards. But there are ways of doing that. If there is an issue


with the different exam boards saying to schools, look come with


us, because actually you can get a better result, let's do something


about that, and make sure there is a consistent standard. Is that


common ground, do you agree with that, broadly, that it is?


present Government has set up a quango specifically to push


standards up in terms of the rigours of exams, that is


absolutely right. What you mustn't do is cut the ground beneath A


large proportion of teenagers who would be incapable of sitting exam


that is would get them on in life. We mustn't go down that road.


you very much. Now, the comedian, Jimmy Carr, has


gone all serious today, he made a terrible error of judgment, and


promises to conduct his financial affairs much more responsibly. His


apology comes after big pilloried by the Prime Minister as "morally


wrong", for an apparently ingenious tax evading scheme called K2. Gary


Barlow, the Take That singer, who also used an avoidance scheme, has


not been part of David Cameron's attack.


Paul Mason Rowe reports. Here, heard the one about the Prime


Minister who called a comedian "morally wrong", for avoiding tax?


You have now as Jimmy Carr tried to get his head around a world where


if you earn a lot of money you pay tax on it. David Cameron was trying


to xain himself. In terms of people's tax -- Explain himself?


terms of people's tax affairs, of course people can plan their tax


affairs and put money into their pension, that can have an effect on


their tax bill and all the rest of it. That is sensible, fair and


reasonable. As the Chancellor of the Exchequer said, some of these


aggressive, anti-avoidance schemes, that may not be illegal, are


morally questionable. When it comes to tax avoidance, the


old ones are the good ones, specifically the case of Inland


Revenue versus the Duke of Westminster.


The House of Lords ruled in 1935 that rich people were entitled to


do as much as possible to avoid The UK is, in effect, like a tax


haven. Not in the same way as say the BVI or Jersey, but there are


certain provisions and encouragements that the Government


brought in, to help people minimise the tax. With the purpose of


probably creating employment, and creating growth. I can name you


countless number of incentives, which, are, reducing tax, and which


may be regarded as avoidance. But perfectly legal and have the


blessing of the Treasury. It was in December 2010 that


Britain's status as a legal tax haven started to look uncomfortable.


Then it was Vodaphone getting it in the neck, and Philip Green, the


boss of Arcadia, since then, the battle has widened. It is obvious


there is a battle going on between the tax avoiders, the politicians


and the state. It is up to the politicians to decide to win that


battle. The tools to do it are available. We could have a general


anti-avoidance principle, not a rule, because rules are always


broken by accountant, but a principle that gives the power to


the revenue to overrule artificial schemes, a tax them on the


substance of what is really going The Inland Revenue has indeed


proposed an anti-avoidance rule, not the stricter principle wanted


by tax campaigners, but while the rule is out for consultation, the


revenue has begun to act, cracking down on schemes using the movie


business as a way to pay less tax. To some people paying tax is an


anathama, and they want to reduce paying tax. If the incentive ace


veilable don't work for them in whatever they are trying to do then


they will resort to these schemes, and the ramifications are serious,


if one has gone into one of these schemes, then probably, I have no


evidence to support that, their card is marked by the revenue, they


will question everything they do in the future, and probably look back


in the past and see whether there has been any misdemeanors. Morality


has never been a matter in the British tax system, if it was, the


biggest problem would be this, only the rich and self-employed even


have the opportunity to avoid tax. There is no Duke of Westminster


principle for those on PAYE. In contrast to the case of Jimmy


Carr, the Prime Minister refused to comment on the tax affairs of Gary


Barlow, also reported to be using an aggressive tax avoidance scheme,


but a Conservative supporter. When it came to Philip Green, the


PM famously said, well he doesn't comment on individuals.


For tax campaigners, there is an even bigger mixed message going on.


On the one hand they are condemning Jimmy Carr for moving his money to


Jersey, to use it effectively as a personal bank. And at the same time,


quite literally at the moment, they are creating laws so that


multinational corporations can move their money to use it as, well


their personal bank, and either to pay no tax at all, or a maximum of


5.5%, that is real hypocrisy. Britain's "fill your boots culture",


on tax avoidance goes back decades. As austerity bites, it looks less


and less funny. The comedian Marcus Brigstock was


offered a tax scheme similar to Jimmy Carr and declined. Giles


Fraser was former canon of St Paul's, and our other guest is with


us. What were you offered? Something similar to Jimmy's, but


with a sweet extra thing on the end. You give all of your earnings to


this trust and they loan it back to you so you don't pay any tax on it.


When you die they say you owe us all the money you have lone -- lone


today us, we will take it all and your children don't have to pay tax.


Just like Jimmy I made a massive error of judgment, and I said, no.


Were you a mug in saying no? No, it wasn't something that I could do.


But my comedy, the difference may be subtle to people outside, my


comedy is a bit different from Jimmy's, he has never made any real


claims for himself as a politically engaged comedian. He did the sketch


about Barclays and their aggressive tax avoidance stuff, which, now,


has made him look very, very stupid. It is the hypocrisy factor? In his


own stand-up there isn't anything else. Certainly that sketch on


10..00 Live, the ip pockcy has made him look fool -- the hypocrisy has


made him look foolish. Do you think, to put a fine a point on it, he's a


mug? The problem with comedians is they have a reputation management


issue. If Jimmy Carr make as lot of money from left-leaning students


paying money to go to his shows, and the Show was a left-leaning


show, he has a reputation management problem. Are you happy


to avoid tax legally when you can? I'm a tax dodger, I dodge tax in


all sorts of ways. Some of it seems to be schemes the Government has


intentionally set up, an ISA, tax relief on my pension contribution,


I use that, that seems to be the Government's intention. To give awe


recent example, a week ago I bought 600 cigarettes in Belgium, purely


and entirely on the fact that they are five euros a pack, I bought


them for one reason and one reason alone, to avoid the Government's


tax, and the Government is �200 a year worse off. You should smoke


them! The moral side of this, because it was the Prime Minister


who raised that, is somebody more of a saint because they fess up and


say here is the money back. Are they a sinner because they go off


and buy cheap cigarettes in Belgium, or is it the scale of the thing


that counts? We shouldn't make this a question about individuals, for


me. I'm proud to pay tax, I think I'm proud to pay tax, I think we


should get more into a culture of people being proud to pay tax, it


is our subscription to living in a fair society. The problem s we have


now a situation where, you know, the CEO pays less tax, as a pro-


portion of his or her income, than the cleaner in that company. That


situation is so grossly unfair and perceived to be widely. We can talk


about border line calls, but you know it when you see it. What we


see, not necessarily in Jimmy Carr, but in huge corporations paying


very, very little, or almost zero tax, because they have clever


accountants, not available to ordinary people. That is clearly


wrong. We don't expect, presumably, these huge organisations to do What


Car? Car did, being shamed into it, saying sorry and paying the money


into it? That is why the Prime Minister is happy to name Jimmy,


he's a face and lots of people know who he is, and he's quite useful. I


have to say it was remarkably clumsy of Cameron, some of whose


funders and closest friends are certainly in avoidance schemes very


simple later to Jimmy's. Not just the companies that have -- similar


to Jimmy's, not just companies but on a personal level. Jimmy is a


comedian and he sticks himself out there and the Prime Minister can


call him moral or immoral. How many companies have done what he has


done, saying I'm terribly sorry, we got it wrong, we change our minds


and will do it differently. There hasn't been any of that. Surely it


should be a question more laugh than of shaming people into it. The


law should say you have to pay up? In my view, I don't want to hear


David Cameron's moral judgment ones Jimmy Carr's tax affairs, his


marital status, sex life or anything else. I'm not interested


in David Cameron's morality, David Cameron, Frances Osborne and Danny


Alexander set the rulebook, it is 15,000-pages long. It is impossible


for any single human being to understand the tax code of this


country. But Cameron, Osborne and Alexander control that. Some people


understand how to get round the tax code in this country, it would


appear? In that case Frances Osborne and David Cameron need to


change the rules. It is like Sepp Blatter saying it is a moral


outrage there isn't video refereeing. It is in his control.


The rules can't cover all the eventualities, you have the rules


and you can find clever ways around them. You need something to jun pin


the rules, something you might call a sense of responsibility or


something to do with moralty. I may have a different one to the Prime


Minister. But there needs to be a sense of the common good, something


about fairness. Not everybody has got it, as you well know, tough


legislate for that, you have to legislate for people who will only


do it if they are shamed into it? I'm not saying take the law away,


the law is important, and it is worth looking at tax avoidance


legislation. That is easy to sort out without statute. We used to


have a lot of common law cases. What hinges legally and morally is


was this Jimmy Carr's income, it should be treated as income for


revenue reasons, or wasn't it. We need a much more simple code that


threets, for example, what you get in income and what you get in


capital games, on the same percentage, not different


percentage, because everybody plays silly games with T I reckon we


should be able to get the principles of the code down in 15-


pages not 15,000. They are already ahead of any possible legislation,


that is the game they are in. They take a percentage from these


schemes, and so anything that they come up with, the IFAs are ready


just to make the next step round. I don't know whether it is actually


possible to legislation against this. I do this, if Frances Osborne


and David Cameron, are trying to make some -- George Osborne and


David Cameron are making some political capital they much make a


bigger effort than thus far. seemed to be a good thing for this


country, that the Prime Minister says f there's high tax rates in


France and these rich people from France want to come here, we will


welcome them? That was the day before he made a moral judgment


about Jimy. Saying you are paying too much in France, -- Jimy. Saying


you are paying too much in France, come over here. Supposing for


example, Jimmy Carr decided to become an American citizen, and


work in the United Kingdom for 50- 60 days a year as a cheedian, and


pay all of his tax -- comedian, and pay all of his taxes in the staid


of Texas, would that be immoral? Fair number of people become


citizens of Monaco for tax reasons. This conversation is not going off


in the wrong direction, but unless it is underpinned by a sense of


possibility, you will always find clever people who will get round T


the idea that you actually have a sense of shame about not paying


your taxes properly, it seems to me that's something, people brag about


it and think it is a jolly good thing they pay no tax. The sense of


shame should been what you do with your money, that need not be about


handing it over in tax, it is about your overall contribution to


society, or to charity. Egypt is still without a


democratically elected President tonight, a the Election Commission


refuses to say who has won. Tahrir Square, more than a year after the


fall of the Mubarak regime, continues its now familiar display


of protest. Stoked up by the newly assumed military rule. For years


people across the Arab world have looked to Egypt, the strongest and


most populist Arab country for leadership. Now Egypt is in


political limbo, or worse. Our diplomatic editor has recently


returned from Egypt. Where are these presidential results that we


were supposed to have had? There was initially talk of having them


yesterday, then today. Now it has been postponed, there is some


rumours in Cairo tonight that it might come out at the weekend.


Meanwhile Ahmed Shafiq, one of the candidates, who most people think


have lost, tonight declared he was the winner, even though most of the


accounts people have suggest he isn't the winner. And the other


candidate, Mohammed Morsi, the man backed by the Muslim Brotherhood's


political Government, the Freedom and Justice Party. Most people


think he has just under% more votes and he should be the winner. As it


stand -- 2% more votes and he should be the winner. As it stands


we have no winner. How have the people been responding to all of


this? The public response has been curious in a way. A week ago this


extraordinary judgment came out of the Supreme Court dissolving


parliament. This had been elected with a very large prepondrance of


the members from the Muslim Brotherhood and Salafists, they


said the lot of them can go due to a technicality in Egyptian law.


Many of us expected huge demonstrations to protest this,


virtually nothing happened. The question now is that each move that


the military council, the Supreme Council of the Armed Forces, or


SKAF makes, seems to be calibrated by the reaction it causes or


doesn't cause. It seems that the absence of reaction, to the


disillusion have of -- dissolution of parliament, led them to take


this staggering step, if you like, on Sunday night, pretty much


reversing all of the gains of the revolution, apart from the ousted


of Hosni Mubarak, and to take this step to give themselves these


extraordinary powers. If Dr Mohammed Morsi is made President,


he won't be able to scrutinise or sign off the budget, or declare war.


We won't be able to dissolve parliament if and when it gets


reconvened and elected. He's in a tight spot. What are the options


for the Muslim Brotherhood, on the brink of power, but not much power?


Most people think there is going to be a difficult period of prolonged


crisis but effectively of negotiation between the two sides


in this. The military, I think, at some level, accept they can't hold


all the power. Some suggest, I have heard senior officers suggest, that


they want Dr Morsi to take all the responsibility politically for all


the bad things that will happen in Egypt politically over the next


year, particularly on the economic front. The Brotherhood is calling


for more mass protests tomorrow, Friday, of course, they are calling


for a huge protest, they are talking about occupying Tahrir


Square continuously now. Until their grievances are met,


parliament is reinstated, and the country is put back on a proper


constitutional basis. Let's speak now to two distinguished Egyptian


writers, one among the crowds in Tahrir Square, and Tariq Ramadan,


author of the Arab Awakening, her grandfather was one of the founders


of the Muslim brother Hoo. How worried are you about your country?


I'm very worried at the moment, but I'm worried in the short-term. I


think in the long-term, there is no rolling back what has happened.


People went out because the country was on the knees and not run in the


interests of the people. People had enough, they demanded a decent life,


freedom and human rights. They are not going to go back on these


demands. And the people, can they live with either person as


President? No. In what way? General Shafiq is a return to the old


regime. General Shafiq presents the old regime coming back,


consolidated with the military. Resuming power. The Muslim


Brotherhood are not what the revolution was about, they are not


what the revolution really wanted. They are not why you took to the


streets? No, but they are still a strand within the revolution, and


they are still demanding change. How concerned are you that actually


what we are seeing is this very slow, effectively, a mill tro coup,


it is the military coming back into power one way or another? I think


this is the case. It is not something we can only see now when


I was writing the book, I straight away said behind the scenes it is


not as simple as that. The military and from within we have tendencies


within the mill tree, struggling and some were supporting --


military, struggling and some were supporting Mubarak and some were


against. This is the taking over from behind the scenes. I never


used the concept of revolution, and there was not talking about the


Arab Spring, in the region we have something which is a chess game.


The only revolution we have in the Arab world is intellectual, we can


make it without violent demonstration, we can act against


the Government. Now what is happening with the institution is


to get someone in power who will have power without authority. It


could be Morsi or Shafiq, for the time being, what they are telling


us and they said this two days ago, is in the coming we are going to


get a President for six months and then we will start again the whole


process. What does it mean, it means nothing is changing. One


thing I want to say, is that there are internal struggles, we also


have to look at the region and see who is also supporting what is


happening, because I don't think that we get it right if we think


that the transparency and the democratic process is supported,


for example, by the American administration today. I don't think


so. There is a question of outsiders, but you seem to be


fundamentally optimistic, given the fact that as we said earlier, there


is no Government, no parliament, no constitution, it is not clear who


is in charge? I think that what's happening is that the military are


really actually trying to tighten their grip. It almost for them


doesn't matter which candidate gets the presidency. What they are doing


is they are threatening the committee that is set up to write


the constitution, and they are talking about disbanding it and


creating their own committee, that will write the constitution that


they want. They have got a law in place that allows them to arrest


people, to detain civilians off the street, they have now written in


immunity for the military if they do that. I think that these are the


things, the underpinnings of the power that they are now trying to


establish on the streets, whichever candidate comes in. Are you


surprised how calm low, sor far, most Egyptians have take -- calmly,


so far, most Egyptians have taken this. There is economic problems,


as we heard a moment ago. There is some demonstrations, everything


seems to be relatively peaceful? Yes, I think why we don't have the


result today, I think it is because it is Friday. If, for example, they


were to announce that Shafiq is winning, something could happen.


And I want, I'm cautiously optimistic, I'm not really


optimistic, cautiously optimistic, hoping that what will happen in the


near future is the people should not stop demonstrating, but the


point is to avoid anything that has to do with violence. It has to be


non-violent, resistance process, coming from the people, if we want


to keep the spirit. At the end of the day what is happening now, we


are too much looking at the political factors and forgetting


the economic dimension of the whole process. Egypt is not Tunisia.


Egypt is central to anything which is happening in the region. And


when we speak about the army, we don't speak only about military


force, we speak about economic power in the region. I think ...It


Is plugged into that? Exactly we need the people and the Egyptians,


it is good, what we have seen over the last weeks is people now


committing to resist, but at the same time understanding they should


eschew violence. But the army can push the people to go towards


violence because it can help them. Exactly I think really when you say


that the country is surprisingly calm, I hope it remains calm to an


extent. My sense, our sense, is very much that people are being


prodded towards violence wrecks get a lot of news about arms caches


being found everywhere, the rumour mill is being used to scare and


panic people. The army has played this devisive role for a long time


In the past hour the credit ratings agency, Moody's, has downgraded its


assessment of 15 of the world banks, including Barclays, HSBC and RBS.


What have they been saying? Economics' journalists have had to


sit through half an hour of alphabet spaghetti. The big banks


are the big French banks and Canadian banks and our's. Bark


close down two notches, HSBC down one, and RBS down one. What does it


mean? The reason they are downgrading is the general


situation in capital markets is getting more risky, they have to


judge which banks are affected. The way to judge is it HSBC, a big


global bank, and very rebust in this situation. RBS only held up in


this situation because the Government implicitlys it. Barclays


a bigger hit, exposed to the capital markets and a volatile


situation. Not earning enough from other things. What we know today is


that, it doesn't affect Joe Public on the high street, meetly. When we


wake up tomorrow and look at what the markets are doing and how the


eurozone is reacting, what difference will that make?


general thing happening in the world is the general drift away


from banks and Governments having triple-A ratings. There was one day


where everybody had it, and it was suicidal if you lost it, now


everyone is losing it. The banks were told they need 63 billion


extra Uri rows to survive, we expect that pa -- euros to survive.


As Governments move to support banks throughout the world, what


markets think of them is less important what credit ratings


agency think of them is usually one step behind markets. More on this


That's all tonight, I'm back with more tomorrow. We wanted to leave


you with the Venezuelan conductor who led the Simon Bolivar orchestra


in a housing estate in sterling tonight, as part of celebrations


connected to the Olympics. Good night.


Apology for the loss of subtitles for 41 seconds


More downpours to come over the next 24 hours. Especially wet


tonight across eastern Scotland, the rain slowly easing here, a


gusty night across southern parts of England, blustery throughout the


day on Friday. It stays very, very wet across North West England, here


the Met Office have an amber warning in force. Downpours


continuing through much of the day. A real risk of flooding here.


Further south it looks brighter, there will be sunny spells, but a


few showers. Those showers zipping through quickly on a strong wind.


That wind means even if you get some sunshine t will not feel


particularly warm. Dryer spells across south wells, but in North


Wales again, persistent, at times heavy rain, for Northern Ireland


and south-west Scotland, it looks very wet and that rain could build


up through the day and maybe cause problems. For eastern Scotland it


is very wet tonight. It will turn a bit dryer here during the course of


Friday afternoon. There is more rain to come, particularly over


northern Britain on Saturday. Cloudy with outbreaks of rain


across northern England, Scotland and Northern Ireland. The winds not


as strong on Saturday, but they will still be a feature, perhaps a


little bit dryer again across the south, and maybe even seeing a few


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