05/07/2012 Newsnight


05/07/2012

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


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Tonight, the political row over the rate-fixing scandal, reaches fever

:00:12.:00:16.

pitch as the Chancellor accuses his Labour opposite number of being

:00:16.:00:21.

complicit in the affair. If he has any integrity on this narrow point

:00:21.:00:26.

of his allegation, he should stand up now, withdraw the allegations,

:00:26.:00:32.

and apologise. The idea that I'm going to take lessons in integrity

:00:32.:00:36.

from a man who smeared his way through 13 years of Labour

:00:36.:00:41.

Government. I have been asking Ed Miliband

:00:41.:00:44.

whether the last Labour Government is to blame? It is the Chancellor

:00:44.:00:48.

of the Exchequer, if he has evidence about this, let him come

:00:48.:00:52.

forward with the evidence. Have you asked Gordon Brown? No I spoken to

:00:52.:00:56.

him in the last 24 hours. We were once one of the world's

:00:56.:01:00.

great military powers, but as the Government takes an axe to the army,

:01:00.:01:05.

can we remain so? The future shape of the army has been unveiled. And

:01:05.:01:09.

the scale of its ambitions has been trimmed back, in keeping with this

:01:09.:01:14.

age of austerity. I will be asking the Defence Secretary if we can

:01:14.:01:20.

still mount a mission anywhere in the globe. We will ask a

:01:20.:01:22.

distinguished panel what they think, and what it says about Britain's

:01:22.:01:32.
:01:32.:01:33.

place in the world. Good evening. The level of rancour

:01:33.:01:37.

in the House of Commons today beat anything we witnessed as the

:01:37.:01:41.

coalition came to power. It was not a pretty sight. This was the bear

:01:41.:01:45.

pit and both the Chancellor and Shadow Chancellor's claws were out.

:01:45.:01:49.

George Osborne trying to put Ed Balls in the frame for the LIBOR

:01:49.:01:53.

scandal, and Ed Balls outraged with the allegation, but aware, that

:01:53.:02:00.

whatever the truth, the events happened in the banking crisis

:02:00.:02:05.

within Labour's watch. The atmosphere went from bad to

:02:05.:02:10.

worse after the vote went for a parliamentary action. It was

:02:10.:02:14.

vicious stuff? What was whites of the eyes politics. What you have is

:02:14.:02:18.

two of politics most fiercesome operators, they pride themselves at

:02:19.:02:22.

being vicious about it. The question they were debating is the

:02:22.:02:27.

big US one out there, which is who can handle the economy and banks.

:02:27.:02:31.

The Government has assessed they are not culpable in this scandal,

:02:31.:02:35.

actually very little will come out, so it is all to pin on the

:02:35.:02:39.

opposition. They want to plant firmly in the minds of voters and

:02:39.:02:49.
:02:49.:02:50.

viewers the four Bs, Barclays Bank, Brown Balls. Once they could sort

:02:50.:03:00.
:03:00.:03:00.

it out with weapons, now 200 years on, political empty still goes on.

:03:00.:03:05.

He -- Eminity. That lip curl in the Chancellor in the chamber today,

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says it all. This was supposed to be parliamentary debate about what

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type of inquiry for banking. It became a near brawl to decide the

:03:16.:03:21.

biggest question in politics, who best to run the economy. I have

:03:21.:03:26.

never seen the Shadow Chancellor and the opposition leader so

:03:26.:03:32.

rattled. The spark was this, in an interview with a magazine, the

:03:32.:03:35.

Chancellor named his opposite, Ed Balls. The House and the public

:03:35.:03:40.

will judge the integrity of a Chancellor, who cannot defend here,

:03:40.:03:46.

what he whispers to the Spectator Magazine. Mr Deputy Speaker. He has

:03:46.:03:52.

no evidence, and knows it. Because what he said is not true, and he

:03:52.:04:01.

knew that too Mr Deputy Speaker. We had one hour, one hour of an

:04:01.:04:06.

attempt by the City minister to defend his conduct when he was in

:04:06.:04:12.

office, and these scandals happened. And we have still not had from him

:04:12.:04:20.

a simple apology for what he did. His failure of regulation. Get up

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and say, not, we were all involved in this, there were Governments all

:04:24.:04:28.

over the world doing it, just get up and say, I was the City minister

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and I am sorry. I'm named, he has made an allegation, he has no

:04:34.:04:37.

evidence, because there isn't any, because it is untrue, and he knew

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there was no evidence, because he knew it was untrue, and he said it

:04:41.:04:48.

any way. Because that is the character of the man, Madame Deputy

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Speaker. The idea that I'm going to take lessons in integrity, from a

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man who smeared his way through 13 years of Labour Government, who

:04:58.:05:01.

half the people, whoever served with him, thinks he was a disgrace

:05:01.:05:07.

in his post, is another thing. But let him redeem himself, by not,

:05:07.:05:11.

today, blocking an inquiry into what happened under the last

:05:11.:05:15.

Government. Take part in the inquiry. You're not prepared to do

:05:15.:05:19.

that. Today's acrimonious events settled

:05:19.:05:22.

the question of what sort of investigation should be conducted

:05:22.:05:27.

into the behaviour of traders at Barclays Bank. Labour feared a

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short inquiry limited the exercise to just the years it was in power.

:05:32.:05:34.

A wider inquiry had a greater chance of reflecting what they

:05:34.:05:39.

believe is the hands-free, laissez faire instincts of the

:05:39.:05:44.

Conservatives on the City. Back in the chamber, as MPs

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streamed out to vote. Certainly one of the men in your screen rose in

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stature. Andrew Tyrie stood on the floor of the House and was press

:05:53.:05:56.

ganged, first by Ed Balls and then the Chancellor. Labour decided not

:05:56.:06:02.

to withhold their support from the Conservative inquiry, ensuring it

:06:02.:06:05.

was cross-party, and Tyrie chairing it. There was room for one surprise,

:06:05.:06:08.

the Attorney General, made a rare personal intervention, appearing to

:06:08.:06:13.

call for a judge-led public inquiry into the wider crisis.

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Because of the depais when parliamentarians were routinely

:06:20.:06:24.

lairy, the two chambers are a sword's length apart. Between Ed

:06:24.:06:31.

Balls and George Osborne today, it was probably quite a good job.

:06:31.:06:34.

Earlier I spoke to the Labour leader at Westminster. You don't

:06:34.:06:38.

vote for the parliamentary inquiry, and yet you say you will co-operate,

:06:38.:06:42.

it is politicing, isn't it, naked politics? No, it is about the

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family I met this morning, call the Hendersons, a small business,

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driven to the brink of bankruptcy because of what the banks' did. For

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them I wanted a full, open, judge- led inquiry, because I thought it

:06:56.:07:00.

was the only thing to get to all the issues. This one won't work

:07:00.:07:07.

then? To all the issues people are facing and get to the bottom of

:07:07.:07:10.

what happened and stop it happening again. We will co-operate with it

:07:10.:07:13.

because parliament has voted that way, it is the right thing for to

:07:13.:07:16.

us do. We will not defy the will of parliament. We will co-operate with

:07:16.:07:19.

the chair of the Select Committee, but I will continue to press my

:07:19.:07:24.

case for the open inquiry we need. I think it is still what the

:07:24.:07:26.

circumstances demand. Look at what was going on in the House today,

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you said in your leadership speech of 2010, you said, let's be honest,

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politics isn't working and people have lost faith in politicians and

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politics is broken. The practice and the reputation and the

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institutions, you are in and and you find it depressing? I find that

:07:45.:07:47.

at Prime Minister's Questions too. It is not a great advert for

:07:47.:07:50.

politics. But I have to say when you have a Chancellor of the

:07:50.:07:56.

Exchequer who starts throwing around allegations, which he then

:07:56.:08:01.

can't substanceate, it is only right the shad -- substantiate, it

:08:01.:08:04.

is only right the Shadow Chancellor challenges him. Why did passions

:08:05.:08:10.

run high tonight, at least on our side, let me make the point. I feel

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we have seen scandal after scandal in the banking system, I think the

:08:14.:08:20.

response of politicians on all sides has been inadequate. I make

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the parallel with pack hacking lasty, I think it is a moment when

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politics needs to rise to the challenge, and the challenge is why

:08:29.:08:33.

does an inquiry matter, it sounds technical, but it is important

:08:33.:08:37.

because it can get to the truth. The truth may be difficult for you,

:08:37.:08:40.

because it may mean there was bad practice in the last Government?

:08:40.:08:44.

tell you one thing we got regulation wrong in the last

:08:44.:08:48.

Government, we weren't tough enough. You might have got LIBOR wrong too.

:08:48.:08:53.

Can I quote from the memo sent to the chief executive of Barclays.

:08:53.:08:56.

That Paul Tucker, from the Bank of England, received calls from a

:08:56.:09:00.

number of senior figures among Whitehall to question why Barclays

:09:00.:09:04.

was always towards the top end of the LIBOR pricing. Have you any

:09:04.:09:08.

idea who these figures in Whitehall are? No idea at all, that is why we

:09:08.:09:11.

need the proper inquirey. The irony of this argument, Kirsty, is I have

:09:12.:09:16.

been arguing for what some people would say was against the narrow

:09:16.:09:21.

party interest, which people might say Labour wants to avoid skrutnee.

:09:21.:09:26.

I have been ageing for the judge- led inquiry, for judges to get all

:09:26.:09:29.

the e-mail, if a Select Committee can do that, great as well. Why do

:09:30.:09:32.

I say that? Because I don't think we should be afraid of the past.

:09:32.:09:36.

I'm a Labour leader who says we move on from the past. We learn the

:09:36.:09:40.

lessons. Only when the past is sorted out? Sure that is why I want

:09:40.:09:45.

a judge-led inquiry. If you have this accusation that there were

:09:45.:09:48.

senior figures in Whitehall, what have you done, for example, today,

:09:49.:09:53.

to check it out, have you spoken to Ed Balls? He made his position

:09:53.:09:56.

clear, totally untrue. Have you made any inquiries or conversations

:09:57.:10:00.

with the Bank of England? It's totally untrue. I do say this about

:10:00.:10:04.

politics, Kirsty, that part of the problem is when allegations are

:10:04.:10:10.

flung around, and are reported in good faith, and turn out to be

:10:10.:10:14.

total -- totally one true. And even the Chancellor's aides are saying

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they have nothing to back up the allegations. Yes, but these

:10:17.:10:20.

allegations, as you know, the Chancellor has done an interview

:10:20.:10:25.

for the Spectator Magazine. In that interview he says, more or less

:10:25.:10:29.

he's pretty sure, that these calls or conversations came from within

:10:29.:10:32.

Brown's circle? Fine, if the Chancellor of the Exchequer has

:10:32.:10:35.

evidence about this, let him come forward with the evidence. That's

:10:35.:10:39.

fine. Did you ask, or have you asked Gordon Brown? I haven't

:10:39.:10:43.

spoken to him within the last 24 hours. Why not? Because, Kirsty, I

:10:43.:10:46.

have a responsibility as leader of the Labour Party to make sure we

:10:46.:10:49.

get to the bottom of these allegations. Ask Gordon Brown?

:10:49.:10:53.

way we get to the bottom of the allegations by having the full

:10:53.:10:56.

inquiry we need. It is not about me doing the investigations. You are

:10:56.:11:00.

the leader of the opposition, this is an accusation of something done

:11:00.:11:02.

under the last Labour Government's watch. Gordon Brown was at the

:11:02.:11:08.

centre of this, wouldn't it actually be sensible, wouldn't it

:11:08.:11:12.

be curious, rather than incurrous to speak to Gordon Brown and

:11:12.:11:16.

Darling about this? No, I think my job is to say what is right for the

:11:16.:11:20.

country. What is right for the country is the full inquiry we need,

:11:20.:11:23.

calling all the people before it. Here is the really important thing,

:11:23.:11:26.

the really important thing is to sort out the problems of our

:11:26.:11:28.

banking industry. Some of them created under the last Labour

:11:28.:11:32.

Government? Some of them, yes. The hundreds of thousands of decent

:11:32.:11:36.

people who work in the banking industry, who will be looking on as

:11:36.:11:39.

appalled as I am and you are about what we have seen in banking.

:11:39.:11:42.

People like the Hendersons I met this morning, it is for them we

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have to have the big change that we need. If I was coming to this

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interview saying, Kirsty, I don't want any inquiries, because I don't

:11:50.:11:55.

want to look at the past, you would have a right to say why not get to

:11:55.:11:58.

the bottom of this. I'm the one who wants the inquiry. I don't

:11:58.:12:01.

understand, you speak to Ed Balls, obviously he's in the Shadow

:12:02.:12:05.

Cabinet, but Gordon Brown, it's still, you know, a politician, and

:12:05.:12:10.

was very close to all this. He was at the heart of it. A lot of the

:12:10.:12:13.

mistakes were made under his watch. Wouldn't it be sensible for you to

:12:13.:12:17.

speak to him, and actually find out, why won't you speak to him?

:12:17.:12:20.

course I will speak to him. I speak to him regularly. Why not today, I

:12:20.:12:24.

would have thought? Because I have to say to you that I don't think,

:12:24.:12:30.

saying it is my job to investigate the detailed allegation about Paul

:12:30.:12:35.

Tucker and Bob Diamond, my job is to say how do we change things for

:12:35.:12:41.

the future? For 20, 30 years there has been a tendency in this country,

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and this is much greater than the history of LIBOR towards

:12:46.:12:50.

deregulation, and light-touch regulation, shared by both parties,

:12:50.:12:54.

it was wrong, and it has to change for future. Let's not forget who

:12:54.:12:57.

matters, it is not the insiders at Westminster, it is people like the

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family I met this morning, who are saying, they have been mis-sold.

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Their mis-selling has nothing to do with LIBOR t won't even be within

:13:05.:13:10.

the scope of this inquiry, that is why the inquiry will remain

:13:10.:13:13.

inadequate. It is for them we have to get to the truth and move

:13:13.:13:17.

forward. Finally, wave after wave of problems of possible implication

:13:17.:13:24.

of politicians in all sorts of murky stuff, what would your father

:13:24.:13:28.

think about it all? I think he would think that the most important

:13:28.:13:33.

thing of all is that politicians speak truth to power wherever it

:13:33.:13:36.

lies. Whether it lies in the banking system, whether it lies in

:13:36.:13:43.

the press, whether it lies in our energy companies. To that extent

:13:43.:13:51.

I'm my father's son, or I hope I am. These men have to co-operate on

:13:51.:13:54.

this inquiry. But there is a sense tonight that there is a change in

:13:54.:13:59.

the Chancellor's stand? There was a sense there was a change for about

:13:59.:14:04.

20 minutes! Hostilities are not called off at all. The Chancellor

:14:04.:14:08.

was seen to have slightly clarified what he said in his magazine

:14:08.:14:12.

interview, all he's doing is drawing attention. Ed Balls in the

:14:12.:14:14.

Commons today said he had been accused by George Osborne of being

:14:14.:14:21.

clearly involved. No, if you look at the paragraph, Osborne is

:14:21.:14:26.

accusing those "closely" linked to Brown as being involved A few

:14:26.:14:29.

sentences later, he says Ed Balls has questions to answer, that is

:14:30.:14:34.

not as strong as Ed Balls said in the chamber he was being accused of.

:14:34.:14:39.

It is close text actual analysis, not hostilities called off. They

:14:39.:14:44.

have to co-operate. It is highly likely this narrow inquiry sprawls

:14:44.:14:48.

and sprawls, and falls down under the pressure of the parties not

:14:48.:14:52.

being able to co-operate in the long run. Once the cry was to join

:14:52.:14:56.

the army and see the world. Today the question is how much of an army

:14:56.:15:00.

will there be to join. And where in the world will a much reduced

:15:00.:15:05.

fighting force army do its soldiering? The bald facts are

:15:05.:15:09.

these, the army will be cut by one fact to 82,000, and reservists will

:15:09.:15:13.

double in numbers and take up the slack. There will be two tranches

:15:13.:15:18.

of redundancy next year, and the following wurpbgs with highly

:15:18.:15:22.

trained soldiers, some just back from Afghanistan, in the job market.

:15:22.:15:26.

We will discuss what impact this will have on our historical and

:15:26.:15:35.

cultural view of ourselves. First here is our defence editor.

:15:35.:15:39.

When this place was built, national security outranked all other

:15:39.:15:43.

political concerns. But these days the Tower of London

:15:43.:15:50.

sits under the shadow of mam Monday. And the army, once more, must

:15:50.:15:54.

adjust to woorld in which available financial resources are shrinking.

:15:54.:15:58.

It is very hard to be certain about the future. As Professor Sir

:15:58.:16:01.

Michael Howard once said, the important thing about trying to

:16:01.:16:06.

predict the future is not to be so wrong as when the future reveals

:16:06.:16:09.

itself you can't adjust quickly to meet the new circumstances. That is

:16:09.:16:12.

what the Government needs to do, to manage the risk it has taken or

:16:12.:16:16.

board, and make sure it can adjust quickly in new circumstances if

:16:16.:16:25.

they present themselves. Here the harvest of foreign Vic tree, these

:16:25.:16:33.

French guns taken at Waterloo -- Victory, these French guns taken at

:16:33.:16:39.

Waterloo on display. How do we maintain our reputation.

:16:39.:16:42.

People make comparison with previous demobilisations, including

:16:42.:16:46.

the one after water loo. But these days Britain's global commitments

:16:46.:16:50.

are very much reduced, and the political will to use force, dit at

:16:50.:16:57.

the moment it is hard to see that any of -- Tito, it is hard to see

:16:57.:17:02.

that -- ditto, it is hard to see that any of the regiments will be

:17:02.:17:09.

reinstated. When the Cold War ended Britain had 149,000 soldiers, after

:17:09.:17:14.

the cuts it will have 82,000. While the numbers is not cut in half, the

:17:14.:17:20.

UK will field a single armoured division, compared with three in

:17:20.:17:23.

1991. There will be career compression and further redundancy,

:17:23.:17:27.

whether you like it or not, if you are reducing 20%, things like

:17:27.:17:32.

opportunities to command regiments at Lieutenant Colonel rank will

:17:32.:17:39.

diminish. Opportunity to command companies and squadrons for Majors,

:17:39.:17:43.

will diminish, that is a fact. Announcing its plans, the

:17:43.:17:45.

Government conceded morale was fragile. But the head of the army

:17:46.:17:48.

believes a balanced force will result from the plan. What today is

:17:48.:17:52.

really about is the structure of that army, the way in which we

:17:52.:17:57.

shall be reshaping it to be an army fit for the future. A place where

:17:57.:18:02.

our soldiers will have challenging and rewarding careers.

:18:02.:18:05.

Of course, the professional horizons of the army have narrowed

:18:05.:18:10.

with the retreat from empire. Postings like Singapore, Hong Kong

:18:10.:18:13.

or Aden, have disappeared, even Germany is being wound down. Where

:18:13.:18:19.

as 21 years ago a British general commanded an army group of more

:18:19.:18:24.

than 200,000 NATO soldiers, bit late 1990s, core command, about

:18:24.:18:30.

80,000 was the summit of their ambitions, and today a division of

:18:30.:18:38.

about 20,000, is the highest scale of war the army will train for.

:18:38.:18:42.

For six years the Helmand commitment has shaped the army. We

:18:42.:18:47.

filmed the Green Howards in one of the toughest parts of the Afghan

:18:47.:18:52.

province. Chris, one of the young soldiers featured then, was founded.

:18:52.:18:57.

He's till -- wounded, he's still serving, but his battalion will go,

:18:57.:19:02.

as part of today's plan, and his sister decrys the redundancies now

:19:02.:19:07.

taking place. It is heart-breaking, I went to the pass out parade when

:19:07.:19:11.

they came home. The first soldiers to go and receive their medals,

:19:11.:19:16.

were the injured soldiers. And everybody cheered, and it was

:19:16.:19:22.

heart-breaking, it was really heart-breaking, and to see that

:19:22.:19:28.

udisbanded and got rid of, they are a team a family, I find it shocking.

:19:28.:19:31.

Once today's plan goes into effect, even a sustained commitment, the

:19:31.:19:35.

size of Helmand, would require the use of whole units of reservists.

:19:35.:19:38.

There is scepticism among many regular soldiers, that the reserve

:19:38.:19:45.

forces of today could do this. The plan of an army of 1 10,000, is

:19:45.:19:51.

very much preddikaited on a big chunk of that, 50,000 being from

:19:51.:19:55.

the reserves. It is a risk, the Ministry of Defence knows it is a

:19:55.:19:58.

risk and it has to manage that. To make the plan work, it has to be

:19:58.:20:01.

managed properly let's put the shoulder to the wheel and make it

:20:01.:20:05.

work. We know the budgets for training exercises, that type of

:20:05.:20:10.

thing, are often the first to be cut, when there is a pinch. If that

:20:10.:20:15.

is the case, the plan is doomed. When the ravens leave the tower, so

:20:15.:20:20.

the legend has it, Britain's greatness will be over. They are

:20:20.:20:24.

still here, and that other embodiment of national pride, the

:20:24.:20:29.

army, is still in residence too. But that force is being cut, once

:20:29.:20:33.

again, and today it symbolises a diminished power, struggling for

:20:33.:20:42.

relevance, in an uncertain world. In terms of future deployment, for

:20:42.:20:45.

example, if there was another call on us like Helmand, what would

:20:45.:20:55.

happen? Initially, the answer seems straight forward, the high-

:20:55.:20:59.

readiness brigades would be able to do it. As it is sustained and goes

:20:59.:21:03.

on, there would be more reliance on reservists. That seems to worry a

:21:03.:21:13.
:21:13.:21:15.

lot of people I speak to in the forces. One used the term of a

:21:15.:21:19.

"Temkin village", because it is not as good to rely on the reservists

:21:19.:21:23.

and other aspects not appeared to be thought out. The Government

:21:23.:21:26.

saying that we have the fourth- biggest spend in the world on

:21:26.:21:30.

defence what does that mean? It is true, Britain does still spend a

:21:30.:21:34.

lot on defence. You can see it as a source of pride and punching above

:21:34.:21:39.

our weight. You can see it in some ways that we don't get that much on

:21:39.:21:41.

what we spend in full structure. There are other countries, like

:21:41.:21:45.

France, which doesn't actually spend radically different amounts,

:21:45.:21:50.

the UK has a similar profile in international affairs. At this

:21:50.:21:54.

particular moment it may be they have a terrible reckoning coming

:21:55.:21:59.

through, and delivering significant capability. A carrier air wing, and

:21:59.:22:03.

40% more deployable units in their army, I would reckon, and all sorts

:22:03.:22:06.

of other capablities that Britain doesn't have any more. In that

:22:06.:22:10.

sense Britain does seem to have fallen back, it is a question of

:22:10.:22:14.

whether now they have done that they have put the fores on a

:22:14.:22:19.

sustainable foot -- forces on a sustainable footing. We have Philip

:22:19.:22:22.

Hammond, the Defence Secretary. Presumably this will affect foreign

:22:23.:22:26.

policy, where we go in, how long our deployment remains and so

:22:27.:22:34.

forth? We set out in the strategic defence and security view, in 2010,

:22:34.:22:38.

our broad strategic approach. And the level of our military ambition

:22:38.:22:43.

within that. What we have announced today is the structure of the army,

:22:43.:22:47.

one part of our Armed Forces, how it will be structured to deal with

:22:47.:22:50.

the smaller total regular forces that we announced last year. And

:22:50.:22:54.

what the chief of the general staff has said very clearly is that with

:22:54.:22:59.

this construct, he can deliver the military output required of the

:22:59.:23:06.

army to give effect to the 2010SDSR. We set out what we want to do, now

:23:06.:23:11.

we are setting out how we are going to do it. You heard it said that

:23:11.:23:18.

reliance on reservists would be a risk. For example, in Helmand

:23:18.:23:23.

n2006-2012, you have many thousands of troops, now you would have to

:23:23.:23:28.

rely on reserve is, getting them up to 30 though, getting employers on

:23:28.:23:34.

side in a recession, how do you do that? The General is right, this is

:23:34.:23:39.

a risk and they that needs to be managed. That is the key. We have

:23:39.:23:43.

set aside �1.8 billion of additional funding for reserve

:23:43.:23:50.

training, equipment, kit, to make sure the reserves get a proper deal.

:23:50.:23:53.

15,000 to 30,000, do you accept something like Helmand would be a

:23:53.:23:58.

risk because you would be relying on reservists? We would rely on

:23:58.:24:02.

reservists in a sustained operation, in the second and third years.

:24:02.:24:06.

Helmand? Yes. And these dangerous territories? The point is this, for

:24:06.:24:10.

years now the reserves have not been properly resourced, the last

:24:10.:24:14.

Government cut their training as an easy way to cut the defence budget.

:24:14.:24:18.

You can't expect to have effective reserves if you don't train them,

:24:18.:24:22.

if you don't qip them, and if you don't make a two-way bargain with

:24:22.:24:26.

them. They must train and be available for deployment, but the

:24:26.:24:30.

Government must fund that training. There is a three-way bargain,

:24:30.:24:33.

because it is about the Moyers as well. I know you did a big --

:24:33.:24:43.

employers as well. I know you did a big consultation on this, but it is

:24:43.:24:50.

a big ask for employers. What about reservists that go away for six

:24:50.:24:54.

months? We look at the whole range of options, we have a limited

:24:54.:24:58.

amount of resources but will look at how best to engage with

:24:58.:25:02.

employers. I'm confident large employers will step up to the

:25:02.:25:05.

challenge. The public sector will step up to the challenge. If there

:25:05.:25:10.

needs to be legislation, we will do that. You accept there can be a

:25:10.:25:14.

discrimination, an employer looks at a series of potential employees

:25:14.:25:18.

in front of her, and realise they might be without him or her for six

:25:19.:25:23.

months. Would there be legislation against discrimination? And an

:25:23.:25:27.

employer can't ask someone if they intend to get pregnant over the

:25:27.:25:32.

next five years, and maybe not asking about the reserves may be

:25:32.:25:37.

the way. If we were in two theatres like Afghanistan and Iraq together,

:25:37.:25:41.

that would be a big ask for this formation? That would be very

:25:41.:25:47.

challenging. We might be able to do it? Our expectation it is we would

:25:47.:25:51.

be working with allies, primarily NATO, but other allies as well.

:25:51.:25:54.

does change, and maybe for the better, maybe we shouldn't be

:25:54.:25:58.

saying, actually, we can go around being the world's policeman, maybe

:25:58.:26:03.

we should be saying we don't have the capability to go and help the

:26:03.:26:07.

Americans in Iraq, in a future theatre of war? It is not about

:26:07.:26:10.

helping the Americans, it is about being able to protect our national

:26:10.:26:15.

interest where it is placed at risk. As Mark just confirmed, we do have

:26:15.:26:21.

the world's fourth-largest defence budget, you wouldn't sometimes

:26:21.:26:25.

think it given what the British media says about our defence

:26:25.:26:29.

capablities. If we were faced with a position now, with the new formed

:26:29.:26:33.

army, a position of having to do Iraq and Afghanistan at the same

:26:33.:26:36.

time, you accept we couldn't do that? We would be really struggling

:26:36.:26:41.

to do Iraq and Afghanistan on a sustained basis. Tony Blair got us

:26:41.:26:46.

into a position where we were doing those two operations. But the the

:26:46.:26:50.

army was put into massive overstretch in consequence. It was

:26:50.:26:54.

underresourced. But they did it then? We are still paying the price

:26:54.:26:58.

today of the stress placed on the army during that period. Do you

:26:58.:27:02.

accept we are retreating from the world's stage? We are still one of

:27:02.:27:08.

the world's leading military powers. We have huge capabilities, hugely

:27:08.:27:14.

capable Armed Forces, working with our allies, we can project

:27:14.:27:18.

significant military effect to give muscle to our foreign policy.

:27:18.:27:23.

you know, when you look at the changing political balance in the

:27:23.:27:28.

world, you wondwhreer we should have a permanent seat -- wonder

:27:28.:27:31.

whether or not we should have a permanent seat at the security?

:27:31.:27:35.

think we should. We are one of the world's legitimate nuclear powers.

:27:35.:27:39.

We have a powerful nuclear deterrent, we have one of the most

:27:39.:27:44.

effective armed forces in the world. Well respected. We project

:27:44.:27:49.

significant amounts of soft power, our Armed Forces are not only in

:27:49.:27:56.

the business of Kennettic powered delivery, -- kenitic powered

:27:56.:28:00.

delivery, they do a lot of stablisation in Third World

:28:00.:28:04.

countries. It was said it was not as good in chance, our capability?

:28:04.:28:10.

France is in a position where it is on the brink of a fiscal consol

:28:10.:28:14.

itself. We are all waiting to see - - consolidation itself, we are all

:28:14.:28:17.

waiting to see what the French defence budget will look like, I

:28:17.:28:21.

wouldn't put bets on it tonight. Can I bring it back to the soldier

:28:21.:28:27.

in the battalion, you will have two tranches of redundancy in 2013, you

:28:27.:28:32.

hope there will be a lot of natural redundancies, people wanting to

:28:32.:28:36.

leave, there may not be, people doing compulsory redundancy. What

:28:36.:28:41.

do you say to a soldier, given so much training, and been perhaps in

:28:41.:28:44.

Afghanistan and Iraq, in various theatres, who comes back and

:28:44.:28:48.

realises that he has got no longer place in the army, which is his

:28:48.:28:52.

home, and actually not much of a likelihood of getting a job? First

:28:52.:28:57.

of all, nobody wants to make redundancies, we announce that the

:28:57.:29:00.

regular army would be smaller last year, we have already started a

:29:01.:29:05.

redundancy programme, and the army also has a programme to slow

:29:05.:29:08.

recruitment so that we minimise the level of redundancy required to get

:29:08.:29:13.

over the next few years to this smaller size. Where people do have

:29:14.:29:18.

to be made redundant, the army has a very effective package of support

:29:18.:29:22.

available to them, to prepare them for civilian life, and to help them

:29:22.:29:26.

find jobs. Actually, ex-service people are very much sought after

:29:26.:29:32.

by employers for very good reason. Unemployment rates have very high

:29:32.:29:38.

among ex-servicemen now? Unemployment rates are, sadly,

:29:38.:29:43.

higher than we would like across the country. But if you ask

:29:43.:29:47.

employers with people coming out of the services with the police

:29:47.:29:51.

Palestinian and -- discipline and education they have is suitable for

:29:51.:29:58.

employment. Employment for army personnel is significantly higher

:29:58.:30:03.

it is said? I would contest that. Listening to that is General Sir

:30:04.:30:08.

Mike Jackson, the professional head of the army in 2004, brought in

:30:09.:30:16.

significant reforms to its structure. A military head, and a

:30:16.:30:26.

corporal shot and blinded while serving with the Royal Battalion.

:30:26.:30:32.

My other guests also. In the big picture, how do you think this will

:30:32.:30:36.

affect, both the perception we have of ourselves, as a nation with

:30:36.:30:41.

great military capability, and the perception that other people have

:30:41.:30:46.

of us? We have always had tremendous self-image as a military

:30:46.:30:50.

nation. At the same time I would not be sad to see the cliches going

:30:50.:30:54.

about punching above our weight. I think we have to be very realistic

:30:54.:30:58.

about what we can do in the world, I don't think we should make any

:30:58.:31:04.

pretences about it. You heard it said there, that if faced with

:31:04.:31:07.

Afghanistan and Iraq at the same time, with this new formation, it

:31:07.:31:11.

would simply not be possible. Where does that place us? What does that

:31:11.:31:16.

say about us? In any case we have come out of Iraq and Afghanistan

:31:16.:31:21.

much more realistic about what we can. Do the and the Americans, our

:31:21.:31:27.

-- can do. And the Americans, our main allies, have done that too. We

:31:27.:31:31.

can do less than in the past. you think as a nation or series of

:31:31.:31:35.

nations, that is good for us to know and accept? It means we won't

:31:35.:31:39.

take on more than we can do. That is the real politic of this,

:31:39.:31:44.

that we won't be the force we once were in terms of being able to move

:31:44.:31:47.

in for sustained deployment? Well, I'm not sure that's quite right.

:31:47.:31:56.

First of all, it is for Governments to decide the size of the resource

:31:56.:32:01.

envelope in regards to defence. It is the army's job, and the sister

:32:01.:32:06.

services, to get the best military capability we can from the

:32:06.:32:13.

resources allocated. We also have to meet the requirements of the

:32:13.:32:16.

Strategic Defence and Security Review, which are quite specific. I

:32:16.:32:23.

won't bother you with technicalties. But just on two operations, one

:32:23.:32:29.

enduring, and one "one-off" six month, is within that envelope. I

:32:29.:32:36.

think what the army has actually come up with is a very innovative,

:32:36.:32:40.

and interesting solution to what happens when we stop campaigning,

:32:40.:32:45.

which we are told we will do by the end of 2014. In an uncertain world

:32:45.:32:51.

what will the army be asked to do next? We don't know. So a balanced

:32:51.:32:54.

and flexible course is the very sensible answer. From the soldier's

:32:54.:32:59.

point of view, you are a former corporal, Simon, what is morale

:32:59.:33:02.

like, we have heard about unemployment. What is morale like

:33:02.:33:06.

amongst serving soldiers? There is a lot of uncertainty now. Back in

:33:06.:33:09.

camp people are not sure what is going on, so that they wrap

:33:09.:33:12.

themselves up in work. The professionalism of the guys and

:33:12.:33:18.

girls on the ground, means they just carry on following their oath.

:33:18.:33:24.

There has to be some effects out on the ground with the guys. The

:33:24.:33:28.

professionalism means they will carry on doing the job they have to

:33:28.:33:31.

do. Everybody would be concerned about going to work and coming back

:33:31.:33:36.

not sure of a job when they finish. That day out there is six months on.

:33:36.:33:40.

You have no idea how long you have to prepare. I know there is things

:33:40.:33:44.

put in line, they don't have access to the media and information. They

:33:44.:33:49.

are hearing bits and pieces t will just scare the guys. When you came

:33:49.:33:53.

out you were severely wounded, you lost all but 15% of your sight.

:33:53.:33:57.

What was like for you to come out, and adapting to the natural world,

:33:57.:34:01.

and all these soldiers feeling the need to take voluntary redundancy

:34:01.:34:06.

or be faced with compulsory redundancy? It is frightening,

:34:06.:34:11.

especially with the those with disabilities. There are many who

:34:11.:34:16.

have done action on the frontline and they have things to deal with

:34:16.:34:20.

mentally. For me it scared me, all of a sudden, not only have a lost

:34:20.:34:26.

my job, but my career, a family that have been there. Even the

:34:26.:34:30.

thing of hand anything my ID card, I have been told to treasure and

:34:30.:34:34.

nuture that, and all of a sudden having to give it back like it

:34:34.:34:37.

meant nothing to me. All these things of adapting back into

:34:37.:34:40.

civilian life, it is terrifying. When you look at housing and stuff

:34:40.:34:47.

as well, it is hard. How do you think we will have to change the

:34:47.:34:50.

feeling of what we can actually do in the world. You were talking

:34:50.:34:53.

about the closure of punching above our weight. Will we see a

:34:53.:34:58.

difference in foreign policy? army has to pond respond to the

:34:58.:35:03.

foreign policy de-- respond to the foreign policy desessions, and

:35:03.:35:06.

having to take into account the relative restrictions there. We

:35:07.:35:09.

will still be part of a NATO alliance and operating with allies

:35:09.:35:13.

as we have had to do for a very, very long time. What do you think

:35:13.:35:18.

about the idea that the ple de employment of reservists -- the

:35:18.:35:23.

deployment of reservists will become much more important in

:35:23.:35:26.

sustained operations? They have been used in other countries in

:35:26.:35:29.

greater proportions than by the British army. We have to get used

:35:29.:35:33.

to the idea, it is a question of adapting the systems to it. Do you

:35:33.:35:38.

think in this country employers are ready for that kind of upping twice

:35:38.:35:43.

from 50 to 30,000? As the Defence Secretary has said t I think it is

:35:43.:35:46.

incredible. It is really very hard to see how it is going to work. Not

:35:46.:35:51.

only are employers going to hate it, particularly small ones, but

:35:51.:35:55.

employees in this tough environment, going out, trying to get a job.

:35:55.:36:01.

They have no incentive, not only to be part of the reservists but

:36:01.:36:07.

joining it. The idea of being a reservist, the idea of always being

:36:07.:36:12.

in the reservists or the TA, but if you are mopping-up operations and

:36:12.:36:17.

facing the matter of the legislation and the employer, do

:36:17.:36:22.

you think people will be so keen? It is a challenge, let's give

:36:22.:36:25.

credit where it is already due, for the numerous, now, interventions,

:36:25.:36:30.

which have taken place since the end of the Cold War. At any one

:36:30.:36:36.

time, somewhere around 10% of the deployed force have been reservists.

:36:36.:36:42.

This is not a new thing, we are all, to some extent, down the road. We

:36:42.:36:49.

are asking them to up the game. tradition has been of the effective

:36:49.:36:53.

soldier. I wonder how you feel about the idea that more reservists

:36:53.:36:58.

have to step up to the plate? have massive respect for reservist,

:36:58.:37:01.

I served with them on the frontline. We have relied on them for many

:37:01.:37:05.

years now tauls the case, regardless of legislation and law,

:37:05.:37:14.

tuls it is always a thing you know reservists - it is always a thing

:37:14.:37:19.

you know reservists can say no and the employer can say no. The

:37:19.:37:22.

professionalism means they will keep going and pushing until they

:37:22.:37:27.

break, but the reservists might crack. What about that, they keep

:37:27.:37:35.

going until they snap? Two aspects. There is the whole employment

:37:35.:37:38.

dimension, civilian employment dimension, I'm pretty confident

:37:38.:37:43.

that the law will have to change to give better protection to the

:37:43.:37:47.

reservists and in civilian employment. However, you can't

:37:47.:37:56.

produce a law which keeps families happy. There is that family

:37:57.:38:00.

dimension as well. Which is going to be, I think, requiring a culture

:38:00.:38:07.

change as much as a legal one. the beginning we were talking about

:38:07.:38:10.

others' perception of us in the world. And Philip Hammond saying

:38:10.:38:14.

there is no reason why Britain wouldn't retain a place in the

:38:14.:38:18.

Security Council. But, do you think in the long-term, as things change,

:38:18.:38:21.

that isn't necessarily a given. That we will have to see ourselves

:38:22.:38:25.

differently in the world and other people will see that too? Holding

:38:25.:38:30.

on to Trident is the key to holding on to the seat at the Security

:38:30.:38:34.

Council. Whether we can afford Trident is a different matter.

:38:34.:38:38.

Should those resources be deployed within the Armed Forces themselves.

:38:38.:38:42.

I have to come in, we can afford Trident, the question is whether we

:38:42.:38:47.

choose to. Should we choose to afford Trident? I'm dubious, but I

:38:47.:38:53.

know I'm going to be overruled here. Outranked. But if the holding of a

:38:53.:38:58.

nuke clear weapon gets your place in the permanent seat on the

:38:58.:39:02.

Security Council, in future years many other countries will want the

:39:02.:39:06.

place on the Security Council by the same token? That is certainly

:39:06.:39:09.

true. The whole question of the Security Council is bound to come

:39:09.:39:15.

under change. Europe obviously is demanding a seat for the Europeans.

:39:15.:39:21.

We may be in retreat from that? The council is not going to look

:39:21.:39:26.

the way it does now, probably in 0 years time. But any way it will be

:39:26.:39:32.

interesting to see how soon this is tested. The testing of it, we are

:39:32.:39:39.

talking about lots of change. Many things have to be put in place to

:39:39.:39:43.

make this work. You are talking about redundancies, but also in the

:39:43.:39:48.

year after talking about doubling the reservists in a quick time?

:39:48.:39:52.

During a period of some turbulence, we have the whole question of

:39:52.:39:55.

international intervention in Syria and America clearly doesn't want to

:39:55.:39:58.

get in. South Eastern Europe in a very unsettled state, America

:39:58.:40:02.

doesn't want to touch it, telling Europeans, including Britain, you

:40:02.:40:06.

sort it out if there is any trouble. We may have to answer these things

:40:06.:40:11.

fast. Do you think, when you look at what moit happen in the next

:40:11.:40:14.

four or five -- might happen in the next four or five years, that we

:40:14.:40:18.

might be called on? Syria is a live question and south Eastern Europe,

:40:18.:40:24.

isn't at the moment, but could be. Or Europe's borders, the Balkans

:40:24.:40:28.

and that. Somewhere like Syria, where the deployment would be very

:40:28.:40:32.

difficult and could be protracted, that might be something that we

:40:32.:40:39.

maybe shy away from? I think we should certainly steer clear of

:40:39.:40:44.

sirbia in all circumstances. It is -- Syria in all circumstances. It

:40:44.:40:49.

is an American-led push. What would it say about us if we decided not

:40:50.:40:53.

to follow the Americans' lead if there was a confrontation in Syria.

:40:53.:41:00.

What would that say about us? think it would leave us in a lesser

:41:00.:41:03.

place than so far we have been. Some may argue. That is just as

:41:04.:41:08.

well. -- some may argue that is just as

:41:08.:41:15.

well. That is bringing reality into play. On the other hand, I'm not of

:41:15.:41:21.

that view. We are not alone in this global world, and stability of this

:41:21.:41:28.

world is part of our strategic interest. We still have the

:41:28.:41:31.

capability to influence what goes on outside. It is for Governments

:41:31.:41:36.

to decide this, but they need to keep the tools there, in my view.

:41:36.:41:41.

If we don't go and help in Syria is called upon what will happen next?

:41:41.:41:45.

We will look smaller, but even ten years ago we could do less than we

:41:45.:41:49.

took on. Britain took on some pretty big things in the south of

:41:49.:41:54.

Iraq, Helmand, the responsibility for drugs in Afghanistan. Arguably

:41:54.:41:56.

they were bigger responsibilities than we should have taken on,

:41:56.:42:00.

because we didn't have the capability ten years ago to do that.

:42:00.:42:04.

What would you feel like ifp you were still on the force and -- if

:42:04.:42:11.

you were still on the force and you didn't go. There is a various ethos

:42:11.:42:15.

about it, Kosovo and all sorts of places, if which don't go? We are

:42:15.:42:20.

still in a lot of places where we don't know and people forget about

:42:20.:42:24.

deployments. We don't think about that, we do as wl we are told, we

:42:24.:42:29.

take an oath and we follow it. As the general said, the Government

:42:29.:42:36.

make a decision and we go there. There would be some grumbling if we

:42:36.:42:42.

didn't go, being bad-mouthed in NATO and not pulling our weight.

:42:42.:42:47.

Grumbling goes on in the army, it is fact of life. Although we don't

:42:47.:42:51.

want the commitment wrecks don't want other people to think we are

:42:51.:42:55.

not pulling our weight. We don't want to be seen pulling our weight,

:42:55.:42:59.

but areas like Syria may be problematic for us? They could be,

:42:59.:43:02.

and we don't want to be in a position, because of lack of back-

:43:02.:43:07.

up and resources, that we daren't perform as well as we should be.

:43:07.:43:11.

you think what we are doing as a nation is providing the back-up,

:43:11.:43:15.

the Special Forces, the intelligence, it is short-term

:43:15.:43:20.

operations. The strategic decision would be not to go anywhere, we

:43:20.:43:25.

won't have to stay very long? will be no doubt in any Government

:43:25.:43:30.

in whatever hue of the United Kingdom, when confronted with the

:43:30.:43:33.

decision of to commit or not to comi. Our Special Forces are world

:43:33.:43:39.

class, no two ways about that. We are very good at training others.

:43:39.:43:43.

There are training teams all over the place. They have a stablising

:43:43.:43:50.

effect, and do, to some extent, reduce the risk of a conflict.

:43:50.:44:00.
:44:00.:44:00.

Apology for the loss of subtitles for 43 seconds

:44:00.:44:43.

Thank you all very much indeed. That's all from Newsnight tonight.

:44:43.:44:48.

The tallest building in Europe had its official opening today, the

:44:48.:44:51.

Shard, standing in the South Bank of the Thames, reaches over 1,000

:44:51.:45:00.

feet into the sky. The Mayor of London, told French TV that the

:45:00.:45:10.
:45:10.:45:37.

Britains were experiencing shieden More severe weather is heading

:45:37.:45:41.

across the UK, by the end of the night heavy rain will arrive across

:45:41.:45:44.

eastern counties of England. It spreads across England, northern

:45:44.:45:48.

England, into much of Wales. Torrential rain persistent. A real

:45:48.:45:52.

risk of flooding during the course of Friday. There are a number of

:45:52.:45:55.

warnings in force. We have an amber warning across parts of the UK. A

:45:55.:46:01.

threat of flooding, especially across parts of the Midlands and

:46:01.:46:06.

Wales. In the far south most places having a reasonable day, dry and

:46:06.:46:10.

bright with sunny spells. In Wales there will be rain. North Wales in

:46:10.:46:15.

particular having heavy and persistent downpours, the threat of

:46:15.:46:18.

further problems. Flooding across parts of Northern Ireland, from

:46:18.:46:21.

intense showers. In the far south there could be more rain, elsewhere

:46:21.:46:25.

on Friday it is looking general low dry and bright. As it is across the

:46:25.:46:28.

North West of Scotland. And generally fine further south for

:46:28.:46:34.

Scotland at this stage. But there is more rain to come. And

:46:34.:46:36.

particularly across central and eastern parts of Scotland. Another

:46:37.:46:40.

cause for concern. We continue with the risk of flooding through the

:46:41.:46:46.

weekend. On Saturday it looks across northern England and central

:46:46.:46:50.

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