28/09/2012 Newsnight

Tonight: Newsnight reveals what really happened with the summer's

great GCSE results scandal. We have got the documents that show

how the watchdog leaned on exam boards to change grades.

Also tonight: Can social unrest derail austerity across Europe?

are the bond market so spooked by protests on the streets?

We have the man who predicted it all on Newsnight 14 years ago.

blimey, look at her. And as close to 40,000 sign the

petition to end the Sun's Page 3, we ask if it's time to bin the pin-

We're joined by Hattie from Good evening. What really happened

with the summer's GCC scandal? This programme has come a step closer to

understanding the sequence of events. Documents obtained by

Newsnight show how Ofqual and leaned on exam boards to change

grades. The aim, as we now know, was to end more than two decades of

grade creep. Sanchia Berg has been going through

the correspondence and is with me now. A strong sign there was

intervention. Yes, we knew there was intervention but what it looked

like we did not know, but now we do. This year's GCSE English grading

was the worst fiasco in history of the exam but thousands of students

expecting that crucial a C grade did not get it. Ofqual said they

did not fix the results and had not told exam boards that the results

should fall but ever since, everybody has been trying to find

out what happened, which is why we put in a Freedom of Information

Bill quest for all the correspondence between the exam

boards and Ofqual, and we have discovered that at least two exam

boards had problems with their grades as though they were coming

in. So the regulator intervened. During a telecoms runs on Friday

the 13th July it with all the exam boards, the Ofqual representative

said that Ofqual could not accept any apparent grade inflation. Four

days later, another teleconferencing with the exam

boards and they were raising Pretty unconditional. They were

saying, grades cannot rise. Ofqual said those remarks should be seen

in the context, that they were seeing the results could only rise

is justified, and this is the first year comparable outcomes came in in

English, which means the result should be on a par with recent

years. Do they justify them? Edexcel and a Welsh board did try

to justify them. Edexcel said there was a serious mismatch between the

examiner's judgments and the required outcomes. But these

objections, even though they were sustained for a long time,

eventually they had to drop them because Ofqual said they would

force them to change their grades if they did not do it voluntarily.

Ofqual was pretty worried about how this would look, bluntly. Yes.

There is a briefing paper from July where a Ofqual official says, how

will we defend the grade boundary changes? And he says the rationale

must be that it... The examiners judgment, rather than the

statistical fix... But a statistical fix is what it really

does look like, especially to Brian Lightman, who is head of the

Association of school and college leaders. He is part of a group

taking legal action against Ofqual at the moment. I think it shows

that what has gone on here has been attempting to manipulate results in

order to meet a statistical outcome and the problem with that is it

does not take into account the actual quality of the pupils' work

and you cannot simply hold down results in order to meet some sort

of expectation without looking at the students'' work and making sure

that pupils actually get their just deserts in terms of the effort that

they have made. And as we heard, the grades did not rise, they fell.

And that is something Ofqual did not anticipate. It was seeking ways

to explain that. We found in this correspondence the message is that

Ofqual has circulated to all of the exam boards the day before the

results were published. Ofqual were telling the exam boards how it

would explain the drop in results. Students from selective schools

were not doing a GCSE English any more, their exams would not show up

in the figures, but eight minutes after Ofqual sent its messages out,

one bounced back from a main exam That was the explanation that

Ofqual gave the following day. Later on it said that there were

other reasons why the fall may have taken place, there were other

changes in the cohort, but it is interesting to see that is what AQA

said and yet Ofqual went ahead with that explanation anyway, so there

are still questions to be answered. It is a very interesting situation.

Thank you. Ofqual refused to appear live on the programme this evening.

Protests in Spain, are riots in Greece, the spectre of another

direly needed a bail-out, just another long week in the eurozone.

Tonight, suggestions that Spanish banks will need another 60 billion

euros in extra capital to ride out the downturn. The Spanish

government has gone tough with posterity and paved the way for

serious spending cuts, but will social unrest destabilise this

For Spanish politicians, this is the world they can control.

Everything goes to a script and timetable. These are the most

rigorous stress tests ever, says the minister, and now, tonight, we

no space need 60 billion euros to save its banks. -- we know that

Spain needs. But this is the world they cannot control. Violent

clashes in Madrid this week, just the latest in a growing wave of

opposition to the cuts Spain has to make to stay afloat. And the

problem is, it is not just Spain. If Portugal's workers took to the

streets in massive numbers last Saturday, faced with a rise in

national insurance that would have taken a month's salary out of their

national pay. We have become used to scenes like this of course, but

not to what happened next. Portuguese government backed down.

For two years, we have seen protests against austerity that

have achieved nothing, more or less, but the Portuguese U-turn has

changed that. Bond investors now have to consider the prospect that

social unrest Candy real things and they are starting to price in the

risk of constitutional crisis normally associated with developing

countries. This man advises the Investment funds that buy and sell

government bonds. They are acutely sensitive to the qualitative

aspects, and one of those his political risk, and this is evident

across the board throughout southern Europe, so what we have

now is a situation where emerging market type risk factors are now

being priced in too many developed markets, and the markets are much

more in tune to these risks but are struggling to come to terms with

the social and political risk. Greek workers, who went on general

strike this week, are facing another 11 billion euros worth of

cuts to come, and some economists believe the austerity plans are

unachievable. This graph shows how much higher labour costs are in

The blue plaque shows where we were three years ago, the red bars the

effects of austerity. But from Greece, Spain, Portugal and Italy,

which costs may still have between What happened in Portugal last week

is very significant because it shows that is popular resistance is

strong enough, sooner or later the government will have to change

their stance. That is what the markets are worried about, and

politicians and officials in Brussels and Frankfurt and Berlin

are fearing that more than anything else. The problem is, produced in

Europe has begun to move in ways politicians are finding hard to

cope with. Andalusia has seen rates and supermarkets co-ordinated by an

elected mayor. -- have seen it raids on supermarkets. And in

Catalonia, much of the population wants independence or fiscal

autonomy. I don't think the masses can stop Mariano Rajoy's austerity

measures but I think they can bring down his government. I think there

is every chance that will happen. We will see a must intensify over

the next year, and the ferocity of some of the individual localised

protests this year, when they gather strength and when the

austerity measures at a country, which already has 25% unemployment,

we will see chaos. The if the Spanish government of Mariano Rajoy

looked strong and decisive, the markets might worry less, but it

doesn't, and they do. Spain is not just facing a budget deficit, Spain

is facing a banking, sovereign debt, real-estate, political and

constitutional crisis. They are all feeding off each other. This is

making deficit reduction measures in Spain extremely difficult. I

think that really is the nub of the Spanish problem. This week, scenes

of violence were not new, but their economic meaning might be.

In a moment we will speak to a Spanish MP who speaks to the

government on foreign affairs about this, and the world-famous

economist Martin Feldstein, but first we wanted to show you a clip

from Martin Feldstein's appearance on Newsnight 14 years ago, in which

he made some a marks that are starting to look eerily prescient.

One of the doom-mongers in-Chief is the imminent American economist

Martin Feldstein at Harvard. We are about to pop in on him and get him

to outline way things might turn nasty. If you have more

disagreement, if you have countries that feel they are under the thumb

of others, under the thumb of a process that they cannot control,

and yet they are in their own mind sovereign countries, the temptation

to pull out will be very small, and who knows just what the response

will be from the centre? Well, 14 years on, we can speak to Martin

Feldstein again. He is in Berlin. You predicted this almost to the

word. Has it taken longer than you expected? I don't think I had any

timetable in mind but I think it was clear that trying to force a

common monetary policy and a single exchange rate on such disparate

countries was not going to work. Where do you think this is going?

Well, frankly I am quite worried about Spain in particular. Not just

because of the rioting, but because of the power of the individual

regions. The new plan that the European Central Bank announced, in

which they will buy Spanish bonds as long as Bain sticks to a plan

that has been approved by the European stability mechanism, I

think that is not going to last -- as long as Spain the sticks. I

think at some point, Spain will depart from what they have promised,

because of riots or local regions, and at that point the ECB will have

to decide, do they stop buying the government bonds and allow interest

rates to sort? Or do they keep buying them and weaken the

credibility of the programme? Either way I think it will be bad

news for making progress in Spain. Do you think we will see political

break-up within Spain? More autonomy for some of the regions

like Catalonia? They have a fair amount of fiscal autonomy already.

While they are talking about pulling out, I think the odds of

that are still pretty low. Quite interesting listening to the bond

analyst a moment ago saying that calculated risk now in southern

Europe is like it used to be for the emerging markets, that they are

taking into account all sorts of things they never had to worry

about? Well, in the emerging markets, in east Asia and Latin

America, they could always take the option of devaluing the currency

and allowing their economies to recover. Spain cannot do that. As

long as the euro remains as strong as it is today, we are going to

continued to see large international deficits, large

current account deficits in Spain, and that is going too frightened

the bond markets. You are famous of course for this formula that showed

us originally that the measure of globalisation of capitalism... Do

you think we are starting to Globalised capitalism? I don't

think it is collapsing. What we are seeing is financial markets within

Europe, which were supposed to be strengthened as a result of forming

the euro, they are rapidly breaking down and going back to national

markets, because people are afraid to lend, banks are afraid it to

lend to borrowers in other countries. So we are seeing a

breakdown of credit within the euro-zone. What do you think

happens to the euro-zone and the euro? If we are inviting you back

in another 15 years, what good your prediction be? Let's is a one-year!

It is very hard to say. I think it was a mistake to enter into the

euro in the first place, but it would be very costly in many ways,

economically, politically, to turn the process away. We still could

see some of the countries, like Greece, which are in much worse

shape than Spain and Italy, we could see them leave the euro-zone.

Not immediately, but perhaps after the German election. Do you think

we will see a pressure to more extreme kinds of government as a

result of this social unrest we are seeing, if they can get rid of the

government of Mariano Rajoy, for example? The one government that

seems to be working very well in the peripheral areas is the Italian

government, where experienced bureaucrat, not elected officials,

have been putting together a programme that has been reducing

fiscal deficit in a meaningful way. We are going to move on. Today's

Page Three quads the American philosopher William James on the

perils of pessimism while wearing a tasselled monokini. The debate

about Page Three has never really gone away, but has gained traction

over the past week with a sequence of high-profile comedians and

politicians signing a petition to ended. -- to end it. Look at her!

Where would we be without Page Three? In a much better place, say

many. Beauty queen shocks a council. Sharon Spencer, 22... She is more

It is more than 40 years since the first scantily-clad model made her

bow in the pages of the tabloids. Page 3 is a British institution,

but labelled anachronistic this week by Labour's Harriet Harman,

known by some as Hattie from Camberwell, a moniker she

apparently shared with today's Page Three girl in there Sun. The

pictures were clamours and sophisticated in the early years,

says one of the original Page Three girls. Today, not so much. They are

tacky, and too obvious, and probably inappropriate to be in a

family household. Today's families are different, you mustn't forget

that when Page Three started, it was at a time in the Seventies,

when we were exploding into free love, it was an exciting time, or

freedom, free-spirited people floating about the place with

flowers in the -- in their hair. current, model says Page Three

objectifies women, but in a good way. It is a form of

objectification but any anthropologist will tell you that

it has been imperative for the survival of the human species.

Celebrating sexuality is imperative, and Page Three is celebrating that.

Campaigners against pornography have linked Page Three pictures to

violence against women. But others have seen them to -- as the working

man's old masters. The chap I am talking about is as likely to enjoy

looking at the Dell on page three of these -- of the Sun as his

intellectual betters, as they see themselves are, to go to the Art

Gallery, seeing it painted. Today there is a lot more sex about them

when Page Three began. It is still with us, and there are no shortage

of young women keen to appear in it. However, almost 40,000 people have

signed a petition urging the sun to drop it. -- urging the Sun.

years after winning the right to vote through protest, papers might

actually start to fill pages of with the almost outrageous words of

powerful women, every day when the, whose place -- faces don't need to

be pleasing. It is meant to represent youth and freshness and

it represents natural beauty, we don't have models to have had

plastic surgery on the page. It is legal, we are allowed to publish

those images. It has become an innocuous British institution.

proud of my body, and whatever I do with it in my spare time is none of

the council's business. So, Page Three has its knockers!

One person campaigning for decades against it is Harriet Harman. She

is joined by the former deputy editor of the News Of The World,

Neil Wallis. How do you feel when you have been on this sort of

campaign for more than two decades, and it doesn't seem to have shifted

at all? It is an institution today as much as ever. I think so much

has changed since the Seventies. I think the whole expectation for

women of what they can do with their lives and what they can be in

their lives, I think it is really very old fashioned now, very out of

date. It was always objectionable, the idea that women are most

important as sex objects, but I do just wonder whether or not

sometimes they sit down there in the News Of The World and think,

should we really pack this in? Is this sensible? We have women having

all sorts of campaigns, why have we got this? They may be are saying,

we're not going to be told what to do by a bunch of Wood Lane. What is

it for? I think it is the wrong way round, the question. This is really

about - it does this matter enough that women are campaigning about

edition like this, when it there are frankly most important issues?

You are here now, let's have the debate. What is it for? I don't

believe there is an issue about it really being in debate. Because

nobody really cares. 37,000 women have signed this petition. Not just

women, people. 3 million women reads the -- read the Sun every day.

It is an out rated -- outdated argument. Page 3 is a harmless

picture that has been their back 440 odd years. Real women do not

care about it. What purpose does it serve for you? If it went, with the

paper be worse off? What is the purpose of any picture of an

attractive person? It is a nice picture, it is harmless, adds a

touch of fun to the paper, and why not? If you open any newspaper, and

one of the great things I love about broadsheet is whenever they

illustrate the story, it is always a pretty young woman who

illustrates the story. You look at pages about the City in particular.

I think you would be fair to recognise they usually have their

clothes on. Sometimes! The idea that they have got to have bare

breasts and it is for objectification, and the idea that

women are there to be Lear at. you see the advert for the

Wonderbra? With that woman... It said, hello boys. What was it

selling, on what basis? The truth is, there are many issues. But the

Sun is a newspaper. The paper is full of the stories about how

police and social workers have ignored, for years, the issue about

exploitation of children. That is an issue to campaign on, an issue

to have a petition about. Harriet Harman has done, to be fair.

There are other British newspapers that have a much more vindictive

approach to do some of the women that they portray in their papers,

he doesn't have to be the Sun alone, does it? Yes, but with their Page

Three Women, dressed only in their knickers... The whole point of them

is none other than for them to be Lear at as sexual objects, that is

the point of it. Of course there are a lot of other issues which are

important. But we are entitled to have our say about it without being

accused of not being real women, or being vilified for being frumpy old

harridans. That is the other thing. You want your free speech to

publish these photos, we want our free speech to say, we don't think

that is how you should be looking at women in this day and age,

without being vilified as a result. The issue is, there are far more

serious issues. The people who have launched this petition, putting it

in the Guardian, gaining lot of headlines... You could say that

about anything of you wanted. What happens on Saturday and Sunday in

your paper? They don't run bomb. Because the paper as much more in

the house, so there is much more chance... You don't want families

to see them? The primary leadership of the Sun, the 7 million adults to

read it, are adults. So why did they are good, clean, innocuous fun,

in which case presumably you are not ashamed to have them on any day,

or else you do feel they are slightly seedy and don't want them

in the house at the weekend? That is fairly fatuous, really. 7

million adults choose to look at the paper every day. If they take

it home or not, that is a decision for them. It is a paper aimed at

adults. What we are aware of, not that I work there now is the paper

is very much more family-orientated at the weekend, more television and

sport orientated, so it is much more round the home, and

accordingly, they don't have topless women in it. So why are you

saying that there are no doubts, or thinking again about this? They are

going to be sticking to it, not even having second thoughts, even

though we are in the 21st century? When you look at what is around in

the 21st Century, the idea that a 40 year-old institution should fall

out because if a particular demographic of women deciding they

don't like it - and many of those women who don't even read the paper,

they are asserting their view over the 3 million... You keep saying it

is women, a lot of men have signed it as well. Quite high-profile

people as well. What does high- profile have to do with it? The

fact that some comedians and actresses and might sign up...

what happens... But what are they there for? In their bed -- in their

knickers, with bare breasts, that is the betrayal of Women on page 3.

With respect, who want you to say that people cannot choose to look

at it? Did you read today's? didn't, I don't think had the comes

from Camberwell anyway! I think women should be respected for what

they can do in their lives, and girls should have high aspirations

than just looking good with no clothes on. Surely, in the 21st

century there is more than that two women. I Usain a girl should not

have the right to aspire to be a Page Three girl -- or Usain? We are

going to leave it there. Thank you very much. The front of the papers