30/01/2013 Newsnight


30/01/2013

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


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What exactly are you eat when you bite into a burger? As we learn

:00:12.:00:16.

that horse meat could have been on our shelves for a year, why do we

:00:16.:00:22.

know so little about our food? Welcome to London Airport, in

:00:22.:00:26.

Istanbul. As the competition hots up for British passengers, we head

:00:26.:00:33.

to the gateway for Asia. This is the meeting point of two continents,

:00:33.:00:37.

Istanbul is in the world economic market for nearly 3,000 years.

:00:37.:00:43.

Also tonight a Barclays insider attacks levels of pay in banking,

:00:43.:00:47.

and says the boss, Bob Diamond, should never have taken his bonus.

:00:47.:00:50.

We speak to a former Deputy Chairman of Barclays, and Lord

:00:50.:01:00.
:01:00.:01:11.

And the Oscar-nominated film that portrays the toppling of Augusto

:01:11.:01:15.

Pinochet. The Mexican star of the film, Gael Garcia Bernal, is here

:01:15.:01:24.

with me now. Good evening. Remember those horse

:01:24.:01:28.

meat burgers? Well, today it emerged they could have been sold

:01:28.:01:31.

in British supermarkets for up to a year. One leading supermarket,

:01:31.:01:35.

Tesco, vowed to end its relationship with the firm that

:01:35.:01:39.

supplied those burgers, insisting it was a breach of trust. Now if

:01:39.:01:43.

horse meat, pork meat and God knows what else has been on the shelves

:01:43.:01:46.

for 12 month, what does it tell us about the health and transparency

:01:46.:01:51.

of our food industry. Tonight we go behind the scenes to find out where

:01:51.:02:01.

our food comes from, and what is in Let's have a quick look around. How

:02:01.:02:05.

about a quick snack? That's where the beef burger comes in, feed it

:02:05.:02:11.

one pound of fine mincemeat, and in less than no time it makes beef

:02:11.:02:17.

burgers ready to be fried or grilled. The beefburg certificate a

:02:17.:02:22.

regular British dish for decades. Ten million have been taken off the

:02:22.:02:25.

shelves, after the Irish food agency found horse meat from Poland

:02:25.:02:31.

in a Tesco burger. The supermarket cancelled its contract with the

:02:31.:02:35.

supplier responsible. Today, MPs grilled the British agency, wanting

:02:35.:02:41.

to find out why it wasn't spotted here. If you don't use those tests,

:02:41.:02:49.

how do we know that the FSA UK would have picked up the

:02:49.:02:56.

contamination if FSA Ireland hadn't. Interesting thing, we have

:02:56.:02:59.

accredited test, and we have a mixture of DNA and other tests,

:03:00.:03:08.

that we could use. We have tests available that, had we tested, and

:03:08.:03:12.

had there been the wrong stuff there, we would have found. The

:03:12.:03:19.

real issue is that we wouldn't have tested, because we have our

:03:19.:03:22.

surveillance approach which is risk-based. The burgers could have

:03:22.:03:31.

been on sale for a year. The retailer, bears prime

:03:31.:03:35.

responsibility for food quality. Tescos said the company had tests

:03:35.:03:40.

and audits right the way up the chain, but the sub-contractor went

:03:40.:03:45.

outside it. If somebody decides to step outside that process, in a

:03:45.:03:47.

deliberate attempt, for whatever commercial reason, it is impossible

:03:48.:03:51.

to check a supplier in Poland who we don't know even exists. Unless

:03:51.:03:56.

you check the product when it comes to you? Which is why we have

:03:56.:04:01.

instituted a programme of DNA testing, starting today. Now?

:04:01.:04:06.

Exactly. The horse meat came from blocks of powered filler, one of

:04:06.:04:12.

the many ingredients in burgers. Burgers rarely contain 100% beef.

:04:12.:04:17.

The FSA has two classifications for burger products, a standard beef

:04:17.:04:23.

burger, need only contain 62% beef, a chicken burger, 55% chicken, and

:04:23.:04:28.

a pork burger, 67% pig meat. For called economy products, the

:04:28.:04:38.
:04:38.:04:46.

These days we expect our food to be fresh all year round, and food

:04:46.:04:50.

supply chains stretch right round the globe, ensuring food security

:04:50.:04:55.

has become ever more difficult. At the same time, testing is more

:04:55.:05:00.

sophisticated, and you can identify all kinds of alien substances,

:05:00.:05:05.

alien DNA, but you have to decide what you are looking for.

:05:06.:05:11.

Technicians analysing meat samples like this can test for horse DNA,

:05:11.:05:15.

donkey DNA, zebra DNA, or maybe all at the same time. It is up to the

:05:15.:05:19.

client to decide. The technicians can't just look for DNA that

:05:19.:05:25.

shouldn't be there. It is a specific test, because it is a very

:05:25.:05:30.

selective test, targeting on specific he will empts of the DNA

:05:30.:05:33.

of the species of interests, it can't be a scatter gun approach.

:05:33.:05:38.

That is not to say that multiplexing can't be performed if

:05:38.:05:45.

a laboratory is asked to set up an as say or PCR for a variety of

:05:46.:05:50.

spees she is, that can be done, but it must be named species

:05:50.:05:54.

deliberately sought for in the analysis. Nearly ten years ago, the

:05:54.:05:58.

Food Standards Agency found donkey DNA in salami sold in Yorkshire and

:05:58.:06:02.

Tyneside. They checked over 100 salami samples, right across the

:06:02.:06:06.

country, but didn't find it anywhere else. It doesn't surprise

:06:06.:06:14.

me that the issue has reemerged. It is well known that maybe 80-90% of

:06:14.:06:17.

food problems are problems that have happened before, and then

:06:17.:06:22.

reemerge into the system. The problem is, we don't know when that

:06:22.:06:27.

reemergence is going to take place. Others say this issue shows the

:06:27.:06:31.

need for tougher enforcement in this industry now. With public

:06:31.:06:36.

confidence undermined. DNA testing of meat, once the exception, could

:06:36.:06:43.

become far more common. Professor Philip James is a food

:06:43.:06:46.

policy expert, who drew up the blueprint for what became the Food

:06:46.:06:53.

Standards Agency, and lelen Browning leads the farming group,

:06:53.:06:56.

the Soil Association. We invited executives from the meat and

:06:56.:07:00.

supermarket sector, they said they were unavailable. Warm welcome to

:07:00.:07:05.

both of you. The extraordinary thing is even Tesco hold us it was

:07:05.:07:08.

surprised by all this, Tesco doesn't know where its own meat

:07:08.:07:13.

comes from? All you have to do is look at the food chain, and when I

:07:13.:07:20.

try to work out how to get a valid system, so that people can be

:07:20.:07:25.

assured, that was during the BSE crisis and the E-coli. It rapidly

:07:25.:07:29.

became available that there was the issue of control of abattoirs,

:07:29.:07:34.

which was far from perfect, and then there was the whole issue of

:07:34.:07:39.

where do all these components come from? I didn't realise at the time,

:07:39.:07:44.

and I told parliament in an inquiry about a year or two later, I hadn't

:07:44.:07:49.

realised just how much food and ingredients were coming from abroad.

:07:49.:07:55.

And in the nature of the Food Standards Agency, I realised it was

:07:55.:08:00.

essentially impossible to have a monitoring system that would track

:08:00.:08:05.

every portion of ingredients and food that came from abroad.

:08:05.:08:09.

Completely impossible. And so that then leads us into the EU, where if

:08:09.:08:13.

the majority of our food comes from the EU, you are then dependant on

:08:13.:08:17.

the European system, monitoring it, but you have to remember that this

:08:17.:08:22.

is not an isolated case. In about the SE, we worked out when I was in

:08:22.:08:27.

Brussels, that -- BSE, we worked out when I was in Brussels, a

:08:28.:08:34.

animal cut up in Germany, and sent to Denmark and be in ten countries'

:08:34.:08:37.

food products. Whose responsibility is it to trace what is in the food.

:08:37.:08:40.

Is it the supermarkets, the suppliers? I think that the problem

:08:40.:08:46.

we have here is we do have a global food industry, which is all about

:08:46.:08:51.

trying to produce food as cheaply as possible. We have a consumer and

:08:51.:08:54.

retailer putting a lot of pressure on the supply chain for cheap food.

:08:54.:08:59.

You would want prices to go up? think you cannot expect, if you are

:08:59.:09:02.

putting pressure all the way down the chain, on every part of the

:09:02.:09:06.

chain, from the farmer to the processor to the retailer even,

:09:06.:09:08.

because shareholders are demanding short-term profits from those

:09:08.:09:12.

retailers as well, then you are going to get all sorts of strange

:09:12.:09:15.

things happening. We have seen it over the years, we will see it

:09:15.:09:20.

again. I wonder whether there is even a sense that the consumer

:09:20.:09:24.

minds this. Sure, when the headline is horse meat people get very

:09:24.:09:28.

agitated, as we saw from the report there, the breakdown is also on the

:09:28.:09:33.

packet. You are told exactly what is in a cheap-end burger, people

:09:33.:09:38.

buy them, they don't mind? They don't actually realise some of the

:09:38.:09:41.

implications. I'm also in the nutrition game, the health problems

:09:41.:09:45.

of Britain are extraordinary. People haven't got it into their

:09:45.:09:49.

heads yet that actually what's in that stuff, and it is quite

:09:49.:09:53.

difficult to tell really its impact, except for this traffic light

:09:53.:09:57.

labelling, which was an attempt to get there. But that's nothing to do

:09:57.:10:02.

with ingredients in terms of validating where it comes from,

:10:02.:10:09.

food safety and so on, which is the only subject the FSA is having to

:10:09.:10:14.

handle. I wonder if the labelling is something of a middle-class

:10:14.:10:18.

obsession, if you are interested in your organics and phosphates you

:10:18.:10:22.

will read it. If you are short of time and money you don't sit down

:10:23.:10:27.

and wonder about the countries listed on a packet? I agree a lot

:10:27.:10:30.

of people aren't reading the labelling properly, but a lot of

:10:30.:10:33.

people are driven by the price on there. You sound as if you are

:10:33.:10:37.

surprised by that, we are in the middle of a recession? Absolutely,

:10:37.:10:40.

the pressures during the recession are greater than they were five

:10:40.:10:45.

years ago. We have had huge food scandals in this country over the

:10:45.:10:49.

last ten 20 or 10 years -- 10 or 20 years. We have done a lot to try to

:10:49.:10:53.

remedy the situations around. When the supply chain and all the

:10:53.:10:55.

businesses are under pressure, actually, there are only a few

:10:55.:10:59.

people who care enough to read the label, who really want to look at

:10:59.:11:04.

the prefnens, who really want to make sure they know where the food

:11:04.:11:07.

comes from. You were at the heart of repairing what was a massive

:11:07.:11:13.

scandal, the BSE scandal, you sound like you still don't understand the

:11:13.:11:20.

transparency of the system? If you don't, who does? The fact is, it is

:11:20.:11:22.

exceptionally difficult. anything properly changed since

:11:22.:11:27.

then? We know that the abattoir system is different? The abattoirs

:11:27.:11:32.

have changed. The nutritional labelling has changed. The called

:11:32.:11:37.

validation process is now in a mode where you are essentially relying

:11:37.:11:43.

on intelligence as to what probably might be there. If you have a

:11:43.:11:45.

thousand tests, do you put a thousand tests into all these

:11:45.:11:49.

products. You cannot do it. Therefore, the question is...This

:11:49.:11:55.

Goes back to the test for the DNA of zebra? Precisely. If you are

:11:55.:12:01.

going for cheap food, you will fill that food, sorry, with essentially

:12:01.:12:06.

rubbish, fat, sugar, gristle, all sorts of things, just to fill it.

:12:06.:12:10.

That has been recognised for a long time. Don't forget the farmers have

:12:10.:12:16.

a very small proportion of the cost of that food that the retailer gets.

:12:16.:12:20.

Should anybody be apologising for what is going on, and should there

:12:20.:12:24.

be legal implications for this. This came up before MPs and the

:12:24.:12:28.

Food Standards Agency today, should Tesco and other supermarkets be

:12:28.:12:32.

thinking in terms of the legal fees this will cost them? I think they

:12:32.:12:35.

should be thinking very hard about their reputation, and the security

:12:35.:12:38.

of their supply chain going forward. Actually one of the things that has

:12:38.:12:41.

happened as we have increased the amount of regulation around food,

:12:41.:12:44.

is it has driven a lot of the smaller business, and smaller

:12:44.:12:48.

abattoir, the smaller meat processors, out of business. The

:12:48.:12:53.

whole system is even more globalised than it was 10 or 20

:12:53.:12:57.

years ago. When you get a problem somewhere, it will spread really

:12:57.:13:01.

fast. It doesn't feel like food is cheap, food inflation is on the up?

:13:01.:13:04.

Food inflation is on the up, these pressures will get greater. We need

:13:04.:13:07.

to take short-term thinking out, we need to plan for the long-term. We

:13:07.:13:11.

need Governments to think about the long-term. And we need retailers to

:13:11.:13:14.

be working fairly with the businesses who are supplying them

:13:14.:13:18.

with the farmers supplying those businesses, to make sure we really

:13:18.:13:20.

do know where food comes from into the future.

:13:20.:13:23.

Thank you very much. This week, the Government announced

:13:23.:13:30.

a concrete plan to build the second stage of the high-speed 2 rail line

:13:30.:13:34.

from Manchester to Leeds. That won't be built until much later, so

:13:34.:13:37.

much for speed. That crawls through the planning stages and Britain

:13:37.:13:41.

should have decided what to do with the other big infrastructure

:13:41.:13:44.

headache, airports. The review into aviation capacity won't report

:13:44.:13:47.

until after the next general election in 2015, whereupon it

:13:47.:13:51.

could take a further decade before anything is built. While Britain

:13:51.:13:55.

delays, dozens of rival airports are eating our proverbial lunch. We

:13:55.:14:04.

have been to Amsterdam and Istanbul, to view the competition. Long

:14:04.:14:08.

before mass air travel, long before Skye Bridges, travel lators or duty

:14:08.:14:13.

free were words. London's principal airport was in fact in Croydon,

:14:13.:14:18.

south of the city. These pictures were shot in 1920s, these are the

:14:18.:14:23.

earliest ever air passengers, flying between Amsterdam and

:14:23.:14:26.

Croydon. Which is where air traffic control was invented and much of

:14:27.:14:31.

the Battle of Britain was co- ordinated. King George VI trained

:14:31.:14:35.

as a pilot here. Now it is a museum in the middle of an industrial

:14:35.:14:42.

estate. Croydon's failure to adapt, it was literally just grass fields,

:14:42.:14:47.

was replaced by an Rafah sillity in west London called Heathrow. Other

:14:47.:14:51.

large airports developed around the capital, notably Gatwick and

:14:51.:14:55.

Stanstead. They are not hubs, all passengers using those airports

:14:55.:14:59.

start or end their journey there. Heathrow, like it or loathe it, is

:14:59.:15:03.

Britain's only true hub airport, where travellers can connect with

:15:03.:15:06.

flight to almost anywhere in the world. But as most people will

:15:06.:15:10.

agree, Heathrow is now full, its owners are screaming out for

:15:10.:15:15.

permission to build another runway. The fifth major review since the

:15:15.:15:19.

1960s into airport capacity in the south-east is now under way.

:15:19.:15:23.

Although it won't report until late 2015, it could suggest expanding at

:15:23.:15:28.

Heathrow, or Gatwick, or Stanstead. Or even building a completely new

:15:28.:15:38.
:15:38.:15:40.

hub airport in the Thames Estuary. So, while London dithers, I want to

:15:40.:15:45.

find out what airports in other cities are doing. First stop

:15:45.:15:47.

Birmingham. Ten million people live within an hour of Birmingham

:15:47.:15:51.

Airport, which has a gleaming new terminal, plenty of spare capacity,

:15:51.:15:55.

and is well served by road and rail. But being just over an hour away

:15:55.:15:59.

from London is one of the problems. British Airways pulled out a few

:15:59.:16:03.

years ago to focus on Heathrow. And now Birmingham is a bit like a

:16:03.:16:08.

beautiful bride, waiting for a suitor.

:16:09.:16:17.

We have Jaguar Land Rover in sight of where we are, yet Jaguar Land

:16:17.:16:22.

Rover's chief executive can't fly to us from India. How many

:16:22.:16:26.

investors is this putting off. We have an aviation policy that

:16:26.:16:29.

concentrates on an airport close to the capital. London is the greatest

:16:29.:16:33.

city in the world, we don't deny that, and there is a lot of

:16:33.:16:37.

concentration on financial services. As we rebalance the services, we

:16:37.:16:39.

have to be real about getting access to markets and manufacturing.

:16:39.:16:42.

We have to change what is a broken system.

:16:42.:16:47.

It is not just regional airports which are hoping to steal a march,

:16:47.:16:57.
:16:57.:16:58.

while London delays. I joined the 2.3 million people who

:16:58.:17:03.

fly from regional British airports, on KLM, into Amsterdam. In fact,

:17:03.:17:08.

people outside London are as likely to use Schiphol to get to their

:17:08.:17:12.

final global destination, as they are to use Heathrow. Schiphol is a

:17:12.:17:16.

large aiorn in a small country, which means in order to -- airport

:17:16.:17:21.

in a small country, in order to expand it needs to lure customers

:17:21.:17:28.

from other countries, Britain is the target. While Britain as

:17:28.:17:33.

prevaricated and delayed about capacity enhancement, Schiphol has

:17:33.:17:39.

six full-length, full-use runways. 70% of all people who use Schiphol

:17:39.:17:42.

are transfer passengers, they have no intention of getting out in

:17:42.:17:47.

Amsterdam. The equivalent for Heathrow is around 30%. So,

:17:47.:17:51.

Schiphol has built its entire airport around passengers changing

:17:51.:17:56.

planes. Something that might not make sense in London. We have the

:17:56.:17:59.

one-termal concept, which makes it very easy for passengers who come

:17:59.:18:03.

in to connect to flights. It is not huge distances they have to travel.

:18:03.:18:08.

And, of course, our airport capacity is also built on making

:18:08.:18:11.

connections, facilitating with a lot of gates, in order to make sure

:18:11.:18:14.

that passengers can connect efficiently to their new flights

:18:14.:18:19.

and then they can go out quickly again. KLM says it will wrap up its

:18:19.:18:23.

presence in Britain even further while London prevaricate. We will

:18:23.:18:26.

continue our expansion strategy into the UK, it is a prime market

:18:26.:18:33.

for us. With the marketing slogan "welcome to Schiphol". Yes. Even

:18:33.:18:38.

though you are in Kent? Schiphol airport was voted as Best British

:18:38.:18:43.

Airport in the UK, why not! Even though Amsterdam is growing, like

:18:43.:18:48.

many of Europe's older hubs, it faces stiff new competition from

:18:48.:18:54.

the near east. Ten years ago Heathrow was Europe's busiest

:18:54.:19:02.

aviation hub, with 63 million passengers, Schiphol had 40 million,

:19:02.:19:07.

and Istanbul's airport only 10 men I don't know. Heathrow squeezed an

:19:07.:19:17.
:19:17.:19:32.

extra 11% out of its two extra # Come fly with me

:19:32.:19:42.
:19:42.:19:42.

It's the only way to fly. # Come fly with me

:19:42.:19:49.

# Let's fly away I will have the prawns and some

:19:49.:19:58.

peppers as well. Great choice, sir. All this pampering was, alas, on

:19:58.:20:02.

the ground. The facility where Turkish airlines trains chefs to

:20:02.:20:05.

serve food in the air, that they have prepared on the ground. It may

:20:05.:20:09.

be a gimmick, but it is part of the ambition and focus of an airline

:20:09.:20:13.

that few of us had heard of 20 years a but is now the fastest-

:20:13.:20:18.

growing airline in the world. Taking the advantage of its key

:20:18.:20:28.
:20:28.:20:29.

geographical location, where Asia meets Europe. # Come fly with me!

:20:29.:20:34.

The boss of Turkish Airlines says the cost of building a new runway,

:20:34.:20:39.

is roughly what he spends on a new jumbo jet, so his success in the

:20:39.:20:42.

air is only possible if it is matched by expansion reinvestment

:20:42.:20:46.

on the ground. I'm the decision maker, I spend millions of dollars

:20:46.:20:50.

on the ground, because we are on the ground, and make the passenger

:20:50.:20:55.

happy, when checking in and boarding, spend more on the ground

:20:55.:21:01.

and your nation becomes a big player in the airline business.

:21:01.:21:05.

My youthful co-pilot encapsulates the vigour of this rapidly growing

:21:05.:21:08.

and modernising economy. Supported on the ground, and in the air, by

:21:09.:21:14.

the Government. She's one of the 2,400 trainee pilots earning their

:21:14.:21:19.

wings on simulators just like this one every year. While London hasn't

:21:19.:21:25.

built any new runways in decades, Istanbul will have five new runways

:21:25.:21:30.

by 2017. As for my first go on a Boeing 777, I think I might stick

:21:30.:21:37.

to journalism. So, will all this recent growth

:21:37.:21:42.

eventually run out of road? There will be a saturation point, which

:21:42.:21:47.

we know. There are 150,000 motorways in the air from Europe to

:21:47.:21:52.

the other parts of the world. There is not any other economic activity

:21:52.:21:56.

which can replace this economy, even the Internet. Otherwise you

:21:56.:22:01.

wouldn't be here. Then, the location of Istanbul is another

:22:01.:22:07.

advantage for us. Istanbul is the meeting point of two continents,

:22:07.:22:12.

Istanbul is in the world's economic market nearly for 3,000 years.

:22:12.:22:19.

Istanbul of the capital of three empires, east Roman, Byzantine and

:22:19.:22:26.

out toeman empire. It is now the -- Automan empire, now it is the

:22:26.:22:33.

capital of the Turkish Republican lick.

:22:33.:22:37.

-- Turkish Republic. Back to the centre of the debate, where the

:22:37.:22:42.

home of the Industrial Revolution seems to find it so tough to build

:22:42.:22:46.

more runway, when the demand from passengers is at least there. The

:22:46.:22:50.

man who wants the additional capacity the most, he's almost

:22:50.:22:54.

philosophical. I would like the answer to come as quickly as

:22:54.:22:58.

possible. But, if, a quick answer is even more quickly undone,

:22:58.:23:03.

because it is a, say First Minister, it is a party political issue,

:23:03.:23:10.

every time there is a new election there is a reversal then, there is

:23:10.:23:13.

no benefit to the British public. We need something that will survive

:23:13.:23:15.

through several political cycles long enough to be delivered.

:23:15.:23:22.

think it is to do with the nature of the democracy in the UK. We have

:23:22.:23:31.

situations where providers of the infrastructure want to develop the

:23:32.:23:35.

infrastructure, local opposition is very strong, either on social,

:23:35.:23:38.

economic or environmental grounds, and there is the constant conflict

:23:39.:23:43.

between those who want to build and those who want to delay or stop

:23:43.:23:46.

building. The Government tends to sit in the middle. It doesn't take

:23:46.:23:51.

sides, and very often if it does take sides, it supports the

:23:51.:23:58.

objectors, which is what has happened at Heathrow.

:23:58.:24:01.

Europe and North America used to be the only shows in town when it came

:24:01.:24:07.

to air travel. Those days have gone the way of Croydon Airport. The

:24:07.:24:12.

question is, not whether, but when Heathrow lose its top dog status,

:24:12.:24:20.

and whether it too becomes a museum in west London.

:24:20.:24:24.

The former head of remuneration at Barclays Bank has criticised the

:24:24.:24:29.

size of bankers' bonuses, saying a culture of entitlement in the

:24:29.:24:38.

sector led to obscene levels of reward. She also laid bare her

:24:38.:24:44.

anger, for Bob Diamond, who received �20 million for his pay

:24:44.:24:47.

package. She said she had been overruled when calling for him to

:24:47.:24:53.

forego his bonus, she had been amazed her suggestions had fallen

:24:53.:24:56.

on deaf ears. You have been grounded for a month

:24:56.:25:04.

and you can take us through what she's saying. Pretty uncoloured

:25:04.:25:08.

words there? She has turn the banking equivalent of turning

:25:08.:25:11.

states evidence. She has said the dogs in the street have known for a

:25:11.:25:16.

long time that the investment bankers are overpaid, a lot of the

:25:16.:25:19.

reward leads to risk-taking, which has led to the problems over the

:25:19.:25:22.

past few years. She was speaking before the banking commission in

:25:22.:25:26.

her capacity of the former chairman of the remuneration committee in

:25:26.:25:31.

Barclays, who decide how much big guys like Bob Diamond get paid. She

:25:31.:25:35.

recommended he gets zero bonus for 2011, because they had an

:25:35.:25:38.

"unacceptable" year. That was overruled by the chairman. And the

:25:38.:25:43.

chairman who is no longer with the bank either, prevailed. The think

:25:43.:25:47.

she was saying to the commission is that shareholders have suffered.

:25:47.:25:51.

The owner of the bank have suffered, whilst the big boss, who were paid

:25:51.:25:57.

so much, have not. Shares are down 70% between 2007 and 2012 yet the

:25:57.:26:01.

remuneration, the total remuneration is stuck at about �12

:26:01.:26:05.

billion. That is indicative of the problem, the wider problem in the

:26:05.:26:10.

banking sector. What is Barclays saying about all this? Well,

:26:10.:26:17.

Barclays are officially saying nothing about Alison Carnworth's

:26:17.:26:20.

statement, other than the current are you numberation chief disagrees

:26:20.:26:25.

with the analysis. Supporters of the bank are saying, while she may

:26:25.:26:33.

have proposed a zero bonus for Bob Diamond, she voted for the �2.7

:26:33.:26:37.

million bonus and spoke up in favour for it at the AGM last year.

:26:37.:26:43.

As to why he was paid the money, the insider world is it was Bob's

:26:43.:26:50.

ego, it had to be paid to placate Bob's ego. Joining me now is the

:26:50.:26:56.

former Chancellor, Lord Lawson, and sir Martin Jacob, a former Deputy

:26:56.:27:00.

Chairman of Barclays. Thank you for coming in. How should we see this

:27:00.:27:05.

woman in this, brave to speak out, or too late after the event. What

:27:05.:27:12.

do you read into what we have learned today? I don't think her

:27:12.:27:20.

evidence is all that important. What is important is the basic

:27:20.:27:25.

remuneration that bankers are paid is too high. That is just a

:27:25.:27:28.

Barclays problem it affects all bank. The reason Alison Carnwath's

:27:28.:27:33.

evidence is note worthy, is she said all this, or she claims she

:27:33.:27:37.

said all this at the time. It is not a revelation, and it was

:27:37.:27:41.

ignored. How can we be in this situation, four years after the

:27:41.:27:44.

credit crunch, where this kind of stuff is still being ignored?

:27:44.:27:50.

tell you it certainly wouldn't have happened in my day. I can't comment

:27:50.:27:54.

on the internal workings between the remuneration committee, and the

:27:54.:27:59.

main board of Barclays. I would have thought that if you were the

:27:59.:28:02.

chairman of the remuneration committee and you didn't get your

:28:02.:28:05.

way, on an issue like this, I would have thought you wouldn't have

:28:05.:28:15.

continued in that role and resigned right away. But I would like to

:28:15.:28:18.

just say something more general about the pay of bankers. There are

:28:18.:28:24.

a couple of things which boards in general fail to take proper account

:28:24.:28:27.

of. One was that these high salaries are very unpopular with

:28:27.:28:31.

the public at large, with the customer, and that unpopularity is

:28:31.:28:39.

picked up by the Governments, and political leaders. That has a very

:28:39.:28:44.

bad effect in terms of the actions Governments take against banks.

:28:44.:28:51.

is very interesting that. You will not find a politician on the scene

:28:51.:28:57.

today, apart from Boris Johnson, who bigs up bankers and the bonuses,

:28:57.:29:01.

but none of them do anything to change it, do they? That is locked

:29:01.:29:05.

at the present time. One of the things the banking commission is

:29:05.:29:11.

looking at is bankers' remuneration. I remember asking Alistair darling

:29:11.:29:15.

about that four years ago? I'm not talking about Alastair Darling,

:29:15.:29:19.

nice fellow that he is. It is successive Governments? It is

:29:19.:29:22.

something we are looking at as a commission, among other things in

:29:22.:29:25.

the banking area. That is why we had the hearing with Alison

:29:26.:29:31.

Carnwath today. One of the striking things, one of the alarming things,

:29:31.:29:36.

Martin is absolutely right, bankers a pay has gone completely out of

:29:36.:29:40.

hand. It is not as if these are particularly special people, a lot

:29:40.:29:44.

of them. They are intelligent, they work hard, but they are readily

:29:44.:29:53.

replacable, most of the time. million Bob Diamond got, for 2011,

:29:53.:30:00.

the leer of LIBOR? For Barclays, in the run up to the crash, what they

:30:00.:30:05.

called structured capital products. Structured capital products, was a

:30:06.:30:10.

euphamism for tax avoidance. They were in the tax avoidance business

:30:10.:30:15.

in massive way. That was earning them something like �100 billion a

:30:16.:30:25.
:30:26.:30:26.

year. The people doing that were paid enormous bonuses. You know, it

:30:26.:30:33.

was no great skill. Your last point, Sir Martin, it is very unhealthy

:30:33.:30:38.

when Governments bash bankers, but what happens? Nobody actually

:30:38.:30:42.

leaves, nobody goes to Geneva, or takes their business elsewhere,

:30:42.:30:49.

that is just an empty threat, isn't it? I don't think it is, I think it

:30:49.:30:54.

has a highly undesirable combination of events. It makes the

:30:54.:30:59.

existing people running the banks, right now, much more cautious of

:31:00.:31:05.

everything they do, with the result that they are not functioning.

:31:05.:31:08.

current head of Barclays, should people be looking at what he gets

:31:08.:31:12.

now? There are questions over what his bonus is? The current head of

:31:12.:31:16.

Barclays got exactly the same what the previous head of Barclays got,

:31:16.:31:20.

with no bonus, he is not taking any bonus and no pay increase. Should

:31:20.:31:25.

there be a position to clawback bonuses for years that have proven

:31:25.:31:30.

to be ...I Think so. There is one thing which I think, just before I

:31:30.:31:36.

answer that point, which I think people forget when they are in the

:31:36.:31:41.

boardrooms, deciding on the pay. That's this, that you may have a

:31:41.:31:44.

really star trader, he may be very, very valuable, and you may think

:31:44.:31:49.

you have to pay a lot to get him, and he may make a lot of profits,

:31:49.:31:55.

but those profits are made by the combination, not by him alone, but

:31:55.:32:01.

by the combination of him and name of the bank he's working for.

:32:01.:32:05.

People forget that. That is why bankers aren't the same. Presumably

:32:05.:32:08.

banks have proved that they cannot deal with this question on their

:32:08.:32:13.

own. If we are still hearing testimonies like this, four years

:32:13.:32:16.

after the beginning of the crunch, five years some would say. They

:32:16.:32:23.

can't do this themselves can they? They need regulation. I'm not sure

:32:23.:32:26.

whether regulation. There needs to be some regulation, of course, I'm

:32:26.:32:30.

not sure regulation is the whole answer, I'm sure it is not. I'm not

:32:30.:32:36.

sure it is the main part of the problem. It will always be gamed.

:32:37.:32:44.

You have to have structural changes of various kind. But three things,

:32:44.:32:48.

first of all we do want to have a strong banking industry in this

:32:48.:32:54.

country. It is good for the economy. We shouldn't give it away. We

:32:54.:32:58.

should clean it up, and the third thing, you are absolutely right,

:32:59.:33:02.

these people are not going to up stick and go somewhere else. Thank

:33:02.:33:10.

you both very much indeed. In a few Government moment we will speak to

:33:10.:33:14.

the Mexican actor, Gael Garcia Bernal, about his new film about

:33:14.:33:20.

the fall of Pinochet. First, to help the poorest six million pay

:33:20.:33:24.

their council tax, it is the most widely means-tested benefit in

:33:24.:33:27.

Britain. It is a major headache from tomorrow for local authorities,

:33:27.:33:32.

the Government has decided to cut the budget by 10% and relinguish

:33:33.:33:37.

administration of it, councils have to decide whether to swallow the

:33:37.:33:41.

cut or make savings elsewhere, or start charging people a portion of

:33:41.:33:45.

their council tax. One former Conservative cabinet minister said

:33:45.:33:52.

the changes could be a new poll tax for the Government. Wind the clock

:33:52.:33:56.

back to the start of the 60, and not go lamb was the setting for the

:33:56.:34:01.

classic film Saturday Night, Sunday Morning. A young, bed-hopping

:34:01.:34:06.

chancer of a character, played by Albert Finney, enjoys chasing the

:34:06.:34:11.

city's women by night. But he doesn't exactly ooze enthusiasm

:34:11.:34:19.

about the day job. At a bike factory run by Raleigh.

:34:19.:34:24.

No wonder I always have a bad back, don't let the bastards grind you

:34:24.:34:30.

down, I have learned that. coalition have promised to make

:34:30.:34:34.

work pay people like this bike- building anti-hero, it has also

:34:34.:34:40.

promised to make the benefits system simpler and fairer. Many

:34:40.:34:44.

locals here, including here in Nottingham, are pretty sniffy about

:34:44.:34:47.

a change that will make them responsible for helping poorer

:34:47.:34:50.

families with their council tax. It will be the job of the devolved

:34:50.:34:54.

administration in Scotland and Wales, Northern Ireland still has

:34:54.:34:59.

the rates. The Resolution Foundation think-tank said that

:34:59.:35:03.

over half of local authorities that replied to them, over three-

:35:03.:35:08.

quarters plan to bring in a council tax repayment for two thirds of the

:35:08.:35:12.

lowest paid households of working age. Nottingham is one of them.

:35:12.:35:15.

Government has given us the council tax benefits system to manage, they

:35:15.:35:19.

have cut the budget by 10%, it is going to get worse because we have

:35:19.:35:22.

been told to exempt pensioners and there is no inflation. In addition,

:35:22.:35:26.

it has sold a way that is dividing society T has told everyone that

:35:26.:35:31.

people on benefits are scroungers, a lot of people, we know, are not.

:35:31.:35:34.

All working-age households in Nottingham will have to pay at

:35:34.:35:40.

least 8.5% of their council tax bill, around �82 a year for a

:35:40.:35:45.

single parent in a band B property. Across England, many of the 2.5

:35:45.:35:49.

million households with no-one working and currently exempt from

:35:49.:35:57.

council tax will have to start paying it, typically between �96-

:35:57.:36:02.

�255 a year. 70,000 families with one person working will be affected.

:36:02.:36:06.

A single parent with children working part-time could see their

:36:06.:36:11.

bill rocket from �173 a year, to �750. I have come to meet one of

:36:11.:36:17.

those who will be affected by the changes. Jo Scott works 25 hours a

:36:17.:36:21.

week and has two school-age daughters. She knows a new bill

:36:21.:36:25.

will soon land on her doorstep, but doesn't know for how much. I do

:36:25.:36:29.

work here in school hours, which is very convenient, but obviously

:36:29.:36:37.

means I'm only working part-time. I'm an admin assistant, I do a lot

:36:37.:36:42.

of computer work and paperwork, I'm concerned about how it will affect

:36:42.:36:47.

us as a family, we do struggle as it is being on a part-time wage and

:36:47.:36:50.

being a single parent already. Anything additional taken away from

:36:50.:36:57.

that is a concern. Back in 1960s Nottingham, Arthur Seaton is still

:36:57.:37:00.

chasing skirt, where will this benefit change now leave the

:37:00.:37:04.

political parties in their chase for votes.

:37:04.:37:09.

Councils are also rushing to meet a deadline this week to work out how

:37:09.:37:12.

they should implement this idea in their own areas. Remember the

:37:12.:37:16.

question of what people make of it, what political blow-back there

:37:16.:37:19.

could be, with some people suggesting they are asking lots of

:37:19.:37:23.

people on relatively moderate incomes to make some contribution

:37:23.:37:28.

to their local services, has something of the whiff of the poll

:37:28.:37:32.

tax. Nonsense say Conservative MPs, who see this change as sensible and

:37:32.:37:38.

logical. Ultimately we are in a desperate financial mess. There is

:37:38.:37:41.

also a real psychological situation, where if you get something for free,

:37:41.:37:45.

you really don't value it. Now, you put those two together, and there

:37:45.:37:51.

has to come a point where everybody has to pay something towards where

:37:51.:37:55.

they live. But, the Conservative peer who designed the poll tax has

:37:55.:38:00.

warned this could be the poll tax mark two. It shunting that grim for

:38:00.:38:04.

the Tories, he hopes, but...If have a large number of people who

:38:04.:38:09.

who have never paid anything, and are expected to pay relatively

:38:09.:38:13.

small sums, it is that which created the fuss. For you, once

:38:13.:38:17.

bitten twice shy, you don't want the Government coming up against

:38:17.:38:22.

the same thing you did? I didn't persuade colleagues of that. This

:38:22.:38:26.

change will happen, and plenty of people here in Nottingham and

:38:26.:38:31.

elsewhere are preparing for an unwelcome raid on their already

:38:31.:38:35.

squeezed pockets. What happens when a dictator gives

:38:35.:38:42.

his people the chance to vote him out of power? That unlikely

:38:42.:38:47.

scenario is the story of Chile's Pinochet, who after a decade of

:38:47.:38:51.

unrelenting control offers a referendum. This is captured in a

:38:51.:38:59.

film called starkly No. A young advertising hot shot recently

:38:59.:39:03.

returned from exile played by Gael Garcia Bernal is the hero. First a

:39:03.:39:12.

glimpse of No. It's 1988, the feared Chilean

:39:12.:39:17.

dictator, Augusto Pinochet, has succumbed for a referendum on his

:39:17.:39:21.

leadership. A coalition of opposition parties campaign for a

:39:21.:39:28.

No vote. And decide to bring in a young skateboarding executive, to

:39:28.:39:33.

convince a demoralised population to vote against Pinochet and for

:39:33.:39:38.

democratic elections. This is the first-ever Chilean work to be

:39:38.:39:43.

nominated for Best Foreign Film at the Oscars. Shot using grainy 1980s

:39:43.:39:49.

cameras. It weaves in real-life foot j from the rather to give the

:39:49.:39:58.

-- footage from the era. He decides to run a positive campaign, under

:39:58.:40:04.

the banner "Chile Happiness Is Coming". Some say it looks like a

:40:04.:40:09.

soft drinks advert. But for him that is the genius.

:40:10.:40:13.

This is one of the advertising executives the film was based on,

:40:13.:40:19.

he worked with the actors during the shoot. You can offer more

:40:19.:40:24.

violence and more blood, we needed to change this emotion. We needed

:40:24.:40:29.

to change this para dime, we proposed another pardigm, if we can

:40:29.:40:33.

live together we can live in peace. The star of the film, Gael Garcia

:40:33.:40:37.

Bernal, is no strange Tory such political roles. As well as taking

:40:37.:40:41.

on parts like che gre var ra, in The Motorcycle Diaries, he has worn

:40:41.:40:45.

his political heart on his sleeve, working for Amnesty International,

:40:45.:40:51.

turning his back on Hollywood to some extent, in favour of more

:40:51.:40:58.

arthouse roles. There are rumours of blockbuster offers from

:40:58.:41:01.

Hollywood for Mexico's favourite son, but will the love affair be

:41:01.:41:04.

mutual. Gael Garcia Bernal is with me now.

:41:04.:41:10.

Thank you for coming in. You are attracted to what, revolution, or

:41:10.:41:13.

revolutionaries, it is an attractive role for you? Yeah, I

:41:13.:41:19.

think the films that shake up the established narrative are the ones

:41:19.:41:25.

that interest me. Ultimately the ones that I get called for. I don't

:41:25.:41:33.

usually get called for films that are... Playing the banker? You know

:41:33.:41:38.

how it is going to end in a sense. This film, I think, it taps into

:41:38.:41:45.

something that has a change of pardigm, definitely. One of the

:41:45.:41:50.

biggest and more heroic feats that democracy has seen in the world.

:41:50.:41:58.

And it gives also a critical point of view about democracy and the

:41:58.:42:01.

compromise that was made as well. This election was won, but there

:42:01.:42:05.

was a compromise within it. Many things changed, but there was also

:42:05.:42:10.

the open question. What did it really change? And also, the whole

:42:10.:42:18.

nature of selling politics like McCrown knee cheese, or coke --

:42:18.:42:23.

macaroni cheese, or Coca-Cola, almost a cheapened message for the

:42:23.:42:27.

end. What was your thought about that? There is this thing that

:42:27.:42:32.

Pinochet became a classical tragedy himself, you know. He came and

:42:32.:42:38.

imposed, or was a puppet of this imposition of an economic model,

:42:38.:42:44.

which is calling for the markets. And he did reform it? He did. But

:42:45.:42:51.

it was through the tools that he imposed which was the way they

:42:51.:42:57.

chuck him out of power. It was through publicity, the most

:42:57.:43:02.

perverted version of a publicity, which they used it in favour of the

:43:02.:43:05.

No Campaign, already a big political campaign. But I call it

:43:05.:43:09.

perverted because at the end of the day it was very technical. It was

:43:09.:43:14.

like, they didn't want to sell violence, they didn't want to use

:43:14.:43:21.

the message of, the ideas that were in opposition to Pinochet, meaning,

:43:21.:43:26.

showing everything that he had done before, you know, all the

:43:26.:43:30.

disappeared people. They twisted and they shifted into a kind of

:43:30.:43:35.

happy campaign. And you have said that politics in South America, in

:43:35.:43:40.

Latin America, is everything. It's daily life. And here, or in other

:43:40.:43:44.

parts of the world, where you have lived, it is more of a recreational

:43:44.:43:50.

sport? Yes, I think, it is, it has that kind of maybe it has to do

:43:50.:43:55.

with the connection that ever since we were kids, and politics is very

:43:55.:44:01.

engrained into our day-to-day life, where you buy this or that.

:44:01.:44:06.

everything is about La Luce, the struggle, the fight? I was lucky

:44:06.:44:10.

enough to be born into a point where my generation was the first

:44:10.:44:15.

one in Latin America to see, more or less, the kind of stablised

:44:15.:44:20.

democracy. The first time I voted of the first time that the PRI, now

:44:20.:44:25.

in power, when I voted of the first time that the PRI went out of power,

:44:25.:44:31.

after 72 years. You have lived here, I know, you have shaken cocktails

:44:31.:44:35.

and bars and in Islington and all the rest of it, when you look at

:44:35.:44:38.

the politics now, we were chatting, David Cameron's launching his

:44:38.:44:43.

referendum, if gets in, on the EU, how do you see something like that

:44:43.:44:49.

being run? Do you run that as a campaign for happiness? It depends

:44:49.:44:53.

on the question being asked, and how the question is being asked. I

:44:54.:44:59.

think it is definitely a call for an urgent discussion, back in those

:44:59.:45:06.

days, in 1988, the referendum was basically the only way that

:45:06.:45:10.

Pinochet could legitimise, and could appropriate democracy. He was

:45:10.:45:18.

going to be elected dictator, in a way. That was a very particular

:45:18.:45:23.

thing. But also in those days, there was less media. Television

:45:23.:45:29.

meant everything, you know, in the sense. Nowadays, the discussion can

:45:29.:45:35.

be much more open, it will be a little bit less serious, on some

:45:35.:45:44.

levels. It can be manipulated on a very "democratic" way. Does it feel

:45:44.:45:49.

manipulated here, or superficial, or do you think it is just not a

:45:49.:45:52.

tragic time? It is interesting to see how much participation there

:45:52.:46:01.

would be in a referendum like this. In this referendum in 1988, 7% of

:46:01.:46:05.

the voting population voted, -- 97% of the voting population voted,

:46:05.:46:10.

that is one of the biggest turnouts. In recent elections in Chile 30-40%

:46:10.:46:19.

of people voted in the elections. We're kind of also where the

:46:19.:46:23.

discontent for democracy is a credible one, we are questioning it.

:46:23.:46:31.

Democracy is a word that has been used and tampered. Let me --

:46:32.:46:36.

Stafrpled. We talked about Hollywood's love affair with you,

:46:36.:46:41.

you have been offered Zorro would you like to become part of that

:46:41.:46:46.

world now? I would like my own pathway, in a sense, that is what I

:46:46.:46:51.

have been lucky enough to be doing. If it involves every now and then

:46:51.:46:55.

getting a glimpse of how it is to work in Hollywood, yeah, I will.

:46:56.:47:00.

But just for the fun of it, really, it is another option. If I have to

:47:00.:47:04.

do only films in Latin America, I'm more than happy to do films in

:47:04.:47:07.

Latin America, no problem. Gael Garcia Bernal thank you. Thank you.

:47:07.:47:12.

Just before we go we will take you quickly through the front pages of

:47:12.:47:22.
:47:22.:47:44.

That's all tonight. Join us again tomorrow.

:47:44.:47:54.
:47:54.:47:56.

Goodbye for now. Hello, wind will strengthen again

:47:56.:47:59.

overnight. There is a belt of rain sweeping across the country. It

:47:59.:48:02.

should be clear by rush hour from England and Wales. But the rain

:48:02.:48:05.

lingering across Scotland. Some snow over the higher ground,

:48:05.:48:09.

elsewhere a lot of sunshine, it is the gusty winds that will be a

:48:09.:48:12.

particular feature, especially in northern England. Gusts of 50-60

:48:12.:48:17.

miles an hour. A westerly wind, if you are travelling on the A1 it

:48:17.:48:21.

could be tricky. Very few showers across England. Not as many as

:48:21.:48:24.

today, fleeting, few and far between. A good deal of sunshine.

:48:24.:48:28.

But the winds are going to be strong and gusty just about

:48:28.:48:33.

everywhere, I suspect. They will take the edge off the temperatures,

:48:33.:48:37.

just as they did today.-10 degrees. In Northern Ireland a windy start

:48:37.:48:44.

in the morning, possibly a bit less wint windy in the afternoon.

:48:44.:48:47.

Largely dry. The The wettest weather in Scotland, stuck across

:48:47.:48:51.

central areas, snow over the higher ground. It will feel cold across

:48:51.:48:58.

northern Scotland, not as windy as it was today. Lighter winds today.

:48:58.:49:01.

Turning colder across the north in particular. Thursday lots of

:49:02.:49:05.

sunshine across the southern half of the UK, for a while on Friday we

:49:05.:49:09.

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