:00:12. > :00:18.$:/STARTFEED. This piece of rubbish was sold as a bomb detector to
:00:18. > :00:22.Governments in some of the most violent countries in the world.
:00:22. > :00:27.Newsnight exposed the conman behind this scam, today he was found
:00:27. > :00:32.guilty at the Old Bailey. He said it does exactly what it is designed
:00:32. > :00:38.to. I said what's that? I was expecting him to say it detects
:00:38. > :00:44.explosives, ivory, gold, he never said that, he said it makes money.
:00:44. > :00:48.If Scotland goes it alone will the Chancellor refuse to accept the
:00:48. > :00:51.Scottish tenner? Why independence might kick it out the pound.
:00:51. > :00:56.We go in search of perfect childcare as the Children's
:00:56. > :01:01.Minister faces her critics on the hot issue at the moment. Welcome to
:01:01. > :01:11.Newsnight all about the difference between England and France,
:01:11. > :01:14.
:01:14. > :01:20.reception year and nursery. Going to enjoy this show, da-da-da-da!
:01:20. > :01:24.Good evening, it started life as a novelty golf ball finder and it
:01:24. > :01:27.helped end the lives of hundreds. A businessman took this gadget, a
:01:27. > :01:30.mere aerial on a hinge and convinced Governments in some of
:01:30. > :01:35.the most volatile countries in the world that it was a bomb detector.
:01:35. > :01:40.Newsnight first revealed the scam in 2010, tonight we can reveal how
:01:40. > :01:45.he bribed senior figures in Iraq to win an $85 million contract. This
:01:45. > :01:50.afternoon he was found guilty of fraud by the Old Bailey. Caroline
:01:50. > :01:55.Horley, who broke the original story, reports.
:01:55. > :02:00.If you believe the sales pitch this called bomb detector could detect
:02:00. > :02:08.explosives more than half a mile away. All powered by no more than
:02:08. > :02:13.the user's static electricity. REPORTER: How many people's lives
:02:13. > :02:17.were taken in Iraq. Today Jim McCormick was convicted of fraud at
:02:17. > :02:21.the Old Bailey. His scam began with this, a novelty golf ball finder n
:02:21. > :02:25.reality just an aerial on a hinge that couldn't find anything. Jim
:02:25. > :02:31.McCormick bought hundreds of them from the US for $20 each, he put
:02:31. > :02:36.his own label on them and sold them as bomb detectors for as much as
:02:36. > :02:42.$5,000 a time. He then created a more advanced-looking version,
:02:42. > :02:47.which he called the ADE 651, this time it came with special cards,
:02:47. > :02:53.supposedly programmed to detect everything from explosives to ivory,
:02:53. > :03:01.human beings or even $100 bill its. He sold this -- bills. He sold this
:03:01. > :03:05.version for as much as $55,000 each. Iraq alone spent $85 million buying
:03:05. > :03:09.thousands of them for use at checkpoints from Baghdad to Basra,
:03:09. > :03:12.as protection from suicide bombs. We have been told that bribes to
:03:12. > :03:20.senior Iraqi officials helped Jim McCormick sweeten the deal for the
:03:20. > :03:25.bogus devices. This was just one of a series of ploifgss to rock
:03:26. > :03:31.Baghdad in -- explosions to rock bad dad in late 2009. At the height
:03:31. > :03:39.of the bombings there were call force the devices to be withdrawn.
:03:39. > :03:44.Mr Jim here. Jim McCormick came to Iraq, and with the head of the
:03:44. > :03:49.Baghdad bomb squad, organised a press conference to persuade Iraqis
:03:49. > :03:52.that it worked. We have discovered that the general had been bribed by
:03:52. > :03:57.Jim McCormick. He has now been jailed for corruption, thanks to
:03:57. > :04:01.the work of this man. He's the Inspector General of the Interior
:04:01. > :04:07.Ministry, Aqil al-Turehi. He says his investigation is backed by the
:04:07. > :04:12.Prime Minister, but that other, high-ranking officials are
:04:12. > :04:16.implicated in the conspiracy. TRANSLATION: I feel furious as a
:04:16. > :04:20.citizen of Iraq when I think that this gang of Jim McCormick and the
:04:20. > :04:25.Iraqis working with him killed my people in cold blood by creating a
:04:25. > :04:30.false sense of security with a useless device. How many people
:04:30. > :04:34.lost their lives in bombs that passed through checkpoints where
:04:34. > :04:40.this device was being used? TRANSLATION: I think hundreds, I
:04:40. > :04:44.don't have the exact statistics, but it was hundreds. For every bomb
:04:44. > :04:52.stopped, he said, four got through. And the explosives that were found
:04:52. > :04:57.were discovered because of tip-offs or by chance. Between 2008-2009
:04:57. > :05:05.over 1,000 Iraqis died in bomb abacks in Baghdad alone, many more
:05:05. > :05:09.were seriously injured. I met Haneen Alwan in Jordan, where she
:05:09. > :05:13.has come for medical treatment. She has already had 59 operations after
:05:13. > :05:17.she suffered horrific burns in a double bomb anything Baghdad in
:05:17. > :05:21.early 2009. She had been two months pregnant at the time, and craving
:05:21. > :05:26.ice-cream, which she had gone out to buy when she was caught in the
:05:26. > :05:30.explosion. TRANSLATION: My life was completely destroyed, I lost
:05:30. > :05:38.everything in an instant. I was left with nothing. I lost the baby
:05:38. > :05:43.and my husband divorced me. She had trusted that Jim McCormick's called
:05:43. > :05:50.bomb detector, used at virtually every checkpoint worked. What do
:05:50. > :05:54.you think of the man who sold these devices? TRANSLATION: The man has
:05:54. > :05:58.no conscience, he is morally bankrupt. How could he sell them
:05:58. > :06:07.just for the money and destroy the lives of others. He has no humanity,
:06:07. > :06:12.a useless person. What kind of man would sell fake bomb detectors to a
:06:12. > :06:16.country where lives depended on it? This is Jim McCormick on a sales
:06:16. > :06:20.trip to Niger, being filmed by a colleague who had believed the
:06:20. > :06:25.devices worked. He has agreed now to talk exclusively to Newsnight,
:06:25. > :06:29.as long as we conceal his identity. Which countries did you go to with
:06:29. > :06:35.Jim McCormick to sell these devices? We flew all around the
:06:35. > :06:41.world, Belgium, Romania, Hong Kong, Niger, Nigeria, Kenya. The training
:06:41. > :06:45.for the Iraqis was done in Turkey. He started to have suspicions, and
:06:45. > :06:49.then senior army officers in Niger complained that the detectors
:06:49. > :06:54.didn't work. The whistleblower confronted McCormick. What happened
:06:54. > :06:57.when you raised your concerns with Jim McCormick? Well, I said if this
:06:57. > :07:03.doesn't work I can't be any part of it. He said it does exactly what it
:07:03. > :07:06.is designed to I said what was that, I was expect him to say it detects
:07:06. > :07:11.explosives, ivory and gold, he never said that, he said it makes
:07:11. > :07:14.money. I said I didn't want nothing to do with it. He said suit
:07:15. > :07:18.yourself, you are walking away from millions, said at least I can sleep
:07:18. > :07:23.at night. The big contract was in Iraq, the trick was to find corrupt
:07:24. > :07:28.middle men who would sign contracts to buy the ADE 651s, people like
:07:28. > :07:31.the head of the Iraqi bomb squad. The middle men don't care if people
:07:31. > :07:36.live or die, they are only interested in one thing, how much
:07:36. > :07:46.will I get back, cash back. question at all that it was bribery
:07:46. > :07:49.
:07:49. > :07:53.that oiled the wheels of this scam? Absolutely, absolutely. Apart from
:07:53. > :08:03.Iraq, one of the places that Jim McCormick sold his bogus bomb
:08:03. > :08:07.
:08:07. > :08:11.detectors was here in Lebanon. The country that had bounce the back
:08:11. > :08:16.after the dark case -- bounced back after the dark case days of the
:08:16. > :08:20.Civil War. He sold them to the Lebanese arm and the United Nations
:08:20. > :08:24.peacekeeping force along the border with Israel. They became suspicious
:08:24. > :08:26.when Mr McCormick couldn't produce evidence that showed they could
:08:26. > :08:31.detect explosives. It conducted a series of tests and found they
:08:31. > :08:34.didn't work. There was something else that brought Jim McCormick to
:08:34. > :08:38.Beirut. The city, once the financial capital of the Middle
:08:38. > :08:43.East, is still a playground for the rich. A free wheeling place where
:08:43. > :08:47.money can be easily spent and laundered. It was, our source says,
:08:47. > :08:51.where McCormick came to pay his bribes to the Iraqis. The
:08:51. > :08:56.whistleblower says he came here to a bank in Beirut and witnessed Jim
:08:56. > :09:01.McCormick organising the pay-offs. He watched as he arranged for bank
:09:01. > :09:04.accounts to be set up under false names. Three Iraqis have so far
:09:04. > :09:10.been arrested for corruption over the deals. But the whistleblower
:09:10. > :09:12.said he saw a list of around 15 names. Our source says the Iraqi
:09:12. > :09:16.officials were issued with bank cards which allowed them to take
:09:16. > :09:20.out large sums of money from cash machines anywhere in the world
:09:20. > :09:26.without being traced. He also says that electronic transfers were made
:09:27. > :09:30.to other accounts. McCormick could afford to give bribes to the Iraqis.
:09:30. > :09:36.He bought exclusive properties in Bath, including this one, sold to
:09:36. > :09:39.him by Hollywood film star, Nicholas Cage. Complete with Roman-
:09:39. > :09:44.style indoor swimming pool. His profits also funded a country home
:09:44. > :09:51.in Somerset, smart cars and dressage horses. As well as houses
:09:51. > :09:56.in Cyprus and Florida. And a yacht. It was Iraq that paid the price.
:09:56. > :10:01.Shockingly the British Government had been alerted months before Han
:10:01. > :10:05.in was injured, that the device was a scam, but nothing was done to
:10:05. > :10:12.prevent the sale. When our whistleblower walked out on
:10:12. > :10:15.McCormick in 2008, he made it his mission to take the bogus bomb
:10:15. > :10:19.detector out of circulation, warning the Ministry of Defence and
:10:19. > :10:24.those who bought the device. By 2009 the American military was
:10:24. > :10:29.sounding the alarm. And Avon and Somerset Police began investigating.
:10:29. > :10:37.But McCormick was freely plugging the ADE 651. In ideal conditions
:10:37. > :10:43.you can be up to 1km away. kilometer, so this device will help
:10:43. > :10:47.this device spot explosives a kilometer away. In ideal conditions
:10:47. > :10:53.it will. Koerm did a BBC interview that said the cards were the key.
:10:53. > :10:58.In early 2010 we decided to put the claims to the test with the help of
:10:58. > :11:02.the Cambridge Computer Laboratory. McCormick said this had been
:11:02. > :11:07.programmed to detect TNT, we decided to find out what was in it.
:11:07. > :11:09.This is the cheapest bit of electronics you can get that look
:11:09. > :11:17.vaguely electronic and are sufficiently flat to fit inside a
:11:17. > :11:22.card. It couldn't be programmed to detect TNT? Absolutely not. The day
:11:22. > :11:29.we broadcast our report in January 2010. Good evening a Newsnight
:11:29. > :11:35.investigation has discovered that a called bomb detector produced by a
:11:35. > :11:39.British company and sold to Iraq does not work.
:11:39. > :11:43.British troops have now left Basra and the Americans have left Baghdad.
:11:43. > :11:48.But at checkpoints across the capital and beyond, where bombs
:11:48. > :11:54.remain a constant threat, the bogus detector is still being used. The
:11:54. > :11:58.man who sold them now faces several years behind bars.
:11:58. > :12:01.I'm joined now by Detective Superintendent Nigel Rock from Avon
:12:01. > :12:05.and Somerset Police who was the senior investigating officer on the
:12:05. > :12:08.case. You must be a very happy man this evening, Nigel Rock. This was
:12:08. > :12:13.a conviction for fraud, which I guess in some ways just doesn't
:12:13. > :12:19.quite cover it, does it, what would be your message to Jim McCormick
:12:19. > :12:25.tonight? I think it does cover it in so much as the device doesn't
:12:25. > :12:33.work, it could never work. Jim McCormick knew it didn't work and
:12:33. > :12:38.the court accepted that. And then he told lies and a deception that
:12:38. > :12:41.he practised and developed over ten years. I think fraud fits the crime.
:12:41. > :12:45.Whether it fits the whole circumstances is a different matter.
:12:46. > :12:50.Because clearly many people's lives have probably been affected by
:12:50. > :12:56.McCormick and his useless device. Hundreds lost we were hearing
:12:56. > :13:00.because of this? We have never been able to directly prove that the
:13:00. > :13:06.device was directly responsible for killing people. But I find
:13:06. > :13:12.inconceivable, there was 6,000 of these devices in Baghdad, in
:13:12. > :13:19.environment of Baghdad. At one point there was there were 10-
:13:19. > :13:24.12IEDs going off in the city how could that not be the device that
:13:24. > :13:27.was thought to protect them. There are many still out there now?
:13:27. > :13:30.it is unfortunate and despite messages from ourselves, messages
:13:30. > :13:35.from Government departments, through the embassies, they are
:13:35. > :13:39.still there and they are still in use on the streets in a number of
:13:39. > :13:44.countries and the people operating them unfortunately still believe
:13:44. > :13:49.they work. How can that be? That is one of the most extraordinary
:13:49. > :13:54.things about this tale, the Home Office tested them, the UN tested
:13:54. > :13:58.them, we know the American military were raising the alarm? Isn't it
:13:58. > :14:03.very simple to work out if something that is a bit of plastic
:14:03. > :14:08.works or doesn't work? It is, clearly the evidence we gathered
:14:08. > :14:11.over a four-year investigation, or the best part of four years, firmly
:14:11. > :14:17.established beyond doubt that the device doesn't work, could never
:14:17. > :14:21.work. But McCormick had developed such a con, such a patter, such a
:14:21. > :14:26.way of delivering the demonstration of the device that he was able to
:14:26. > :14:31.convince some people that it worked. And he was still selling it whilst
:14:32. > :14:37.these investigations were going on? He certainly has not sold one since
:14:37. > :14:44.the moment he was are-ed in September 2009, up until that point,
:14:44. > :14:48.yes, he was selling them. I can assure you that since we -- he was
:14:48. > :14:55.arrested in September 2009, up until that point, yes he was
:14:55. > :15:02.selling you. I can assure you since then he has not sold any more.
:15:02. > :15:06.we claim them back the money from his assets? One of the things we
:15:06. > :15:11.have done through the court is restrain his assets and the
:15:11. > :15:15.investigation continues, hopefully with the assistance of the courts,
:15:15. > :15:19.we will confiscate the assets we know about. It is highly likely
:15:19. > :15:22.there are assets we will never trace. As you saw in the report
:15:22. > :15:25.bank accounts were opened in parts of the world where it may be
:15:25. > :15:28.difficult to get information. money claimed from the assets could
:15:29. > :15:33.go back to refund some of the Governments who have paid out
:15:33. > :15:38.money? The process is the assets are seized through the courts and
:15:38. > :15:43.then the money is distributed through the police and the Crown
:15:43. > :15:47.Prosecution Service. But clearly the civil cases are open to some
:15:47. > :15:50.countries to try to get money back. Do you think you will get money
:15:50. > :15:53.back from those who were bribed? That was a different situation.
:15:53. > :15:57.There are a number of investigations going on in other
:15:57. > :16:00.countries. We are supporting those, and clearly we have had a lot of
:16:00. > :16:04.contact with the Ministry of Interior from Iraq. We are hoping
:16:04. > :16:08.to assist them, we will give them all the information we can. Nigel
:16:08. > :16:16.Rock, we really appreciate you coming in, thanks again.
:16:16. > :16:25.Coming up: The difference between England and
:16:25. > :16:28.France reception year and nursery. (applause) going to enjoy this show,
:16:29. > :16:32.da-da-da-da-da! All that to come, will you still be
:16:32. > :16:36.able to use a tenner in the new independent Scotland. The SNP would
:16:36. > :16:41.like to say, of course, the Chancellor is not so sure. He's
:16:41. > :16:46.warning, some would say fledening, that the UK -- threatening, that
:16:47. > :16:51.the UK might not want to tie itself to a foreign currency. Many say
:16:51. > :16:57.there is gentle political mischief being made. How realistic is it
:16:57. > :17:05.that the two countries could share the same currency, a kind of
:17:05. > :17:08.eurozone-light? At one time it was easier to imagine this happening
:17:08. > :17:11.than Scotland politically separating from the rest of Britain.
:17:11. > :17:17.But now political time is speeding up, we are starting not just to
:17:17. > :17:22.imagine Scottish independent but to measure the cost. Let's be clear,
:17:22. > :17:26.abandoning current arrangements would represent a very deep dive
:17:26. > :17:32.indeed into unchartered waters. Would a newly independent Scottish
:17:32. > :17:37.state be prepared to accept significant limits on its economic
:17:37. > :17:41.sovereignty? To submit its bugetry plans to Westminster before
:17:41. > :17:46.Hollywood? To constrain the degree of tax competition between Scotland
:17:46. > :17:50.and the rest of the UK. To accept some continuing oversight by UK
:17:50. > :17:54.authorities of its public finances. Those are good questions if you
:17:54. > :17:59.want to leave Britain but keep the pound. So the Chancellor headed for
:17:59. > :18:04.the kind of factory, high-tech, export-driven, partly reliant on
:18:04. > :18:08.defence, where getting independence right would be make-or-break. He
:18:08. > :18:11.asked an even more fundamental question. Why would 58 million
:18:11. > :18:14.citizens give away their sovereignty over monetary and
:18:14. > :18:19.potentially other economic policies to five million people in another
:18:19. > :18:24.state. The SNP asserts that it would be in everyone's interest for
:18:24. > :18:27.an independent Scotland to keep the pound as part of a eurozone-style
:18:27. > :18:31.sterling zone. But the Treasury analysis we are publishing today
:18:31. > :18:37.shows that is not the case. Treasury today laid out three
:18:37. > :18:44.options after a Scottish "yes" vote, joining the euro, launching its own
:18:44. > :18:48.currency or keeping the pound. The problem with all of them is
:18:48. > :18:52.Scotland's economic shape, think oil, whiskey and banks. This
:18:52. > :18:55.London-based economist who designed the residue of RBS and HBOS thinks
:18:56. > :18:59.it is the size of the banking sector that dictates much else.
:18:59. > :19:03.When you have a bank in trouble you have a Central Bank to support it,
:19:03. > :19:06.and behind the Central Bank is always the taxpayer. That means if
:19:07. > :19:11.you have an independent Scotland within a sterling area you need to
:19:11. > :19:14.have a Central Bank, not only for monetary policy, but also banking
:19:14. > :19:20.policy. That requires the big taxpayer, which is the rest of the
:19:20. > :19:24.UK. That's where the complication becomes. Probably the most selling
:19:24. > :19:27.graphs in today -- telling graphs today are these. It shows Scottish
:19:27. > :19:31.exports declining to the UK over the past few years, but remaining
:19:31. > :19:36.way above exports to the rest of the world. It is the same when it
:19:36. > :19:41.comes to imports. Scotland's main trade route, effectively, runs down
:19:41. > :19:45.the M6 and the west coast railway line between Gretna and Carlyle.
:19:45. > :19:49.Confused? A lot of Scottish people are. I like the pound and what we
:19:49. > :19:52.have got. I don't like the euro. Ideally I would like to see it as
:19:52. > :19:58.it is at the moment. Just continuing with the Scottish notes.
:19:58. > :20:03.If it came down to changing the currency I think that would swing a
:20:03. > :20:06.lot of votes. We should create our own currency. With the oil still
:20:06. > :20:11.flowing and the globally important engineering industry it has
:20:11. > :20:16.produced, the SNP's argument is the rest of Britain that needs Scotland
:20:16. > :20:19.to keep the pound. The rest of the UK needs Scotland within the
:20:19. > :20:23.currency area to support the balance of payments. If they didn't
:20:23. > :20:26.have access to Scotland's resources like our oil, that would be a loss
:20:26. > :20:30.of �40 billion from the sterling balance of payments. That would
:20:30. > :20:33.double the balance of payments deficit and cause all sorts of
:20:33. > :20:36.problems. There is no need for. That they can continue to have
:20:36. > :20:40.Scottish resources underpinning the sterling balance of payments. That
:20:40. > :20:44.is why it is in the interests of the rest of the UK. What George
:20:44. > :20:47.Osborne is effectively saying to Scottish voters is you can have
:20:47. > :20:52.independence, but if you want to keep the pound you may end up
:20:52. > :20:57.giving quite a lot of control over that independent Scottish economy
:20:57. > :21:00.to London. So why doesn't Scotland opt, like Denmark, for its own
:21:00. > :21:03.separate currency? This certainly is what some supporters of
:21:03. > :21:07.independence see as the long-term goal? I think you have to
:21:07. > :21:10.distinguish between the short-term and the long-term. The short-term
:21:10. > :21:14.practically would have to be some arrangement whereby Scotland
:21:14. > :21:18.continued to use sterling. I think the option of moving to the euro is
:21:18. > :21:25.a non-starter. You could say that we have been in one dysfuntional
:21:25. > :21:29.currency union in the UK kuorn union, why go into an even more
:21:29. > :21:32.dysfuntional currency union. The preferred option is for our own
:21:32. > :21:35.currency. It is the getting there that worries people and on both
:21:35. > :21:39.sides of the border. The difficulty is how to get from where they are
:21:39. > :21:43.today, with all of their contracts in sterling, to all of their
:21:43. > :21:46.contracts being in a new currency that hasn't been set yet. And going
:21:46. > :21:51.from where we are today to there, you run the risk of capital coming
:21:51. > :21:53.out of the country. It is a big transitional risk, but in the
:21:53. > :21:59.longer term it is a coherent solution.
:21:59. > :22:02.But in the shorter term, come next September, the prospect is of a
:22:02. > :22:07.Scotland-shaped economy using money issued by the bank of somewhere
:22:07. > :22:11.else. The Scottish Finance Minister, John
:22:11. > :22:16.Swinney, joins us from from Dundee. Thank you for your time this
:22:16. > :22:20.evening. Let's imagine, if you like, that you have won, that Scotland's
:22:20. > :22:24.independent. Why wouldn't a proud, new low- independent Scotland want
:22:24. > :22:28.to have its own currency? What we have set out is a framework that is
:22:28. > :22:32.well evidenced about the arguments which essentially create the
:22:32. > :22:36.platform for a continuity of the business environment between
:22:36. > :22:38.Scotland and the rest of the United Kingdom. That is one of the very
:22:38. > :22:42.powerful attractions of the proposition we have put forward to
:22:42. > :22:48.the rest of the UK into the bargain. That companies south of the border
:22:48. > :22:52.would continue to be able to trade with Scotland in the same currency.
:22:52. > :22:55.And visa versa for companies and organisations within Scotland. It
:22:55. > :23:00.is a practical and sensible and rational approach which is in the
:23:00. > :23:06.interests of everybody north and south of the border. In currency
:23:06. > :23:08.terms Scotland couldn't go it alone then? I think that Scotland has all
:23:08. > :23:13.the attributes to be a strong, independent country. Our
:23:13. > :23:16.proposition is to ensure that our country is able to take all of the
:23:16. > :23:21.decisions that are relevant and important to the economic and
:23:21. > :23:24.fiscal interests of our country. But not with its own currency?
:23:24. > :23:28.currency, you have looked at all the various options that the UK
:23:28. > :23:30.Government has looked at into the bargain. We consider the best
:23:30. > :23:34.approach for Scotland is to maintain the use of sterling as
:23:35. > :23:40.part of a sterling zone. Is that just for a short-term transition or,
:23:40. > :23:45.I mean is there a long-term goal for a Scottish currency?
:23:45. > :23:49.proposition we have put forward is a strong and sustainable
:23:49. > :23:53.proposition. It is one we put forward as a robust long-term
:23:53. > :23:56.proposition to give the correct framework for the Scottish economy
:23:56. > :24:00.and to enable the companies and businesses of Scotland to continue
:24:00. > :24:03.to be able to trade effectively with the rest of the UK and for
:24:03. > :24:08.other companies in the rest of the United Kingdom to be trading with
:24:08. > :24:11.the companies and businesses in Scotland. It makes sense in the
:24:11. > :24:15.interests of everybody in these islands to be taking that approach.
:24:15. > :24:20.There seems to have been three identifyable positions on currency.
:24:20. > :24:25.You were unambiguously committed to joining the euro in 1999, you were
:24:25. > :24:29.in favour of pegging the Scottish pound to sterling. Now you are
:24:29. > :24:33.staying with terling, if you got your own way -- sterling, if you
:24:33. > :24:36.got your own way and there is no talk of a currency at all. It is
:24:36. > :24:39.hard for people looking at your policies to work out what you
:24:39. > :24:43.really mean isn't it? Over the years there has been a broad cross
:24:43. > :24:47.section of political opinion that at some stage has supported
:24:47. > :24:51.membership of the single currency, not least of which the last Labour
:24:51. > :24:54.Government and the current Chief Whip to the Treasury and the Lib
:24:54. > :24:58.Dem party. The issue of the single currency is broadly debated across
:24:58. > :25:01.the political spectrum. What we have set out over some considerable
:25:01. > :25:06.time is the advantages of Scotland retaining the pound, establishing a
:25:06. > :25:10.sterling zone that would enable us to operate within a framework which
:25:10. > :25:14.would essentially create the stability of a unified market
:25:15. > :25:19.across these islands and that in the interests of everybody aclos
:25:19. > :25:21.the UK. We have heard the -- Across the UK. We have heard the
:25:21. > :25:25.advantages for Scotland, the Chancellor has laid down the
:25:25. > :25:28.compromises you needed to make, significant limits, and submitting
:25:28. > :25:31.plans to Westminster. Accepting continuing oversight of public
:25:31. > :25:35.finances, you would be prepared to do that would you, under the Bank
:25:35. > :25:39.of England? These are some of the overbearing interventions of George
:25:39. > :25:42.Osborne. Why are they overbearing, they seem completely sensible don't
:25:42. > :25:46.they? They are pretty overbearing. We have made it pretty clear that
:25:46. > :25:50.we would see the logic and the rationale of some form of
:25:50. > :25:53."stability pact" arrangements in which we set out some strategic
:25:53. > :25:57.rules around the management of the public finances in Scotland. With
:25:57. > :26:06.particular agreements around the level of debt that we would incur,
:26:06. > :26:09.or the level of borrowing we would be undertaking. When you talk about
:26:09. > :26:14.strategic rules, a lot of tax- payers will be rembering that
:26:14. > :26:17.billions were paid out to rescue Scottish banks, RBS and HBOS to be
:26:17. > :26:20.rescued by the Bank of England. Would that continue? All of these
:26:20. > :26:23.factors are part of the public finances of the United Kingdom as
:26:23. > :26:27.we stand just now. Basically you would use the loans there are the
:26:27. > :26:30.Bank of England without submitting any of our bugetry restrictions or
:26:30. > :26:35.qualifications, you would be prepared to just take and not give?
:26:35. > :26:39.What I said a moment ago is we accept the rationale for a
:26:39. > :26:43."stability pact" type arrangement, where the levels of debt we would
:26:43. > :26:47.be incurring, or the level of borrowing we would undertake would
:26:47. > :26:50.be part of the "stability pact". That would give Scotland a maximum
:26:50. > :26:53.amount of fiscal flexibility to determine economic policy in the
:26:53. > :26:58.interests of the community of Scotland and to create the
:26:58. > :27:03.strongest possible economy. Chancellor said it was unworkable.
:27:03. > :27:08.That is the argument to enable us to do that. The Chancellor said it
:27:08. > :27:12.was unworkable. The Chancellor said why would the 58 million citizens
:27:12. > :27:17.of the rest of the UK to give their sovereignty to share in a new kind
:27:17. > :27:19.of eurozone with you? There are two reasons why that would be in their
:27:19. > :27:22.interests, the first is there is a significant amount of trade between
:27:22. > :27:28.Scotland and the rest of the UK, and crucially between the rest of
:27:28. > :27:33.the UK and Scotland. And secondly, you can see, you saw in the clip
:27:33. > :27:37.from the First Minister in the package that you just ran, Scotland
:27:37. > :27:41.makes a significant contribution towards the balance of payments
:27:41. > :27:45.situation for the United Kingdom, to the tune of �40 billion alone in
:27:45. > :27:47.North Sea oil and gas revenues. That is a particular prize that I
:27:47. > :27:51.think the Chancellor of the Exchequer would be determined to
:27:51. > :27:55.get his hands on for the sterling zone benefits. Isn't the truth, as
:27:55. > :27:58.was made clearly and succinctly by the woman in the film, that people
:27:59. > :28:04.don't want to hear about any real change. They want to think you
:28:04. > :28:07.still keep the pound and the Queen, nothing really changes. It is an
:28:07. > :28:11.independance-light, where you take the good bits and leave the bad
:28:11. > :28:15.bits, and you don't tell people exactly what they are settling for,
:28:15. > :28:18.because it is easier to get them voting for you? People want to hear
:28:18. > :28:21.is what it is possible to achieve within Scotland. What it is
:28:21. > :28:25.possible to achieve is a much stronger economy, using the
:28:25. > :28:28.economic and fiscal levers that countless other countries around
:28:28. > :28:35.the globe take advantage of. To make sure we have a more prosperous
:28:35. > :28:39.and fairer society. We live in the United Kingdom, in the fourth-most
:28:39. > :28:42.unequal country in the IOC. It is high time we used our wealth,
:28:42. > :28:48.imagination and talent to create a more prosperous and fairer country.
:28:48. > :28:51.Thank you very much indeed. How do we want our kids to be
:28:51. > :28:55.raised? What role should the Government have in looking after
:28:55. > :29:01.them? If child minders were more qualified they could look after
:29:01. > :29:06.more children at a time, childcare would cost less, children would be
:29:06. > :29:09.better behaved? Make sense? The French does, and our Education
:29:09. > :29:19.Minister, Elizabeth Truss, agrees with them. We went across the
:29:19. > :29:23.channel to see if we could learn a lesson.
:29:23. > :29:28.Look at these faces very carefully. They seem perfectly normal. But
:29:28. > :29:36.from a very young age they have become more disciplined, more
:29:36. > :29:44.socialised, more attentive, more mind-boggleing angelic! By the way,
:29:44. > :29:47.they are French. If on the rare occasion a French child throws a
:29:47. > :29:50.tantrum or throws food, it is because, we are told, they have
:29:50. > :29:56.permission to do so. That is the idea we are going to test with a
:29:56. > :30:00.Government minister on a trip to France. Before we head off to check
:30:00. > :30:10.this little angel thesis, I want someone of my own to test any
:30:10. > :30:11.
:30:11. > :30:16.claims that we hear in France. So, we have French mother Lola. She has
:30:16. > :30:20.three children who -- Leila, she has three children who at various
:30:20. > :30:24.stages of their upbringing have experienced both systems. We will
:30:24. > :30:34.come back to her later. Until the children enter school parent are
:30:34. > :30:38.really struggling here. Probably in France they do not as much. Last
:30:38. > :30:45.Tuesday we got up and out with Government minister for children,
:30:45. > :30:51.Elizabeth Truss. We are on a research expresident dix into early
:30:51. > :30:54.years education. -- expedition into early years education. This is a
:30:54. > :30:59.nursery, but more like a school, three-year-olds attend it, a year
:30:59. > :31:03.earlier than attending school in the UK. A lot of problems in the UK
:31:03. > :31:07.is quite a lot of kids arrive in school not able to sit and
:31:07. > :31:11.concentrate in lesson. That means they will get behind further on in
:31:11. > :31:15.their school career. What these children are doing is they are
:31:15. > :31:22.being led by really qualified professionals, who know what they
:31:22. > :31:28.are doing. Who can operate with large groups and encourage that
:31:28. > :31:31.self-reliance amongst children. children here are not shouting out
:31:31. > :31:39.or running about, they are concentrating on what the teacher
:31:39. > :31:44.is saying. That is so important. You would see this in some nursery
:31:44. > :31:48.in -- nurseries in the UK, but only a third of them, this is an
:31:48. > :31:53.entitlement for all children in France. The headteacher has hosted
:31:53. > :31:57.a large delegation from the UK, why does he think that they are
:31:57. > :32:04.mesmerised by his school? Language is improving fast. We can see they
:32:04. > :32:13.develop social relationships very, very quickly. They become quite
:32:14. > :32:23.deep as well for this age. As well they improve their abilities about
:32:23. > :32:29.being ready to learn how to read, how to write. What did Leila's son
:32:29. > :32:34.make of the French school? He has take great advantage of being
:32:34. > :32:40.schooled that early. He enjoyed it. He was ready to have other
:32:40. > :32:45.relationships and that he started to build up his own path,
:32:45. > :32:52.confidence, knowledge. What does the big sister think? They have
:32:52. > :32:57.these sort of stricter methods of teaching children. Here we learn
:32:57. > :33:04.through games and through all that. So we learn more discipline in
:33:04. > :33:08.France. Discipline at three years old but also in the earlier years.
:33:08. > :33:14.As we travelled around nurseries we met child minders with high
:33:14. > :33:17.qualifications where one looked after eight two-year-olds.
:33:17. > :33:21.Elizabeth Truss is shifting Britain to this French system, one to eight,
:33:21. > :33:27.if the minder is looking after children at home, it will be one to
:33:27. > :33:36.four. Elizabeth Truss has been much criticised for this shift, she
:33:36. > :33:39.thinks it is possible. My colleague Jacob Reece-Mogg has four under-
:33:39. > :33:43.fives and they are capable of looking after it and so should
:33:44. > :33:47.child minders. We are saying it is down to individual child minders to
:33:47. > :33:53.say how many children it is OK to look after and how it fits with
:33:53. > :33:57.their life. Back in Oxford we had ratios that had a mixed report card.
:33:57. > :34:02.When my last baby started in a French City Council nursery, she
:34:02. > :34:08.was six months old, she was one of eight children for one carer. And I
:34:08. > :34:14.thought it was a bit hard after the experience of the British ratios of
:34:14. > :34:17.three children for one carer. Leila does agree with Elizabeth
:34:17. > :34:20.Truss that all round provision in France is better. This means that
:34:20. > :34:25.more French mothers than British mothers work. Two-thirds of mums in
:34:25. > :34:30.Britain go out to work. I'm very concerned that those mums who often
:34:30. > :34:34.have to go out to work for economic reasons, and this is a trend across
:34:34. > :34:38.the world, in all developed countries dual-income families are
:34:38. > :34:47.the norm, I'm concerned those mums are made to feel guilty about a
:34:47. > :34:52.choice they don't really have. France probably the experiences of
:34:52. > :34:58.women are the same as the experiences of British women. We
:34:58. > :35:02.are juggling probably you know we have got our cultural habits of
:35:02. > :35:10.raising children that are quite different from the more relaxed
:35:10. > :35:14.approach of British women. I feel like English mums and parenting is
:35:14. > :35:24.much more gentle and geared toward the children, where as in France
:35:24. > :35:28.maybe we ask the children to fit into our lives more. With me now is
:35:28. > :35:33.the Education Minister, Elizabeth Truss, also joined by Laura Perrins
:35:33. > :35:36.who is the mother who challenged Nick Clegg on his radio programme.
:35:36. > :35:40.And we have a member of the professional Association for
:35:40. > :35:43.Childcare and early years. Elizabeth Truss do you think French
:35:43. > :35:48.kids really are better behaved? What I noticed in the French
:35:48. > :35:52.nurseries we visited is they do tend to be very calm and purposeful
:35:52. > :35:56.and they are very good at actually improving the outcomes of children
:35:56. > :36:02.later on in life. There has been some very good studies of the
:36:02. > :36:08.impact of French l'ecole maternello Casanova which are positive. I
:36:08. > :36:14.think the strong eacher leadership is really good. Is that the
:36:14. > :36:17.qualification of the teachers in charge, or is it the numbers or a
:36:17. > :36:20.discipline introduced or what is it? The qualifications of the
:36:20. > :36:23.teachers is really important. That is one of the main factors in the
:36:23. > :36:26.outcomes for children. The more qualified the teacher, generally
:36:26. > :36:31.the better the outcomes are. That is true in studies in Britain, but
:36:31. > :36:37.also for studies in France. I think though that the structured
:36:37. > :36:41.environment they operate in enables them to hire those high-quality
:36:41. > :36:44.teachers. There is a relationship between the two. What do you hear
:36:44. > :36:47.when Elizabeth Truss talks about high-quality teaching and that
:36:47. > :36:51.difference that we see in France? think there is a very different
:36:51. > :36:56.language in terms of the conversations that we have with our
:36:56. > :36:59.members, childcare professionals and nursery workers and childminder.
:36:59. > :37:03.They talk about children enjoying their time in childcare, learning
:37:03. > :37:08.through play, and having a very much mixed balance of child-led
:37:08. > :37:12.experience as well as adult, teacher-led experience. That is at
:37:13. > :37:18.the heart of the early years foundation stage we work with in
:37:18. > :37:21.England. You can't disentangle high-quality from good
:37:21. > :37:26.qualifications and ratios, it is both. What do you mean by that?
:37:26. > :37:29.key factors for a good-quality experience for children are high-
:37:29. > :37:33.quality one-to-one interactions with their adult carer, that is
:37:33. > :37:39.about the number of children you are looking after at any one time,
:37:39. > :37:42.that allows them to be provided by play-led opportunities. Play-led is
:37:42. > :37:45.important? We are talking about structured play, of course we are
:37:45. > :37:49.not talking about three-year-olds sitting down at desks writing
:37:49. > :37:53.things. But we are talking about teacher-led activities. We do know
:37:53. > :37:56.that the impact of the teacher is the most important thing. The level
:37:56. > :38:00.of qualifications is the most important factor, it has been shown
:38:00. > :38:03.to be the case in France as it has in England. Only a third of our
:38:03. > :38:07.nurseries are led by graduate teachers, even though we know that
:38:07. > :38:11.is the most important factor. So, yeah, interaction between adults
:38:11. > :38:15.and children is important, but also socialisation between children is
:38:15. > :38:18.important, learning to take turns is important, all of those kinds of
:38:18. > :38:23.things. You do need structure. What I really worry about is some of the
:38:23. > :38:25.children in the most deprived areas, who don't have structure in their
:38:25. > :38:29.family backgrounds need that structure when they get to nursery
:38:29. > :38:34.so they can learn and be ready forle skoo. What we know is a third
:38:34. > :38:38.of -- school. What we know is a third of children arrive at school
:38:38. > :38:41.without communication and language skills that more structured play
:38:41. > :38:49.delivers. Don't they get that at home with their parents as opposed
:38:49. > :38:52.to being in an organised group? think they get it in both groups.
:38:52. > :38:55.I'm very supportive of more child minders, and I'm supportive of stay
:38:55. > :39:00.at home parents. What we need is people to have a choice. The thing
:39:00. > :39:03.I pointed out in the film is a lot of women, men, have to go out to
:39:03. > :39:07.work for economic reasons, and we need to make sure the childcare
:39:07. > :39:11.that they rely on is really high quality what you get in France is a
:39:11. > :39:15.sense of a continuum, a system you can rely on so you can make your
:39:16. > :39:19.choice, secure in the knowledge that your child is getting a really
:39:19. > :39:24.good quality education. minister has accepted that many,
:39:24. > :39:28.many parents have to go out to work. The reason for that is that this
:39:28. > :39:32.Government has actively discriminated against stay at home
:39:32. > :39:38.mums and single income families by penalising them in the tax system
:39:38. > :39:43.and stag ma advertising them in the language they use, implying --
:39:43. > :39:47.stigmatising them in the language they used and in the language they
:39:47. > :39:53.use, implying they are lazy. Eight out of ten mothers say they would
:39:53. > :39:56.like to reduce their hours to go part-time or full-time stay at home
:39:57. > :40:06.mothers. The minister and the Government, instead of coming here
:40:06. > :40:09.in here with this French fairytale of Ameila and Jacques sitting down
:40:09. > :40:14.at desk, should think about Alice and John, the British children you
:40:14. > :40:16.are elected to represent, they want to be at home with their parents.
:40:16. > :40:20.And importantly, the key factor is those parents want to care for
:40:20. > :40:24.their children at home. And your Government instead of coming in
:40:25. > :40:30.here with this French fantasy, should instead do what they did,
:40:30. > :40:34.and implement the promise in the coalition agreement to provide for
:40:34. > :40:38.a transferable tax allowance. That would give a real choice to working
:40:38. > :40:43.parents to stay at home for the crucial early years and care for
:40:43. > :40:48.those kids at home. You have deprived them of that choice.
:40:48. > :40:52.will be putting in the tax allowance for marriage. When will
:40:52. > :40:57.that happen? Is that a promise on Newsnight? Let me finish responding
:40:57. > :40:59.to your point. Let's just get to the bottom of that, is this a
:40:59. > :41:02.marriage tax allowance that is coming in this parliament? This is
:41:02. > :41:07.a commitment that the Conservatives have in our manifesto. Jo are you
:41:07. > :41:12.going to act on it? I hope so, I'm very supportive of marriage in the
:41:12. > :41:16.tax system. You hope so, are you going to act on a commitment, given
:41:16. > :41:20.in the coalition agreement, parliamentary democracy is for the
:41:20. > :41:23.children you represent, act on that commitment. This is crucial, we
:41:23. > :41:26.have heard a lot about the marriage tax allowance t will come in, it
:41:27. > :41:30.was a commitment, then a promise, it got dropped because now of the
:41:30. > :41:33.Lib Dems, now you say it is a commitment and you hope it will be
:41:33. > :41:37.brought in, before the end of this parliament? I hope so. I can't
:41:37. > :41:40.commit that. I'm not the Chancellor, I can't say that. Why don't you
:41:40. > :41:44.lobby the Chancellor to bring it in? I think it is important.
:41:44. > :41:46.However, what I would say is we need to support all families. We
:41:47. > :41:50.need to allow families to make choices. I don't think it is right
:41:50. > :41:54.to pit one set of parents against another set of parents. We are
:41:54. > :41:58.supporting those parent. What we have to recognise is that childcare
:41:58. > :42:01.costs here in England are twice as high as they are in other countries
:42:01. > :42:06.in Europe, it is very, very difficult for some families to get
:42:06. > :42:13.by. Some families are on very low incomes. We need to make sure that
:42:13. > :42:17.the childcare of those 66% of mums that go out to work can be relied
:42:17. > :42:20.on and is good. There is an important factor that we need to
:42:20. > :42:24.remember. The parents currently signing petitions to Governments
:42:24. > :42:32.around the ratios have two messages, it is not about cost it is about
:42:32. > :42:35.the quality of care for children. There is concerns about increasing
:42:35. > :42:40.ratios, alongside proposals for qualification change that will take
:42:40. > :42:46.longer than the ratio change. of parents are saying we spend an
:42:46. > :42:50.enormous amount, a friend who had twins spent �2,500 a month, that
:42:50. > :42:53.nearly broke them. Can't you say as a parent I want a better
:42:53. > :42:57.qualification and I expect for more that money? Absolutely, one of the
:42:57. > :43:01.lessons we need to recognise is countries like Holland and France
:43:01. > :43:06.are investing far more in state- funded childcare. And alongside
:43:06. > :43:08.that a greater contribution from employers. There is choices to be
:43:08. > :43:13.made around how much childcare costs, will there is more that
:43:13. > :43:16.could be done in terms of employer- supportive vouchers. We spend the
:43:16. > :43:23.same as a proportion of GDP on early years that the French do. It
:43:23. > :43:26.is about getting value for money for what we spend. We spend �5
:43:26. > :43:33.billion. The figures on what you spend keep changing. We had the
:43:33. > :43:37.lower ratios in Europe, and the average childcare worker gets �6.60
:43:37. > :43:39.an hour, barely above minimum wage, we can't kid ourselves that the
:43:39. > :43:42.system we have at the moment is right. Let's not kid ourselves that
:43:42. > :43:46.you have any support for this change in ratio. The entire
:43:46. > :43:55.industry is against you, most parents by the parenting forums are
:43:55. > :43:59.against you, and Professor Nut Brown who commissioned the original
:43:59. > :44:04.report has dismissed the ratio changes as nonsense. These ratios
:44:04. > :44:09.are across Europe. You heard the film about the French system.
:44:09. > :44:14.you interested in British children or British parents are you
:44:14. > :44:20.interested in French parents and children. You can see the high
:44:20. > :44:24.quality care works in France. A lot of childcare providers operate in
:44:24. > :44:29.other countries with different qualifications and higher ratios.
:44:29. > :44:34.Let's be clear we are only going to allow childcare providers who hire
:44:34. > :44:38.high-quality staff to operate these ratios, there will be strict
:44:38. > :44:43.criteria to operate the ratios. There is no link to child minders
:44:43. > :44:47.for qualifications and ratios. is why we are having childcare
:44:48. > :44:52.agencies. That is not about quality assurance through qualifications.
:44:52. > :44:56.It is. I think the key issue for parents is absolute he cost but not
:44:56. > :45:00.at the sacrifice of quality. But I don't think there is evidence
:45:01. > :45:06.really for us to see that how changing ratio levels will really
:45:06. > :45:10.change the cost of childcare. up to the professionals to decide.
:45:10. > :45:20.I'm sorry we have run out of time, thank you for coming. I come to
:45:20. > :45:54.
:45:54. > :45:57.these papers rather new so I will That's all we have time for tonight.
:45:57. > :46:07.But Jeremy will be here tomorrow, from all of us here, a very good
:46:07. > :46:32.
:46:32. > :46:35.Good evening. Wednesday will be a bit of a mixed picture across the
:46:35. > :46:39.UK, some rain, some sunshine. The rain across primarily northern part
:46:39. > :46:42.of the UK, during the first half of Wednesday. It turns brighter across
:46:42. > :46:46.Scotland. Sparkling sunshine and fresh conditions, a little further
:46:46. > :46:49.southwards in Northern Ireland it will remain cloudy. The north coast
:46:49. > :46:53.getting sun but well and truly it is across Scotland where we will
:46:53. > :46:56.have the best of the weather in the north of the UK. Then we get into
:46:56. > :47:01.England, here it is relatively cloudy. To the east of the Pennines
:47:01. > :47:04.there might be breaks in the cloud. A little bit more cloud across the
:47:04. > :47:08.north Midland. For East Anglia and the south-east, a little bit more
:47:08. > :47:12.cloud on Wednesday compared to what we had on Tuesday. So maybe the
:47:12. > :47:16.temperatures in one or two spots won't be quite so high. For the
:47:16. > :47:21.south west some low grey cloud and mist in one or two places affecting
:47:21. > :47:25.areas deep inland, not just around the coast. Some of that may drift
:47:25. > :47:29.up the Bristol Channel. Cloudy across Wales too. Let's look at the
:47:29. > :47:33.outlook over the next couple of days. Wednesday and Thursday
:47:33. > :47:38.temperatures across the north hovering around 1010 degrees. As
:47:38. > :47:41.far as the Midland go on Wednesday. Already temperatures starting to