31/05/2013 Newsnight


31/05/2013

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


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Transcript


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Remember this? Tlfrjts is, I believe, a big issue we can no

:00:10.:00:14.

longer ignore. The next big scandal waiting to happen. I am talking

:00:14.:00:22.

about lobbying. Today, over three years later,

:00:22.:00:25.

Patrick Mercer has resigned the Tory whip to save his party

:00:25.:00:28.

embarrassment, he says, after being caught up in a lobbying scandal.

:00:28.:00:35.

We'll ask whether reforms are long unemployment figures, young people

:00:35.:00:38.

out of work - in Germany, 7.5%, in the south in the eurozone, more than

:00:38.:00:48.

50%. We'll be discussing the two most powerful men in euroland -

:00:48.:00:58.
:00:58.:00:58.

Apology for the loss of subtitles for 127 seconds

:00:58.:03:05.

2Nd Battalion, The Mercian Regiment was approached by a fake company,

:03:05.:03:15.
:03:15.:03:17.

the fake company, Communication The fake company, Alistair Andrews

:03:17.:03:21.

commune cation. The programme released this clip of

:03:21.:03:24.

Mr Mercer. I do not charge a great deal of

:03:24.:03:30.

money for these things. I would normally come out at �500 for half

:03:30.:03:35.

a day. So �1,000 a day. Patrick Mercer says he took the

:03:35.:03:40.

money for work outside of Parliament.

:03:40.:03:44.

It was said he admitted five parliamentary questions, all

:03:44.:03:50.

answered. In total, he was paid �4,000. This had stale not been

:03:50.:03:57.

declared by Mr Merer as the rules demand in the register of members

:03:57.:04:02.

interest. Whatever the truth in this instance, links between the

:04:03.:04:09.

MPs and lobbyists are problematic. Indeed there are scandals going

:04:09.:04:13.

back decades. From cash for questions in the 90s. To three

:04:13.:04:19.

Labour MPs found guilty of breaking the rules in 2010. Indeed, that

:04:19.:04:23.

year David Cameron called lobbying the next big scandal waiting to

:04:23.:04:30.

happen. We know how it works. The lunches,

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the hospitality, helping big businesses find the way to get its

:04:33.:04:38.

way. Yet the promise statutory register

:04:38.:04:43.

of lobbyists still has yet to materialise, inspite of having the

:04:43.:04:46.

supposed support of all three main Westminster parties. The Government

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is considering responses to its consultation.

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It is not the complexity of the proposal that is the problem, but

:04:53.:05:01.

the lack of political will. There is no political oomph behind this

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proposal whatsoever. Panorama says that Patrick Mercer

:05:06.:05:14.

agreed to set up a Fiji all-party group. Officially they have no

:05:14.:05:19.

status but they are confused in the minds of journalists and the public

:05:19.:05:22.

with official bodies like select committees. They have grown in

:05:22.:05:28.

number. There were about 250 all- party groups in 1985. By January,

:05:28.:05:36.

2012, there were 566. Far more even than the US Congress which has 380.

:05:36.:05:42.

A recent survey of MPs and peers by the speakers office through up the

:05:42.:05:47.

result asked if they were agreed that all-party groups were prone to

:05:47.:05:52.

be taking responses from their own lobbyists for their own purposes,

:05:52.:05:56.

48% agreed. It is said that the groupings are

:05:56.:05:59.

small beer in the big scheme of things.

:05:59.:06:05.

It is in the context of a �2 billion industry. Yes we have lots

:06:05.:06:08.

of large consultant lobbyist agencies in London, but there is

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this enormous in-house industry. You look at something like the case

:06:13.:06:18.

of Murdoch and his lobbyist. The kind of access that they had to

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Jeremy Hunt's office, for example and the close contact, the texting,

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that is what of concern here. Whatever else happens, the pressure

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on the Government to deliver on lobbying reform is bound to

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increase. Well, I am joined by Mark Spencer,

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the Conservative MP for Sherwood, the neighbouring constituency of

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Patrick Mercer and former lobbyist, Thomas Docherty. First of all, Mark

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Spencer, your colleague caught on camera, offering services to a fake

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lobbying group, unwise to say the least? It does not look good.

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Patrick will have to defend that when it comes to the investigation.

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It was interesting he said he was resigning the Whip in order to save

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his party embarrassment but does think not thank think that anything

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he might have done is efficient to resign from the constituency?

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think we have to say it was Patrick's decision to resign from

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the party. Nobody forced him out. That is his decision. He has to

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justify that course of action, but we have to ensure that we get the

:07:30.:07:33.

facts and establish the truth and get to the bottom of what has been

:07:34.:07:36.

happening. If the allegations of cash for

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questions prove true, should he resign the constituency? There are

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clear lines, cash for questions is wrong. It is set out in the

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statutory legislation. Any MP prove tonne have taken cash

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for questions should resign. Thomas Docherty, a problem, surely

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a lack of clarity over the rules and the regulations? Last year I,

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when 2nd Battalion, The Mercian Regiment was accused of the

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breaching -- when Patrick Mercer was accused of breaching lobbying

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rules, he refused to get involved as he could not see which of the

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rules that Patrick Mercer could have broken, but I agree that we

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need to overhall the work of the Standards Commissioner.

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You are a former lobbyist, in any of the recently issues it is not

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the lobbying groups themselves, lobbying company companies, I

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should say, sorry, that have been a problem? I think where a important

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point is made you cannot differ enSecretary of State between the

:08:43.:08:48.

third party lobby ists and the lobbying industry as a whole. There

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is a �2 billion industry here. They are professionals, they do it with

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integrity, but there are too many who will not abide by the rules. It

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is disappointing that four years after a voluntary code was

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introduced that the individuals and companies that will not sign up

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that is why I introcuesed a bill in the last session of Parliament,

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that the Government refused to support that would have supported a

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statutory register. What difference would that have made in this case?

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There is a danger. What we don't want to do is to alienate the

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constituents, the charities, the vicar from being able to lobby our

:09:26.:09:31.

MP what is important to them. But your leader promised that. It

:09:31.:09:35.

was the next big scandal waiting to happen, was said. It is proved to

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be the case? When you try to write it down in legislation it becomes

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grey in the areas. So you are not keen in a register?

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We need more transparency. But we have to make sure that we

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don't if you like, put off the small charities, the small unions.

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I have spoken to the Fire Brigade unions, the local lobbyists.

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It sounds like the Conservative MP to my left thinks that a statutory

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register will not make a difference? I will tell you what my

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bill covers. It does not cover the village vicar but it does cover the

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�2 billion industry. There is a big difference between a constituent

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writing to you about a bill and the �2 billion industry that exists and

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what the Labour Party has been calling for is a cross-party

:10:29.:10:34.

approach that says that we need transparency. We need a code of

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conduct that says when Members of Parliament, when lobbyists break

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that code of conduct, that they can have disciplinary action. If Mark

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does not understand that... Do we need more stings like the Panorama

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sting? I think that the journalists do a good job of exposing

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corruption, but there are extremes. It is the grey area in the middle

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that is the difficulty to write down in legislation.

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One of the areas, which is a burgeoning industry, is this idea

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of all-party groups, which is what the evidence is suggesting that

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some confuse with the select committees, a different thing, why?

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To be fair, they are a good way of informing MPs of what is happening.

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So, 566 of them are working one day in every two years? I am a member

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of the Caresers' All Party group. It is is a really good way of

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informing me as to what is happening.

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Thank you very much. Well, nearly 3.5 million young

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Europeans are out of work. However, today's latest joblessness figures

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could be seen as almost Good News. We learn that number has remained

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static for a third month. But look more closely, you can see

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why the European leaders are so worried about youth unemployment.

:12:00.:12:04.

In the continent's youth joblessness hotspots, the numbers

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out of work are continuing to soarN Greece, 53% of under 25s were

:12:11.:12:17.

jobless a year ago. That stands now at 62%. Spain, Portugal and Italy

:12:17.:12:23.

have seen huge rises too, but look at Germany, just 8% a year ago, now

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it is even lower. The UK, which, of course, is not part of the eurozone,

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has seen its youth unemployment fall too. So when it comes to young

:12:32.:12:35.

people out of work it is the continent's south that is

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continuing to suffer badly. �6 billion of EU funds have been

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set aside to get every young person in Europe a job, but there are

:12:46.:12:51.

demands from both sides for more to be done. Those who are anti-

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austerity, blame it for strangling job creation. Supporters of

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austerity fear that joblessness prompts social unrest and the

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unpicking of the policy. In the words of Italy's Labour minister,

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we now have to rescue an entire generation of people, who are

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scared. We have the best ever educated generation in this

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continent and we are putting them on hold.

:13:16.:13:26.
:13:26.:13:32.

Joining me now is Jonathan Todd, Professor Hertz and Megan Greene.

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First, is persistent youth unemployment one of the serious

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problems facing Europe? It is. As you wouldn'ted -- pointed it out it

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is not only the high levels but the disparrities between Austria and

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Germany on the one hand and Spain and Greece in another. There are a

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number of reasons to go into on this.

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Yes, let's do. 7.5% in Germany, and 62% in Greece

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is it responsible that -- possible that Germany truly understands the

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pain of some of these countries? think that they are beginning to,

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but we have to look at the difference between the two. Clearly

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countries like Germany and Austria are not hit by the recession as

:14:17.:14:21.

hard as the eurozone countries, but there are other factors as well.

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For example a high rate of school drop-outs in the southern European

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countries. There are problems of labour laws. That on the one hand

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you have workers, established workers with gold-plated employment

:14:35.:14:39.

conditions, on the other hand, young people who cannot get a job

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or if they are it is on a short- term contract. Their public

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employment services do not work very well. So as to link up people

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with skills that employers are looking for... Sorry, carry on.

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And then there is also the problem of the burden of labour taxation.

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That is too high in some countries like France where labour is hit

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much more hard. There should ab way to shift these things, for example

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property taxes. So a combination of factors?

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Exactly. Marina, the social nightmare. We

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heard the Italian labour minister saying that we have the best-

:15:27.:15:33.

educated generation, however there are school drop-outs, so the best-

:15:33.:15:38.

educated youngsters with nothing to do? The figures are shocking. The

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ramifications will be felt for decades, on the individuals and the

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scarring. We know that the longer someone is out of work, the less

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likely they will have jobs in the future and they will get a wage cut,

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but in terms of society. As you raise, we know that youth

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unemployment is linked with higher rates of social unrest. We have

:15:59.:16:03.

seen riots in Sweden. Not only because of youth unemployment but

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youth unemployment playing a role. We have seen protests in Spain, in

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Italy, in Greece. And when these young people they

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are out of work for 12 months, some of them? Yes, and graduates in

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Spain, 40% of the unemployed youth there are college graduates N

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Greece, 30%. They have no hope. What Mr Todd is saying that Mr Must

:16:30.:16:36.

be structural changes, changes in the labour laws, hiring and firing

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issues that should be changed? the short-term, structural reforms

:16:41.:16:46.

result in more unemployment. Then they support employment later, but

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that is not the case immediately. In countries such as Italy, Spain,

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Greece, they have a lot more to do in terms of opening up the labour

:16:55.:16:59.

markets so I expect that employment will rise before it stabilises. I

:16:59.:17:03.

would say some of the other long- term effects of such high use

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unemployment it is not just a reduction in the productive

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capacity for the youths but also a lot of them are joust leaving. For

:17:12.:17:19.

example, I am not exactly in the youth employment age bracket but

:17:19.:17:25.

half of the context that I know have left N Ireland and also a lot

:17:25.:17:31.

more political fragmentation. This is a long-term problem for the

:17:31.:17:34.

eurozone. If young people are leaving the southern European

:17:34.:17:42.

countries, then the chance of recovery is lessened? Absolutely.

:17:42.:17:48.

And the point is that if you managed to create jobs that creates

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demand which helps the economy o get out of a recession. The

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attitude in the passes has all too often been once we restore growth

:17:58.:18:04.

the jobs come after but the jobs should be coming before the growth

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as well. You raise the point, that follows on from what you are saying

:18:08.:18:14.

that the focus on austerity, austerity plus recession is a very

:18:14.:18:18.

toxying cocktail. We cannot sacrifice our youth on the

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austerity. We need policies that focus on job creation, growth, on

:18:24.:18:29.

increasing lending to small and medium-sized enterprises so that

:18:29.:18:34.

they can hire people. Creating apprenticeship schemes that give

:18:34.:18:39.

jobs to the under 25. A whole host of measures that cost money.

:18:39.:18:43.

But the problem is we don't know the direction that Europe is going

:18:43.:18:48.

in? Is it about deficit reduction, banking reform, is it about

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targeting? I mean, what is the plan to get us out of this? It is not

:18:53.:18:58.

one thing or the other. Clearly we have to resolve the underlying

:18:58.:19:02.

financial crisis. To get back to sustainable growth, but at the same

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time, we have to introduce the structural reforms. One solution

:19:07.:19:12.

that we are pushing hard is the so- called youth guarantee. It is the

:19:12.:19:17.

idea that has been applied successfully in Austria and Finland.

:19:17.:19:21.

It is a system whereby in four months of a young person losing

:19:21.:19:26.

their job or leaving school that they are either offered a job or

:19:26.:19:30.

failing that an apprenticeship, traineeship or further education.

:19:30.:19:35.

This means that the young person what cannot find a job is at least

:19:35.:19:41.

spending their time in investing and acquiring the skills that could

:19:41.:19:49.

get them a job in the future. You look sceptical? It is the sums

:19:49.:19:53.

that seem small. There will be hope in the European Investment Bank in

:19:53.:19:58.

terms of helping facilitating lending to support growth and youth

:19:58.:20:02.

unemployment, but the EMB is a sclerotic institution. If anybody

:20:02.:20:09.

is looking for a quick turn around on unemployment in Europe.

:20:09.:20:14.

-- I think they will have to wait. How much can we lay the blame to

:20:14.:20:21.

anyone? Germany has been at the helm. They have not borne the brunt

:20:21.:20:26.

of this crisis. That has driven their crisis to. Make a 108 turn on

:20:26.:20:31.

the approach to this crisis, they would need to feel it also at home.

:20:31.:20:37.

Do you agree? Germany does not feel the pain has it does not have a

:20:37.:20:41.

crisis at home? Well, Germany is beginning to be uncomfortable to

:20:41.:20:45.

say the least with the high levels of unemployment.

:20:45.:20:51.

And should they be uncomfortable? Absolutely. Absolutely. Because

:20:51.:20:55.

something has to change. But the point is that there is no

:20:55.:21:00.

magic bullet to resolve the problem from one day to the next there. Are

:21:00.:21:05.

a whole series of reforms that must be put in place and to resolve the

:21:05.:21:09.

underlying financial crisis and the underlying economic problems of the

:21:09.:21:14.

European Union. There is no getting away from that at the same time we

:21:14.:21:19.

have to take specific measures to help the young people, to make them

:21:19.:21:23.

more employable, to ensure that they are not cut off from society

:21:23.:21:27.

whilst they are unemployed. Thank you very much indeed. Well,

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this week in the European Commission has been giving advice

:21:30.:21:38.

to its members in how to get their economies going. Joe Lynam has been

:21:38.:21:44.

in Strasbourg to meet the movers and shakers.

:21:44.:21:48.

Including one in particular. Yet if asked to name the President of The

:21:48.:21:53.

European Parliament, how many of us would know it was a bespekled

:21:53.:21:58.

German chap called Martin? He represents half a billion Europeans

:21:58.:22:04.

at global summits like the IMF and G20. He is Europe's top directly

:22:04.:22:10.

elected official. The signature enacts laws that affect all and he

:22:10.:22:14.

is well placed to become the new head of the European Commission.

:22:14.:22:20.

Yet how many of us know his name? How would he describe himself? What

:22:20.:22:30.
:22:30.:22:32.

kind of guy are you? President Martin Shulz is arriving. I am

:22:32.:22:37.

going to spend the day with him. Do you have a busy day today? Always

:22:37.:22:44.

busy days in Strasbourg. Martin Sh lurbgs z is chairing a

:22:44.:22:48.

debate about tax havens and tax avoidance. Something that Britain

:22:48.:22:54.

has a keen interest in. Push for a political commitment on

:22:54.:22:58.

a simple principle, in 2015, the European Union should have an

:22:58.:23:02.

automatic exchange of information for all forms of income.

:23:02.:23:06.

The topic may be tax but it soon gets to Britain's future in the

:23:06.:23:10.

European Union. I think that the British business

:23:10.:23:15.

leaders yesterday had it completely right. They said very loud and

:23:15.:23:22.

clear, to you and to the others, that it will be an economic

:23:22.:23:26.

disaster to to leave the European Union.

:23:26.:23:30.

You can probably see the President of The European Commission, Jose

:23:30.:23:33.

Manuel Durao Barroso and two seats over, Nigel Farage, the scourge of

:23:33.:23:39.

the European Union is there as well. UK Independence Party got wind that

:23:39.:23:44.

Newsnight was in town. Suddenly and in breach of parliamentary rules,

:23:44.:23:49.

Union Jacks appeared on their desks. Looking at officials that work for

:23:49.:23:51.

the European Commission and Parliament. The highest category

:23:51.:23:57.

are people that earn a net take- home pay of just over �100,000 a

:23:57.:24:03.

year. And yet under EU rules they pay tax

:24:03.:24:10.

of 12%. It is tax fraud Ann absolutely

:24:10.:24:14.

massive scale. Jose Manuel Durao Barroso, I say, how can that be

:24:14.:24:20.

deemed fair? They are used to Nigel Farage's views here. So much so,

:24:20.:24:26.

that Mr Shulz can do a half-decent impression of the UKIP leader.

:24:26.:24:36.

What are you planning here, Mr Barroso ?! Mr Shulz may anybody

:24:36.:24:40.

charge of the Parliament but has not hidden his desire to become the

:24:40.:24:45.

commission President. To achieve it he may have to replace bras Jose

:24:45.:24:54.

Manuel Durao Barroso. Who we intercepted to meet Mr Shu lz.

:24:54.:24:58.

What kind of guy is he? I am not prepared... We are doing a

:24:58.:25:03.

professional of the man. I get the impression he is man of strong

:25:03.:25:07.

opinions? It is true. He is on the opposite side of the

:25:07.:25:11.

political divide from you? Opposite? What do you mean by

:25:11.:25:16.

opposite? He is centre-left, you are centre-right.

:25:16.:25:23.

Oh! We are, it is true, he is a socialist, I am not, but yes a good

:25:23.:25:30.

working relationship. OK. I was just giving an interview,

:25:30.:25:40.
:25:40.:25:44.

also about HerrKlaus. Are we looking at the current of

:25:44.:25:51.

the... Are you worried about the scepticism growing? The real threat

:25:51.:25:59.

to Europe is in difrt. I like the debates, but what we need is a real

:25:59.:26:05.

political debate about the way that Europe needs to go forward.

:26:05.:26:09.

But the one country that were talking of retreating from its

:26:09.:26:13.

relationship with the EU is Britain. So are some people in Europe tiring

:26:13.:26:21.

of Britain as much as some in Britain are tiring of the EU? Is

:26:21.:26:25.

the thrrb there a fatigue for the British in the European Union?

:26:25.:26:29.

Absolutely not. I think that the majority like me

:26:29.:26:34.

members of the European Parliament, we want to see the UK as a member

:26:34.:26:40.

of the European Union active within the European Union, we honour the

:26:40.:26:44.

enormous contribution of the situation to the UK to our success.

:26:44.:26:50.

Therefore, there is no anglofatigue. There is perhaps a euro fatigue in

:26:50.:26:54.

the UK. It is purely tactical. Nothing else. This is creating a

:26:54.:26:58.

problem. From the first day, whatever he did and said, David

:26:58.:27:04.

Cameron, in my eyes, that is my feeling, had more to do with the

:27:04.:27:10.

internal situation in the Tory Party and in Europe and as a member

:27:10.:27:14.

in the UK. There is an exten shall opinion,

:27:15.:27:20.

that it may not survive it may break up? If it fails, the

:27:20.:27:23.

political project behind the currency will fail as well.

:27:23.:27:27.

Therefore we should be prudent in some of the Member States of the

:27:27.:27:31.

European Union, 50% of young people, younger than 25 years, they are

:27:31.:27:35.

unemployed, this is a shame. Unacceptable in the richest

:27:35.:27:39.

continent of the world. Therefore, yes, I understand that people are

:27:39.:27:44.

angry, but is this a result of European integration? Or is this a

:27:44.:27:52.

result of a very poor fairness in this distribution of the rich to

:27:52.:27:57.

welfare within the European Union. What kind of guy are you? We know

:27:57.:28:01.

about your political background. What kind of person are you if you

:28:02.:28:05.

were to describe yourself to someone who met you? That is

:28:05.:28:15.
:28:15.:28:29.

difficult to describe yourself. (speaks in German.) I think, from a

:28:29.:28:37.

political point of view... I'm a fighter.

:28:37.:28:44.

Sharon Bowles works closely are Martin Shulz on key financial

:28:44.:28:48.

legislation. He can be fiery and thoughtful.

:28:48.:28:52.

a personal level, he is OK. You can deal with him.

:28:52.:28:57.

If he replaced Jose Manuel Durao Barroso, what do you make of that

:28:57.:29:01.

don't think it is an outcome that I would favour there. Are many other

:29:01.:29:06.

candidates whose ylds that I identify with.

:29:06.:29:12.

-- ideals, that I identify with. Mr President... The end of a long

:29:12.:29:19.

day? Not yet. So, ten hours after he arrived in

:29:19.:29:25.

Strasbourg, Martin Shulz leaves for a flight to brels to address

:29:25.:29:30.

Europe's 27 leader. And the front pages. We begin with

:29:30.:29:37.

the Daily Telegraph: It says that the original deal was a �24,000

:29:37.:29:44.

contract to help lobbyists to help push Fiji business. To the

:29:44.:29:49.

Independent: Sir Bradley Wiggins out of the Tour de France. Eurozone

:29:49.:29:58.

crisis as one in four youths is jobless. The Daily Mail: A block

:29:58.:30:05.

for wild child porn. In the Guardian: Sleaze returns to damage

:30:05.:30:09.

Tories as MP quits in lobbying scandal. That is all from us

:30:09.:30:14.

tonight, but there is an important anniversary on Sunday, for which we

:30:14.:30:20.

need a suitably regal tone. Over to my colleague, Sylvia Peters.

:30:20.:30:26.

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