28/11/2013 Newsnight


28/11/2013

News stories with Emily Maitlis. Including does the Bank of England fear a housing bubble, Boris Johnson is accused of elitism, and was the tuition fees row for nothing?


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Transcript


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Tonight, Mark Carney pulls the plug on a scheme to help home buyers.

:00:09.:00:15.

Does this portray his fear of the housing bubble to come? It would no

:00:16.:00:19.

longer be appropriate or necessary to have our foot on the accelerator.

:00:20.:00:24.

It's better to shift into neutral. That's why the changes are being

:00:25.:00:28.

made. This man once said he wanted to be King of the world. Boris

:00:29.:00:32.

Johnson tonight is accused of unpleasant elitism.

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The policy that causes violence on the streets and prompted this.

:00:38.:00:44.

# I'm so, so sorry # There's no easy way to say I'm

:00:45.:00:49.

sorry... # But how But has the row over tuition

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feels all been for nothing? And whatps -- what happens when you turn

:01:00.:01:04.

your back on your parents' religion and have to tell them? She began to

:01:05.:01:13.

cry. She said to me, "if it's between you and Allah, I choose

:01:14.:01:21.

Allah. ". Good evening.

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Is Mark Carney getting cold feet about the UK housing market? Today,

:01:25.:01:28.

starkly, one of its mortgage lending schemes was shut down. But funding

:01:29.:01:32.

for lending programme which allows people to borrow at low rates will

:01:33.:01:37.

no longer be available for home buying after the end of January. The

:01:38.:01:41.

Bank of England's concern was the unexpected speed at which house

:01:42.:01:44.

prices were rising in many parts of Britain, time he suggested to take

:01:45.:01:48.

his foot off the gas before the interest rates underpinning the

:01:49.:01:51.

fragile economy would have to go up. Of course, there are other ways of

:01:52.:01:55.

borrowing cheap money to buy a home. The Government flagship scheme, Help

:01:56.:02:01.

To Buy, remains untouched, but sceptics may wonder for just how

:02:02.:02:03.

long. Here is Andy Verity.

:02:04.:02:12.

Who is setting the course for the housing market? As evidence mounts

:02:13.:02:18.

of house prices getting even less affordable, the Treasury's answer

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has been to use Government noun help buyers pay the prices, loosening

:02:22.:02:25.

lending. But today, the Bank of England fired a shot across the

:02:26.:02:30.

Treasury's bows. The risk to financial stability may

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grow if there is further substantial rapid increases in house prices and

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further build-up of household debt. These risks would be amplified if

:02:40.:02:43.

unrate standards on mortgage lending were to weaken, as has been the case

:02:44.:02:48.

in previous house price sickles. Until today the Governor had been

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content to go along with the Treasury line that the risks of a

:02:53.:02:57.

bubble were remote. But today, he presented mounting evidence that

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there were significant risks in the housing market. On this chart, the

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two bars on the right represent those whose mortgages are more than

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four times their, in holding a third of the mortgage debt in the country.

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On the right, is those who hold a fifth of mortgage debt.

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The lending scheme is one of the reason we have the cheapest

:03:20.:03:23.

mortgages offered. You can borrow ?500,000 and pay just ?621 a month.

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No wonder some people now including the Bank of England are worried

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about house prices taking off. 40% of outstanding mortgage debt is

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held by people who have a debt equal to, or greater than four times their

:03:40.:03:43.

income. Clearly this is Kuwait a high number and could cause concern

:03:44.:03:46.

under higher interest rates. Funding for lending makes cheap

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funds available at a quarter of a percent, a measure introduced last

:03:53.:03:57.

year when the banking process threatened the recovery. The Bank of

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England made it clear today it was withdrawing that for household

:04:02.:04:06.

lending. In its stability report published today, the fear is less

:04:07.:04:10.

double dip, more double bubble. It might be an increase, or a shift

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really, in the Bank of England's thinking about what is more worth

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worrying about maybe, which is that the problems with affordability, the

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structure of the housing market, the prices one has to pay in Central

:04:32.:04:38.

London et cetera. Actually, they have an impact on financial

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stability. What they seem to be saying in the financial stability

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report is that they have the policy tools to address that. Mark Carney

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has reason not to want his tenure at the bank to be marred by a housing

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bubble. The He was accused of that while in Canada with buyers

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stretched. When a bank lend you the money for the mortgage, its biggest

:05:13.:05:16.

cost isn't the interest to get hold of the funds but the capital it has

:05:17.:05:19.

to set aside. The rules on that are set by the people in here, the Bank

:05:20.:05:23.

of England, and what they've been saying today is, if they see the

:05:24.:05:26.

housing market taking off, they could tighten the rules right now

:05:27.:05:30.

for every ?100 of money they lend and have to set aside ?1. If the

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Bank of England raised that to say ?2 it would double their costs and

:05:36.:05:39.

mortgages would become more expensive. The Bank of England could

:05:40.:05:44.

raise capital requirements on areas in the bank's balance sheet where

:05:45.:05:49.

risks were beginning to rise. What that could mean in our view is that,

:05:50.:05:56.

for example, higher loan to value mortgages, mortgages with higher

:05:57.:06:02.

price to income ratios could attract higher capital requirements from the

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Bank of England. Therefore higher costs? Yes.

:06:05.:06:09.

The Treasury had one answer to rising house prices, loosening

:06:10.:06:12.

lending to the most stretched with the help of taxpayers' money. The

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bank hasn't stopped that, but it's warning -- its warning shots can't

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be ignored. Don't expect mortgage rates to stay cheap.

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Joining me now is Anatole and Mariana Mazucato. Was this the right

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move? No, most economists believe that the Chancellor was making a big

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mistake six months ago when he created the Help To Buy scheme. I

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was one of the few who said at the time, this is the one thing the

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Government's done that could actually turn the economy around. It

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did turn the economy around. I think the reason why the UK economy has

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been surprising most experts on the upside has been doing better than

:07:06.:07:09.

any other European economy now for the first time in five years is the

:07:10.:07:16.

revival of the housing market. So have they got this one wrong? No.

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This is the kind of action the Bank of England will probably have to

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take and should take two or three years from now once the economy's

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recovered and once we are back to a normal economic situation with

:07:30.:07:32.

employment back to 6% and so on, but you think it's too early to do it

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and it does endanger the economy. Shot his goose a bit too soon,

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Mariana Mazucato? He's right and wrong. He's right because he's

:07:45.:07:47.

saying we don't want to fiddle with the economy by increasing the

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interest rate by things overheating. He reintroduces the concept of

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regulation, he wants to increase leverage ratios and we don't want to

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lend to the speculative economy, so to give mortgages to consumer

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selections won't be able to pay the mortgages back, especially once

:08:10.:08:11.

rates do change. He's wrong in the sense that what we are trying to do,

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and anyone thinking about growth, has had to rebalance the economy

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away from a speculative finance toward product you have finance and

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the emphasis that somehow it will happen by lending to SMEs whereby if

:08:25.:08:28.

you look around the world and the UK, SMEs don't provide that much job

:08:29.:08:33.

creation and innovation. So if there is a chance that growth from the

:08:34.:08:36.

housing bubble will be better than what comes next which could be no

:08:37.:08:42.

growth... The problem right now in the world, but definitely in the UK

:08:43.:08:45.

is not the quantity of finance. There's plenty of finance out there.

:08:46.:08:50.

There's not the right quality. . We need long-term, patient committed

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finance that helps the types of companies that do want to invest in

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the long-term areas to be able to do that. It's independent of size,

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small and medium companies need that but none of the reforms are

:09:02.:09:05.

increasing the long-term committed patient finance. He's still trying

:09:06.:09:08.

to go through the banks, just like Vince Cable, with his business bank

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was still going to go through the private banks. In the US, there's

:09:13.:09:20.

direct lending to companies. Anatole Kaletsky you said you were at odds

:09:21.:09:25.

with a lot of the comikists. All the home lending schemes have been

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popular but economically slightly crazy? I don't think it has been

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crazy. This is a case of a measure which was initiated for political

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and, if you like, quite cynical and manipulative reasons. It was all

:09:43.:09:45.

about winning the next election but it happened to be the right thing to

:09:46.:09:48.

do for the economy at the time because, you know, at the beginning

:09:49.:09:51.

of this year, the economy was in its deepest and longest slump in history

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and there was no prospect of turning that around. But just explain to us,

:09:57.:10:02.

where does the dynamic sit now between the Bank of England and the

:10:03.:10:07.

Treasury? Who clamped down on this exactly? I think that's a great

:10:08.:10:11.

question because my assumption of course as an outsider was that when

:10:12.:10:16.

George Osborne introduced the Help To Buy programme, it was more or

:10:17.:10:19.

less the same time he announced Mark Carney as the next Governor of the

:10:20.:10:22.

Bank of England, so my assumption, I think most people's was that he must

:10:23.:10:26.

have consulted the new Governor to ensure that he would be supportive

:10:27.:10:32.

of this programme. That's exactly how things seemed for the last or

:10:33.:10:36.

first three for four months with Mark Carney at the Bank of England.

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But he suddenly and quite inexplicably seems to have changed

:10:41.:10:43.

his position and, to me, I was thinking about this, this is like

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Henry II and Thomas Beckett. If Mervyn King would have been in

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charge, it would have been hard to Boro is deuce the Help To Buy

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programme. Do you think Help To Buy is similarly under the microscope

:10:57.:11:00.

now? I don't think that's where the problem is. Going back to the

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previous question, the real schizophrenia is in the Treasury. I

:11:04.:11:07.

do actually have quite a bit of faith in Carney. I think he has red

:11:08.:11:16.

Cains. What drives the spirits, your gut instincts about what the future,

:11:17.:11:21.

technological and market initiatives are, that doesn't change. He's

:11:22.:11:26.

trying to think, how can we rebalance towards productive finance

:11:27.:11:29.

to eventually increase that private business investment. I think the

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problem with the trezly is -- Treasury is, there's no growth. This

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is why the innovation and industrial policy, which is finally back to

:11:40.:11:44.

business skills, is having little effect because it's not coherent

:11:45.:11:48.

with the Treasury and what they are saying.

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I think what you are missing, is that businesses are not going to

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invest unless they see consumer demand. What generates animal

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spirits is the knowledge that people out there are going to buy your

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products and services. That is how a housing recovery was beginning and

:12:06.:12:09.

is beginning to feed into the broader economy.

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One thing canes didn't get right is that, he found that digging ditches

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and building them up again would improve recovery. For all those

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people to be able to get a mortgage from lending, you've got all this QE

:12:29.:12:33.

floating in at the other end, the gap between those at the top and

:12:34.:12:37.

those who are not able is even bigger. That's what this is doing,

:12:38.:12:41.

isn't it? Yes. Inequality was both the cause and an effect of the

:12:42.:12:45.

financial crisis. There are too many people taking out these not only bad

:12:46.:12:49.

loans but good loans in the US that didn't have the income. Real incomes

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have been stagnant for three years. The Help To Buy was beginning to

:12:55.:12:57.

redress that and we are beginning to get to the point where it's

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beginning to move out from London to the other parts of the country where

:13:01.:13:04.

other houses are not expensive. The average house price in this country

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is ?170,000. We have got to leave it there. Thank

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you both very much indeed. I don't want to think about the

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possibility of what would happen if they found out I'm just too scared

:13:18.:13:22.

to tell them. There are a lot of Cornflakes

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rattling around Boris's speech last night. When he got past the cereal

:13:32.:13:35.

and delved down to the free toy at the bottom, the message was stark -

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I don't believe, he told an audience for an annual Margaret Thatcher

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lecture, that economic prosperity is possible. What if this is in fact

:13:49.:13:53.

the Boris creed? What if his own brand of Boris Pops revolves around

:13:54.:13:59.

the importance of board room greed and unfairness as a spur to economic

:14:00.:14:05.

activity? Here is Zoe Conway. I've never seen anything like this

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in all my life. When Boris Johnson was a child, he said he wanted to be

:14:10.:14:14.

world King when he grew up. There were times during the Olympics that

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childhood ambition didn't seem quite so far fetched.

:14:19.:14:21.

These days, he's lowered his sights somewhat. Many in the Conservative

:14:22.:14:26.

Party assume he wants to be their next leader. So what does this

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pretender for the Tory throne actually believe?

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Last night, he talked about ineasy quality in a lecture aimed at the

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Tory right. I don't believe that economic equality is possible.

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Indeed, some measure of in inequality is essential for the

:14:49.:14:51.

spirit of envy in keeping up with the Joneses and so on that is a

:14:52.:14:57.

valuable spur to economic activity. His comments are interesting because

:14:58.:15:01.

they are such a contrast to David Cameron's public agonising about

:15:02.:15:05.

inequality when he became lead leader. Three years ago, he said

:15:06.:15:10.

less equal societies do worse. But Boris also argued for a move

:15:11.:15:15.

away from the perceived excesses of 1980s Thatcherism.

:15:16.:15:20.

I hope that the Gordon geckos of London are conspicuous not just for

:15:21.:15:24.

their greed, and I accept the CPS view that greed is a valid Motivator

:15:25.:15:29.

of economic progress. As for what they give and do for the rest of the

:15:30.:15:31.

population. It's on education that Boris Johnson

:15:32.:15:42.

is most clearly positioning himself to the right of David Cameron by

:15:43.:15:46.

calling for the return of academic selection. He accuses his party of

:15:47.:15:52.

hypocrisy on grammar schools. I remember once sitting in a meeting

:15:53.:15:56.

at the Shadow Tory education team and listening with mounting

:15:57.:16:00.

disbelief to a conversation where aall agreed it would be political

:16:01.:16:03.

madness to try to bring back the grammar schools. Well, I happen Tono

:16:04.:16:07.

that most of the people in that room were able to make use, as parents,

:16:08.:16:13.

only some of the most viciously selected schools in the country --

:16:14.:16:17.

selective schools in the country. Being Mayor of London has not always

:16:18.:16:21.

given Boris the chance to endear himself to the right of his party.

:16:22.:16:24.

If anything he's had to tack left. He may argue for a smaller small

:16:25.:16:30.

small estate, but he's spending millions on the transport

:16:31.:16:32.

infrastructure. Then there are his calls for a higher living wage for

:16:33.:16:33.

Londoners. When in China, Boris is keen to

:16:34.:16:44.

emphasise house open London is to the rest of the world. But last

:16:45.:16:49.

night, he expressed frustration at the Government's immigration policy.

:16:50.:16:53.

It's time to sort out the immigration system so we end what is

:16:54.:16:58.

currently a totally mad situation. At the moment we are claiming to

:16:59.:17:02.

have capped immigration by having a 60% reduction in New Zealanders when

:17:03.:17:08.

we can do nothing to stop the entire population of Transylvania, charming

:17:09.:17:13.

though many of them, almost all of them doubtless are, from trying to

:17:14.:17:22.

pitch camp at Marble Arch. Boris's direction of travel on

:17:23.:17:26.

Europe can be confusing. He was once a hero to Euro-Sceptics, but

:17:27.:17:30.

recently he said he's narrowly in favour of staying in the EU. Last

:17:31.:17:36.

nights, he played it safe, attacking eurocrats, definitely the low

:17:37.:17:42.

hanging fruit of Europe bashing. They make us pay our taxes for Greek

:17:43.:17:46.

olive groves which possibly don't exist. Then I read the other day

:17:47.:17:51.

they say that we can't dip - have you seen this - we can't dip our

:17:52.:17:56.

bread in pots of olive oil in restaurants. We think we are

:17:57.:18:00.

sophisticated enough to use olive oil and then say we can't.

:18:01.:18:06.

Boris Johnson said he's more likely to be reincarnated as a baked bean,

:18:07.:18:13.

or decapitated by a phrase bithan become Prime Minister. But with

:18:14.:18:17.

scenes like this, doesn't that just sound like piffle -- by a frisbee.

:18:18.:18:27.

The Government is asking the big six energy firms not to raise prices on

:18:28.:18:30.

the basis of Government policies until the middle of 2015. What

:18:31.:18:36.

should we make of this? Is it blatant conceptual drivery or

:18:37.:18:41.

something much more subtle -- thievery. Danny fin Kell Stein of

:18:42.:18:48.

the Times and Olly Grender join us, along with John McAteer nan. Welcome

:18:49.:18:55.

to you all. -- McTiernan. This is just coming out, John, what we

:18:56.:19:00.

understand from industry sources, that suppliers are being asked to

:19:01.:19:05.

keep bills on hold. What do you make of that? Imitation is obviously the

:19:06.:19:10.

form of flattery. What we are seeing at the moment is the Tory party in

:19:11.:19:14.

two minds about what it wants to do. Does it want to go nasty or does it

:19:15.:19:24.

want to go touchy feely and do payday loans and do this on

:19:25.:19:29.

electricity prices? It's usteringly incoherent. You can go to the nasty

:19:30.:19:42.

end of TfL -- end of the market or go the other way. All that stuff

:19:43.:19:47.

about statism and national and 1983 manifestos after Ed Miliband... I

:19:48.:19:50.

thought I was going to agree with you, then I didn't. There is a

:19:51.:19:54.

dilemma and the Conservative Party is trying to weigh up what to do.

:19:55.:19:57.

It's between whether to make the pure argument we have put the

:19:58.:20:00.

economy right and run on growth, or try to do something about

:20:01.:20:03.

cost-of-living in the short run which is very difficult.

:20:04.:20:08.

That is actually a genuine dilemma. Clearly, they have decided they've

:20:09.:20:14.

got to do something about the cost of heading up that argument in order

:20:15.:20:20.

to allow them to make the argument about deficit, debt and Britain's on

:20:21.:20:24.

the right track, don't turn back. I think it's hard because if you do

:20:25.:20:29.

that, you look as though you are looking at some of the initiatives

:20:30.:20:32.

by Labour. You have to do something about the cost-of-living because

:20:33.:20:35.

that's a large component of the indicators that make a successful

:20:36.:20:39.

election campaign. I think you are right about the dilemma, but I don't

:20:40.:20:44.

think there is a situation where the Tories sit around going, do you

:20:45.:20:47.

think we should be nasty or nice, it's absurd. We saw the same with

:20:48.:20:53.

payday loans which was very much seemed like a Labour initiative, to

:20:54.:20:57.

put a cap on prices there, and suddenly, ahead of the Autumn

:20:58.:21:01.

Statement? I'm not particularly in favour of what was done, but I can

:21:02.:21:05.

see the political logic of it again because it's about cost and it's

:21:06.:21:11.

about cost-of-living and also about trying to remove the sort of

:21:12.:21:15.

economic negatives that you might get, I think maybe cigarette

:21:16.:21:18.

packaging comes in as well. You have got this dilemma all the time where

:21:19.:21:22.

you are trying to cut off the negatives, if you possibly can,

:21:23.:21:25.

without giving the impression that you are allowing the opposition to

:21:26.:21:28.

set the agenda. That's a difficult balance. Also it's about

:21:29.:21:33.

anticipating what is coming up. In both cases, on payday loans and on

:21:34.:21:39.

cigarette packaging, you know, kind of David Cameron knew that in the

:21:40.:21:43.

House of Lords he was going to get into significant trouble because

:21:44.:21:47.

there were Lib Dems who were going to move on them, both of those

:21:48.:21:53.

things. On the energy companies, first off, they've still got ?1

:21:54.:21:57.

billion that they haven't spent on all the eco measures. It's pretty

:21:58.:22:02.

disgraceful that they are still sitting on them. They have plenty

:22:03.:22:05.

they can spend. Strikes me as a reasonable thing to a ask of them,

:22:06.:22:09.

but what my concern is, and I think this is where Lynton Crosby might be

:22:10.:22:13.

right in his advice, which is not the nasty nice, you know, I kind of

:22:14.:22:18.

sense what Danny is saying about that, but he is right when he tells

:22:19.:22:22.

David Cameron, stop getting dragged on to agendas of the Labour Party

:22:23.:22:26.

and of the media. I wonder where this leaves the green

:22:27.:22:33.

taxes or "the green crap". Does that mean taxation for all the green

:22:34.:22:38.

stuff does go? Elections are settled by not small political rows but by

:22:39.:22:44.

very big economic forces. The Conservative Party's going to have

:22:45.:22:47.

votes running for it at the next general election more strongly than

:22:48.:22:51.

people anticipated in the six months before and after. The question is

:22:52.:22:54.

whether it will have real disposable income so it has to choose to do

:22:55.:23:00.

things about what will affect the disposable income. The danger is you

:23:01.:23:07.

see the intellectual initiative, you make Labour look more economically

:23:08.:23:13.

competent. What is interesting is that polls say that they love the

:23:14.:23:17.

energy freeze strategy but they don't believe it which is really an

:23:18.:23:21.

Ed Miliband problem fundamentally isn't it? Danny is right, there are

:23:22.:23:26.

two frames. There is a frame of, you have taken the pain, and we have

:23:27.:23:30.

restored the growth, now you are going to get some gain out of that.

:23:31.:23:34.

Or there is the touchy feely Ed Miliband, I feel your pain and we

:23:35.:23:37.

should do something about it. The difficulty for the Tories is, they

:23:38.:23:42.

are not sure which frame they are purr suing and if you mix the frames

:23:43.:23:48.

you muddle your message -- pursuing. The public's big doubt is, I like Ed

:23:49.:23:52.

Miliband's policies, will he do them? It talks the point that he's

:23:53.:23:57.

got to find a way of presenting and representing his promise on the

:23:58.:24:01.

issues. He's aided by the fact the Government keep moving on to his

:24:02.:24:04.

ground so he's allowed to talk about it. The Labour Party are failing at

:24:05.:24:07.

the moment in prosecuting the case that they are determining and

:24:08.:24:11.

dictating the agenda and they've got to get on to that space too.

:24:12.:24:21.

That is down to the electorate. What I think most of all is important for

:24:22.:24:25.

the Labour Party at the moment and what I found extraordinary about the

:24:26.:24:28.

press release that came out today, it was by the way the press

:24:29.:24:31.

officer's nightmare press release saying we are going to be and larger

:24:32.:24:35.

and put some organisers on the ground. It was just the kind of

:24:36.:24:41.

thing that you never do. It's not strategic.

:24:42.:24:46.

ALL SPEAK AT ONCE The long-term plan. Bnchts but it's

:24:47.:24:50.

the kind of show me don't tell me kind of classic mistake that both

:24:51.:24:53.

the other political parties are making I think. If you are devising

:24:54.:24:57.

a strategy and have to make this choice for the Conservative Party, I

:24:58.:25:01.

think you would calculate that you're unlikely to succeed the

:25:02.:25:07.

electric election initiative. I don't think people think of Ed

:25:08.:25:12.

Miliband has a dynamic person. Even if they are wrong, that's not what

:25:13.:25:15.

they think. Think in you are making that calculation, you think, I have

:25:16.:25:18.

a big enough advantage to risk trying to do something about

:25:19.:25:21.

cost-of-living in order to try to neutralise that as much as I can and

:25:22.:25:27.

make people feel better. Presumably though there is a tipping point if

:25:28.:25:31.

they like his policies enough, that happens, right? There is a problem

:25:32.:25:34.

too in that David Cameron's no longer who they thought he was when

:25:35.:25:37.

they voted for him. That's a difficulty for the Tories that they

:25:38.:25:40.

have to deal with that he was going to be the man that saved the NHS,

:25:41.:25:45.

and that's broken. He was, let sunshine have the day, and whatever

:25:46.:25:49.

he said yesterday about immigration was not sunshine having the day. I

:25:50.:25:57.

agree that people were never absolutely blown away at the next

:25:58.:26:01.

general election by David Cameron. That's not why he didn't win. If you

:26:02.:26:11.

are devising Conservative election strategy, obviously I think a

:26:12.:26:14.

reasonable fixed point is that Ed Miliband has a lot of structural

:26:15.:26:20.

advantages and Labour do, but Ed Miliband doesn't convince people

:26:21.:26:23.

that much whether he should or not and therefore what you do is...

:26:24.:26:29.

Before we carry on with that, Nick Clegg's line on this today was that

:26:30.:26:35.

it was bold conservatism I guess you would call it. Is he missing the

:26:36.:26:40.

point of Boris? No. I mean I think Boris is, as usual, all over the

:26:41.:26:47.

place. So he's just impossible. It must be maddening for the

:26:48.:26:50.

Conservatives, because one minute he's one thing, the next he's the

:26:51.:26:58.

next thing. He said things about David Cameron and George Osborne? I

:26:59.:27:03.

must be missing something. I do not understand the row concerning

:27:04.:27:07.

observing the disparity in the population. Social mobility, the

:27:08.:27:11.

issue with that is that people have different talents. He was talking

:27:12.:27:14.

about if you are down there, you may end up having to stay there, you

:27:15.:27:20.

know. Maybe he thinks that, but he did not say that. It sounds like he

:27:21.:27:25.

said that. It was the language and tone of contempt for fellow human

:27:26.:27:29.

beings which had a nasty tone. That's not a fair reading of his

:27:30.:27:32.

speech. That's what people maybe hoped he said but it was not a fair

:27:33.:27:35.

reading. Thank you all very much indeed.

:27:36.:27:39.

If tuition fees were meant to solve a problem, making academia more

:27:40.:27:42.

sustainable for the future, the latest reports suggest the project

:27:43.:27:46.

might be failing. The National Audit Office believes more than ?5 billion

:27:47.:27:51.

of public money paid out in student loans will be unaccounted for

:27:52.:27:54.

because the Government doesn't know who owes it and whether it can pay

:27:55.:28:04.

it back? Martin Williams is a part-time

:28:05.:28:08.

teacher at a sixth form college in Southampton. He spent five years

:28:09.:28:13.

studying fine art, graphics and photography but doesn't earn enough

:28:14.:28:17.

to pay back his own student loan. I've actually probably paid nothing.

:28:18.:28:21.

I probably haven't even dented the interest that's incurred from it

:28:22.:28:24.

because I've not been in employment to take me over the threshold of the

:28:25.:28:28.

minimum payment. Like the other teachers, he gives teenagers career

:28:29.:28:32.

advice. Some ask whether student loans are effectively free money?

:28:33.:28:38.

A lot of them ask me what have I had to pay back and I'm honest with them

:28:39.:28:42.

and said I've not been in a position where I've had to pay anything back

:28:43.:28:45.

because I've not earned enough yet. In that sense, it does come across

:28:46.:28:51.

that it's cost me nothing to do, so I do advise them to make sure that

:28:52.:28:55.

they are aware of the terms. I do tell them about the terms.

:28:56.:29:04.

Britain needs more highly skilled workers the Government often say. By

:29:05.:29:10.

2035, they expect nearly 500,00018-year-olds will start

:29:11.:29:15.

university every autumn. As student numbers rise and

:29:16.:29:19.

individual tuition fees rise, so the impact on the overall student loan

:29:20.:29:25.

bill will be dramatic. Even now, ?46 billion of loan repayments are

:29:26.:29:29.

outstanding and it's estimated that in 30 years' time, that'll more than

:29:30.:29:36.

quadruple to ?200 billion. More people are failing to pay back

:29:37.:29:39.

their loans. In 2010, it was estimated 28% of the

:29:40.:29:45.

debts would have to be written off. That's risen to 35% this year.

:29:46.:29:50.

The model that the Government used to model this system didn't take

:29:51.:29:54.

into account the recession, lower graduate earnings, the fact that

:29:55.:29:58.

women earn considerably less than men over their lifetime. From the

:29:59.:30:02.

beginning, the system has been shaky and it's a numbers fiddle, it moves

:30:03.:30:06.

the amount of money from the deficit to the debt.

:30:07.:30:12.

Since the student loan scheme ban over 20 years ago, nearly 370,000

:30:13.:30:17.

students have disappeared from its records. They might be working

:30:18.:30:21.

abroad, they might be unemployed here with the National Audit Office

:30:22.:30:27.

estimating they owe about ?5 billion and the student loan company is not

:30:28.:30:31.

doing enough to try to track them down.

:30:32.:30:34.

I don't think it's surprising. I is have a friend who's led me to

:30:35.:30:38.

believe that they are no longer in the country is so don't voluntarily

:30:39.:30:42.

repay the loan. They have never outright said it to me but they have

:30:43.:30:46.

implied they are no longer paying it. I don't think it's common. At

:30:47.:30:51.

the end of the day, the incentive is there if HMRC aren't chasing people

:30:52.:30:56.

once they go overseas. It's not surprising that people go abroad to

:30:57.:31:00.

avoid paying the loan back. Neither the Government nor the student loan

:31:01.:31:02.

company were available for interview. Though the loan company

:31:03.:31:06.

gave us a statement saying it would use the findings and recommendations

:31:07.:31:11.

from the report to help it further improve the way it secures the loan

:31:12.:31:16.

repayments due from all its bow rowers, including those who were

:31:17.:31:19.

overseas. Meanwhile, analysts say other

:31:20.:31:25.

sectors are likely to suffer. The The impact of overspending on

:31:26.:31:29.

loans is that you have to make up the short fall else where. The

:31:30.:31:36.

department can't make any savings in the short-term so have to look to

:31:37.:31:39.

other bits of the budget to make savings. That means further

:31:40.:31:44.

education, research funding, widening participation funding are

:31:45.:31:47.

all very vulnerable to cuts to try and offset the impact of

:31:48.:31:51.

overspending on loans. In 2010, the Conservatives came up with a new

:31:52.:31:57.

vision for higher education, raising tuition fees would secure its

:31:58.:32:01.

Financial Future. Student loans would make university affordable for

:32:02.:32:04.

all. Reluctantly, the Liberal Democrats

:32:05.:32:08.

accepted it, but this report shows that picture is seriously flawed.

:32:09.:32:17.

Newsnight has learned of a plan to destroy Syria's chemical weapons at

:32:18.:32:21.

sea, using a US Navy auxiliary vessel. Industry sources told us the

:32:22.:32:24.

plan will put a mobile destruction plant aboard that uses water to

:32:25.:32:28.

dilute the chemicals to safer levels. Mark Urban has the story.

:32:29.:32:35.

Talk us through this plan, Mark? We have been looking into the

:32:36.:32:39.

detail. There's a very ambitious schedule been set for the agreement

:32:40.:32:43.

to disarm Syria of the weapons and they are all supposed to be out of

:32:44.:32:46.

the country by the end of this year, just a few weeks away. How is it

:32:47.:32:50.

going to happen when all of the countries that have been canvassed

:32:51.:32:55.

about being the place where these things would be destroyed have

:32:56.:32:58.

refused to have it? It seems that the plan that's now come to the

:32:59.:33:03.

front is to do it on board this US Navy auxiliary, a big ship, a roll

:33:04.:33:10.

on roll off ship, the MV Cape Ray imported in Vicki Young ya, it will

:33:11.:33:14.

have a special plant placed on it and that's what will happen. Before

:33:15.:33:20.

we get to that point though, it will have to be moved -- Virginia. Most

:33:21.:33:26.

are being concentrated in happen a dozen sites in Damascus. They'll be

:33:27.:33:31.

moved up around the Lebanese border up to the north, then the east, to

:33:32.:33:38.

the ports of either Tartus and Lattakia. 200-plus contaunter-size

:33:39.:33:43.

loads on the quayside will be collected then. There's still some

:33:44.:33:49.

doubt about whether the Cape Ray will go into the ports, it's a US

:33:50.:33:54.

Navy vessel. Others might have to shift it from the quayside to the

:33:55.:33:59.

cape Ray. But once on board, the destructive process of diluting it

:34:00.:34:02.

can commence. Well, talk us through that? Where

:34:03.:34:06.

does it go? Does it end up in the sea? Well, it's a very important

:34:07.:34:15.

question. There are still some unanswered aspects to that. Earlier

:34:16.:34:22.

I spoke to a chemical weapons expert and asked if that was the end of it

:34:23.:34:26.

once they are on board? It's not going to be the end of the problems

:34:27.:34:30.

because it's going to be 30 tonnes of mustard gas and 600 tonnes of

:34:31.:34:36.

toxic precursors that will be destroyed on the Cape Ray. It will

:34:37.:34:42.

produce about seven million litres of toxic effluent which will need to

:34:43.:34:46.

be gotten rid of somewhere. You can't take to it the sea, it will

:34:47.:34:52.

have to be taken to a commercial facility. They have argue that that

:34:53.:34:57.

effluent is none more toxic than other things in the ocean. You can

:34:58.:35:01.

see the possibility that the ship could become like a plague vessel

:35:02.:35:04.

that no-one will have. So how would we even be sure that they'd all

:35:05.:35:12.

gone? Well, the organisation that's carrying it out, the

:35:13.:35:15.

Netherlands-based organisation, that's about to get the Nobel Prize

:35:16.:35:22.

feel confident that their inventory has been successfully compiled and

:35:23.:35:26.

that they can remove it. There are many rumours persisting that some

:35:27.:35:30.

small quantities may have slipped through their fingers, including

:35:31.:35:34.

with rebel groups. Mark Urban, thank you very much.

:35:35.:35:40.

What happens when you choose to turn your back on your parents' religion,

:35:41.:35:44.

particularly when they're people who hold their faith dear? We often

:35:45.:35:48.

focus on those converting, but what about those who leave? In extreme

:35:49.:35:56.

cases, they are punished by families. Newsnight spoke to three

:35:57.:36:00.

people from devout Islamic backgrounds who've lost their faith.

:36:01.:36:14.

These pictures are the only pictures I have of my early childhood. They

:36:15.:36:27.

were taken before my mother became observant and they remind me of a

:36:28.:36:30.

happier time. When you have to lie as much as you

:36:31.:36:45.

do, it's like when you are not a believer amongst the believers, it's

:36:46.:36:50.

really just drains you, it drains you in every single way possible.

:36:51.:37:06.

I felt isolation. I neat I was being rejected, demonised. I felt that my

:37:07.:37:17.

thoughts weren't being respected and it was harder because I knew that I

:37:18.:37:20.

would have problems at home. I just prayed, please don't let me

:37:21.:37:39.

lose my faith. That's all I wanted. But it was sort of at that point as

:37:40.:37:43.

well that I just did not feel the connection to God any more and I

:37:44.:37:48.

felt like all my pleas were just going into empty space.

:37:49.:37:53.

I knew how much Islam meant to her, that it was everything. So to... I

:37:54.:38:00.

knew that it would be something, you know, grave in her opinion.

:38:01.:38:06.

Something that would potentially change our relationship for ever.

:38:07.:38:13.

I was wrong I was round about 15 years plus when I told them. And

:38:14.:38:26.

they didn't receive that well. I got abuse from my mum. Swearing at me,

:38:27.:38:34.

telling me that Allah would be angry with me and that I would bring a

:38:35.:38:42.

curse upon my family. I remember her reaction to this day, you know. She

:38:43.:38:44.

began to cry. It was upsetting because, you know,

:38:45.:38:59.

being the oldest child, I was always a source of pride for my mum. She

:39:00.:39:06.

looked at me. I think it really registered with her and she said to

:39:07.:39:10.

me "Amal, if it's between you and Allah, I choose Allah". And that's

:39:11.:39:17.

when I felt that the lines were clearly drawn, that, you know, I'd

:39:18.:39:27.

crossed a point of no return. One of the uncles got in front of the car,

:39:28.:39:32.

the other uncle who was at the back of the car. I was scared. One of the

:39:33.:39:42.

uncles had been in and out of prison for fighting. I was terrified. It

:39:43.:39:46.

was only half way through the journey I knew something was wrong.

:39:47.:39:49.

It was only when I got to the airport that I found out that I was

:39:50.:39:59.

due to a flight to Pakistan. I was threatened, either get on the flight

:40:00.:40:02.

or he'd beat the hell out of me. Why did they want to take you back to

:40:03.:40:07.

Pakistan? I suppose in their eyes, I was out of control. I don't want to

:40:08.:40:11.

think about the possibility of what would happen if they found out. I'm

:40:12.:40:14.

just too scared. I know I'd lose them. Especially

:40:15.:40:30.

because all my mum cares about is that I'm a Muslim and then that's

:40:31.:40:37.

the one thing that you've gone and said that you can't do for her. I

:40:38.:40:42.

would consciously call home and ask to speak to her and she'd refuse to

:40:43.:40:48.

speak to me. My sister would pick up the phone and I'd chat to her for a

:40:49.:40:54.

while and say "can I spook to mum? " And shieed "no, mum doesn't want to

:40:55.:41:09.

speak to you". I remember my mum actual actually... You know, I felt

:41:10.:41:13.

awful about what I was putting my mum through. A prayer is where you

:41:14.:41:24.

ascend to the heavens. You ascend to Allah. Then you will have

:41:25.:41:28.

surrendered. Nobody should discriminate a person just because

:41:29.:41:33.

they have left faith. Families are not for judging. We are not judges.

:41:34.:41:39.

We are simple Searle vats of God. Those people who prejudice

:41:40.:41:42.

individuals for leaving the faith. They have misunderstood. Islam is

:41:43.:41:48.

about embracing even your enemy. Islam is about teaching those who

:41:49.:41:51.

may not have learned the faith properly. Islam is about sharing the

:41:52.:41:55.

goodness of the faith. It's not manifested if you are going to

:41:56.:41:59.

outcast them, prejudice them, throw them out of your mosque and your

:42:00.:42:02.

centre, your community, you would not speak to them. It's not a very

:42:03.:42:06.

loving way of approaching the human being. Leaving your faith is a shock

:42:07.:42:19.

for your immediate family. Sometimes people have a pressure, thinking

:42:20.:42:23.

that once the pressure is exorcised, the person will think about it,

:42:24.:42:28.

reconsider the matter, maybe come back to the faith. And by pressure,

:42:29.:42:32.

do you mean? into the enemy, so I'm not just

:42:33.:43:09.

going to risk and go into that battle for no reason. If we

:43:10.:43:14.

understand Islam as a comprehensive way of life, which is, then of

:43:15.:43:20.

course leaving Islam would change everything and, as I told you, it

:43:21.:43:25.

includes a change in the political allegiance, the social life, so it's

:43:26.:43:30.

treachery to Islam. If he has committed that, then in an Islamic

:43:31.:43:36.

estate before an Islamic court, it's like the punishment of treason. It

:43:37.:43:46.

is treason. That punishment is? As you know, it's a capital punishment.

:43:47.:43:58.

I do feel sad slightly when I think about my family and I do wish things

:43:59.:44:06.

were different. But I'm very happy in my life.

:44:07.:44:13.

I don't know what the future holds for me yet. I don't know it. It's

:44:14.:44:18.

just changed everything. You don't know how you are going to do

:44:19.:44:22.

anything any more and everything you do is going to be completely on your

:44:23.:44:33.

own. My parents had another baby boy when I left home. I never met him. I

:44:34.:44:41.

want to go home and hug my family that I miss.

:44:42.:44:49.

Voices of those who've lost or changed their faith and their

:44:50.:44:54.

families. Lets's take you through tomorrow's papers before we go.

:44:55.:45:01.

Financial Times has the lead story, Khan Khanny -- Carney ditches cheap

:45:02.:45:06.

home loans. And there is the look at the debt restructure of Co-op Bank

:45:07.:45:09.

which has sold almost its entire investment in the lenders since the

:45:10.:45:14.

revelations of Paul Flowers emerged. The Times has a picture of Peaches

:45:15.:45:21.

Geldof who Tweeted the names of women who let the lost prophet

:45:22.:45:25.

singer abuse their babies. That's her Tweet. The Guardian, bank puts

:45:26.:45:31.

brakes on amid fear of house price bubble and the Mail, half of

:45:32.:45:34.

dementia patients failed by the NHS and that picture of Charles Saatchi

:45:35.:45:38.

at court. That is all from us tonight.

:45:39.:45:45.

As a special treat, a dubious one, we thought we'd bring you a casual

:45:46.:45:48.

modest Newsnight first tonight. It's a live rocket launch from Cape

:45:49.:45:55.

Canaveral. Unfortunate Liz though, the company behind Falcon 9 proved

:45:56.:46:01.

as erratic at time keeping, as we are, but instead, here are some live

:46:02.:46:08.

pictures of a stationary rocket at the bottom. Good night.

:46:09.:46:44.

Hello. Quite a change for the weather on Friday. Bright and breezy

:46:45.:46:50.

for many. Strong winds a feature across Scotland.

:46:51.:46:52.

Does the Bank of England fear a housing bubble? Boris Johnson is accused of elitism. Was the tuition fees row for nothing, Syria's chemical weapons, and apostates.


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