28/01/2014 Newsnight


28/01/2014

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The British economy is growing faster than any other major economy

:00:09.:00:15.

in Europe. Are we back to happier times? Or is this all something of a

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mirage. There are mutterings from the Liberal Democrats that this is

:00:25.:00:29.

the wrong sort of recovery. Not enough focus on this sort of thing.

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We forget, made in Yorkshire, made in Britain, that damage sells across

:00:35.:00:39.

the world, we seem to have forgotten about that. Does the Chief Secretary

:00:40.:00:44.

to the Treasury get it? Police are practising for the next round of

:00:45.:00:51.

riot in Ukraine. The opposition have run big concessions already, what is

:00:52.:00:56.

it the protestors want. They are criminals, the Government, our

:00:57.:00:59.

President, all of them, they are criminals. The Government, they

:01:00.:01:05.

offered to resign? ? Is that good enough for you? It is not good

:01:06.:01:10.

enough for me. # Where have all the flowers gone

:01:11.:01:17.

# Long time passing Do you remember, Pete Seeger, one of the great

:01:18.:01:25.

protest singers? We remember him tonight.

:01:26.:01:31.

Just in nice time for the election next year we learn that the British

:01:32.:01:36.

economy grew by nearly 2% last year. Things certainly seem better than

:01:37.:01:41.

they were. But how impressed should we be? If you look at the four

:01:42.:01:45.

quarters of last year, the overall size of the economy grew by one. 9%,

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making it much larger than it was in 2010 in the midst of the credit

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crunch. But if you take a longer view, the year before the crash,

:01:56.:02:00.

2007, the economy was consider below bigger. Some parts of the economy

:02:01.:02:05.

are now bigger than they were at the economic peak in early 2008. Here

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you can see that the service sector, which represents three-quarters of

:02:12.:02:15.

the economy is one. 3% larger. But the production sector, which

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includes manufacturing and construction is nearly 12% lower

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than it was in 2008. And the figures also show that the amount we're each

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producing, GDP per person, hasn't grown at all. Because while more

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people are employed than for a long while, the people in work aren't

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producing any more than before. So what to make of it all? Earlier I

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spoke to the Chief Secretary to the Treasury, Danny Alexander. Who

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should take credit for this recovery? I think there are a lot of

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people who deserve credit, primarily it is the workers and businesses of

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Britain who have worked very hard to create this growth, to help get the

:02:58.:03:01.

economy through the recovery, I think the coalition Government has

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played a significant role in providing the conditions through our

:03:05.:03:07.

economic plan, dealing with the deficit, and I think we as Liberal

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Democrats deserve our fair share of the credit for that coalition

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Government agreements. You would say that, wouldn't you, of course, when

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times have been bad you have always blamed it on economic head winds or

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the euro crisis or something or other? Look, the point is, we came

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into Government with hugely serious economic problems as a country, we

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put in place when we started a plan, plan that was involving taking a lot

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of difficult decisions, you are right there have been head winds

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along the way, head winds from problems within the eurozone,

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domestic problems in terms of the banking system and financial crisis.

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I think what we are seeing now is the plan we set out when we started

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was the right plan for this country for creating the conditions for

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economic growth. You planned that this growth should be fuelled,

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essentially, by consumer spending, is that it? You didn't tell the

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public that? I don't think that is a fair reading of the figures that

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came out today. When you look at the figures what you see is the service

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sector has grown by zero. 8% and manufacturing by zero. 9%. We have

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seen agriculture and so on growing, the construction quarter shrinking

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but growing strongly across the year. And the whole thing lower than

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it was in 2008? The economy is still smaller than 2008, that is true.

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That is a measure of the depth that our economy fell to during the

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financial crisis. I always said, and you and I have spoken about this a

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number of times over the years, that it would be a long process of hard

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work, that hard work is by no means over if we're going to secure and

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stablise our economy. When do you think we will be at a point above

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the level in early 2008? I'm not an economic forecaster. We contracted

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that out. Your forecasts are rubbish? We contracted that out to

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an independent Office of Budget Responsibility, precisely so

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politicians conned diddle the forecast. On the OBR forecast they

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reckon that will be met some time during the calendar year or early

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into the next one. What matters is making sure we have the conditions

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in this country now for businesses to invest. One of the weaknesses

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still in our numbers is business investment. Why aren't they

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investing, businesses? Business investment has always tended to lag

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behind a recovery. Businesses have been building up large cash balance,

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especially large businesses over the last few years, because of

:05:30.:05:34.

uncertainties about the UK economy. Uncertainties about the wider UK

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economy. Now people can have a degree of confidence in the

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direction of the UK economy, backed by a Government that has a strong

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and firm economic plan, I think this is the year to be investing if you

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are a business that h built up those cash balances over the last few

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years. Of course your friend, Vincent Cable, has been saying this

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for ages and ages that businesses have to get around to investing

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their cash. They didn't take any notice of him or indeed you. What a

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should they now? What we have been doing as a Government is

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systematically tackle the problems holding back business investment.

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Whether that is problems in the public finances, which we are

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fixing. Whether it is the investment in infrastructure, the skills in the

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work force, a Compative tax system, bringing the corporation tax down to

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the most competitive level in the G20. We are creating the conditions

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in this country for businesses to invest, we will start to see that

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during the course of the year. Why is our productivity so bad? That is

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an economic problem known as the productivity puzzle. There are lots

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of different explanations. Have you solved the puzzle? I don't think we

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have. It is partly about the fact that during this financial crisis

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and subsequently, businesses have decided to keep on their staff to

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maintain their skills in their work force. They have chosen not to

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invest, and so what you have seen is a period of time where we have seen

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significant job growth in our economy, but much lower investment

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in plant and machinery. That causes productivity to be lower. That is

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why I think this year business investment is so important. That is

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the way we can increase productivity. It is only bin ceasing

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productivity that we can raise the living standards of our population.

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Do you worry about the level of house prices in south-east of

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England? I think that house In central London, very rapid and large

:07:35.:07:40.

rises in house prices. I think fuelled a lot by investment from

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overseas. But I think what we have got to look at is what is the

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condition in the housing market, what are we seeing in terms of

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construction, because in the end we have to get more houses built in

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this country. On that measure there are some encouraging signs in terms

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of our planning reform, in terms of the Government's investment in

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affordable housing. You have now worked for George Osborne for over

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three years. You know what his priorities are. You have a clear

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choice now, Ed Balls has said he wants to raise the top level of

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income tax to 50%, George Osborne would like to reduce it from what it

:08:17.:08:22.

is now, 40% or something. Now, which of those do you prefer? Well I think

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we have the position about right at the moment. I think the 45p rate is

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the right place to stay. But let me say this. Would you consider raising

:08:32.:08:35.

the top rate of income tax to 50%? We debated this as a political party

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at o conference last September, we decided to stick with the 45p rate.

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There are a number of reasons for that. Firstly there is no evidence

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at all that raising it to 50p would raise any money. We think we have

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better ideas of how to get the wealth to pay more. Isn't it more

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consumate with your principles, fair next you are always going on about

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that -- fairness, you are always going on about that? I don't think

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it is fair to levy tax that doesn't raise money. I think what we have

:09:06.:09:09.

done in Government and what we prodoes to do going -- propose to do

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going forward in Government. Restricting tax relief wealthier

:09:14.:09:16.

people get on pension contributions. That is a better and more effective

:09:17.:09:21.

way to ensure the better-off are making more contribution. Looking

:09:22.:09:25.

ahead to the election, could you work as Chief Secretary to Ed Balls?

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Look, the question about the future Government of this country is a

:09:31.:09:36.

matter for the British people. We as exactly as we have said in 2010,

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whichever party, assuming we have a balanced parliament, I don't see

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much evidence that either Labour or Conservatives have got the political

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momentum to win a majority by themselves. We would seek to have

:09:47.:09:51.

discussions with whoever had the strongest mandate. The point I would

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make though is that when, if you are worried about the economy, and you

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see the threat that Labour poses with their ideas about the economy,

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you see the threat that Conservatives pose with the game of

:10:03.:10:05.

chicken they want to play with our largest market in Europe, I think if

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you are worried about economic stability and strength in this

:10:09.:10:11.

country, you need to make sure the Liberal Democrats are part of the

:10:12.:10:15.

next Government. Whatever the overall way the cards fall in the

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general election. You don't care who you get into bed with? What I care

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about is making sure that we have a strong and stable economy, a strong

:10:22.:10:25.

economy and a fair society. I think we're the only party that is

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committed to both of those things. These are parties that have

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diametrically opposed views of the world? I have just explained to you

:10:34.:10:36.

some areas where I disagree with both parties. I think that what

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Labour are saying about taking a lot longer to deal with the country's

:10:43.:10:46.

financial problems would be bad for the economic health of this country.

:10:47.:10:50.

What the Conservatives are saying about increasingly some of their

:10:51.:10:56.

backbenchers taking Britain out of the European Union would be a

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catastrophic thing for our economy. We have a role to anchor the

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economics in the next election. And anchor society. If you care about

:11:06.:11:08.

the stability of the British economy, and you want to have the

:11:09.:11:10.

Liberal Democrats in there as part of the mix. So were the largest

:11:11.:11:13.

party to be the Labour Party you would say we will open talks with

:11:14.:11:17.

you but let as you be quite clear, there will be no 50p rate of tax?

:11:18.:11:25.

I'm not going to get into prenegotiation for coalition talks.

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I can tell you what I think as a Liberal Democrat. And what I think,

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I don't think there is any strong case for going back to the 50p rate

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because you would be raising a tax that doesn't raise any money for the

:11:36.:11:39.

country, but sends bad signals about us around the world. Therefore you

:11:40.:11:42.

couldn't be part of the Government that did it could you? I'm not going

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to get into trying to renegotiate coalitions at this point. What I'm

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saying to you is my tax priority. Surely wouldn't join a Government

:11:53.:11:56.

going to do something as foolish as that? My tax priority for the next

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parliament is to make sure that we continue to deliver further tax cuts

:12:01.:12:04.

for people on low and middle incomes. This coming April we will

:12:05.:12:11.

get to that 10,000 tax-free amount that we promised in 2010. I want to

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go much further. That is what we want to raise money for. I want to

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make sure the next Government in tackling the deficit, on the path we

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have set out, also asks the wealthy to make a contribution. I think

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there are much better ways do that than a 50p rate. Which as I say is

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ineffective and there are better ways to raise money. While we are in

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this terrain, do you think walls walls Ed Balls -- Ed Balls could run

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the economy as well as George Osborne? I don't think that the

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Labour Party and Ed Balls would have done anything other than a

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catastrophic job on the economy. I think together the Conservatives and

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the Liberal Democrats in this parliament have had a good plan for

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the economy, we have taken tough decisions and came together as a

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coalition Government. This recovery wouldn't be happening if we didn't

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have a strong and stable coalition Government. As a Liberal Democrat

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I'm incredibly proud of the role we have played in making sure we get to

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this point of strong economic recovery in the UK. Now, if we

:13:08.:13:13.

accept the economy is finally pick up after more than half a decade in

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the doldrum, where is that growth coming from? Can it continue to

:13:18.:13:22.

create new well-paid jobs? Jim Reid has gone in search of signs of the

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recovery in Yorkshire and the north-east. This is. Here come the

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steel workers, nearly seven thousand men and women, these are the men and

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here is the metal. Just 40 years ago, the UK made twice

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as much steel as the whole of China. Yorkshire firms, Vickers, Browns,

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fox's, were all major industrial names. These are the men who are

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producing the new steels needed to build the engineering and scientific

:14:04.:14:14.

achievements of our age. The days of rolling hills and mass production

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here might have gone, but 900 workers are left and they specialise

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in something more cutting edge. Here ?2 million electric forges turn out

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electric high-quality steel. Metal is melted and remelted until it is

:14:33.:14:38.

strong enough to make parts for the energy and Aerospace sectors. It is

:14:39.:14:41.

a business now taking on staff, after losing a third of its work

:14:42.:14:44.

force in the recession. Last month there were four new orders, three of

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those from China. You don't want the plane you a flying on to fall out of

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the sky. The consequence is unthinkable, what you have to do is

:14:55.:14:57.

produce material that does exactly what it says, always, every time the

:14:58.:15:02.

same, and is reliable for the next 25 years. Those applications almost,

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almost, the price is not the most relevant factor. It is actually the

:15:07.:15:09.

quality, the knowledge, the high-tech. When you look around a

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site like this you don't see hundreds of steel workers, you are

:15:14.:15:17.

not creating the jobs that maybe the steel industry was 20, 30 years ago?

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I guess in absolute terms that is absolutely correct, not what it was

:15:24.:15:27.

20 years ago, but the jobs we are creating are actually real high-tech

:15:28.:15:30.

jobs, they are real jobs, they are not zero hour contracts. There are

:15:31.:15:36.

signs the manufacturing sector, in parts of the north, is starting to

:15:37.:15:43.

recover. New figures show 57% of factories in Yorkshire show a rise

:15:44.:15:46.

in orders over the last three months. That is well over the UK

:15:47.:15:50.

average, and ahead of London and the south-east. Specialist engineering

:15:51.:15:56.

has been enjoying a quiet resurgence in this region. Sheffield university

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has been working with companies like Tata, but also Boeing and

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Rolls-Royce to develop new products and manufacturing techniques. The

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people behind the project say it is about more than trading off

:16:09.:16:13.

Yorkshire's industrial heritage. The issue we have is we cannot committee

:16:14.:16:18.

with the eastern European block, or China, particularly on price. We

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have had to go for quality. What we have here we forget, made in

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Sheffield, made in Britain, made in Yorkshire, that badge sells across

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the world, and we seem to have forgotten about that. All of a

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sudden we have remembered that and that sells. The charm of Newcastle

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lies in its virility, the four great bridges overriding the city, yes,

:16:46.:16:53.

virility with a capital "V", that's Newcastle. Another city with a proud

:16:54.:17:05.

industrial past, from mining to shipbuilding to rail. This tunnel

:17:06.:17:10.

deep beneath Tyneside was built to take coal from Newcastle and ship it

:17:11.:17:15.

to every corner of the world. In 150 years since it has closed the local

:17:16.:17:19.

economy has really had its highs and lows. In the last recession this

:17:20.:17:23.

region lost more public sector jobs than any other part of the UK. But

:17:24.:17:27.

again, the economic picture is starting to look a bit different.

:17:28.:17:38.

This is a project we have been developing ourselves as a team. And

:17:39.:17:41.

we have been using the environment around us. So this is you know the

:17:42.:17:46.

famous bridge in the centre of Newcastle at the bottom of Dean

:17:47.:17:51.

Street. This fantasy version of Gateshead was created by a local

:17:52.:17:55.

digital arts company, Ron lost his job in 2009, so he gambled and

:17:56.:17:59.

started up his own firm in the middle of a recession. It now makes

:18:00.:18:06.

images for big budget films and games. Can you see here how it was

:18:07.:18:12.

reduced into the painting. This firm has just opened an office in South

:18:13.:18:15.

Africa and is planning to grow its work force by a third this year. If

:18:16.:18:20.

you are a big sort of lumbering London company and agency who has a

:18:21.:18:23.

lost of staff and overheads it is very hard to then suddenly cut

:18:24.:18:28.

prices or produce something that is competitive. I think there is an

:18:29.:18:33.

unfair sort of view of the north from the south, that it isn't all

:18:34.:18:43.

like you know delap dated factories and kids ddelapidated factories and

:18:44.:18:48.

kids running around with no shoes! It is high-tech business here and we

:18:49.:18:51.

are able to stand our own against any company in the world these days.

:18:52.:18:55.

The latest figures showed the last time companies in the north-east was

:18:56.:19:00.

this optimistic was back in 2003. But growing confidence doesn't yet

:19:01.:19:06.

mean widespread job growth. Unemployment here is still twice

:19:07.:19:09.

what it was before the recession. I think a lot of the growth is taking

:19:10.:19:13.

place in the main core cities, Manchester, Leeds, Sheffield,

:19:14.:19:16.

Newcastle and Liverpool. But those are some of the places where we're

:19:17.:19:22.

seeing high growth, innovative businesses. But we have concerns

:19:23.:19:27.

that some of those sectors, if you like, are very much at the high end.

:19:28.:19:33.

And we need jobs across the board in the north of England. We need to see

:19:34.:19:38.

lots of jobs and not just a few jobs in the high-tech companies. There

:19:39.:19:44.

might then be some signs of optimisim in cities like Newcastle.

:19:45.:19:49.

But with so much lost ground to make up, it may take a while until this

:19:50.:19:53.

recovery starts to feel it is built to last. Here now in the studio are

:19:54.:20:03.

Stephaine Flanders, formally the BBC editor, and also with us Ruth Glee,

:20:04.:20:12.

director and adviser at the Arbuthnot Banking group. Are you

:20:13.:20:16.

impressed by the growth figures? It is good news, we always make the

:20:17.:20:19.

mistake in economics when things are going well we expect the good times

:20:20.:20:23.

to carry on forever. When things are going badly, as they have for so

:20:24.:20:27.

long in recent years, a year ago, when I was still in my old year,

:20:28.:20:32.

people were wallowing in the gloom and dispond dennedcy, and they came

:20:33.:20:37.

-- dispondancy, and they came around to the idea that the economy

:20:38.:20:40.

wouldn't grow again. It is growing again. We are taking time to catch

:20:41.:20:44.

up with the optimisim. I wasn't asking whether it is good or bad

:20:45.:20:48.

news, are you impressed? I think it is very good news. I'm not

:20:49.:20:53.

particularly impressed. We're quite to grow by well over 3%, but I don't

:20:54.:20:57.

think that will be a moment when we should say we have gone to heaven. I

:20:58.:21:01.

think we forget this is a normal rate of growth. We have not gone to

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heaven, but I am impressed by it. I must say when peop talk about this

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is the wrong sort of growth because it is consumer led, I think hang on

:21:10.:21:14.

a minute most recoveries are consumer-led to start with. They

:21:15.:21:17.

talk about investment, investment only responds when you have growth.

:21:18.:21:22.

Growth doesn't lead recovery it lags recovery. I think too I'm encouraged

:21:23.:21:26.

that this particular recovery is reasonably sustainable. Afterall the

:21:27.:21:30.

labour market is behaving extremely buoyantly. Employment was up 280,000

:21:31.:21:36.

in the three months from November, compared with three months earlier,

:21:37.:21:40.

it was 450,000, higher than a year earlier. These are encouraging

:21:41.:21:43.

numbers. But people aren't better off? That is to come, and obviously

:21:44.:21:49.

at the moment you have still got inflation running ahead of earnings

:21:50.:21:53.

growth. Inflation is 2% and earnings growth less than one. With any luck,

:21:54.:21:57.

as commodity prices are weakening, inflation should weaken, and as the

:21:58.:22:01.

economy continues to recover, assuming it does, the Lea labour

:22:02.:22:07.

market will tie in a wage settlements and earnings will tie

:22:08.:22:12.

in. Do you see it in the same way? I think it is important to remember

:22:13.:22:16.

how far we have come in terms of living standards. Even just a few

:22:17.:22:19.

weeks ago when inflation finally went back to target. There is all

:22:20.:22:23.

this conversation about Labour is wrong to be focussing on living

:22:24.:22:27.

standards because we have had one month where inflation is lower than

:22:28.:22:31.

wages. There is a danger, I think, that we get a year zero problem. We

:22:32.:22:36.

don't remember the fact that we have actually had many years of very,

:22:37.:22:44.

very low growth. It has taken us an extraordinary long time to get to

:22:45.:22:47.

where we are, and people have been hit with living standards. And

:22:48.:22:50.

people talk a lot about productivity, that puzzle and people

:22:51.:22:53.

worrying about why workers are not making more and why we are not able

:22:54.:22:57.

to make more per head is actually the flip side of the living

:22:58.:23:00.

standards issue. You can pay workers more when they are making more. I

:23:01.:23:04.

asked Danny Alexander about this, he didn't seem to know what the answer

:23:05.:23:10.

was? Officially we don't know. I think it is growth, as the economy

:23:11.:23:13.

continues to grow one should get catch up on productivity. There is

:23:14.:23:19.

another side to the coin on the productivity, that is the labour

:23:20.:23:21.

market has done better than most people expected. I expected

:23:22.:23:25.

unemployment to rise far more than it did during the great recession.

:23:26.:23:30.

When GDP at one point was over 7% down on the peak. We mustn't regret

:23:31.:23:37.

that. It is still below the peak? It is, but by the second half of the

:23:38.:23:43.

year it will be back to the 008 level. You can't have it both ways,

:23:44.:23:49.

you can't have a buoyant economy and jobs. If you take your pick I would

:23:50.:23:54.

prefer lower productivity and more people in jobs, and as the economy

:23:55.:23:58.

recovers you hope to get that other growth in. Why? Because I prefer

:23:59.:24:02.

people to stay in jobs? You want them to stay connected to the labour

:24:03.:24:05.

market. But there is a genuine puzzle. I hope growth will be the

:24:06.:24:10.

answer to the productivity problem. But you know, it was perfectly

:24:11.:24:14.

reasonable. The Bank of England has done a terrible forecasting job, and

:24:15.:24:18.

you rightly pointed that out to Mark Carney the other day. But when the

:24:19.:24:22.

Bank of England was making that forecast about how slowly

:24:23.:24:25.

unemployment would fall, they weren't the only ones. They were

:24:26.:24:30.

assuming it would take a long time and would be an historically low

:24:31.:24:35.

recovery of productivity. We haven't had that, we have had employment go

:24:36.:24:39.

faster than output. It is a genuine puzzle. We have to hope the Bank of

:24:40.:24:43.

England gets the room to test out how to let the economy find that

:24:44.:24:47.

capacity. It is a lot slower here than some places elsewhere? Put it

:24:48.:24:53.

this way, we are now growing faster than the eurozone. That is good

:24:54.:24:57.

news. Come on, let's cheer up for goodness sake! Come on. But I think

:24:58.:25:05.

there were dreadful head winds, and merit veining king -- Mervyn King

:25:06.:25:13.

used to talk about it. It was about the terrible crash in the banking

:25:14.:25:16.

sector which is slowly only recovering. And the European market

:25:17.:25:20.

doesn't seem to be doing terribly well. We had the period of fiscal

:25:21.:25:26.

consolidation. You had these three dreadful head wants the economy had

:25:27.:25:32.

to push against. It was the Bank of England's superloose monetary policy

:25:33.:25:35.

that has managed to push the whole thing. This is a test year, this is

:25:36.:25:40.

a year for not just the UK but across the world, it is a year where

:25:41.:25:43.

the excuses have run out. The he can ten waiting circumstances for this

:25:44.:25:48.

-- extenuating circumstances for this slow recovery is starting to

:25:49.:25:53.

run out. I hope we will seeks port and growth come back, but if in a

:25:54.:25:59.

year or two's time we don't see those things and seeing relatively

:26:00.:26:03.

slow growth elsewhere, we have to talk about structural change. I

:26:04.:26:08.

think the eurozone is condemned to a period of slow growth. The IMF

:26:09.:26:13.

thinks so too. If we stopped the conversation 30 seconds ago I could

:26:14.:26:16.

have said two cheerful economist, I can't do that now. I'm still

:26:17.:26:21.

cheerful, relatively. You have to be cheerful but also trying to get that

:26:22.:26:24.

lost capacity, that lost growth back, let's not forget about it.

:26:25.:26:29.

Absolutely. The man David Cameron chose as his head of communications

:26:30.:26:34.

sat and listened to a recording of a private phone conversation between

:26:35.:26:37.

two actors who were having an affair. Andy Coulson exclaimed it

:26:38.:26:41.

was brilliant and then organised to try to hide the fact that he had

:26:42.:26:45.

heard it at all. At least he did, if the court believes the account given

:26:46.:26:49.

today at the phone hacking trial at London's Old Bailey. The Prime

:26:50.:26:53.

Minister has promised a profound apology if it turns out that Andy

:26:54.:26:58.

Coulson was party to phone hacking, which Mr Coulson of course denies.

:26:59.:27:02.

Our man on the press benches is Steve homosexual lit. -- Hewlett.

:27:03.:27:12.

SMEI That was the sub tense of a message allegedly left by Siena

:27:13.:27:17.

Miller, on the voice mail of her secret lover, actor Daniel Craig.

:27:18.:27:21.

The Old Bailey was told it had been hacked and recorded by a News of the

:27:22.:27:26.

World report e and it was the proof that the paper's editor, Andy

:27:27.:27:30.

Coulson, had been waiting for. "Brilliant" is what Coulson is

:27:31.:27:34.

alleged to have said when he was played the phone hacked message by

:27:35.:27:38.

the man who had recorded it and who has gone on to become the star

:27:39.:27:43.

prosecution witness. He's also the first self-confessed phone hacker to

:27:44.:27:46.

come to court and give an account of what he did. Which is why he's so

:27:47.:27:51.

central to the crown's case against Andy Coulson, which is that he

:27:52.:27:54.

didn't just know about phone hacking at his newspaper, but was thoroughly

:27:55.:27:59.

complicit in it. Dan Evans claimed to have learned the dark arts of

:28:00.:28:03.

phone hacking, not at the News of the World, but at the Sunday Mirror

:28:04.:28:06.

were it served him very well, story-wise. It didn't take long for

:28:07.:28:10.

the News of the World to come knocking. But an initial attempt to

:28:11.:28:16.

poach him failed. However a subsequent approach, from a senior

:28:17.:28:20.

journalist, who we can't name for legal reasons, led to a breakfast

:28:21.:28:25.

meeting, over scrambled egg and smoked salmon, here at the central

:28:26.:28:30.

London hotel, between Dan Evans and Andy Coulson. Dan Evans told the

:28:31.:28:33.

court: That, Evans told the court was a

:28:34.:28:54.

"kerching" moment, within ten minutes of the meeting ended he had

:28:55.:28:58.

got the job. And the News of the World had hired another expert phone

:28:59.:29:03.

hacker. The pressure to deliver scoops was, Evans said, intense. He

:29:04.:29:08.

found life there tough. He told the court how after an enormous

:29:09.:29:13.

rollicking of a senior colleague, he went home and spent the entire

:29:14.:29:18.

weekend hacking celebrities' phones. Which is where Siena Miller's

:29:19.:29:24.

personal message to Daniel Craig, which so thrilled Andy Coulson, came

:29:25.:29:31.

from. He went further, accusing Coulson of masterminding a programme

:29:32.:29:33.

to cover the phones. Andy Coulson of seen making notes

:29:34.:29:52.

and shaking his head during today's proceedings. Evans, who has already

:29:53.:29:57.

admitted phone hacking, also has previous convictions for possession

:29:58.:30:01.

of drugs and whilst at the News of the World used cannabis, cocaine and

:30:02.:30:06.

ecstacy. His cross-examination by Coulson's legal team is due to start

:30:07.:30:10.

tomorrow. All the defendants deny the charges against them. God knows

:30:11.:30:18.

what it seems like if you are one of the unfortunate people trapped by

:30:19.:30:24.

the Civil War in Syria. But the piece -- Pacific talks broke off

:30:25.:30:31.

early today with both sides unable to get past the sticking point of

:30:32.:30:35.

what a transitional Government looks like. Nothing is done to evacuate

:30:36.:30:42.

the trapped and wounded from some of the more intense fighting. One of

:30:43.:30:49.

those behind closed doors is a Syrian minister. Good evening to

:30:50.:30:57.

you, Faisal Mekdad. Good evening. Why were these talks ended early

:30:58.:31:06.

today? In fact today's talks did not end early, but there were no

:31:07.:31:11.

traditional consultations in the afternoon. In today's session the

:31:12.:31:18.

delegation of the Syrian Arab Republic tried to discuss deeply and

:31:19.:31:25.

to go into the heart of the matter, but when we protested the fact that

:31:26.:31:34.

the United States has resumed arming the armed groups and this was a

:31:35.:31:37.

decision announced today or yesterday. The other party refused

:31:38.:31:43.

to discuss this issue. We believe this is a bad message by the

:31:44.:31:49.

Government of the United States and we believe that the US

:31:50.:31:52.

administration should be more serious, and it should not be arming

:31:53.:31:57.

armed groups or terrorist groups. So when will the talks resume? They

:31:58.:32:06.

will resume tomorrow morning. The United States position won't have

:32:07.:32:09.

changed by tomorrow morning will it? No, it will not change. But at least

:32:10.:32:19.

we have put before the mediation, before the meeting and before the

:32:20.:32:24.

public international opinion what the United States is doing to harm

:32:25.:32:34.

and influence those talks. In a way that may harm the interests of the

:32:35.:32:40.

Syrian people. We don't need arms what we need is peace talks. The

:32:41.:32:46.

opposition group have put forward their proposition which demand

:32:47.:32:52.

Syria, a democracy with a rule of law, reconciliation between the

:32:53.:32:56.

opposing sides, guarantee of human rights. What could you possibly

:32:57.:33:00.

object to in all of that? We didn't object to any of these things. In

:33:01.:33:06.

fact yesterday we presented a paper that includes, among others, these

:33:07.:33:13.

very points. But it was totally rejected by the opposition. In fact,

:33:14.:33:19.

we want to go directly for discussions about concrete issues

:33:20.:33:25.

but step by step to build a consensus and to tell the Syrian

:33:26.:33:28.

people that we are advancing before we go to the very heart and core

:33:29.:33:34.

issues. What is the feeling there, do you think that there is a belief

:33:35.:33:40.

in these talks, that there will be a peace settlement at the end of them?

:33:41.:33:49.

In fact we are coming determined to achieve peace. Because for the last

:33:50.:33:53.

three years we have been working to achieve this objective, but frankly

:33:54.:33:59.

speaking some misinformation has been taking place all the time. That

:34:00.:34:06.

has led to some big fragments of the international public opinion that we

:34:07.:34:09.

are not for peace. But we are here, now, in Geneva, for this conference,

:34:10.:34:14.

to achieve peace, and we shall try do it as soon as possible. In the

:34:15.:34:18.

meantime, of course, you have all these unfortunate people trapped by

:34:19.:34:22.

the fighting, now I believe you said that women and children can leave

:34:23.:34:28.

the city of Homs, is that correct? Absolutely. In fact they should have

:34:29.:34:34.

left, yes, yes of course. I have been directly involved in this file

:34:35.:34:40.

for the last two years. This is not a new issue, I don't know why the US

:34:41.:34:43.

administration is emphasising this issue since the beginning of these

:34:44.:34:48.

talks. It is partly I think because... Let me just ask you a

:34:49.:34:53.

specific point if I may. The point is, you are saying that the men

:34:54.:34:58.

there must register their names with you y do you want their names? --

:34:59.:35:04.

why do you want their names? We don't mean the men, we mean the

:35:05.:35:10.

fighters. Amnesties have been declared in all parts of Syria, and

:35:11.:35:13.

lists of names have been given in all parts of Syria, we shall allow

:35:14.:35:21.

women and children to leave without any conditions. As far as fighters

:35:22.:35:25.

are concerned, we have to know who these people are so they don't go

:35:26.:35:29.

outside and shoot other people in other places in Syria. It is only

:35:30.:35:36.

for the departure of this these men. Who will determine whether they are

:35:37.:35:43.

civilians or fighters? Frankly speaking in the recent amnesties,

:35:44.:35:47.

declared by President Assad, the only precondition we wanted was that

:35:48.:35:54.

they give up their arms and live and be free Syrians. So you don't want

:35:55.:36:04.

their names. We need their names to distinguish between those who are

:36:05.:36:07.

killing innocent people and those who are innocent. But once they give

:36:08.:36:14.

their games, we are will be clear who are these people who have been

:36:15.:36:19.

trying to leave because they have been taking citizens in Homs hostage

:36:20.:36:23.

for at least one-and-a-half years. The protest in the Ukraine brought

:36:24.:36:27.

down the Government there today. With the Prime Minister and all of

:36:28.:36:31.

his cabinet quitting. Though President Yanukovych is still in

:36:32.:36:37.

post. It will still be a bold person who chooses to predict how this

:36:38.:36:42.

confrontation between those who want a European future and those leaning

:36:43.:36:46.

towards Russia turn out. Things seem to be moving, the capital Kiev has

:36:47.:36:51.

been the arena for many of the protests, but it is not of course

:36:52.:36:55.

the country. We sent Gabriel Gatehouse to eastern Ukraine where

:36:56.:37:00.

you night expect to find more pro-Russian feeling. Here they are

:37:01.:37:07.

building barricades out of snow. But these are not protestors. These are

:37:08.:37:12.

the riot police. Fortifying local Government offices against the

:37:13.:37:18.

threat of attack. This city was once a centre of Soviet rocket

:37:19.:37:24.

manufacturing. It's Ukraine's pro-Russian industrial heartland,

:37:25.:37:28.

where the people and the oligarchs have been traditionally been solidly

:37:29.:37:32.

behind the Government. While the demonstrations were contained in the

:37:33.:37:35.

capital, Kiev, the Government felt like it could handle the situation.

:37:36.:37:40.

But then last week, following that violence, the demonstrations moved

:37:41.:37:44.

west, into opposition heartland and some of the protestors even seized

:37:45.:37:48.

local Government buildings. Now they have come east, and this week a mob

:37:49.:37:53.

tried to storm the local Government headquarters. Hundreds of young men,

:37:54.:38:00.

most of them armed with clubs and rocks, attacked the police. Both

:38:01.:38:06.

sides took casualties, several policemen were seriously injured,

:38:07.:38:11.

one is still in a coma. The rioters were eventually dispersed and dozens

:38:12.:38:15.

were arrested. But the authorities were rattled. We spoke to somebody

:38:16.:38:21.

who knows just how rattled they are, this woman is an insider, part of a

:38:22.:38:26.

team of close advisers to the President. TRANSLATION: It was only

:38:27.:38:32.

when violent protests broke out in the province, when people started

:38:33.:38:37.

taking over Government buildings that those in power started taking

:38:38.:38:40.

the demonstrations seriously. Then they realised they had a big problem

:38:41.:38:44.

on their hands. That they were losing the electorate, in one region

:38:45.:38:53.

after another. And so, this afternoon, at a trap -- tram spot,

:38:54.:39:02.

they digested the latest concessions, the Prime Minister and

:39:03.:39:09.

the entire cabinet quit. The repressive laws that caused the

:39:10.:39:15.

protest were repealed, an argument breaks out. This lady says get rid

:39:16.:39:20.

the demonstrator, under no circumstances says the gentleman,

:39:21.:39:23.

let the people come out and demand their people. Another woman

:39:24.:39:26.

dismisses him and says the President has been far too soft on the

:39:27.:39:33.

protesters, she said. But in Ukraine real political pressure comes not

:39:34.:39:37.

from the bottom but the top. It was a public intervention late last week

:39:38.:39:42.

by an oligarch, Ukraine's richest man, that prompted the President to

:39:43.:39:52.

compromise. TRANSLATION: He can't ignore the oligarchs, that is

:39:53.:39:55.

impossible, they are too powerful. Yanukovych won the last elections,

:39:56.:39:58.

not because he was hugely popular with the electorate. We He won

:39:59.:40:03.

because he had the strong support of the oligarchs. Today we saw

:40:04.:40:10.

policemen in training, preparing to protect Government buildings from

:40:11.:40:14.

attack. But the more pressing threat to President Yanukovych is that he

:40:15.:40:19.

could lose his financial backers. We have spoken to people close to two

:40:20.:40:23.

of Ukraine's most prominent oligarchs, both said they were

:40:24.:40:26.

unhappy with the President's handling of the crisis. And on that

:40:27.:40:34.

point, for once, the oligarchs seem to be in tune with the protesters on

:40:35.:40:40.

the street. Here their numbers may be small compared to Kiev, but they

:40:41.:40:43.

are no less vocal and they are clear. Today's concessions are not

:40:44.:40:47.

enough. They want the President to go. They are criminals, you know,

:40:48.:40:53.

the Government, our President, all of them they are criminals. The

:40:54.:40:57.

Government today offered to resign? Yes. Is that God enough for you? It

:40:58.:41:05.

is not good enough for me. This is unfamiliar territory for Ukraine,

:41:06.:41:11.

the old assumptions of the divide between east and west and Russia and

:41:12.:41:14.

Europe are being thrown into question, the allegance of the

:41:15.:41:19.

oligarch seems to be in flux, one things seems clear is the centre is

:41:20.:41:24.

struggling to hold. As the politicians in Kiev try to pull this

:41:25.:41:29.

country back from the brink, here the police prepare for another long,

:41:30.:41:33.

cold night outside the local Government headquarters, their riot

:41:34.:41:38.

shields propped up like tomb stones in the snow.

:41:39.:41:41.

Radio stations across the land have been filled with protest songs

:41:42.:41:45.

today, marking the death of one of the great political tub -- truers.

:41:46.:41:55.

Pete Seeger was nine # and difficult to the end. Only a cop -- 90 and

:41:56.:42:01.

difficult to the end. Only a few years ago he was processing through

:42:02.:42:08.

Manhattan on an occupy Wall Street march.

:42:09.:42:14.

# Me and my wife # Went all over the town

:42:15.:42:20.

# Everywhere the people turned us down

:42:21.:42:22.

Pete Seeger performing a song from the civil rightseria about

:42:23.:42:33.

segregation in hotels. He fell foul of senator McCarthy in the 50s, but

:42:34.:42:38.

he later saw himself and the old Red Square man as ying and yang. Every

:42:39.:42:44.

establishment in the world needs a good opposition to be healthy. Just

:42:45.:42:57.

like the moose population need the animals to harass them. We discussed

:42:58.:43:03.

Seeger with whispering with Bob Harris and what do you know. I'm

:43:04.:43:09.

part of the 60s generation that grew up with Bob Dylan and the protest

:43:10.:43:17.

singers of the mid-1960. Of course Pete Seeger was the God fathering of

:43:18.:43:23.

that entire movement. He's also massively important figure in terms

:43:24.:43:29.

of the shaping of American music as we know today. After te Seeger's

:43:30.:43:43.

salad days, it became a little less folksy.

:43:44.:43:50.

# Get up stand up # Don't give up the fight It

:43:51.:43:56.

continued to address issues, including racism, equality. The

:43:57.:44:03.

Vietnam War. # Brother, brother, brother

:44:04.:44:08.

# There is far too many of you dying I believe very strongly this general

:44:09.:44:11.

election is a very, very important general election, not only for the

:44:12.:44:15.

Labour Party but for democracy as a whole.

:44:16.:44:19.

# Stand down mam # Stand down please

:44:20.:44:23.

Some veterans of the struggle and other struggles are available, say

:44:24.:44:28.

the kids of today aren't up for a good protest song. This generation

:44:29.:44:33.

has other medium available to it. Social media and I think that the

:44:34.:44:39.

idea of music taking that vanguard role again we may not see that. But

:44:40.:44:46.

others claim to hear a protest message from even the most

:44:47.:44:53.

comfortably off of today's stars. You believe racism is a problem it

:44:54.:44:58.

doesn't matter if you are a multi-millionaire black man you will

:44:59.:45:00.

still make the point that feminism is still necessary. You may be as

:45:01.:45:05.

rich and powerful as Beyonce, that is still a point you want to make.

:45:06.:45:11.

# It's raining men Finally pop pickers this track is

:45:12.:45:16.

set to climb the charts again. Coopted by gay rights campaigners

:45:17.:45:21.

after UKIP meteorologists blamed the bad weather on same-sex marriage!

:45:22.:45:25.

That is it for tonight. We will leave you with the musician Frank

:45:26.:45:32.

Turner playing tribute to Pete Seeger, with playing We Shall

:45:33.:45:37.

Overcome, one of the songs he was most closely associated with.

:45:38.:45:48.

# We shall over # We shall overcome

:45:49.:45:58.

# Some day # Oh deep in my heart

:45:59.:46:06.

# I do believe # We shall overcome

:46:07.:46:16.

# Some day # And we'll walk hand in hand

:46:17.:46:29.

# We'll walk hand in hand # Some day

:46:30.:46:37.

# Oh deep in my heart # I do believe

:46:38.:46:47.

# We'll walk hand in hand # Some day

:46:48.:46:52.

# And we are not afraid Lord # We are not afraid today

:46:53.:47:09.

# Deep in my heart # I do believe

:47:10.:47:20.

# We shall overcome # Some day

:47:21.:47:26.

# And we shall overcome Lord # We shall overcome

:47:27.:47:28.

# We shall Hello again, showers continuing

:47:29.:47:40.

through the get, we will have a lot of cloud tomorrow with showers and

:47:41.:47:47.

long spells of rain, we will pick up the easierly, and showers

:47:48.:47:50.

particularly over the hills. Showers moving away

:47:51.:47:51.

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