03/03/2016 Newsnight


03/03/2016

Analysis of the stories behind the day's headlines with James O'Brien. Is the chancellor planning major pension reform? Mitt Romney lays into Donald Trump.


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As the Chancellor mulls major reforms to the pension system,

:00:00.:00:07.

Radical changes to pensions tax relief could hit millions of higher

:00:08.:00:11.

earners. But would the Chancellor do something so drastic -

:00:12.:00:14.

and potentially unpopular - just before the EU referendum?

:00:15.:00:23.

If we Republicans choose Donald Trump as our nominee,

:00:24.:00:26.

the prospect for a safe and prosperous future

:00:27.:00:28.

The Republican Establishment fights back.

:00:29.:00:35.

But will Mitt Romney's attack actually help Donald Trump?

:00:36.:00:40.

David Cameron's former adviser has been watching the race.

:00:41.:00:49.

Also tonight - could an ancient Chinese board game help build

:00:50.:00:52.

A piece of software developed in London could just herald

:00:53.:00:56.

the biggest step forward in artificial intelligence

:00:57.:00:58.

Death and taxes might be civilisation's only certainties,

:00:59.:01:13.

Some of us already draw one, some of us pay into one,

:01:14.:01:17.

some of us don't, but all of us expect to receive one one day.

:01:18.:01:21.

But what can the modern British worker expect their pension to look

:01:22.:01:24.

like and when can we expect to get it?

:01:25.:01:30.

How much should Government be doing to ensure that the most help goes

:01:31.:01:33.

to those with greatest need and should the age at which we get

:01:34.:01:36.

one depend not just on how old we are, but also on the kind

:01:37.:01:39.

As the Chancellor prepares to address at least some of these

:01:40.:01:46.

questions in his looming budget, Newsnight's Chris Cook has taken

:01:47.:01:48.

The world of work is always changing, but one question

:01:49.:02:05.

is a constant - how do you get people to pay

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Tax policy is a critical lever and we may be the cusp

:02:09.:02:13.

I think major changes are more likely than not.

:02:14.:02:22.

There's been a lot of pension reform already and tax relief is,

:02:23.:02:25.

Workplace pensions are all about deferring income,

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delaying the moment when you receive a portion of your pay,

:02:33.:02:35.

until the time when you can actually enjoy it.

:02:36.:02:37.

Pensions get the benefit of tax relief.

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That means the state waives income tax on money that people put aside

:02:41.:02:43.

Now, there are critical discussions going on about the future

:02:44.:02:48.

At the moment, any income you put into your pension

:02:49.:02:53.

Any gains your pension pot makes are also not taxed.

:02:54.:03:01.

You're not taxed on money while it's in there.

:03:02.:03:03.

It's only at the end, when you start drawing an income

:03:04.:03:06.

This arrangement is known as exempt-exempt-tax or EET.

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Your pension is tax exempt when you put money in,

:03:18.:03:20.

exempt as it's invested and it's only taxed as it's withdrawn.

:03:21.:03:26.

Paying tax at the end of the process means your tax payments

:03:27.:03:29.

reflect your actual income in retirement.

:03:30.:03:34.

In any given year, the Chancellor foregoes tens of billions of pounds

:03:35.:03:37.

of tax because when people put their money into a pension,

:03:38.:03:39.

he doesn't get the tax on that wage, he says -

:03:40.:03:42.

don't worry, I won't tax you now, I'll tax you when you

:03:43.:03:45.

The question is, could you lose that money in the current year and get

:03:46.:03:49.

more people to do more saving, better than we do now,

:03:50.:03:52.

and, unequivocally, the answer to that is, yes.

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A radical idea currently being considered by the Treasury

:03:57.:03:59.

would completely change how we tax pensions.

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Rather than waiting until the end, until you're drawing an income

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to claim tax off you, the taxman would instead tax money

:04:04.:04:06.

as you're putting it into your pension scheme.

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So this changes things to tax-exempt-exempt or TEE.

:04:13.:04:14.

You'd pay into your pension scheme after you've been taxed,

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meaning that the tax burden falls on current earnings

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and then your pension would be totally tax-free,

:04:19.:04:20.

At the moment, the Government offers a few eases, notably a tax-free lump

:04:21.:04:33.

sum to bribe you to save in a pension.

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Any new system would needed a top-up bribe, too.

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But the Chancellor would certainly benefit now.

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This would raise tax revenues in the short-term,

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but cut them in the future, and that might not be wise.

:04:44.:04:52.

You've got the fact that this is a policy that brings forward tax

:04:53.:04:55.

revenues from future years, from a time when there'll be

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an older population, putting more pressure on the public

:04:58.:05:00.

finances, through state pensions, through the health service

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The fear would be that that might make future governments a bit more

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desperate and maybe a little more likely to renege on the promise that

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withdrawals from these pension ISAs would remain tax-free.

:05:11.:05:21.

So what about a less radical reform, say of tax relief?

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At the moment, if someone in the 40% tax bracket want to put ?1

:05:25.:05:27.

in their pension, they only need to pay in 60p.

:05:28.:05:29.

The Treasury puts in the remaining 40p.

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But people in the 20% bracket have to put in 80p because the taxman

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The reality is we're giving more money today to the better off,

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who are already putting more money into pensions, and that's not

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the best use of money when we have a savings crisis.

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So my preference would be to level things up, up for lower

:05:52.:05:54.

rate taxpayers at 20%, down for higher rate taxpayers.

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The pensions industry likes this idea.

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It would be a less disruptive change.

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This model might also save about ?6 billion a year

:06:08.:06:10.

for the Treasury, but it looks a lot more like a straight tax hike

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on higher earners, it would also cause an administrative headache,

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and the Chancellor may not want to upend the pension system,

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David Grossman is our Political Editor and he's

:06:19.:06:28.

Was dreaming or was there a promise that a Conservative Government

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wouldn't go near tax relief? We can quote from a central office briefing

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note from April last year, which says we believe the pensions tax

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relief system will be fair and affordable and we will not propose

:06:51.:06:53.

any further changes to that. Is during the next Parliament. So in

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the process, the Chancellor could be accused of going back on commitment

:06:59.:07:01.

made before the election and annoying large numbers of people who

:07:02.:07:04.

have voted for the Conservatives, because not only were they told

:07:05.:07:07.

there aren't any plans to do that, they were told the only way to stop

:07:08.:07:11.

Labour doing us wit to vote Conservative. Why is he suggesting

:07:12.:07:17.

he might be doing it? The ansz is ten, maybe 15, maybe ?20 billion of

:07:18.:07:21.

extra income he could get in the process. Income as one of our

:07:22.:07:27.

interviewees suggested, a future Chancellor could be left feeling the

:07:28.:07:31.

pinch of. Exactly. What he is doing is perhaps taking the money, that

:07:32.:07:37.

future Chancellor might earn, or tax, pensioners with, but that

:07:38.:07:40.

Chancellor may not have been born yet. And it is not just voter, there

:07:41.:07:45.

will be Conservative MPs who are a little troubled by this. Why and how

:07:46.:07:49.

long a shadow the referendum cast over this whole process? Well,

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partly kith MPs are annoyed about going back, annoying their core

:07:58.:08:01.

voter, some activists in the constituency ises, there is this

:08:02.:08:04.

referendum of course, the wisdom is, that if you are going to do

:08:05.:08:09.

something unpopular or something you are voters might not like get it

:08:10.:08:12.

down early, that is when your mandate and majority are freshest

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and the voters have time to forgive you. We are going into a referendum

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in 120 days' time, a bit less than that, The, one of the core groups

:08:22.:08:25.

that are wavering in the middle of this are some of the affluent people

:08:26.:08:29.

whose hearts may tell them they would like to vote to leave the EU

:08:30.:08:33.

but their heads maybe susceptible to arguments that the Chancellor is

:08:34.:08:36.

making about their best economic interests. If they don't trust the

:08:37.:08:39.

Chancellor, if they feel the Chancellor hasn't got their best

:08:40.:08:42.

interests at heart they maybe harder to win over in all this. So the

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stakes are high. Let us Mark Garnier, a Conservative MP

:08:45.:08:48.

who sits on the Treasury Select Committee, and Josephine Cumbo,

:08:49.:08:53.

the pensions correspondent for the Financial Times,

:08:54.:08:55.

whose reporting has led the coverage You are splashing tomorrow with a

:08:56.:09:04.

warning to the Chancellor from one of his own Pensions Ministers he

:09:05.:09:07.

perhaps needs to calm down, if not slow down. Think what we are seeing

:09:08.:09:12.

now is the tensions and concerns and fears are really starting to

:09:13.:09:16.

surface, that what the Chancellor is going to announce in the budget,

:09:17.:09:21.

while saving the Treasury billions of pounds could cause deep damage to

:09:22.:09:26.

the retirement system. In July last year, he announced the consultation

:09:27.:09:30.

on the future of saving incentives for retirement and at the time he

:09:31.:09:34.

said it was going to be an open consultation, but the only option he

:09:35.:09:39.

really mentioned at the time was the pension ISA, during the consul

:09:40.:09:43.

location there has been a core Corus of industry representatives and MPs

:09:44.:09:48.

queueing up to say that this is a wrong idea, it could lead to severe

:09:49.:09:53.

complications for the industry, you will have two systems running at the

:09:54.:09:57.

same time, you will have an old pension system and a new pension

:09:58.:10:02.

system. There are concerns that a futures Chancellor might say well, I

:10:03.:10:07.

am going to start taxing the income that George Osborne promised was

:10:08.:10:11.

going to be tax free, so that could really hit pensions saving and

:10:12.:10:15.

confidence in pension savings at a time when the UK is starting to

:10:16.:10:21.

enrol people in pensions through automatic enel rollment. There is

:10:22.:10:24.

two possibilities on the table really. There is the ISA and you

:10:25.:10:29.

explained and the flat rate of tax which was very well explained in the

:10:30.:10:34.

film. I sense from your journalism you are too wise to place bettings,

:10:35.:10:38.

which would you say he is closest to? He is attracted to the pension

:10:39.:10:43.

Isa. He likes to make bold decision, let us think back to 2014, when he

:10:44.:10:48.

stood up at the despatch box and said no-one will have to buy an

:10:49.:10:52.

annuity. That came out the blue, there must be a big temptation for

:10:53.:11:00.

him to do that again, in spite of the range of opponents he has had to

:11:01.:11:05.

doing anything drastic. Something has to give doesn't it? The notion

:11:06.:11:09.

that the lowest earners get the least help to save for their few

:11:10.:11:13.

while the highest get the most help. If it wasn't true it would be

:11:14.:11:17.

unthinkable. O Think you are right. The numbers speak for themselves. If

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you look at the 10% of people who earn more than ?50,000, they

:11:24.:11:25.

represent 47% of pension contributions and if you look at the

:11:26.:11:30.

1% who earn more than ?150,000, they represent 14%. So clearly, it is

:11:31.:11:36.

skewed in favour of the richer people, who have more disposable

:11:37.:11:39.

income. So it could be partly to do with the incentive and the fact if

:11:40.:11:44.

you have ?150,000 you have a lot more disposable voluntary income

:11:45.:11:49.

than if you are on ?12 nap,000. I think what we have done so far is

:11:50.:11:54.

like House of Lords reform. We have done a bit but haven't finished the

:11:55.:11:57.

whole journey. There is talk about this pension Isa where it will be

:11:58.:12:01.

taxed on the way in and there is a possibility there may be a

:12:02.:12:05.

contribution by the Government. If the contribution is 50-50, for each

:12:06.:12:09.

pound put in everybody, including the high rate taxpayer's will be

:12:10.:12:12.

better off. I think one of the problems facing the pension

:12:13.:12:15.

industry, and facing pensions in general is that the Holy Grail of

:12:16.:12:19.

this is getting people to put as much money as they can in to their

:12:20.:12:24.

pension pot as early as they can. I think that really clever thinking on

:12:25.:12:28.

this would be able to work out a system where by people can look at

:12:29.:12:32.

their entire lifetime savings schemes, and perhaps we could come

:12:33.:12:38.

up with a system where by the pension system can be allied with

:12:39.:12:43.

mortgage guarantees, so people could start looking at this sort of,

:12:44.:12:47.

together rather than a separate entities. You are proposing a third

:12:48.:12:53.

way, you don't like the idea of equalising the playing field so

:12:54.:12:56.

however much you earn the amount of help you get remains the same It

:12:57.:12:59.

will cause a lot of the problems, if you are going to create the problems

:13:00.:13:03.

you need to have something really important that is going to come

:13:04.:13:08.

along with it. If we go to the flat rate of, the flat rate of discount,

:13:09.:13:12.

then you end up with this problem of the hybrid, you have half in one

:13:13.:13:15.

type of pension and another in another type of pension, you have

:13:16.:13:19.

the administration, it will be very difficult for pay role managers so

:13:20.:13:22.

that will be difficult. Then you have the contribution of the vt go,

:13:23.:13:26.

so that could be expensive. Anything is going to be difficult. I was

:13:27.:13:30.

thinking more of fairness. Yes, I think one of the inthises which I

:13:31.:13:34.

would be keen on, if he is going to make change, I think you have to

:13:35.:13:38.

give people a lot of warning, what, I am getting people who are writing

:13:39.:13:41.

to me and stopping me in the street, saying is he going to do something?

:13:42.:13:46.

Should be I be worried about my tax free lump sum? If you are saving for

:13:47.:13:50.

your pension you have spent your life focussing on the one point when

:13:51.:13:54.

you retire. At the closer you get to that the less options you have

:13:55.:13:57.

available in order to mitigate any changes, so the key thing I, I

:13:58.:14:00.

think, would be if he is going to make changes he has to give really a

:14:01.:14:05.

decade's warning before they come into play. Very briefly, what do you

:14:06.:14:09.

say when you are stopped in the street, to the voters who say you

:14:10.:14:14.

promised they wouldn't go near this issue and they are. They are looking

:14:15.:14:18.

at it. It is right to have a look at it. At the end of the day the tax

:14:19.:14:25.

credit given to pensions in this country is worth billions they get

:14:26.:14:29.

back 13 billion on taxes, paid on pensions coming out. It is not as

:14:30.:14:33.

simple as it sounds but that is the problem they have got. But I come

:14:34.:14:38.

back to this remaining point point, which is if eare going to change

:14:39.:14:42.

something people like me and my colleagues will be advising the

:14:43.:14:46.

Chancellor we have to give people plenty of warning. A decade is not

:14:47.:14:51.

unreasonable I think. I don't think that would happen. He would be

:14:52.:14:55.

looking for savings to balance the books by 2020. People are diving in

:14:56.:14:59.

and maxing owl their pension contributions on concerns that high

:15:00.:15:02.

rate relieve is going. He would have to do something in the budget to

:15:03.:15:05.

clamp-down on that. Many thanks indeed.

:15:06.:15:09.

Start any observation about the performance or prospects

:15:10.:15:11.

of Donald Trump at the moment and you run a very real risk

:15:12.:15:14.

of being comprehensively disproved before you've

:15:15.:15:16.

But, it's probably fair to say, that much of his appeal lies

:15:17.:15:24.

in his supporters' deep dislike of mainstream politicians.

:15:25.:15:29.

So the fact that very senior mainstream politicians

:15:30.:15:32.

from within his own Party are now queueing up to condemn him,

:15:33.:15:35.

in the strongest of terms, could be construed as evidence

:15:36.:15:37.

If we Republicans choose Donald Trump as our nominee,

:15:38.:15:46.

the prospect for a safe and prosperous future

:15:47.:15:48.

If Donald Trump's plans were ever implemented,

:15:49.:15:55.

the country would sink into prolonged recession.

:15:56.:15:58.

Doesn't he know what he's talking about?

:15:59.:16:02.

Look, his bankruptcies have crushed small businesses and the men

:16:03.:16:12.

He inherited his business, he didn't create it.

:16:13.:16:19.

Mr Romney was joined in his condemnation of Mr Trump

:16:20.:16:21.

by another former Republican presidential hopeful,

:16:22.:16:25.

John McCain, who said he "shared the concerns about Donald Trump"

:16:26.:16:28.

and criticised Mr Trump's "uninformed and indeed dangerous

:16:29.:16:39.

Mr Trump had a few choice words for Mr Romney in return.

:16:40.:16:43.

Look, I'll just address it quickly, because it's irrelevant.

:16:44.:16:45.

Steve Hilton, David Cameron's former strategy director,

:16:46.:16:53.

now based in San Francisco, joins us to make sense

:16:54.:16:55.

That's quite a big ask, Steve Hilton, can you make sense of it for

:16:56.:17:06.

us? I'll have a go. Good to be with you. I think what's going on here is

:17:07.:17:12.

actually pretty profound. We live in a world run by bankers and

:17:13.:17:15.

bureaucrats and accountants, people like Mitt Romney. Those people,

:17:16.:17:20.

regardless of who has been in power, for the last few decades have been

:17:21.:17:25.

pushing an agenda, an ideological agenda, that it favours big

:17:26.:17:30.

businesses over small. That champions globalisation and open

:17:31.:17:32.

immigration, whatever the cost of that. It's been pretty inhuman and

:17:33.:17:38.

callous about the impact of that approach to government on the real

:17:39.:17:40.

lives of working people. Basically, I think people are sick of it. They

:17:41.:17:44.

are sick and tired that. They are sick and tired of being told to suck

:17:45.:17:48.

it up and deal with it because it's the world we live in. That is what

:17:49.:17:53.

is driving support for Trump. On the left for Bernie Sanders. Someone

:17:54.:17:58.

like Mitt Romney, who pretty much epitomises that approach to

:17:59.:18:02.

government, which is being comprehensively rejected. Is about

:18:03.:18:05.

the worse person you could ask for to make the argument against Trump.

:18:06.:18:11.

Judd Trump trump has dealt with John McCain by questioning his heroic

:18:12.:18:18.

status. Neither Romney or McCain have learnt the lesson, they feel

:18:19.:18:22.

the way to get him is conventional weapons. He doesn't recognise

:18:23.:18:25.

conventional warfare in political terms? I think that's right.

:18:26.:18:30.

Actually, we need to dissting swish somewhat between the froth of the

:18:31.:18:34.

campaign, Trump is very good at that, getting attention for

:18:35.:18:37.

statements which every now and again go beyond the boundaries of what

:18:38.:18:41.

people might consider to be acceptable. People di discounted,

:18:42.:18:48.

dissupporters discount it, because they identify with the substantive

:18:49.:18:52.

argument that underlice that. The other point is his character and

:18:53.:18:57.

temperament. Mitt Romney made the argument that his character and

:18:58.:19:01.

temperament disqualifies him from being President. Again, it's

:19:02.:19:04.

precisely his character that people are responding to. The idea that he

:19:05.:19:07.

is not some smooth-talking politician. He is actually a strong

:19:08.:19:11.

guy who is going to get in there and shake things up. That is exactly

:19:12.:19:14.

what people If you were want. Looking after one of his opponents,

:19:15.:19:17.

what would you advise them to do next? Well, I don't know. I'm not

:19:18.:19:23.

that involved, so I don't think of it necessarily in those terms. I

:19:24.:19:27.

think one thing that is clear is that, as the race is going on, there

:19:28.:19:34.

is more time, for example, in the Presidential debates, another one

:19:35.:19:38.

here in the States, for focus on the actual policy agendas of these

:19:39.:19:42.

various candidates and to look at the substance of what they're saying

:19:43.:19:45.

it. Seems to me there is more concentration on that. That will

:19:46.:19:49.

only increase once you get into the general election setting. I think

:19:50.:19:54.

someone like John Kasich, who is around right now in terms of the

:19:55.:19:58.

state of the race, he is the governor of of Ohio. A distant

:19:59.:20:03.

fourth in the race right now. He is still sticking to a positive agenda,

:20:04.:20:07.

setting out how he would solve these same problems. His analysis is

:20:08.:20:12.

pretty much consistent with the same arguments Trump is making he is

:20:13.:20:16.

putting something which is a little more tangible. That could over the

:20:17.:20:20.

next few weeks, prove to be quite a good way of approaching it. Tangible

:20:21.:20:25.

versus toxic, if you like. I was reading a piece, # 0 years old, from

:20:26.:20:32.

the New York Times, they explained that Adolf Hitler's anti-Semitism

:20:33.:20:36.

wasn't here, exaggerated but to carry favour with the sentiments

:20:37.:20:40.

that American voters are feeling. History suggest that is over

:20:41.:20:44.

optimistic. Do you think Donald Trump is as nasty as he seems with

:20:45.:20:50.

his descriptions of Mexicans, Muslims, building of walls and hi

:20:51.:20:54.

bans of people of the wrong religion? I don't think so. It's

:20:55.:20:58.

something about him. The truth about Donald Trump is that he is a pretty

:20:59.:21:05.

non--ideological, pragmatic, problem-solving businessman who says

:21:06.:21:08.

the first thing that comes into his head much I don't think he makes

:21:09.:21:14.

these statements because there an underlying, bigoted or ideologically

:21:15.:21:16.

driven point of view about people from other countries or races. I

:21:17.:21:20.

just don't think that's how he is. He is very much someone who speaks

:21:21.:21:25.

off the hoof. There is another important point, it might be easy in

:21:26.:21:29.

people in the UK to follow the race from afar to conclude from some of

:21:30.:21:33.

the things that Trump is saying he is pretty much another crazy

:21:34.:21:36.

right-wing American politician. In fact, it's the opposite. One of the

:21:37.:21:40.

reasons that the Republican establishment is really worried

:21:41.:21:44.

about Trump and rounding on him, is not that he's too right-wing, it is

:21:45.:21:50.

not that he's right-wing enough. They think his positions on abortion

:21:51.:21:54.

and immigration are not right-wing enough. The other candidates in the

:21:55.:21:57.

race the establishment would like people to get behind, Marco Rubio

:21:58.:22:02.

and Ted Cruz, are to the right of Trump on abortion and immigration

:22:03.:22:05.

and some other issues. You are quite right to suggest that we are

:22:06.:22:08.

following it from afar. Of course, the vote we're following more

:22:09.:22:13.

closely is the looming vote on EU membership, the referendum on that.

:22:14.:22:17.

Your former boss has laid out his stall fairly effectively. Are you

:22:18.:22:22.

impressed by it? Look, one thing I think is important for such an

:22:23.:22:27.

important debate is for me not to get involved from afar. I don't want

:22:28.:22:34.

to wade into that from a long distance away. Let's pretent tend

:22:35.:22:39.

you are next door. I don't want to get involved. Better to leave the

:22:40.:22:43.

debate to you over there. You haven't made a secret in the past

:22:44.:22:48.

about your scepticism of the European project, I presume that

:22:49.:22:51.

hasn't changed? Neither has David Cameron. He himself has said there

:22:52.:22:55.

is no way he sees the EU as being perfect or an organisation or an

:22:56.:22:59.

approach to governance that absolutely ideal. So I think, being

:23:00.:23:05.

a critic of the EU doesn't necessarily put you in one camp or

:23:06.:23:08.

the other. I fully appreciate you don't want to endorse David

:23:09.:23:12.

Cameron's position or condemn it, but in many ways that speaks volumes

:23:13.:23:17.

itself, doesn't it? I think it's not right to get involved from a long

:23:18.:23:21.

way A former director away. Of strategy at Number Ten Downing

:23:22.:23:26.

Street doesn't feel it would be right to get involved about the

:23:27.:23:29.

biggest issue that the residents of the Number Ten Downing Street is

:23:30.:23:32.

going to tackle in his career, come on? I don't think it's reasonable to

:23:33.:23:38.

get involved from a long way away. It's a vivid and highly energised

:23:39.:23:42.

debate right now. I just don't think it would be right, beamed into your

:23:43.:23:46.

studio for me to make an intervention. Do you think we might

:23:47.:23:51.

leave, leaving aside the battle. Do you think the result might go the

:23:52.:23:55.

way of the Brexit campaign? You have months of campaigning and, as we

:23:56.:23:58.

have seen here in the US, anything can happen. Indeed. Steve Hilton,

:23:59.:24:01.

many thanks indeed. You may remember the excitement

:24:02.:24:05.

in 1997 when Deep Blue, a computer, defeated

:24:06.:24:08.

the chess grandmaster, That moment was considered a great

:24:09.:24:09.

leap forward for artificial intelligence - a sign that computers

:24:10.:24:13.

could now better mankind at even Now, almost 20 years later,

:24:14.:24:16.

technology developed in London is about rewrite the rulebook again

:24:17.:24:20.

as it takes on the World Champion at the ancient Chinese

:24:21.:24:25.

board game of Go. If it wins, some experts believe

:24:26.:24:30.

this will be the greatest breakthrough yet in the quest

:24:31.:24:34.

for robots to mimic minds. Former Downing Street tech adviser,

:24:35.:24:38.

Rohan Silva, is one of them and he's Until recently, computers have

:24:39.:24:41.

been relatively simple. Even the most powerful machines can

:24:42.:24:57.

only carry out the specific tasks This limits the scope

:24:58.:25:00.

of what they can do, After all, the real world

:25:01.:25:05.

is messy and unpredictable and computers aren't good

:25:06.:25:15.

at dealing with that. But what if machines

:25:16.:25:17.

could think like humans? What if software could learn

:25:18.:25:20.

new things by itself? That's been a goal of scientists

:25:21.:25:23.

working on artificial intelligence since the very dawn

:25:24.:25:26.

of the information age. But it's proved

:25:27.:25:28.

a near impossible task. A piece of software,

:25:29.:25:31.

developed in London, the biggest step forward

:25:32.:25:41.

in artificial intelligence It was developed playing simple

:25:42.:25:43.

computer games and now it's about to take on the best

:25:44.:25:52.

player in the world, A game of such complexity

:25:53.:25:54.

and intuition, no machine has ever AlphaGo's creator is the British

:25:55.:25:59.

start-up, Google Deepmind. So the game of Go has just two

:26:00.:26:06.

rules, but out of those rules There are more possible board

:26:07.:26:10.

configurations in the game of Go than there are atoms

:26:11.:26:14.

in the universe. So really, it takes a whole

:26:15.:26:16.

lifetime to master. We're ready for the next step

:26:17.:26:18.

for us, which is the ultimate challenge - to take on one

:26:19.:26:21.

of the world's top Go players. So we've decided to challenge

:26:22.:26:26.

Lee Sedol in a $1 million Lee Sedol is the greatest Go

:26:27.:26:29.

player of the last decade. Probably one of the greatest Go

:26:30.:26:33.

players of all time. I describe him as the Roger Federer

:26:34.:26:36.

of Go and, you know, the press and the excitement

:26:37.:26:39.

there is just huge from the general population, because they really love

:26:40.:26:42.

technology and they love Go. Human professional players,

:26:43.:26:50.

at the top of the game, they're extremely creative

:26:51.:26:52.

and they'll do unexpected things So we're pretty confident,

:26:53.:26:54.

our internal tests are saying we should do pretty well,

:26:55.:26:58.

but Lee Sedol has been interviewed by the Korean press and he's very

:26:59.:27:01.

confident of winning, so it's going to be a very

:27:02.:27:07.

interesting match-up. Of course, this isn't the first time

:27:08.:27:09.

computers have beaten humans But what really marks out AlphaGo

:27:10.:27:12.

from the machines that mastered noughts and crosses in the 1950s,

:27:13.:27:19.

and eventually chess, in the 1990s, is not

:27:20.:27:22.

just its ability to play a much It's the way it plays

:27:23.:27:25.

the game - by learning. AlphaGo actually learns how to play

:27:26.:27:29.

in quite a human-like manner. So the way we start off training

:27:30.:27:32.

AlphaGo is by showing it 100,000 games that strong amateurs have

:27:33.:27:37.

played, that we've downloaded We first initially get AlphaGo

:27:38.:27:39.

to mimic the human player, so we give it a position,

:27:40.:27:44.

and we train it to predict the move But of course, ultimately,

:27:45.:27:48.

we would like AlphaGo to be stronger than human amateurs, and compete

:27:49.:27:55.

with the top professionals. So the way we do that is,

:27:56.:27:58.

after we take that first version, that's learned to mimic human play,

:27:59.:28:02.

we then allow it to play itself 30 million times, on our servers,

:28:03.:28:06.

and using reinforcement learning, the system learns to improve

:28:07.:28:10.

itself incrementally through avoiding its errors,

:28:11.:28:13.

and increasing and improving its win rate against older

:28:14.:28:18.

versions of itself. After all these games,

:28:19.:28:21.

then you end up with a new version that can beat the old version,

:28:22.:28:25.

the original version, The computer Deep Blue has tonight

:28:26.:28:27.

triumphed over the world chess It's the first time a machine has

:28:28.:28:34.

defeated a reigning World Champion Kasparov, after the move

:28:35.:28:38.

C4, has resigned. This is in many ways a more

:28:39.:28:46.

interesting piece of software than Deep Blue, which was the piece

:28:47.:28:49.

of code that did beat Garry Kasparov Why are people excited

:28:50.:28:53.

at the moment? I think that's because these machine

:28:54.:28:58.

learning techniques have made a little bit of a breakthrough,

:28:59.:29:01.

at the sort of lowest level of functionality that's

:29:02.:29:06.

really important for AI, So being able to take raw data,

:29:07.:29:08.

large quantities of raw data, such as images or sounds,

:29:09.:29:13.

and to be able to do the basic processing and recognise

:29:14.:29:17.

what's there. Key to understanding why AlphaGo

:29:18.:29:20.

could be a much bigger breakthrough than Deep Blue is to see just how

:29:21.:29:23.

differently the two machines work. Deep Blue was programmed

:29:24.:29:27.

to recognise the value of each piece It then used raw computing power

:29:28.:29:30.

to search every possibility, It's a bit like trying every

:29:31.:29:36.

password combination until the safe unlocks, but ask Deep Blue to do

:29:37.:29:43.

anything other than play chess, like even play a much simpler game,

:29:44.:29:46.

and it just won't know Like a human, it can't measure

:29:47.:29:50.

all the possibilities in Go. Instead, AlphaGo teaches itself

:29:51.:29:58.

to play the game by watching thousands of others,

:29:59.:30:04.

playing matches against itself, When historians come to write

:30:05.:30:08.

about the 21st Century, I believe this match will be seen

:30:09.:30:14.

as a pivotal moment in our Because as Deepmind software shows,

:30:15.:30:18.

we may be entering an age of thinking machines and general

:30:19.:30:23.

artificial intelligence, capable of carryling out a huge

:30:24.:30:27.

number of tasks currently Whether or not Deepmind wins

:30:28.:30:30.

the game, it's likely that intelligent machines

:30:31.:30:35.

are going to have a profound impact AI can make great contributions

:30:36.:30:38.

to things liked medical imaging diagnosis, to self-driving cars,

:30:39.:30:48.

to image recognition processing, so that computers can understand

:30:49.:30:50.

what they see. Going beyond this, real general AI

:30:51.:30:53.

means that these systems can do all of these things together,

:30:54.:30:56.

and maybe can guide robots to make the right decisions,

:30:57.:31:00.

so that they can behave with humans The whole point about general AI

:31:01.:31:04.

is to not put bounds on any specific thing they can do, but to provide

:31:05.:31:11.

a general technology whereby computers can make smart decisions,

:31:12.:31:15.

can understand what they're doing. That's the really open challenge

:31:16.:31:22.

for AI, is to try to make AI more and more general, and more and more

:31:23.:31:25.

robust to situations that it The next step for Deepmind's

:31:26.:31:29.

technology is applying it to real world situations,

:31:30.:31:36.

not just games. The idea is that, you know,

:31:37.:31:39.

these algorithms that we're working on are general purpose and can be

:31:40.:31:44.

translated into these new domains, so we'd love to use these types

:31:45.:31:48.

of algorithms for things like health care and science, and improve

:31:49.:31:53.

the speed of breakthroughs in those areas by helping human

:31:54.:31:57.

experts achieve more. The match against the world's best

:31:58.:32:04.

Go player is a key milestone It could represent the dawn

:32:05.:32:07.

of machines that think like humans and open up the possibility

:32:08.:32:12.

of advanced artificial intelligence, This may all sound like science

:32:13.:32:15.

fiction, but now it might really be The beautiful game is at its ugliest

:32:16.:32:21.

when attention turns to the personal morality and apparent sexual

:32:22.:32:36.

incontinence of some players. The conviction this week of former

:32:37.:32:38.

Sunderland and England winger, Adam Johnson, for engaging in sexual

:32:39.:32:40.

activity with a 15-year-old girl, has brought many attendant issues

:32:41.:32:43.

into particularly sharp focus, with swathes of social media

:32:44.:32:45.

contributors blaming Johnson's victim for his crimes

:32:46.:32:47.

and the players' union calling today for footballers to receive more

:32:48.:32:49.

education about "personal COMMENTATOR: Now for Adam Johnson.

:32:50.:32:51.

Shooting in. Like so many young Premiership

:32:52.:33:08.

footballers, Adam Johnson A multi-million-pound contract

:33:09.:33:11.

and a great playing career But it was a sexual encounter

:33:12.:33:14.

with a girl he knew to be under age In one series of messages,

:33:15.:33:20.

the victim clearly tells In the next, he makes it clear

:33:21.:33:26.

exactly why he wants to see her. He finishes by telling her to keep

:33:27.:33:35.

deleting their exchanges. Now those who supported Johnson

:33:36.:33:37.

are coming to terms with his crimes. I was aware of his plea

:33:38.:33:43.

for all charges to be not guilty. Just before the trial started,

:33:44.:33:49.

to hear that he had pleaded guilty was a massive shock to everybody,

:33:50.:33:52.

everybody at the football club, which the football took

:33:53.:33:54.

swift and direct action As Johnson awaits sentencing,

:33:55.:33:56.

it leaves football asking more Can the game do anything

:33:57.:34:07.

to stop its allure being used With me here, Mihir Bose,

:34:08.:34:12.

a sports journalist who has written Joining me from Sheffield

:34:13.:34:19.

is Richard Caborn, who was Sports Minister under

:34:20.:34:22.

the last labour Government. O something in the budget to

:34:23.:34:31.

clamp-down on that. Many thanks indeed.

:34:32.:34:34.

Obviously, Adam Johnson particular crime is not one thankfully we see

:34:35.:34:39.

replicated across football, but it was committed against a backdrop of

:34:40.:34:45.

a sort of moral vacuum. We use the word veteran perhaps rudely in the

:34:46.:34:48.

introduction, as you look back over the years you have been covering

:34:49.:34:53.

football. Is that new development or has there always been a sense of

:34:54.:34:57.

impunity about the top players? There have been bad footballers who

:34:58.:35:01.

have done bad things, what we have is a dysfunctional system. Football

:35:02.:35:04.

has become business. Club has become business. At the same time it

:35:05.:35:08.

portrays itself as a community thing, it has a moral sense, and

:35:09.:35:14.

what this case shows is where is the club's moral sense? Because what

:35:15.:35:17.

Johnson did, what the club knew, we don't know for a fact what the club

:35:18.:35:22.

exactly knew, what did it do, to, if you like educate Johnson, it is not

:35:23.:35:26.

just the players union thing, the clubs have a responsibility and the

:35:27.:35:30.

club claims to be a community club, the club of Sunderland, this was a

:35:31.:35:36.

young 15-year-old, who was, who worships Sunderland, worships

:35:37.:35:39.

Johnson which is how the whole thing started, where is the duty of care

:35:40.:35:43.

to the season ticket holder o the fan? This is where the moral vacuum

:35:44.:35:48.

has come. The clubs have spent too much time becoming businesses, and

:35:49.:35:53.

forgetting how they originated and also what they say their main

:35:54.:35:56.

appeal, that we are not just a business, we are more nan a

:35:57.:36:00.

business. How, education is one thing, how do you discipline or

:36:01.:36:06.

punish a man, earning 60,000 Bourne a week whose presence on the pitch

:36:07.:36:11.

will have a direct affect on the profitability of the club or company

:36:12.:36:15.

he works for? But in any proper situation, he would have been

:36:16.:36:19.

suspended. Not played. They originally suspend him, brought him

:36:20.:36:23.

back, the question is not whether he should have been dismissed but the

:36:24.:36:26.

club new a serious charge is made, then they howl not have played him.

:36:27.:36:30.

They should have suspended him but the club was then facing a

:36:31.:36:33.

relegation battle, he is a very important player and the question

:36:34.:36:37.

the club hasn't answered is why did they remove that suspension? Is it

:36:38.:36:41.

because they needed to stay in the Premier League and all the money it

:36:42.:36:46.

brings or is there some other reason? Sunderland are themselves in

:36:47.:36:53.

the dock, but if you could step away from that particular case and tell

:36:54.:36:59.

me what you as a man who didn't have a background in professional support

:37:00.:37:02.

was struck by between the relationship between football and

:37:03.:37:05.

morality. I agree to some extent with that. It is wider than that. It

:37:06.:37:10.

is about the responsibility of the world of football, to put its house

:37:11.:37:14.

in order. And some of us have been asking for that, that, I have worked

:37:15.:37:17.

with a group of people who for the last ten years have been saying why

:37:18.:37:21.

don't we have an independent service set up that can advice, give

:37:22.:37:26.

counselling, education, to, we are taking young people now, into, young

:37:27.:37:31.

people into this profession, the profession of football at nine years

:37:32.:37:35.

of age, and that is really where it ought to start. We put forward the

:37:36.:37:39.

players' programme where there ought to be this education programme, we

:37:40.:37:44.

ought to have a proper counselling service, the other part in this

:37:45.:37:47.

profession is how these players are dealt with. They are not dealt with

:37:48.:37:51.

as people, they are dealt with as commodities by the agents, so the

:37:52.:37:57.

whole structure is actually artificial, yes, ?60,000 a week they

:37:58.:38:01.

were paying to Johnson, but that, I think when you look at the round,

:38:02.:38:05.

when you are taking young people into what is a very artificial

:38:06.:38:09.

world, without any counselling, without any support, I think the

:38:10.:38:13.

profession of football ought to be looking at it. There are demands and

:38:14.:38:17.

for the PFA to say it is about education, I have been asking the

:38:18.:38:21.

PFA and the League Managers' Association, and the Premier League,

:38:22.:38:26.

and the FA to set up an independent service for the last ten year, and

:38:27.:38:30.

they have not done that. Briefly why not? , why do you think they

:38:31.:38:35.

haven't? I don't know. I think that is a question that football itself

:38:36.:38:40.

has to ask. It is no good, the PFA saying they want education, we have

:38:41.:38:45.

put on the table to them, a programme, what we call the players

:38:46.:38:48.

programme to start at nine years of age and help these young people to

:38:49.:38:54.

be able to manage much more responsibly the profession of

:38:55.:38:57.

football. It is a wake up call they ought to take to heart.

:38:58.:39:04.

In a sentence, how optimistic are you that football will learn any

:39:05.:39:09.

lessons from this? I don't think football will learn lesson, we have

:39:10.:39:13.

have a lot of sound bites and football will say it is not our

:39:14.:39:15.

responsibility. We are present aggregate game. The Premier League

:39:16.:39:18.

is a wonderful product. And that will be the end of the story. Watch

:39:19.:39:25.

this space. Many thanks. As the sighs of panicking parents

:39:26.:39:28.

subside for another year, we thought we would mark World Book Day not

:39:29.:39:32.

with costumes, cobbled together at the last minute, guilty. But with a

:39:33.:39:36.

celebration of what is really important about books. What is on

:39:37.:39:40.

the outside. Here are some of our favourite covers.

:39:41.:39:40.

Good night.

:39:41.:39:43.

In-depth investigation and analysis of the stories behind the day's headlines with James O'Brien.

Is the chancellor planning major pension reform?

Mitt Romney lays into Donald Trump.

Artificial Intelligence breakthrough.

Football after Adam Johnson.


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