In-depth investigation and analysis of the stories behind the day's headlines with Kirsty Wark.
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It's been a choppy couple
of weeks for the Government.
But can Philip Hammond put them
back on an even keel
and save his own skin too?
The Chancellor's got
a big job of work to do
with next week's Budget.
So, is he preparing something
special for that battered red box?
New details are emerging about
Philip Hammond's budget tonight -
I've been speaking to one
of his closest political friends,
who reveals the chancellor
is planning a modest loosening
of the taps.
But another tory has a warning
for him on housing:
If we do not do something about this
then we will be writing ourselves
out of the electoral script.
The Budget could see budging
on Universal Credit too.
Tonight we go to Newcastle
to see first hand some
of the problems solved and created
by the new system.
I hid in my bedroom for nearly to
macro weeks. I only went out of the
bedroom to go to the toilet. My
children went to stay with my
parents for a little while. Purely
because I didn't have the money to
All of this makes next week a make
or break week in politics.
We'll discuss it all
with our panel of pundits.
The Budget is normally a big eagerly
awaited affair but it has almost got
lost in mountain of problems facing
Theresa May - from sexual scandals
to Boris Johnson's big gaffe,
to today's ticking off of the Prime
Meanwhile, the Chancellor
is beavering away, trying to make
sure he avoids a repeat
of the humiliating U turn
after the March Budget
over national insurance.
But with fellow Cabinet members
including Michael Gove
and Amber Rudd breathing
down his neck, he'll also be
thinking about making a splash -
in a good way - if such
a thing is possible.
We'll be discussing all this
with our panel throughout
the programme but first,
our political editor, Nick Watt.
I have not got money to buy a house.
When do you reckon you will be able
to buy? About ten years. Do the
Tories expect our support in the
light of another 1% pay increase?
There is not a magic money tree we
can shake to provide for everything
There was no magic
money tree for the nation. Are the
Tories about to unveil a more
modest, magic money tap?
No, they don't have an overall
majority at this stage.
On that grim
night for the Conservatives, they
lost seats in their natural
territory. Anxious younger people
are at the heart of that story is
you people in their 20s, 30s and 40s
preferred Labour. It is Philip
Hammond's challenge in a spread it
to reset his party plasma relations
with those younger voters.
June election, we lost, among all
age groups up to the age of 49. That
is a terrifying position for the
Conservative Party to be in. I do
think the party is very focused.
the feverish atmosphere at
Westminster there has been an
intense, internal debate about how
to pitch the budget. Should the
Chancellor be bold and allow
spending to flow or should it be a
case of steady as she goes with
spending restraint? I am told one
senior aide advise the Chancellor to
throw caution to the wind to make
sure he leaves a memorable legacy.
This could, after all, be your final
budget if Theresa May finally snaps
with you. Others say this most
cautious of politicians is not about
to change the habits of a lifetime.
I understand the budget will contain
both elements of that internal
Treasury debate. The Chancellor will
turn on the tap. There will be more
than a dribble but we should not
expect a gash. Every penny is
accounted for by the man known as
Spreadsheet Phil. No doubt Labour
will say it is all just an illusion.
One of the Chancellor's oldest
friends believe he will spend some
of his so-called headroom or war
chest, even though it is expected to
be below the 26 billion he
identified in March.
I think what
the Chancellor is saying is, it will
be silly to throw away all the good
work we have done in getting down
the deficit level about to turn the
corner on debt. Of course I am
listing in Mike Autumn Statement
there was some headroom. Will look
at other ways in which the headroom
can be used to attack the problem so
many people have spoken to me about.
I am convinced he will be looking at
some housing ideas. There are
creative ones about looking at loan
guarantees. Builders and things in
that sort of era. Also he knows that
we need to build more social housing
and he will be looking at ways to
The astonishing fact
is the difference in likelihood of
someone voting Conservative, whether
they have a mortgage, owned their
own home or are in private rented or
socially rented accommodation. The
difference is dramatic. I know every
single Conservative MP is very
focused on that fact and on the
reality which is that if we do not
do something about this over the
next three to four years before the
next election, we will be writing
ourselves out of the electoral
We can expect a united
Cabinet front next week. Not since
the Blair- brambles has been such a
poisonous atmosphere ahead the
budget. One person told me Boris
Johnson and Michael Gove are leading
the internal charge against the
Chancellor, because they feared the
Treasury has grabbed hold of Brexit
policy. What detail have you been
hearing about the memorable legacy?
The keyword in that report is
headroom. When I was talking to
Stephen hammered, -- Hammond, he
kept repeating headroom. They say
this has ticked up in recent weeks.
He'll want to address the areas,
particularly health and housing
which caused the Tories such grief
in the general election. What is
interesting is the assumption had
been the headroom would be used
solely by the Chancellor to help him
navigate what he expects to be a
bumpy Brexit. Government sources are
saying, no, it is there to help you
when you have a slowing economy is
and that is what we have at the
Talking about loan
guarantees. All builders, it is not
exactly splashy stuff.
with Philip Hammond, he has built
his entire career. He is not an
accountant but he behaves like one.
He is an incredibly cautious person.
He does know that when, as Nick
Bowles, we may have heard him we may
have not met every age group under
49 voted for the Labour majority and
not the Conservatives. Philip
Hammond understands that and we will
see the war chest being dipped into.
He still believes you have to be
cautious and he will be sticking by
the fiscal rules for a moment.
will be coming back to you later on
that next week.
Next week is going to be a busy one
for the nation's political pundits.
We have three of them here tonight
to give us a sense of
how they're feeling.
I'm joined by Rachel Shabi,
Ian Dale and Simon Jenkins.
On the question of whether Philip
Hammond will be safe or bold, will
it be maybe be his last budget
question what will he have to get
something big out there?
Chancellor needs to have a legacy.
Something none of us can predict.
Certainly not an increase in
I wouldn't think
so. Expectations on housing had been
raised through the roof, namely by
his Cabinet colleague making the
speech yesterday. Whatever he
announces will not be enough people
like Nick Bowles who want to see
lots of progress on housing.
that talk on this intergenerational
fairness, something has to be taken
from the younger and given to the
older Tory voters.
It is a fallacy
to think you buy votes from young
people by appealing to their pocket.
The problem he has is Jeremy Corbyn
gave away the biggest election bribe
in history by offering half the age
cohort £50,000 for the university
education. You cannot beat that.
That was gigantic and irresponsible
but massive. I think that is what
moves them rather than housing.
it being neck and neck, you would
expect the polls to be better for
Labour. If there was a decent offer
on housing, maybe stamp duty, a
holiday for first-time buyers, it
might send a signal actually they
are looking after younger voters
rather than the wealthier, older
No, no. This will not cut
it. He cannot do it for that he
cannot do it politically because of
the divisions and chaos in the
Government. He cannot do because it
is not in his DNA, nor the
Government's DNA to try to
understand the economic crisis. They
cannot grasp the causes of that they
cannot grasp whether it is a
systemic crisis. They do not
understand the effect it is having
on people's lives and hardship it is
causing. How can they have any
You have someone like
Sergei Javits saying we need extra
borrowing to build houses. -- Javid.
The housing is bigger, 200,000 but
what it needs to be is 400,000.
They're all sorts of creative
solutions but I'm not sure any of
the parties have the answer.
Hammond deliver that, especially in
the fiscal rules?
Housing is a mess.
You do not build houses overnight.
Can affect the private rented
sector. Young people appreciate more
social housing. The real problem is
homelessness in cities. This
assumption that you can throw money
at young house-buyers and somehow
help them. All it does is increase
Do you think Labour
has outflanked the Conservatives?
Are they offering to younger people
more than the question?
student I have spoken to has said
they were bowled over. They were
That is serious
money. It is not. I am not
underplaying this. Housing is a
massive crisis. Student debt is a
huge issue. There is a bigger
picture here. That is about having a
vision for an economic crisis.
talk about that. The whole question
is, will this be the end of
austerity? The NHS needs to suck in
a lot more money now.
I don't think
they can do it. I don't think they
can handle it. They don't have the
kind of solutions they need for that
we are looking at productivity rates
which are flat-lining while people
are working longer hours for less
pay and working conditions with
living costs rising. The system is
failing. Tinkering around with
things like stamp duty will not
really cut it.
There is a big thing
that he has to go through the big
boost of spending on infrastructure.
They would say they are doing that
already. The building programme at
the moment is the biggest for many
years that we can go down the road
that John McDonnell wants to go down
and spend £70 million on all sorts
of things. We all want more money
for the health service and
education. The problem of Labour so
far if they have not explained how
they would pay for the massive
splurge of spending.
He does spend
it. Anyone can do that. The real
problem is the one that Nick
identified. He wants to appear
responsible without making a silly
mistake like over national
insurance. To do that, you need to
form a very fine judgment as to how
much a giveaway and how much you do
not. The politics is he has to
appear to be giving something away.
Posterity Fx everybody. -- posterity
affects everyone. Finding a way to
appeared to be a generous
He is going to do
something bold. Presumably it is
something that Theresa May agrees
We don't know. We in a vacuum
and do not know what is happening.
In the end, all politicians are
elected to government to decide how
to cut up the public spending cake.
In this budget most people are
expecting a lot of money for the
NHS. If he says we're going to put
in an extra 2 billion, Rachel were
saying that is not enough. We should
put 4 billion in. Whatever the
Chancellor is going to do he will be
What I am saying is we
need to get beyond this thing that
there is only so much money. This is
out of kilter with what most
respected economists around the
world and even those famous
marketers at the IMF are saying, you
have to invest in an economy. That
is where you generate growth. That
is mindful that you should borrow
when there is low interest rates.
What would you like to see that
public requirement going into?
the Labour Party talked to
businesses and representatives about
this, they say, you are right, we do
need this investment. We need
infrastructure and skills.
look at this as a very particular
Budget, happening at a time, I would
not say Brexit stasis, but Theresa
May has been chided by Donald Tusk,
and you have Phillip Hammond laying
out his stall but he does not know
what party it will be at or the end
He has to be a chance for
all time, he cannot pretend this is
my only Budget or this will come to
an end in one year. It is very
difficult but the problem with
journalists as we're in a state of
perpetual hysteria. I think we're
all quite calm! I have lost track
of, she survive... Until Christmas,
now. Prime Minister tend to survive
and chancellors as well. They tend
to not get on very well. This is
normal. Would anything break this
Christmas not until there is a
We are in a
situation where Phillip Hammond is
determinedly soft as a Brexiteer and
there is a difference of opinion as
how this is being handled and Brexit
is a huge focus, people don't know
what is happening but there is more
focused than the Budget?
agree with a lot of what Simon said,
apart from the last bit, I don't
think he is safe, if she carries out
a major reshuffle in January or
February, she may be forced into a
reshuffle before then...
What do you
think the impact of Brexit is on the
is short-term because we don't know
exactly what the Brexit outcome will
be so it is very difficult for him
to plan. He has to keep back some
money in case we have no Deal, very
reluctantly. I think he is looking
to the short-term rally than
long-term on Wednesday.
We're going to Hugh Muir -- hear
more on Brexit.
developments, Donald Tusk has
essentially said to Theresa May, you
need to put more money on the table
within two weeks, there is already
20 billion euros, they want 60
billion, they want a bigger
indication and the significance of
the next two weeks is Donald Tusk
once that before the European
Council on the 14th of December,
where EU leaders might say, yes, we
can move onto the next stage and
talk about trade and transition.
David Davis was tickling that? He
did a speech in Berlin and he said,
we will be doing something in the
next few weeks. He did not want to
be specific and was clearly
indicating that Britain would like
to say it at the council and not
The Taoiseach has also
been pretty vocal today.
We offer a
car has said that Britain has to put
in writing that it will ensure there
is no hard border in Ireland and
that has to be done to ensure that
he will agree to move onto the next
age at the European Council.
Interestingly, no member state has a
veto over the Article 50 process.
But there are three areas, Northern
area -- Northern Ireland, citizens'
rights and money and it is Ireland's
moment in the sand and it is
difficult to see how Donald Tusk
could move on without the agreement
One area where the Chancellor
is widely expected to make
an announcement in the Budget
is the rules for the Government's
flagship welfare programme,
Labour forced a vote yesterday
in the Commons on cutting
the initial waiting time
for Universal Credit
from six weeks to four.
It won, though Conservative MPs
abstained and the Government
has yet to respond.
Critics argue that the inequalities
and delays in the system have
created new hardships for people.
Stuart Denman went to Newcastle,
one of the trial areas,
where he spoke to three people
who say it doesn't work for them.
He began his quest at a food bank.
13 weeks, it was.
It was eight weeks and then
it was another five weeks.
You just had to try to pay
what you needed to pay.
But you weren't paying
rent or council tax.
I'm getting my money every
month now, the same date.
It's just the amount you get.
It was bad enough
when I was on the...
It was £102, I think.
It was bad enough then
but now it is £72 a week.
You cannot do it, it's impossible.
It really is.
Ian has been on Universal Credit
for about six months.
He says he has not been under
pressure to look for work,
which he thinks is down
to poor health.
I have met you here at a food bank.
How often do you come here?
Once a week.
And what do you do for the rest
of the week for food?
I get food out of the bin now
and again, which I did
a couple of days ago.
How old are you, Ian?
Did you imagine life
to be like this at 54?
Not as bad as it is, I don't think.
I knew without a job
it was going to be really,
really difficult but I didn't think
it was going to get
as difficult as it is.
It's getting out of hand now.
If you're not in a family
you may as well not exist.
If you can't buy your own house
you may as well not exist.
Ian later tells me he will be
receiving an additional allowance
for caring for a friend so he is now
more optimistic about getting
by on Universal Credit without work.
But what if Universal Credit
is actually putting
you off finding work?
I have been on the Universal Credit
system as a carer, which means
I don't have to actively seek work
at this point in time
because my daughter receives
a disability allowance.
I have received my
first payment in July.
It went as smoothly as it
could apart from the fact that
I didn't get the amount
I was expecting and also
I subsequently found out that,
despite keeping them informed,
I had a legacy debt that has accrued
by having claimed tax credits.
How much is that debt?
In 2012, Lynne was made redundant
from a well-paid role
in the public sector.
She was able to find short-term
consultancy jobs but increasingly
had to depend on benefits to get by.
She sold her two-bedroom flat
to make ends meet and now
she and her two teenage daughters
live in privately
The option is to either go back
into well-paid work,
which isn't necessarily available,
or in terms of downsizing or trying
to manage within the benefits
system, then that is not going to be
possible under Universal Credit.
Lynne feels it would be too
complicated to accept ad-hoc
consultancy work while on Universal
It's too unstable.
If you have high peak months,
like seasonal, or you get a contract
that is three months but you don't
work for two but you earn that
amount, you are going to be
in and out of the benefits system.
You can't wait six weeks every time.
I am an extremely resourceful person
and now I am in the position where,
through the austerity measures
that the government have implemented
and the system of support has
left me in this situation more
than I have left myself.
I would be better off
handing my taxi badge
in and going and signing on.
I would get more
money by not working.
Which I can't understand at all.
Robert is a self-employed
When he applied for Universal
Credit, an appointment
was arranged for him to prove
he was self-employed.
But on the day of the interview
he was offered a fixed taxi fare
of £90, which he took instead.
The appointment was
but he missed that one, too.
You missed two appointments?
But that was to take work?
Part of your claimant commitment
is you can't refuse paid work.
But you must attend all interviews.
How can you do both?
You're desperate for money.
That's the option you're
going to take every time.
Robert's payments started
eventually, which he combined
with his taxi earnings.
But in September he was thrown
by a much lower payment
than he had expected.
It tipped him over the edge.
Unable to pay the taxi company
he was working through,
they parted company.
Robert was suddenly unemployed.
I hid in my bedroom
for nearly two weeks.
And I only went out of the bedroom
to go to the toilet.
My children went to stay
with my parents for a little while.
Purely because I didn't
have the money to feed them.
Because they weren't there,
I got more depressed.
I didn't open any of my mail.
I wasn't answering my phone.
Adding to an already bad month,
rent arrears that predated his time
on Universal Credit
were about to become a problem.
He visited his GP one day.
When he returned home with a sick
note and antidepressants,
he found that the locks
had been changed.
I had been given seven days
to remove my possessions
and to leave the property.
And the seven days were up.
That's why they said
the bailiffs round and changed
the locks and everything.
But you didn't know that,
you hadn't been opening your mail?
Robert discovered that September's
low payment was because of problems
with something called the minimum
income floor, which is an assumption
about a self-employed
person's monthly earnings.
As a primary carer of two children
under 16, Robert's calculation
should have been based on a 25 hour
working week, meaning
they would expect him to earn
about £800 in a normal month.
But instead, they had used a 35
hour week and assumed
he would earn more than £1000.
Because the error meant
they expected him to get more
in earnings, they paid him less
in Universal Credit.
They said, don't worry,
we will fix the mistake.
They put the wrong postcode
on the letter or something.
It cost me my livelihood.
Robert received a letter admitting
the mistake and his monthly
payment was adjusted.
But in reviewing his case,
they also calculated that
in the initial months,
he had actually been overpaid by...
And a request to make
an arrangement to pay it back.
It's one mistake after another.
Robert is now taxi driving again.
Unsurprisingly, he has no faith
in Universal Credit.
He takes particular issue
with the minimum income floor,
which doesn't recognise that sole
traders may end up earning less
than the national minimum wage
if they have a bad month.
If I don't make that
minimum income floor,
I don't get any extra money,
any help at all.
When Universal Credit
came to Newcastle, it
promised to bring fairness,
simplicity and an incentive to work.
And it has, for some.
But for others, it's yet to prove
that it has brought any
one of these things,
let alone all three.
Stuart Denman there.
We did ask the Department for Work
and Pensions to join us
on the programme tonight but no
minister was available.
In a statement, the department said
Universal Credit lay at the heart
of the Government's commitment
to help people improve their lives
and raise their incomes.
They said the vast majority
of claimants are paid in full
and on time and that support
is available for anyone
who needs extra help.
Well, Rachel, Ian and
Simon are still here.
Rachel, it is fair to say that the
government and the opposition
believe Universal Credit is the
right thing and is here to stay?
think Universal Credit should be
stopped until we get rid of this
government, frankly. They cannot
handle it. They are still defending
Universal Credit despite the fact
that everyone who has anything to do
with it, claimants, local
authorities, food banks, the church,
says it is plunging people into
poverty and debt.
If you talk to
Jeremy Corbyn and John McDonnell,
they think the principle is right to
incentivise people so the Phillip
Hammond does something in the Budget
about the delivery of that?
would be a good thing? Perhaps the
principle of simplifying it is a
good thing but I am not sure, that
might be an illusion. But in any
case, the government have had so
much evidence that it is not working
so we're left with two
possibilities, either they are
indifferent to the level of
suffering they are causing or just
clueless and I don't know what is
Is it fair to say it was
rolled out to some?
It is a disgrace
that there isn't a government
minister on the programme to defend
it and I will not on that role.
Whenever you introduce a complicated
system, even if you think you are
simplifying it, there will
inevitably be teething problems but
they have had time to understand
those problems and the six-week
period, everyone would agree, needs
to be shortened. I think they will
probably shorten that in the Budget
to five weeks and it should be four.
I don't agree with pausing this
because the film had three people...
We know that Eddie people...
still leaves 20? I'm not saying that
is not a bad thing and I have
conducted hours of phone-ins on the
subject and when you have three
people in a row crying down the
phone to you, you can be a hardened
Thatcherite and you will be affected
Just a second, will Phillip
Hammond address this on Wednesday?
Yes, I know he will. Whether he does
it as Ian suggests, I don't know. It
is incredible, people are in favour
of the principle. What is
extraordinary is this six-week delay
intended to get people used to being
paid in arrears as if they were then
work demonstrates such a failure of
the psychology of people in
That's all for this evening.
But before we go, have you ever
wondered what it's like to enter
Mars' atmosphere at twice the speed
of sound attached to a parachute?
Slow motion, in video originally
shot at 1000 frames per second.
But played back here at 30 frames
per second, we see the initial
suspension lines pulling out
of the pack and taking the parachute
backwards, where it will ultimately
inflate in merely half a second.