0:00:12 > 0:00:17This is a watershed moment.Across the public sector of the outsourced
0:00:17 > 0:00:22burst dogma has wreaked Kalinic.
0:00:22 > 0:00:23Is Carillion really the beginning of the end for public
0:00:23 > 0:00:25private partnership, the economic model that's dominated
0:00:25 > 0:00:26government policy for decades?
0:00:26 > 0:00:30There is no evidence of chaos and the government is working very hard
0:00:30 > 0:00:34indeed across all Whitehall departments to ensure that the
0:00:34 > 0:00:37liquidation of Carillion takes place in an orderly manner which does not
0:00:37 > 0:00:39disrupt public services.
0:00:39 > 0:00:42Or is it just a bump in the road for a policy that can't
0:00:42 > 0:00:43in practice be reversed?
0:00:43 > 0:00:46We'll ask this Downing Street minister.
0:00:46 > 0:00:50Also tonight:
0:00:50 > 0:00:53Ten different classmates!
0:00:53 > 0:00:56This is how they used to sell sweets to kids.
0:00:56 > 0:01:01And this is now.
0:01:01 > 0:01:04You cannot see very strong advertising but once you start
0:01:04 > 0:01:08getting into the games and into the stories you can see very close
0:01:08 > 0:01:12association with the toys children receive when they get tender eggs.
0:01:12 > 0:01:14Are advertisers gaming the rules on selling sugar?
0:01:14 > 0:01:16And we remember the Cranberries singer Dolores O'Riordan
0:01:16 > 0:01:21who died today aged 46.
0:01:21 > 0:01:28# In your head # In your head
0:01:28 > 0:01:30# Zombie # Zombie
0:01:30 > 0:01:35# Zombie #
0:01:35 > 0:01:37Good evening.
0:01:37 > 0:01:39Should the government be giving a company that's issued
0:01:39 > 0:01:41three profit warnings millions and millions of pounds' worth
0:01:41 > 0:01:43of further contracts?
0:01:43 > 0:01:45The question sadly, is a rhetorical one.
0:01:45 > 0:01:49Shortly after dawn this morning, Carillion declared itself bust.
0:01:49 > 0:01:51It had racked up debts of more than £900 million,
0:01:51 > 0:01:54and a pension deficit of nearly £600 million.
0:01:54 > 0:01:57And even though the first warning came in July,
0:01:57 > 0:02:00the second in September and the third just two months ago,
0:02:00 > 0:02:05back in November, the government continued to ply them with work.
0:02:05 > 0:02:09Is it enthusiasm for the public private ideology, or incompetence -
0:02:09 > 0:02:11that the financial ill health of such a huge company had
0:02:11 > 0:02:18been so badly misread?
0:02:18 > 0:02:22Carillion started out as the construction arm of tarmac in 1999.
0:02:22 > 0:02:28Since then it has built a lot. GCHQ in Cheltenham. High-speed one and
0:02:28 > 0:02:34Heathrow terminal five for example. But it also provides services
0:02:34 > 0:02:39managing 200 operating theatres and 11,800 beds for the NHS for example.
0:02:39 > 0:02:44Or providing cleaning and meals for hundreds of schools. In short
0:02:44 > 0:02:50Carillion is big. In 2016 had recorded £5.2 billion in revenues, a
0:02:50 > 0:02:55third of which, 1.7 billion, came from UK Government contracts. It is
0:02:55 > 0:02:58partly those government construction contracts which got it into trouble
0:02:58 > 0:03:05with cost overruns on two hospitals and £745 million Aberdeen bypass.
0:03:05 > 0:03:09Warning lights have been flashing for a while, in July it had to
0:03:09 > 0:03:13announce an £850 million hit to its contracts and suspend its dividends.
0:03:13 > 0:03:19By last Friday its share price plummeted by 90%. After crisis talks
0:03:19 > 0:03:24with bankers and the Cabinet Office over the weekend it collapsed this
0:03:24 > 0:03:30morning with £900 million in debt and a £587 million deficit leaving
0:03:30 > 0:03:3343,000 employees globally and hundreds of subcontractors wondering
0:03:33 > 0:03:35what will happen next.
0:03:35 > 0:03:36That's the overview.
0:03:36 > 0:03:39Our business editor Helen Thomas has been taking a look
0:03:39 > 0:03:45at the challenges ahead.
0:03:45 > 0:03:51Trains and planes from beautiful art to the beautiful game. Carillion had
0:03:51 > 0:03:56a hand in many parts of UK life. Today the big battle was how to
0:03:56 > 0:04:00manage the fallout from its collapse. Employees and
0:04:00 > 0:04:05subcontractors were asked to report for work as normal today. The
0:04:05 > 0:04:09government wants to make sure crucial services continue before
0:04:09 > 0:04:15contracts are passed to competitors or taken in-house. Huge
0:04:15 > 0:04:19public-private construction projects like the Aberdeen bypass or work on
0:04:19 > 0:04:23each is too will be taken over by joint-venture partners. But some
0:04:23 > 0:04:28firms involved in the non-government work expected take a hit.It's a
0:04:28 > 0:04:32shame.This boss had 30 people sent home today including from work on
0:04:32 > 0:04:39the new Google building in King's Cross.We were turned away from four
0:04:39 > 0:04:42jobs, so those people had to go home. They are trying to replace
0:04:42 > 0:04:46them on other jobs we have got. But if you are in the government side
0:04:46 > 0:04:50you are OK because they will look after you. For us personally we have
0:04:50 > 0:04:58payments due of £200,000 and that will be in line with the company
0:04:58 > 0:05:02like Carillion.The collapse will also cause bigger questions about
0:05:02 > 0:05:06the government use of outsourcing. Critics say it's another example of
0:05:06 > 0:05:11a private company taking its profits, paying dividends in bonuses
0:05:11 > 0:05:14and then leaving the public sector to clean up when things go wrong.
0:05:14 > 0:05:19The industry would disagree, they say Carillion wasn't raking it in,
0:05:19 > 0:05:24in fact it was bidding to aggressively. Some would argue that
0:05:24 > 0:05:29is because the government, its biggest customer, has only cared
0:05:29 > 0:05:36about recent time, price. An independent report last year for the
0:05:36 > 0:05:39business services Association called it a race to the bottom. Our system
0:05:39 > 0:05:43where aggressive price based tenders and the drive to cut costs in the
0:05:43 > 0:05:48time of austerity risked compromising quality of service,
0:05:48 > 0:05:53workers terms and conditions, corporate profits and potentially
0:05:53 > 0:05:57the political and commercial sustainability of the market.I
0:05:57 > 0:06:00think we see played out in front of us that the construction business
0:06:00 > 0:06:05model is not working and we need to address that. You look at the profit
0:06:05 > 0:06:09margins of the top ten contractors it is about 0.8%. Those who are
0:06:09 > 0:06:14doing well would declare about 2% margins and that is not sustainable
0:06:14 > 0:06:18for the level of risk they take and we need to fix that model. It means
0:06:18 > 0:06:23more collaborative working, engaging the supply chain earlier. Not having
0:06:23 > 0:06:32individual bespoke contract which make things even more
0:06:32 > 0:06:33make things even more complicated. It was the coalition government
0:06:33 > 0:06:35which expanded the use of outsourcing and pushed hard to get
0:06:35 > 0:06:38taxpayers a better deal.The point of bringing in private companies to
0:06:38 > 0:06:41do something the government would otherwise do is to take advantage of
0:06:41 > 0:06:46the fact that private companies are often, not always, more efficient.
0:06:46 > 0:06:50And to try to transfer some of the risk of those projects to those
0:06:50 > 0:06:53companies from government and the kind of risk Bustinza costs being
0:06:53 > 0:06:58higher than you might have anticipated and so on. I think the
0:06:58 > 0:07:02government has got better and better at doing this and driving down the
0:07:02 > 0:07:07profit margins of those companies for taxpayers benefit.The collapse
0:07:07 > 0:07:11of Carillion is still likely to focus minds on what could be done
0:07:11 > 0:07:16better.More imagination in the commissioning process. Better
0:07:16 > 0:07:21oversight of the companies as they are doing their job. And better
0:07:21 > 0:07:24intelligence sharing amongst Whitehall departments so that we
0:07:24 > 0:07:29learn from each other's mistakes. It's kind of telling to me that at
0:07:29 > 0:07:36the last general election, I could not see a single mention of
0:07:36 > 0:07:40outsourcing in any shape or form in either of the party 's manifesto
0:07:40 > 0:07:44was.Insiders told a sneak outsourcing had in some places like
0:07:44 > 0:07:49probation become too niche. Overly complicated contracts make it
0:07:49 > 0:07:53impossible to price work properly. Others argue groups like Carillion
0:07:53 > 0:07:56are part of the problem. Not enough companies bidding and the government
0:07:56 > 0:08:03reliant on a handful of big names. This relies on the market for the
0:08:03 > 0:08:08services, outsourcing works well when there is a market there.
0:08:08 > 0:08:11Government, several government in sequence have allowed the emergence
0:08:11 > 0:08:15of giants conglomerates which do all kinds of services, Carillion is one
0:08:15 > 0:08:20of those. There is not the competition and ability to pass the
0:08:20 > 0:08:24services onto another company that the whole thing relied on so to me
0:08:24 > 0:08:30that is where some of failure lies. As the sun sets on Carillion's
0:08:30 > 0:08:34business it might be the outsourcing market which needs refurbishment.
0:08:34 > 0:08:37A little earlier I spoke to Cabinet Office Minister Oliver Dowden.
0:08:37 > 0:08:43I asked him how the government let Carillion go bust.
0:08:43 > 0:08:48The government when it receives its first profit warning from Carillion
0:08:48 > 0:08:52took contingency measures. The principal measure we took was to
0:08:52 > 0:08:55ensure all new contracts were joint-venture contracts. That means
0:08:55 > 0:08:59the risk is shared with other companies and on those contracts
0:08:59 > 0:09:07they continue to be delivered.So you knew then in July you would need
0:09:07 > 0:09:09a contingency plan?Of course if the profit warning is given in respect
0:09:09 > 0:09:15of a company, people that contract with it have to take appropriate
0:09:15 > 0:09:18measures. You would not expect us to stop contracting with them as you
0:09:18 > 0:09:21are not expect any other company to stop contracting with them but you
0:09:21 > 0:09:28would expect us to take precautions. There were three profit warnings and
0:09:28 > 0:09:34as far as we understand eight new contract awarded despite that.It is
0:09:34 > 0:09:37important to understand the context. Eight new contracts but they only
0:09:37 > 0:09:42account for 2% of our ongoing contracts.It doesn't matter, either
0:09:42 > 0:09:48you are looking at the
0:09:51 > 0:09:53you are looking at the financial health of a company which does
0:09:53 > 0:09:55enormous work for our whole country you are not, you are carrying on
0:09:55 > 0:09:58blindly. This was a company that try to delay the payment to its
0:09:58 > 0:10:01contractors by three months instead of 30 days. This was a company being
0:10:01 > 0:10:04short sold in 2013, a company that HSBC divest it a million shares
0:10:04 > 0:10:09worth over the last 12 months. This is a company whose corporate debt
0:10:09 > 0:10:16was downgraded to junk, how many more signs did you need?The concern
0:10:16 > 0:10:21for taxpayers in respect of this was with the company deliver on the
0:10:21 > 0:10:25contracts? Reconstructed them as joint ventures and they have
0:10:25 > 0:10:29continued to deliver. The taxpayer has only paid out on what they have
0:10:29 > 0:10:32delivered on, there has not been a loss to the taxpayer as the result
0:10:32 > 0:10:39of structuring those joint...There has been no extra cost to taxpayers,
0:10:39 > 0:10:43are you sure?There is a cost in expect of the appointment of the
0:10:43 > 0:10:49official receiver, but all the contracts...All of these delays
0:10:49 > 0:10:53will cost the taxpayer more, right? Anything increased and having to
0:10:53 > 0:10:58bring in other contractors will cost the taxpayer more so don't say there
0:10:58 > 0:11:03is no extra cost to taxpayers.The additional cost has been in respect
0:11:03 > 0:11:07of the appointment of the official receiver. If you point an official
0:11:07 > 0:11:12receiver there is a cost associated with that.If you remove competition
0:11:12 > 0:11:15from the sector and allow the same firms to charge more for the
0:11:15 > 0:11:20contract how is that a good deal? It's important we have more
0:11:20 > 0:11:24competition and that is what we have sought to do. When the government
0:11:24 > 0:11:32came to power in 2010 we set a target of 25% of all government
0:11:32 > 0:11:34contracts being awarded to small and medium-sized enterprises. We set
0:11:34 > 0:11:38another target for this government, we are encouraging more small and
0:11:38 > 0:11:43medium-sized enterprises to bid for these contracts...Why would they go
0:11:43 > 0:11:46for it when they see you supporting a company like Carillion which is
0:11:46 > 0:11:53clearly about to go bust?Those contracts have been agreed and they
0:11:53 > 0:11:57have been delivered upon but there are a huge number of other PFI
0:11:57 > 0:12:02contracts going on quite well at the moment. We have over £60 billion
0:12:02 > 0:12:06worth of contracts clearly there is an issue with Carillion but the
0:12:06 > 0:12:11evidence we have seen today is that the impact on the delivery of public
0:12:11 > 0:12:15services has been minimal.Stand back and tell me in the clear light
0:12:15 > 0:12:20of day it made sense to carry on giving Carillion almost £2 billion
0:12:20 > 0:12:25more of contracts when it was in such bad health?As I said those
0:12:25 > 0:12:29contracts first of all only accounted for 2% of the overall
0:12:29 > 0:12:34contract in relation to Carillion and in respect of those contracts...
0:12:34 > 0:12:39It was still £2 billion.They have been delivered upon, taxpayers
0:12:39 > 0:12:44received services in respect to them. And majority are structured as
0:12:44 > 0:12:46joint ventures so the other joint-venture parties are stepping
0:12:46 > 0:12:51up to the plate and continuing to deliver.There is a concern that you
0:12:51 > 0:12:55are so wedded to the ideology of using the private sector it cannot
0:12:55 > 0:13:02be seen to be failing, it's just not allowed.I don't think this is a
0:13:02 > 0:13:05question of ideology.It's either ideology or incompetence.Third of
0:13:05 > 0:13:11these contracts were awarded under the last Labour government, a third
0:13:11 > 0:13:14under the coalition and the third under this government. They have
0:13:14 > 0:13:18been proven to the liver successfully. Over £60 billion worth
0:13:18 > 0:13:24of contracts agreed. If you look at the picture as we speak now those
0:13:24 > 0:13:27services continued to be delivered. There has not been a disruption to
0:13:27 > 0:13:33the users of those public services. The public takes the risk and the
0:13:33 > 0:13:36private companies take all the profits. That is how this is
0:13:36 > 0:13:40perceived.It's hard to say that the private company has not taken the
0:13:40 > 0:13:44cost, those people who have bought shares in Carillion are unlikely to
0:13:44 > 0:13:49receive the money back in respect of them.20,000 people worrying about
0:13:49 > 0:13:56their job of the first CEO is still receiving a salary and will continue
0:13:56 > 0:14:00to do so until October.You raise two important points, in respect of
0:14:00 > 0:14:04people being worried about their jobs this is a regrettable situation
0:14:04 > 0:14:07but those people working in respect of the public sector can be assured
0:14:07 > 0:14:12we will continue to pay out on those contracts. They should carry on
0:14:12 > 0:14:15going to work as normal. In respect of your concerns about the payments
0:14:15 > 0:14:20which I been made to the person in question...For workers to hear they
0:14:20 > 0:14:24should carry on going to a job and they look at Richard house, former
0:14:24 > 0:14:30CEO still receiving a
0:14:30 > 0:14:32CEO still receiving a salary and will do so until October, is that
0:14:32 > 0:14:35fair?There are serious questions to be answered. But that has to be done
0:14:35 > 0:14:40by the official receiver. They are looking into this and I don't want
0:14:40 > 0:14:42to prejudice those independent enquiries by the official receiver
0:14:42 > 0:14:47into exactly the sort of points. Minister I asked you a question, is
0:14:47 > 0:14:51it fair, from where you are sitting, is it fair that the CEO who fail to
0:14:51 > 0:14:55turn the company into something that can provide jobs and services is
0:14:55 > 0:14:59still getting paid a salary until October?Of course it is not fair
0:14:59 > 0:15:03and of course I understand people's concerns over the rest but it is a
0:15:03 > 0:15:09matter which has to be considered by the process for doing it and it's
0:15:09 > 0:15:14not helpful to prejudge it.Oliver Dowden, thank you.
0:15:14 > 0:15:17Nick Watt our political editor is here.
0:15:17 > 0:15:23What do you take away from today?We have rare agreement among senior
0:15:23 > 0:15:26Labour and Conservative people that this may well be a defining moment
0:15:26 > 0:15:31for this country. You were playing earlier that clip from Jeremy
0:15:31 > 0:15:35Corbyn, saying this is a watershed moment and we should end up -- end
0:15:35 > 0:15:38rip-off private desires is in. I was speaking to one senior Tory thinker
0:15:38 > 0:15:43who said this is really bad for us, the Conservative Party, he said. He
0:15:43 > 0:15:47said it plays into the metanarrative that we are Tories are about
0:15:47 > 0:15:51protecting our private sector friends come even though, is this
0:15:51 > 0:15:55person said, most of this process started under Tony Blair.So who do
0:15:55 > 0:16:01you think is under pressure tonight actually?Their lot of questions
0:16:01 > 0:16:06about Chris Grayling, because he has Transport Secretary approved and HS2
0:16:06 > 0:16:11contract for a Correlli Consortium just after had issued that -- eight
0:16:11 > 0:16:16Carillion Consortium. The Transport Secretary is like the cavity of the
0:16:16 > 0:16:22cat, he always escapes, how longer can this go on. Important to say
0:16:22 > 0:16:26Chris Grayling's department so that was a three strong consortium and
0:16:26 > 0:16:31the other parties in that contract will cover any cost overruns or any
0:16:31 > 0:16:36delay. But real pressure in the Treasury. They are taking a very
0:16:36 > 0:16:39deep breath tonight, because as the government says, this is not a
0:16:39 > 0:16:43bailout of the company, but it is a lifeline to those areas where there
0:16:43 > 0:16:49are public contracts from Karelian, and that, the Treasury are saying,
0:16:49 > 0:16:52will cost them a lot of money -- from Carillion.
0:16:52 > 0:16:55Labour MP Stella Creasy has long campaigned against how
0:16:55 > 0:16:57the government awards its large contracts.
0:16:57 > 0:17:02She is with us now. Nice to see you. Your leader Jeremy Corbyn, we played
0:17:02 > 0:17:08the clip at the beginning, called this a watershed moment, but the
0:17:08 > 0:17:12outsource of first dogma may now be over. Do you think it is a moment
0:17:12 > 0:17:16when everything changes?I hope so, I have been particularly concerned
0:17:16 > 0:17:20about private finance contracts for many years because I had seen the
0:17:20 > 0:17:24impact first and in my local hospital at whips cross. I call them
0:17:24 > 0:17:27the legal loan sharks of the public sector. It is an incredibly
0:17:27 > 0:17:34expensive way to borrow. We were told the reasons for using these
0:17:34 > 0:17:37companies is that you would transfer the risks that might come from
0:17:37 > 0:17:41Public Company is to the private sector. What the Carillion issue
0:17:41 > 0:17:48does is it blows apart that myth. But it doesn't clear up what happens
0:17:48 > 0:17:51next, does it? The government doesn't have the expertise to manage
0:17:51 > 0:17:56these projects, the construction knowledge. They are not really going
0:17:56 > 0:18:00to disentangle themselves from these companies, right?No, and it was
0:18:00 > 0:18:04very noticeable in the house that when the minister was pressed
0:18:04 > 0:18:07particularly about PFI contracts, and committing not to give a penny
0:18:07 > 0:18:11more to these companies and try to give these services back in house
0:18:11 > 0:18:14committee can give an answer, because they don't know. You look at
0:18:14 > 0:18:17these contracts, there is as much power for the banks and the lenders
0:18:17 > 0:18:22as there is for the public sector in it. Outsourcing has gone up 125%
0:18:22 > 0:18:25under this government and it is very clear that government doesn't have
0:18:25 > 0:18:28the skills and the expertise to manage that volume of private
0:18:28 > 0:18:34contracts and other taxpayer will pay the price.So you wouldn't want
0:18:34 > 0:18:39to see Jeremy Corbyn, where everything became with an estate
0:18:39 > 0:18:42remit?We have to look at these contracts because a lot of the
0:18:42 > 0:18:46clauses would mean it would cost a hell of a lot of money to bring them
0:18:46 > 0:18:49in-house. That is why I have been calling for a windfall tax on the
0:18:49 > 0:18:54PFI companies. It has been clear they have benefited from corporation
0:18:54 > 0:18:59tax being reduced. There is a very strong case for the public sector in
0:18:59 > 0:19:03try to get some value for money out of these contracts to introduce a
0:19:03 > 0:19:06windfall tax, and to get these companies go there only a few of
0:19:06 > 0:19:10them around doing it, around the table at the Treasury. Why I don't
0:19:10 > 0:19:14understand is why the Treasury has not done any of this thinking?It is
0:19:14 > 0:19:20not as if a windfall tax would have made Carillion work any better, the
0:19:20 > 0:19:24last thing that company needed was an extra tax, right?But it would
0:19:24 > 0:19:27have made Carillion think about how it manages its public contracts. I
0:19:27 > 0:19:32am struck by the fact that in June last year the NHS must have known
0:19:32 > 0:19:35that there was in difficulty with the Royal Liverpool hospital, get in
0:19:35 > 0:19:38July we saw the Department for Transport giving them a whole series
0:19:38 > 0:19:43of contracts of they issued a profit warning. One arm of government is
0:19:43 > 0:19:47not talking to the other or we are giving these companies contracts
0:19:47 > 0:19:51because they cannot afford to fail. What makes you think that having the
0:19:51 > 0:19:56whole project under that government umbrella would be any more
0:19:56 > 0:20:00successful then?The first thing you have to do is develop a Domesday
0:20:00 > 0:20:04book, and some people have talked about this, we know what it is we
0:20:04 > 0:20:07owe and to whom, because the Treasury doesn't even hold that
0:20:07 > 0:20:10information century, Sarita Devi know how much we are in hock with.
0:20:10 > 0:20:16The government wants to tell you PFI has
0:20:17 > 0:20:19has delivered £750 billion worth of investment but editors at a £200
0:20:19 > 0:20:22billion cost.
0:20:22 > 0:20:25The keeper coming in.
0:20:25 > 0:20:26Ten years ago it was fat.
0:20:26 > 0:20:28Now public health enemy one is sugar.
0:20:28 > 0:20:31This year marks the introduction of the sugar tax -
0:20:31 > 0:20:33we've already seen some of the naming and shaming
0:20:33 > 0:20:35of companies that aren't prepared to reduce sugar content.
0:20:35 > 0:20:37This programme has been looking into whether companies are adhering
0:20:37 > 0:20:40to the new rules of online sugar advertising that emerged six months
0:20:40 > 0:20:43ago - and our enquiries have been changing corporate policy,
0:20:43 > 0:20:50as James Clayton reports.
0:20:59 > 0:21:04About 50% of all the sugar consumed in the UK comes from this,
0:21:04 > 0:21:07British sugar beans, and for factories like this
0:21:07 > 0:21:11one behind me, well, business is booming.
0:21:11 > 0:21:14But the government is trying to make us eat less sugar.
0:21:14 > 0:21:16In April this year, the sugar tax will come into force,
0:21:16 > 0:21:19Public Health England will name the companies that have
0:21:19 > 0:21:21and haven't reduced their sugar and fat content in March,
0:21:21 > 0:21:23and strict new rules around advertising to
0:21:23 > 0:21:28children came in last year.
0:21:28 > 0:21:30But the reaction by companies to these measures has
0:21:30 > 0:21:32been, well, varied.
0:21:32 > 0:21:36Hurry, hurry, it's the Crazy Crocos!
0:21:36 > 0:21:42Back in the day, advertising rules were a lot more relaxed.
0:21:42 > 0:21:45Ten years ago, a review found that 80% of all food advertising
0:21:45 > 0:21:48expenditure in children's airtime on terrestrial channels was for
0:21:48 > 0:21:53foods high in salt, sugar or fat.
0:21:53 > 0:21:56Well, everybody knows, Frosties taste great!
0:22:00 > 0:22:03In 2008, rules were brought in to stop these kind of adverts
0:22:03 > 0:22:05being shown on children's TV, rules that were extended
0:22:05 > 0:22:10to cover online advertising and material six months ago.
0:22:10 > 0:22:13The Milky Bars are on me!
0:22:14 > 0:22:15What does that mean?
0:22:15 > 0:22:19Well, here is the Chief Executive of the Advertising Standards Authority.
0:22:19 > 0:22:24So just be clear, if you are advertising to children,
0:22:24 > 0:22:31and you're advertising for sweets or junk food, you shouldn't be
0:22:31 > 0:22:32allowed to advertise to those children?
0:22:32 > 0:22:34That's right, that's right, and children are defined
0:22:34 > 0:22:36as anyone who's under 16, so it's children, and actually it's
0:22:36 > 0:22:40young people, as well.
0:22:40 > 0:22:42But Newsnight has been given examples of online material that
0:22:42 > 0:22:46campaigners believe push those rules to the limit.
0:22:46 > 0:22:49The Kinder brand makes chocolate products aimed at children,
0:22:49 > 0:22:51and their website, Magic Kinder, has a series of games
0:22:51 > 0:22:55also aimed at children.
0:22:55 > 0:22:57Some have referred to these kinds of games as adver-games,
0:22:57 > 0:23:04and questioned whether they should be allowed at all.
0:23:05 > 0:23:09So what we've got here is the Magic Kinder website,
0:23:09 > 0:23:12so "magic" is the dominant word, but "Kinder" is there
0:23:12 > 0:23:17as well, and you can see their games, targeting 3+, 5+.
0:23:17 > 0:23:20Now you can't see very strong Kinder advertising,
0:23:20 > 0:23:23but once you start getting into the games, and into
0:23:23 > 0:23:27the stories, you can see very close association,
0:23:27 > 0:23:30with the toys that children receive when they get Kinder Eggs.
0:23:30 > 0:23:32I think they're not upholding the spirit of the rules.
0:23:32 > 0:23:35It seems to me that many of them are playing around in the grey areas
0:23:35 > 0:23:38of what is targeting adults or children.
0:23:38 > 0:23:41Adver-games are caught by exactly the same ban
0:23:41 > 0:23:43on advertising to children, when it comes to products that
0:23:43 > 0:23:47are high in fat, salt and sugar, as any other form of advertising is,
0:23:47 > 0:23:50so you should not be, if you are a company with a brand
0:23:50 > 0:23:53that is high in fat, salt or sugar, you should not be
0:23:53 > 0:23:55producing an adver-game for that brand that targets children,
0:23:55 > 0:24:01that appeals to children.
0:24:01 > 0:24:03The big question here, then, is does this constitute
0:24:03 > 0:24:05an adver-game at all, or are they simply fun
0:24:05 > 0:24:06video games for kids?
0:24:06 > 0:24:09In a statement to Newsnight, Kinder said...
0:24:22 > 0:24:26No products are visible, but the toys in them are.
0:24:26 > 0:24:29Since Newsnight told Kinder we were doing the story,
0:24:29 > 0:24:32the company has said it will now place an age restriction
0:24:32 > 0:24:33on the games.
0:24:33 > 0:24:41The Advertising Standards Authority is looking into the websites.
0:24:42 > 0:24:45There are other areas, too, that are difficult to police.
0:24:45 > 0:24:48Take the Chewits Facebook page.
0:24:48 > 0:24:51You have to be over 13 to have a Facebook account,
0:24:51 > 0:24:53and here Chewits aren't paying for advertising, they're just
0:24:53 > 0:24:59updating their home page, but what about posts like this one?
0:25:04 > 0:25:07The important thing here is to make sure if you are an advertiser
0:25:07 > 0:25:10and you are using Facebook, as a communicating channel
0:25:10 > 0:25:16to get through to people, is to make sure that you are not
0:25:16 > 0:25:18you are not targeting under-16s with your advertising
0:25:18 > 0:25:21for your products that are high in fat, salt or sugar.
0:25:21 > 0:25:24And of course also to make sure that you are complying with the tougher
0:25:24 > 0:25:27content rules for ads, even assuming you're not doing that.
0:25:27 > 0:25:29Chewits told Newsnight that the vast majority of people interacting
0:25:29 > 0:25:34with the Chewits page are over 16.
0:25:34 > 0:25:37There's not much doubt that advertising to children works.
0:25:37 > 0:25:39A YouGov poll, commissioned by Cancer Research UK,
0:25:39 > 0:25:42and given to Newsnight, found that 11-to-19-year-olds
0:25:42 > 0:25:45with high ad exposure were almost three times more likely to have
0:25:45 > 0:25:49diets high in salt, sugar and fats.
0:25:49 > 0:25:51And where did the survey find that those young
0:25:51 > 0:25:53people watched those ads?
0:25:53 > 0:25:57Well, on daytime TV, sports channels, reality TV,
0:25:57 > 0:26:03and, most commonly, on entertainment shows.
0:26:03 > 0:26:10So if you look at viewing figures of the programmes most
0:26:10 > 0:26:12popular with children, it is that Saturday night
0:26:12 > 0:26:13family viewing slot.
0:26:13 > 0:26:16Those advertising breaks are absolutely crammed full
0:26:16 > 0:26:19of junk food adverts, so we found in a study
0:26:19 > 0:26:21where we looked at adverts around The Voice, and Hollyoaks
0:26:21 > 0:26:24and The Simpsons, that of the food and drink in the adverts,
0:26:24 > 0:26:2660% of them were for junk food.
0:26:26 > 0:26:29So what we would like to see is a nine o'clock watershed
0:26:29 > 0:26:30on junk food marketing.
0:26:30 > 0:26:32But for some, this is a step too far.
0:26:32 > 0:26:34You know, a lot of these foods appeal to adults,
0:26:34 > 0:26:37and these companies have a right to advertise their foods to adults.
0:26:37 > 0:26:39These programmes, the Saturday night programmes, are watched
0:26:39 > 0:26:42by massive adult audiences, and I think it is perfectly fair
0:26:42 > 0:26:45that they should be allowed to advertise to them.
0:26:48 > 0:26:51It is not just family shows that are in the cross hairs
0:26:51 > 0:26:53of sugar campaigners.
0:26:53 > 0:26:56The rules on advertising to children on TV haven't changed for ten years,
0:26:56 > 0:27:01and some believe those rules should be tightened.
0:27:01 > 0:27:03Coco Pops is not allowed to be advertised on children's TV,
0:27:03 > 0:27:05but Coco Pops Granola, a less sugary variant
0:27:05 > 0:27:09of Coco Pops, can be.
0:27:09 > 0:27:18This kind of falls into a grey area, because, on one hand,
0:27:18 > 0:27:20Kellogg's have created a product, and reformulated a product,
0:27:20 > 0:27:24which reduced the amount of sugar so that it is OK to be advertised
0:27:24 > 0:27:26on kids' TV, and we want to encourage big
0:27:26 > 0:27:27corporations like Kellogg's to reformulate their products.
0:27:27 > 0:27:31On the other hand, it allows them to get the Coco Pops brand
0:27:31 > 0:27:33in front of children, on children's TV, and Coco Pops
0:27:33 > 0:27:37are one of the unhealthiest breakfast cereals on the market.
0:27:37 > 0:27:39Hey, want to try my new Coco Pops porridge?
0:27:39 > 0:27:42But how do we heat up the milk?
0:27:42 > 0:27:44Kellogg's is changing its cereals, though.
0:27:44 > 0:27:47Coco Pops will see a 40% reduction in sugar this year,
0:27:47 > 0:27:49and the company says it is completely appropriate
0:27:49 > 0:27:55for Coco Pops Granola to advertise in kids' airtime.
0:27:55 > 0:27:58Half the sugar us kids eat and drink each year comes
0:27:58 > 0:28:00from snacks and sugary drinks.
0:28:00 > 0:28:03Public Health England will publish its updated nutrient
0:28:03 > 0:28:04profile later this year, and they're expected
0:28:04 > 0:28:06to tighten rules on sugar.
0:28:06 > 0:28:08That would mean products like Coco Pops Granola,
0:28:08 > 0:28:11in its current formula, may not be able to advertise
0:28:11 > 0:28:17in kids' media in the future.
0:28:17 > 0:28:19You'll be hearing a lot more about sugar this year,
0:28:19 > 0:28:21and it's not just in advertising.
0:28:21 > 0:28:22Unsurprisingly, industry doesn't like the sugar tax
0:28:22 > 0:28:25or stricter advertising rules.
0:28:26 > 0:28:28The Food and Drink Federation prefers a voluntary
0:28:28 > 0:28:32sugar reduction target.
0:28:32 > 0:28:35It sounds like a lot of where you guys are is, actually,
0:28:35 > 0:28:37you quite like the status quo, and you don't want anything
0:28:37 > 0:28:39to change, is that fair?
0:28:39 > 0:28:42I would love the status quo, but it is not what we have got,
0:28:42 > 0:28:44what we have got is a world of constant change.
0:28:44 > 0:28:47I mean, we have had endless new initiatives on public health
0:28:47 > 0:28:48the last few years...
0:28:48 > 0:28:50So you want nothing to change?
0:28:50 > 0:28:53What I want is a little bit of stability to complete the work
0:28:53 > 0:28:54that we are currently on...
0:28:54 > 0:28:56So it's just, "trust us, we'll do it"?
0:28:56 > 0:28:58Well, the government set us a challenge, it's
0:28:58 > 0:29:00given us a deadline, it said if we don't hit that,
0:29:00 > 0:29:02it will consider doing more.
0:29:02 > 0:29:04That's a perfectly reasonable position for government to take.
0:29:04 > 0:29:07So let's see where we get to in 2020 before we start
0:29:07 > 0:29:08doing other new things.
0:29:08 > 0:29:10But the lesson from advertising is clear: companies are reluctant
0:29:10 > 0:29:13to change until they are told to do so.
0:29:13 > 0:29:15Unless the food and drink industry shows progress on reducing sugar,
0:29:15 > 0:29:23the government may well look to get even tougher.
0:29:26 > 0:29:29Mario Testino and Bruce Weber are the latest names to be shunned
0:29:29 > 0:29:32by fashion magazines after allegations of sexual abuse.
0:29:32 > 0:29:34They both deny the claims but
0:29:34 > 0:29:36Conde Naste publications - including Vogue - has said it
0:29:36 > 0:29:38will not be working with them in the foreseeable future.
0:29:38 > 0:29:41Once again, it shines a spotlight on an industry that has
0:29:41 > 0:29:43often seemed closed.
0:29:43 > 0:29:45It raises a more visceral and fundamental question,
0:29:45 > 0:29:47how does the fashion industry operate and how much protection
0:29:47 > 0:29:51is there for those who work in it?
0:29:51 > 0:29:53I'm joined by Caryn Franklin - Broadcaster, fashion commentator
0:29:53 > 0:30:00and former fashion magazine editor.
0:30:00 > 0:30:05Nice to have you here. Does any of this surprise you, any of the
0:30:05 > 0:30:10allegations or the response to it so far, allegations which are denied of
0:30:10 > 0:30:15course.Not of the latest names, I have been writing about predatory
0:30:15 > 0:30:19behaviour since 2013. A lot later than some had been talking about it.
0:30:19 > 0:30:27In the fashion industry specifically?Yes, by photographers.
0:30:27 > 0:30:30I was receiving stories on social networking from models who told me
0:30:30 > 0:30:34there are stories and they named photographers who are now being
0:30:34 > 0:30:42talked about.That was 2013, five years ago. Why has this been such a
0:30:42 > 0:30:47slow burn?There is a real struggle I think in the fashion industry,
0:30:47 > 0:30:53recognition of high status professionals overstepping
0:30:53 > 0:30:56boundaries when there is getting the shot that everybody thinks they
0:30:56 > 0:31:00want. We have a culture that hypersexual eyes is young people and
0:31:00 > 0:31:06thinks nothing of it. Not all of us agree with that sober is
0:31:06 > 0:31:11countercultural conversation around that. But campaigns, multi-billion
0:31:11 > 0:31:19pound campaigns are often created around that sort of arousal factor,
0:31:19 > 0:31:24the excitement factor which involves objectification of women and
0:31:24 > 0:31:28increasingly young men.Is at the same set of circumstances that we've
0:31:28 > 0:31:33seen in the movie industry, vulnerable figure at the centre and
0:31:33 > 0:31:38huge amounts of money and power on the top or is it something even less
0:31:38 > 0:31:44overt?There is a similarity of course but what you have got as an
0:31:44 > 0:31:49extra imbalance is you have got a very young, inexperienced model who
0:31:49 > 0:31:53is not given a voice, who is expected to be compliant and remain
0:31:53 > 0:32:00silent and serve the shoot with their body and do as they are told.
0:32:00 > 0:32:04Monetarily you are in a very precarious position as you don't
0:32:04 > 0:32:08know when the next contract is coming as a model.A young male
0:32:08 > 0:32:13model I spoke to said he suspected his agent had sent him to the
0:32:13 > 0:32:19photographer specifically to be preyed upon, under the guise that he
0:32:19 > 0:32:23was going for a test at his home. Nothing was happening at the studio
0:32:23 > 0:32:26but the photographer wanted to see him and this could lead to a big
0:32:26 > 0:32:31campaign. The conversation is on the part of model agents that this could
0:32:31 > 0:32:36be a big money earner not just for you but for us.So when you see
0:32:36 > 0:32:43Conde Naste publications singly will no longer take the work of Mario
0:32:43 > 0:32:46Testino for example who has denied these allegations, how long does
0:32:46 > 0:32:52this last?I don't know the answer to that. What has changed is the
0:32:52 > 0:32:58fashion industry is not riding the crest of big budgets in the way it
0:32:58 > 0:33:04was. All brands are looking to make sure they can survive. The expansion
0:33:04 > 0:33:09plans...So this is about ethics at all?It's about the brand not being
0:33:09 > 0:33:16damaged. I believe people dead because the story was rife and being
0:33:16 > 0:33:22passed around.You believe important figures in the industry, the heads
0:33:22 > 0:33:28of magazines, editors, knew this was going on?There has been a lot of
0:33:28 > 0:33:31conversation and generally people felt powerless. It took independents
0:33:31 > 0:33:35like me and others to be talking about it but also to be ignored
0:33:35 > 0:33:43because we don't have that kind of power to action change.You raised
0:33:43 > 0:33:49it in 2013, how easy was it to name names?I raised the appalling
0:33:49 > 0:33:53spectre of Terry Richardson who was creating situations where young
0:33:53 > 0:34:00women felt hugely coerced to behave in a sexualised way. But he was also
0:34:00 > 0:34:06documenting himself engaging in a range of behaviours that were very
0:34:06 > 0:34:13unprofessional. That, to a certain extent, was deemed to be edgy and
0:34:13 > 0:34:17out there and was supported despite the fact that many young women were
0:34:17 > 0:34:22saying they felt appalled and unprotected when they walked into
0:34:22 > 0:34:28the situation. This was a conversation that took place over
0:34:28 > 0:34:32quite a few years and I even resorted to pressure rising art
0:34:32 > 0:34:39directors not to work with Terry Richardson. I would have one-on-one
0:34:39 > 0:34:42conversations with them.You understand I have to say he has
0:34:42 > 0:34:45denied all those allegations but thank you very much for coming in,
0:34:45 > 0:34:48Caryn Franklin.
0:34:48 > 0:34:50The Irish President has tonight paid tribute to The Cranberries
0:34:50 > 0:34:52singer Dolores O'Riordan following her death in London.
0:34:52 > 0:34:55He called her the voice of a generation for anyone who grew
0:34:55 > 0:34:57up in Ireland in the 1990s, and for all those who
0:34:57 > 0:34:59loved her overseas.
0:34:59 > 0:35:07# But I'm in so deep, you know I'm such a fool for you,
0:35:07 > 0:35:12# You've got me wrapped around your finger,
0:35:12 > 0:35:15# Do you have to let it linger?
0:35:15 > 0:35:20# Do you have to, do you have to, do you have do let it linger?#
0:35:20 > 0:35:23The Cranberries sold 40 million records worldwide and became best
0:35:23 > 0:35:25known for their album, No Need To Argue,
0:35:25 > 0:35:26which went to number one
0:35:26 > 0:35:33in Australia, France and Germany, and number six in the United States.
0:35:33 > 0:35:35Eoghan McDermott worked on the Irish version of The Voice
0:35:35 > 0:35:38with Dolores O'Riordan.
0:35:38 > 0:35:43It is nice of you to join us, this must have come as a huge shock and I
0:35:43 > 0:35:48am wondering how you are thinking of her tonight?It is a shock first and
0:35:48 > 0:35:54foremost. I think we covered a lot on the radio show the news as it
0:35:54 > 0:35:59broke and I think the overwhelming sentiment from people coming in was
0:35:59 > 0:36:03exactly that, shock because she was so young and a mother and now the
0:36:03 > 0:36:06focus is on the music and the Cranberries and the legacy but she
0:36:06 > 0:36:12is a mother of three children as well. So, sorrow but also a lot of
0:36:12 > 0:36:17people, particularly women reaching out and seeing how amazing they
0:36:17 > 0:36:21found Dolores, how great it was in the 90s, pre-the Internet being so
0:36:21 > 0:36:27dominant just to have a feisty and frustrated angry and intelligent,
0:36:27 > 0:36:33flawed but brilliant header went to so it reflects on the music and the
0:36:33 > 0:36:42person simultaneously.It was her voice, known for their mix of rock
0:36:42 > 0:36:49and folk but predominantly it was that voice which resonated with the
0:36:49 > 0:36:53public wasn't it?Yeah, and again I think the reflection today was on
0:36:53 > 0:36:59the Cranberries and Dolores as they voiced of the Cranberries, people
0:36:59 > 0:37:07have paid tribute to the big songs like Linger and Zombie, songs which
0:37:07 > 0:37:11reached across political and cultural lines and these days bands
0:37:11 > 0:37:14like Cranberries would be played on indie rock or alternative stations
0:37:14 > 0:37:18but at the height of their powers they were on the present. They also
0:37:18 > 0:37:25broke America which is the holy grail for any band which has English
0:37:25 > 0:37:29as their first language.An extraordinary thing to be able to
0:37:29 > 0:37:37look back on. You work with her at the The Voice, tell us how you will
0:37:37 > 0:37:41remember her, watching was like?I think when she was announced as a
0:37:41 > 0:37:46coach on The Voice nobody could believe it. Everyone was genuinely
0:37:46 > 0:37:49shocked, we got to know her a little. She admitted she had never
0:37:49 > 0:37:54seen the show, the Irish or, any of the shows anywhere in the world so
0:37:54 > 0:37:58we asked why she did it and she said my girl likes it and said I should
0:37:58 > 0:38:04do it so I did it. The other coaches, we had Sharon from the
0:38:04 > 0:38:11chorus, other Irish acts who have sold millions of records but when
0:38:11 > 0:38:15Dolores was announced people were flabbergasted, she had that legacy
0:38:15 > 0:38:22and that weight. As a person very low-key, very
0:38:23 > 0:38:25low-key, very warm, an producible the producer of the programme said
0:38:25 > 0:38:28on the radio today but in the best possible way. She took direction
0:38:28 > 0:38:35from nobody and was a liability in the warmest way.A real coup for
0:38:35 > 0:38:39them to get her. We often think of the massive worldwide success and
0:38:39 > 0:38:44the 40 million records but coming back to her Irish identity was
0:38:44 > 0:38:50absolutely crucial to her wasn't it? Yeah, she was from Limerick which
0:38:50 > 0:38:55very wrong way had a bad reputation in the 90s which it has now
0:38:55 > 0:39:00outgrown, it is a beautiful and vibrant city. As well as being, it's
0:39:00 > 0:39:03great to celebrate Hometown hero was doing well but I think she really
0:39:03 > 0:39:09lifted a city which had gotten an unfair rap. Some of the songs from
0:39:09 > 0:39:15the Cranberries will forever be included in the pantheon of great
0:39:15 > 0:39:19songs, their legacy forevermore is sealed which makes it all the more
0:39:19 > 0:39:25tragic because she was only 46 and as people know was in London for a
0:39:25 > 0:39:28recording session so there must have been new music on the horizon. She
0:39:28 > 0:39:32was back with the Cranberries and she had a side project. There was a
0:39:32 > 0:39:38lot more to come and it's just really sad.Thank you for talking to
0:39:38 > 0:39:41us tonight, we really appreciate it.
0:39:41 > 0:39:42Just before we go...
0:39:42 > 0:39:44Nick's back - Nick, a word on a momentous
0:39:44 > 0:39:48day for Momentum - Nick, tell us...
0:39:48 > 0:39:54The founder of Momentum and supporter of Tony Ben led a
0:39:54 > 0:39:56landslide victory on to the National Executive Committee of the Labour
0:39:56 > 0:40:00Party will stop three of his supporters are on that committee and
0:40:00 > 0:40:04it's a historic day for the Labour Party because they left for so long
0:40:04 > 0:40:09written off as a marginal force now effectively are in the majority on
0:40:09 > 0:40:14the body.Interesting story in The Times tomorrow seeing the so-called
0:40:14 > 0:40:19centrist Labour MPs, if you can go ahead and deselect some of these MPs
0:40:19 > 0:40:22then they would resign the Labour whip and set as their own bloc in
0:40:22 > 0:40:26parliament but we will see. They have made these threats in the past,
0:40:26 > 0:40:29they are not in the ascendancy in the Labour Party so we will see how
0:40:29 > 0:40:32it goes.Thank you.
0:40:32 > 0:40:34That's it for today, which is of course Blue Monday,
0:40:34 > 0:40:35the saddest day of the year.
0:40:35 > 0:40:38The mathematics behind the concept was created in 2005
0:40:38 > 0:40:40by a psychologist called Cliff Arnall, after a travel company
0:40:40 > 0:40:42commissioned him to prove that everyone should cheer up
0:40:42 > 0:40:44by booking their summer holidays round about now.
0:40:44 > 0:40:47Cliff proved it all a bit too convincingly, and a pseudo
0:40:47 > 0:40:48science legend was born.
0:40:48 > 0:40:51We got in touch with him today to see what he now thought
0:40:51 > 0:40:54about his discovery and he told us - quote - "Don't believe
0:40:54 > 0:40:55a word of it."
0:40:55 > 0:40:56But of course we do.
0:40:56 > 0:40:59And so we leave you with this - Cliff Arnall's immortal
0:40:59 > 0:41:00Blue Monday proof equation.
0:41:00 > 0:41:06Goodnight.