13/03/2018 Newsnight

TRANSLATION: I don't care. I

couldn't care less.

Ever get the feeling

someone's laughing at you?

He was actually laughing

at accusations of US

election interference,

but President Putin might as well

have been talking about Salisbury.

So what, if anything,

can we do about Russia?

One option - kick Russian state

television out of Britain?

Or maybe boycott the World Cup?

But is there really anything

we can do to intimidate

such a large nation?

There have been declarations

of solidarity today from the US

to France and Germany -

but how far will their support

extend beyond rhetoric?

What kind of strategy will work?

We'll reflect on the choices,

or lack of them.

Meanwhile, it's goodbye from him.

US Secretary of State Rex Tillerson

has been shown the door,

which means the West is not

at its most cohesive - in fact,

not even the West Wing is.

Is US foreign policy in disarray,

or has Trump now found someone

who can see it his way?

And puzzle time: which Disney

character has the chancellor

likened himself to?

But what is a Tigger?

# The wonderful thing about tiggers

# Is tiggers are wonderful things!

# Their tops are made out

of rubber

# Their bottoms are

made out of springs!

Yes, some upbeat economic news

in his spring statement gives

Philip Hammond a spring

in his step.

# I'm the only one!

Time, then, to ask

whether it's time to ease

the squeeze on public spending.

Hello.

Yesterday, the Prime Minister had

said Russia should tell us what it

knows about the Salisbury attack

by the end of today.

Her time horizon was quickly

hardened into a theatrical midnight

deadline for the Russians

to respond, and we

are not far off that.

Today, we heard a Russian response -

Moscow says Britain must supply

samples of the poison found

on Mr Skripal and his daughter,

and anyway denies any

involvement in the attack.

It's perhaps unsurprising that

the Russians are not playing ball.

But it leaves a challenge

for Theresa May as tomorrow -

to mix metaphors -

the ball now lies in her court.

What does Britain do?

The helpful news for her is that

from Germany to France

even to the White House,

there is now increasing

support from close allies.

Here's Mark Urban.

Britain set the timescale,

little more than 24 hours for Russia

to come up with answers

on the poisoning in Salisbury.

But it's a type of pressure that's

not likely to cow president Putin.

I think it's very difficult

to see whether the Kremlin

is worried or not.

But if we judge purely

by what is in the Russian press

and the Russian newspapers, it

is not on the front pages anywhere,

including on the main

internet websites.

And it doesn't seem to be

that this is the core issue

which is going to dominate

the remaining several days

of the Russian election campaigning.

It is quite remarkably absent

for the kind of crisis

that is looming on the horizon

from public opinion.

And asked today about Britain's

challenge, Russian Foreign

Minister Sergey Lavrov responded

with one of his own.

TRANSLATION: We immediately

requested through an official note

access to that chemical agent

so that our experts could

analyse it in accordance

with the Chemical

Weapons Convention.

So, time is short for Russia,

but they aren't going to buckle.

The march of minutes also prompts

questions for the UK's allies.

Since late last week,

British diplomats have been

consulting European capitals,

often reluctant to sanction Russia

in the past, gauging their appetite

for tough action now.

It's a very complicated issue.

We have certain very large European

countries like Germany,

France and Italy, where the

sentiment is not as firm on Russia

as we see in other countries.

So it is still an open question.

But I think there is a universal

condemnation of this kind of attack.

But what the EU will do

is still not very clear.

And unfortunately, we have

seen in the past that

sometimes tough talk has not

followed by concrete action.

And President Trump,

often assailed by critics

for being in Putin's thrall,

says Russia must now

provide clear answers.

It sounds to me like they believe

it was Russia and I would certainly

take that finding as fact.

It will be organised in Russia!

For many European countries

the question may be

whether they are prepared to boycott

the football World Cup in Russia.

Germany are the reigning champions,

but interestingly, even Germany's

bestselling tabloid could be ready

to advocate a boycott.

I think there are things

beyond football.

So in the case that, for example,

Prime Minister May would ask

for a British boycott

of the World Cup, and would ask Nato

allies in Europe, in the West,

to join into the boycott,

I would say we as a newspaper,

a news organisation,

would not be in favour of turning

down a request.

We would be in favour

of supporting that request.

And as the last hours of Mrs May's

ultimatum trickle away,

it's time also for her to decide

what steps the UK

should take on its own.

From expelling spies

in the Russian Embassy -

which today tweeted out a series

of messages warning Britain

against tough action -

to imposing so-called Magnitsky

law-type sanctions on Russian

officials or even using GCHQ

capabilities

against the Kremlin.

Well, cyber-countermeasures

are something that has

to by definition happen

in the shadows, so to say.

In the classified domain,

through the intelligence agencies

of the British Government

or European governments

and the United States.

This is also something that has been

discussed during the Obama

administration in the

United States, during

the election interference.

Whether the US should,

you know, for example,

have a more offensive cyber strategy

against Russia, to maybe have

intelligence communities leak

information about corrupt Kremlin

officials, where their money is,

how they are using Western financial

institutions to hide their stolen

money and to launder that money.

I think these are all

potential options.

The choices are many,

but the dilemma is acute.

A nerve gas attack

on British streets may be

an unprecedented outrage,

but the response, the extent,

and even what it's meant to achieve,

are all the subjects

of fierce debate.

And Mark's here now.

Our political editor

Nick Watt is here too -

Nick, we'll come to you in a moment.

Mark, update us on the investigation

in Salisbury today.

We have known

for a couple of days that

identifying the agent suddenly

recast the investigation and they

are looking further back. As a

result of what we have learned

today, we can now see that it is a

window of between one and a half and

four and a quarter hours during

which they think this happened,

never before they got the pub in the

centre of Salisbury. In that window

of time, the is very important. But

they are still saying that they

don't know how and when the poison

was dispensed -- the car is

important. There was speculated

within the law enforcement community

that there was some kind of method

of dispensing it inside the car.

That would not appear to be the case

from what the police have said

today. But the car is important and

where it was during 40 minutes after

they had left home and before they

arrived in the town centre, much

longer than is needed for that

journey. This is the key thing we

have heard from the police, though -

they are still saying there is no

suspect, and they must be keen to

make a determination of someone of

that kind.

So they want people who

saw the red BMW.

The pressure is on.

Theresa May is going to step up

tomorrow and talk about whatever the

Russians have responded. What might

she do?

I understand there will be a

substantial response from the Prime

Minister in the House of Commons

tomorrow, but we will not see the

full range of measures in the UK for

two broad reasons. In the first

case, there will be things that the

UK will do that they will not want

to advertise. And in the second

place, there is an assumption that

Vladimir Putin will retaliate, and

therefore the UK needs some space to

be able to respond to that. There is

also a hope that the UK will not be

alone. There were two encouraging

phone calls today with two Nato

allies, Chancellor Merkel and

President Trump.

Thanks.

In a further development today,

it was confirmed that

counterterrorism police are leading

an investigation into

the unexplained death in London

yesterday of a man believed to be

Russian businessman

Nikolai Glushkov.

Mr Glushkov sought exile in Britain

after being convicted of fraud

in Russia and had become a vocal

opponent of President Putin.

There seems to be no evidence

linking this latest death

to what happened in Salisbury -

but the timing is at the very least

awkward as the world waits to see

how Mrs May responds

to the Skripal affair.

So let's discuss that response now.

I'm now joined by Andrew Mitchell,

Conservative MP and the former

Secretary of State for International

Development.

He is leading a cross party group

of MPs preparing to back

a "Magnitsky amendment"

to the government's Sanctions Bill.

Also with me is the Washington

Post columnist and LSE

professor Anne Applebaum.

In Washington is Andrei Illarionov.

He was chief economic

advisor to Putin -

and is now a senior fellow

at the Cato Institute's Center

for Global Liberty and Prosperity.

I wonder if I could start with you,

Andrei Illarionov. Where do you

think we go when it looks as though

the Russians are somehow not taking

the British complaints very

seriously?

Well, that is not

surprising.

surprising. The traditional response

of the Russian authorities is like

that. Remember what happened with

the Litvinenko case, when he was

poisoned in Britain 12 years ago. So

it is not a surprise. What is more

surprising is the lack of response

from the British side and the

western side to all these cases of

aggression, whether it is against

Britain, as it was in 2006 and 2018,

or against Georgia in 2008 or

against Ukraine in 2014, against the

United States during the

intervention in the election and so

on.

We know the charge sheet. Tell

us what we should be doing?

us what we should be doing?

There

are at least two sides of potential

response. One is punishment of those

who are responsible for all those

acts of aggression and terror. It

should be clearly said that that is

a terrorist act. The other one is

more long term and a wider response

from Britain and not only from

Britain, but from the wider West.

The final long term goal of such a

strategy is to have Russia, free,

democratic, rule of law based on

peaceful.

Sorry to interrupt, but

what do we actually do? We know the

goal. What do we do?

You don't know

yet, because there is no consensus

in the western world. There is not

even discussion about what the long

term goal is. There was not much

discussion about the strategy

itself. That is why it is firstly

necessary to come to an

understanding among the Western

countries of what the West wants

from Russia. That is the main

question new post at the beginning.

What kind of Russia would you like

to see?

Lets hope that there. Andrew

Mitchell, it does feel as though we

don't have a strategy here. While

lurching after a headline that will

work on Thursday. Is there actually

a strategy for a medium-sized

country like Britain to have

sanctions that work against someone

like Russia?

I am sure there will

be. It is comparatively early. We

have the statement yesterday from

the Prime Minister. There will be

another tomorrow, but the most

important thing is to gather the

evidence. We must find out where

culpability lies and put it in my

view through the United Nations.

Firstly, it may be circumstantial.

Is that good enough?

We must be

absolutely clear about what

happened, or we won't have

conviction when we put it into the

public domain through the United

Nations so that our allies can see

the threat it poses to all of us.

Is

it premature for the Prime Minister

to stand up tomorrow and pretend we

are starting on a new path? It is

our deadline, not theirs. Do we need

to do it that fast?

, the deadline

was to answer two questions.

And

tomorrow, should she be saying this

was the response, or should she say

now we will think about it response

and gather a coalition of allies?

I

think she will take it to the next

stage. She will say what evidence is

now available, how she will put into

the public domain and what the

consequences are.

And the same question to you.

The

nature of the question shows what is

the important point, the UK needs to

be part of an alliance, part of the

European Union, what with EU allies.

Unfortunately this is the worst

possible moment for the UK to leave

the EU just as Russia becomes the

surgeon in many spheres not just

inside Britain. The most the UK

could do to revive those alliances,

the better. It is all about the

allies but also about understanding

why we do have power and influence.

The Russians keep their money, their

wives and children, their property,

in this country and western Europe.

Ending that practice, the

money-laundering done, enforcing our

own laws and using those laws about

mysterious money, we now allowed to

go and ask people where your money

comes from. Pushing that through,

ending the practice of using shell

companies to buy property, companies

in the UK, that could all make an

enormous difference.

And you would

agree with that, you support the

Magnitsky Amendment.

Yes, that

enables us to take serious measures

against those conducting themselves

in this way from Russia and I think

Parliament will want to see

something like the full Magnitsky

Amendment that has been introduced

in America and Canada.

A couple of

other options, a World Cup boycott,

surely pointless unless everyone

does the same?

I think it is silly

to involve sport and talk about a

ban. We need to use the leverage we

have in those areas where we can

control things that matter. And

working in conjunction with other

allies. Imagine if we could end

Russian money-laundering all across

Europe and begin working with the EU

to close all the loopholes.

I would

not ban RTX. I spoke out during the

Russian bombing of Aleppo and they

carried that in Russia. I do not

think it is sensible to ban arty.

It

gives credence to the view that

broadcasting is partisan here.

It is

not sensible to ban Russian state

elevation.

Of all the things, the

specific things you've heard, I know

you want a big strategy for the West

to align itself. What would you do

specifically if you with the UK?

Let

me just address what my colleague

has already said, everyone should

understand this is war. This is

aggression against Britain,

aggression against other countries,

aggression against the West. And in

the war of aggression there is no

response that would be enough or not

enough. So that is why all these

instruments that have already been

mentioned dealing with illegal

financial assets in London or the

Magnitsky act or the state

broadcaster of all of them are

important. All of them are important

but they are only elements. Some

elements of the possible grand

strategy. So you do not need to

forget about the long-term goal of

such a strategy. And that is why

those instruments could not

those instruments could not only be

elements but if you really want to

win the war you need to give this

expression.

Thank you very much.

Well, we've referred to it already.

Rex Tillerson, US secretary

of State, has finally,

after months of chat about it -

been sacked by President Trump.

Mr Tillerson was reportedly

not actually told,

other than finding out with everyone

else when the President

announced it on Twitter.

One satirical website suggested that

Tillerson had been surprised to find

he was still in the job.

He had certainly been semi-detached

from the Trump operation

for almost his entire

period in office.

When he was appointed 13 months ago,

Rex Tillerson was an outsider.

He wasn't a politician, but a former

Exxon chief executive, and he'd

never met Donald Trump

until he was offered the job.

At his Senate confirmation,

a record number of

votes went against him.

Democrats suggested

he was too pro-Putin.

Now of course,

the line is he has been

sacked because he is too

anti-Russian for president Trump.

That is not the President's line.

We got along actually quite well.

But we disagreed on things.

When you look at the

Iran deal, I think

it's terrible, I guess

he thought it was OK.

I wanted to either break it or do

something and he felt a little

bit differently.

And President Trump is right,

they clearly have been at

odds.

In tone and substance,

again and again.

In the summer Tillerson openly

registered his opposition to

Trump's plan to withdraw

from the Paris climate accord.

I was free to express my views.

I took a counter view

to the decision that

was made.

But I fully appreciate the elements

behind why he took the

decision.

And then there was a striking

interview that Tillerson

gave to Fox News after racist

violence in Charlottesville,

distancing himself from

the president's views.

I don't believe anyone

doubts the American

people's values

or the commitment of

the American government,

or of the

government agencies to advancing

those values and defending those

values.

And the President's values?

The president speaks

for himself, Chris.

Tempting as it is to see this

in terms of policy differences,

perhaps the real story is just

the chaos in the White House.

John Kerry, Hillary Clinton,

Condoleezza Rice,

Colin Powell, Madeline Albright

and Warren Christopher, the last six

secretaries of state have all served

four years, not one.

And no-one needs reminding

that there have been all

too many comings and goings

in an administration so young.

Well the replacement to Rex

Tillerson is Mike Pompeo. He is a

defender of the CIA after a Senate

report on torture detailing

practices such as waterboarding. He

said that they were heroes and not

torturers. So where I things in the

White House?

I'm joined from Washington by

David Frum - he was a speechwriter

for George W Bush and has recently

written a book about

Donald Trump's White House.

Anne Applebaum is still with me too.

I think he will be remembered at the

least bad Secretary of State under

Donald Trump. I will direct

attention to a story that may not

broken in the UK but is indicative

of what is going on. Rex Tillerson

was not the only person to lose his

job today, Donald Trump also lost

his chief personal aide, the person

who would walk around with the

president and hold onto things for

him. It turns out he was escorted

from the building to the new job

because he is under investigation

for serious financial crimes. That

is the kind of thing that is

happening more and more, people

going out for reasons that another

administration 's would have

prevented them even serving as

visitors let alone star.

You were a

fan of Rex Tillerson?

I think he

will be remembered as a disastrous

secretary of state. He treated the

State Department as if it were a

kind of non-performing part of Exxon

and tried to reform it, bases. He

stuck to a tiny group of advisers,

he ignored diplomats and expect. He

tried to do large-scale reforms

which no one saw the point of,

mostly to do with cutting money

which is not how you want to push

the diplomatic corps. All kinds of

people left the State Department.

Huge numbers of exits.

He made

diplomacy seemed like an

unattractive thing. Having said

that, these things are not

exclusive, on the one hand you could

say he was a terrible secretary of

state at also say the next one main

be no better. So not clear that we

have reason to rejoice.

Do we think

might Pompeo will be less of a

restraining influence on the

president and the world will be more

subject to changes and policy

changes in the presidency?

Mike

Pompeo was a businessman and member

of Congress, and much more sensitive

reader of the personality of the

president than Rex Tillerson. So he

will bend more to the presidential

will then Rex Tillerson and seems

more in line with his views on Iran.

But we're already escalating crisis

in the Korean peninsula, the idea

that we could escalate that with

Iran as well, to nuclear crisis at

the one time.

And just expand on

your idea about more instability to

come. And thinking in foreign

policy. You have all these crises

but just in terms of the sort of

day-to-day stuff outside of the

three or four critical things on the

top of the list for the Secretary of

State.

Donald Trump has repeatedly

said that he has his administration

not quite the way he wants, but

almost. Indicating more changes are

to come. And he also seems to be

more and more impatient on any kind

of restraint on him. That augurs ill

for those members of his

administration who have tried to

restrain him in one way or another.

Chief of staff John Kelly, people

who are good at their jobs and have

told the president you cannot do

this or that.

It feels like people

come and go so frequently, can we

believe that for another three years

or even seven years under resident

tramp, that that kind of place of

chaos can carry on.

It happens in

other countries, Italy for years had

government that changed constantly,

in Latin American countries people

come and go all the time. We get

used to thinking of the United

States as a stately model where

things happen slowly and

administrations do not change. And

the secretaries of state stick

around for four years but really

there's no reason to expect that.

This is a president who wants to

hear, he wants people to express his

will and when they do not he fires

them. He does not want to hear

people contradict him. But he did

not like about Rex Tillerson is that

he sometimes said no, that is not

how things are, I see things

differently. Mike Pompeo, he has

been good and ripping the president,

outlining his views with those of

the president. Done a couple of

things that think are worrying, one

of them he actually lied about an

CIA report and said it showed there

was no Russian interference of

significance in the election whereas

the report said the opposite.

I do

not want to talk much more about

Russia but how much did it play in

the sacking of Rex Tillerson?

We do

not know the answer to that because

we do not know exactly when Rex

Tillerson was fired. The president

clearly has been on his way to this

decision for some time for Doctor

John Kelly the. As said to

reporters, that he had indicated to

Rex Tillerson on Friday to be braced

for bad news. But the actual firing

happened today, the day after Rex

Tillerson gave support to the UK in

a way that is more forthright than

the president has yet done. He has

not yet agreed that Theresa May was

correct in what she said to the

House of Commons. In any normal

administration the US and the UK

would have worked out their

statement in advance. In private

agreement before either country made

a public statement on the matter so

serious. So if he has undercut

Theresa May and that is quite

troubling and troubled Rex

Tillerson.

In the end, international news

completely overshadowed the first

ever Chancellor's Spring Statement.

On this day in years past

we would have had a full-on Budget,

but Philip Hammond has moved that

to the autumn, so today

we had a slimmed down

update on where we are.

The Chancellor's central thought

was that the economic news

is marginally better -

spring is in the air, but the long

term projections have not changed,

and so only if things continue

to improve will there be

extra money to spend.

Nevertheless, the Chancellor

was in an upbeat form,

eschewing his traditional role

as the gloomy one in the cabinet.

And if, in the autumn,

the public finances continue

to reflect the improvements that

today's report hints at,

then in accordance with our balanced

approach and using the flexibility

provided by the fiscal rules,

I would have capacity to enable

further increases in public spending

and investment in the years ahead.

While continuing to drive value

for money to ensure that not

a single penny of precious

taxpayers' money is wasted.

He even likened himself to Tigger.

Now he had to offer a more

optimistic outlook.

With hope of more spending later,

but not so optimistic that people

could demand extra spending NOW.

And here's a graph to show why.

This is the OBR graph on borrowing.

That's the Office for

Budget Responsibility -

the official forecaster.

This goes back over a decade.

So this is what has happened

over the last decade -

you see borrowing soar,

and now, the government

has got it right down.

It's a huge adjustment.

So are we there yet,

as every impatient child asks

on a long car journey?

Can we relax now?

This is what the OBR did think

would happen to borrowing over

the next five years; this

is what they projected

back in November.

Borrowing falling,

but still not disappearing.

So that's the old forecast,

And then we got the new,

more optimistic one today.

Here it is - and you see that

not much has changed.

Borrowing comes down,

but is not eliminated.

Well, I'm joined by Nick Watt.

What were your impressions of this

statement?

Against the backdrop you

were talking about, the dour

Spreadsheet Phil macro became de

rigueur Phil and indeed liberated

Phil. He gave a much stronger

indication of spending in the

November Budget, but said no, I do

have my fiscal head room, but

November is a long way off, so let's

be cautious about that. And to other

things he will do in November is

that he will use that headroom to

keep taxes low and to keep paying

down the deficit. But we also saw

liberated Phil, and the Chancellor

was able to make arguments against

labour that he was not allowed to

make in the general election. He is

essentially going to say the choice

now between vote Conservatives and

you will get spending up and get

down, vote Labour and you will get

spending up and that up, to which

Labour will no doubt say, if used in

the late and economy, you can expand

an economy.

One eye-catching thing

not so much obvious from the speech

but from the documentation of the

OBR - about Brexit.

That's right, a

very striking graph in the OBR book,

saying that the UK will be paying

its Brexit divorce bill up until

2064. It's important to say that the

OBR is mapping out the Treasury

plan. That means it will take 48

years after the referendum for the

UK to finally settle its accounts.

The Treasury is very relaxed about

this. They are saying two key things

which you should be able to see from

that graph. 75% of that will be paid

off by 2022, which coincidentally

will be the next general election.

The other thing they are saying is

that this was actually a UK idea, to

ensure that the UK doesn't make any

payments earlier than if it had been

a member state of the European

Union. And obviously, the crucial

thing is pensions and if the UK

wanted to change the profile of

those payments, we could negotiate

it.

Thank you.

Mel Stride is Financial Secretary

to the Treasury, and Peter Dowd

is Shadow Chief Sectary

to the Treasury.

Mel, are you happy with the level of

public services and how much we are

spending on them?

Well, we always

want to do more and we have done a

great deal.

So you must be happy.

We

have spent over £60 billion on

additional public expenditure. In

the last Budget, we put an extra 6.3

billion into the National Health

Service.

You are quoting all these

numbers, but are you happy with the

level of public services at the

moment?

Going forward...

Are you

happy?

It has to be seen in the

context of taking a balanced

approach.

So are you happy?

What I

am happy is that the Chancellor's

sense of direction is that we need

to keep bearing down on the deficit,

and the OBR says we are successfully

doing that. At the same time, we

look to invest in public services.

So obviously, you are unable to say

you are happy with the level of

public services at the moment, and

yet your policy is to cut them by

another 1% in 2019, another 1% on

top of that in 2020 and another 1%

in real terms per capita. The

day-to-day spending on public

services still has to be cut year

after year. So you must be pretty

unhappy. You can't say you are happy

with them at the moment, and you are

planning another three years of

cuts.

We have to look at the whole

picture, which is firstly being a

responsible government that takes a

sensible approach to bringing down

the deficit.

You could put up taxes.

Well, this comes to my other point.

Firstly, we need to bear down on the

deficit, or we will leave ourselves

vulnerable to external economic

shocks. Secondly, we want to invest

in public services and we have done

a huge amount of that.

Prior to

cutting them.

Thirdly, we do want to

make sure we do whatever we can to

alleviate the financial pressures on

a hard-working family.

a hard-working family.

You are

outlining a big group of

incompatible objectives. You are not

giving me a policy. We would all

love lower taxes, better public

spending and less borrowing.

Stewardship of the economy is of

course about choices.

Petered out,

your choices are to spend more and

tax more, correct?

To tax more in

relation to the top 5%, yes.

The

Conservative Party are saying you

can have all the welfare state you

like and pay no more tax, which

isn't true. On the other side,

Labour are saying we can levy more

tax but someone else will pay

because it will come from the rich,

which also isn't true.

Well, it is

true. I have spoken to you before

about funding Britain's future. We

set out in the manifesto £46 billion

worth of expenditure and £48.6

billion.

Paul Johnson went on to say

Labour's manifesto had a lot of

overestimates on what you can get

from the rich and it did not balance

out.

Yes, it did.

out.

Yes, it did.

Do you take expert

advice?

Of course we do.

And is

there any group of experts better

than the Institute for Fiscal

Studies on making these kinds of

financial conjecture?

Of course they

are entitled to their view, but we

do take advice.

But their view is a

pretty good view. They have a good

overview of the tax system.

But that

is not the only view.

But should the

public believe them, who have no

agenda, or you, who are trying to

sell us better public services

without having to pay for them's

well, the government refused access

to the OBR. The guy running the OBR

used to run the IFS. You would get

the same answer from the OBR, I

suspect.

Maybe a at least we could

have the opportunity to test that

out.

Isn't the truth that both of

you are trying to infantilise the

nation and denied the nation a

sensible decision we have to make,

that if we want better social care

and they better NHS, we probably

have to spend another £15 billion on

public services? Borrowing is not

too low, so we have two tax more,

and we have to tax real people more

to pay for extra public spending. Do

you have any agreement with that?

And my Justin Tucker Ghulam?

It is

not about being in cloud cuckoo

land. We are trying to set out

spending plans in our document.

So

you are against straightforward

increases in spending?

At the end of

the day, we would not start from

where we are now. The point I was

making before is the question of

investment. We are not getting the

investment in the economy that we

need.

Do you ever think that maybe

we just need a bit more tax to pay

for social care? You are from Devon.

What do your local Conservative

council say about funding in their

backyard?

We recognise that there

are precious out there.

If the

vulnerable and elderly of Devon are

to be supported, it is essential

that additional funding is secured.

That is your local Conservative.

There is no way of my taking up the

money.

There is, put up taxes.

Some

will say that that is possible, but

we know from history that it is not

possible.

It's not possible to raise

taxes for better public services?

What are you talking about?

Because

we take a balanced approach to the

economy, which means we have to get

on top of the debt. Equally, we want

to take the pressure of hard-pressed

households. That doesn't mean

overburdening them with additional

taxes, the kind of spending policy

that the Labour Party will pursue

will not leave people feeling better

off. It will make them worse off and

in the long term would derail the

hard work we have done.

The

government have their own fantasy

figures in their Budget and to make

up fantasy figures for Labour is

ridiculous. We have set up our

spending plans.

And the IFS say they

are not credible.

People have

different opinions, but the bottom

line is that the nation is in a mess

in terms of economic growth,

productivity. Schools are having

cuts to their budget. And people out

there recognise that. People out

there who can't get social care

recognise that.

He says he is not

happy with public services as they

are.

I didn't say that.

You didn't

say you were happy.

I don't agree

with Peter's characterisation of our

country and our economy.

Half your

cabinet are arguing the same thing.

This is an economy with a

near-record level of employment.

Then why is it not possible... If it

is going well, as

is going well, as you say, why do we

not have social care that is

adequately funded?

We will have a

green paper on social care. We have

already put £2 billion into social

care. And the reason we have been

able to do those things is that our

stewardship of the economy has been

responsible. If you go for this tax

and spend and spray the money

around, it ends up in disaster. We

end up back where we were in 2010.

You keep saying tax and spend. You

have gone from a strong and stable

economy to the magic money tree. You

gave the DUP £1 billion, which

suddenly was found. The magic

monetary analogy went. The bottom

line is that the country is in need

of investment and we are not getting

it from the government.

And that,

gentlemen, is where we have to leave

it. It was a good discussion. Thank

you both. That is all we have time

for. I will be here tomorrow. Until

then, good night.