28/06/2012 Question Time

Tonight, we're in lieu on the. Welcome to Question Time.

-- we're in Luton. Welcome to Question Time.

And on our panel here, the Transport Secretary, Justine

Greening, the shadow Olympics Minister, Tessa Jowell, who was

Culture Secretary when London won the Olympic Games. The former

leader of the Liberal Democrats, Paddy Ashdown. The chief executive

of the leading City of lon brokerage firm, Terry Smith and the

-- Tony Robinson. Good. It is very, very hot in here,

so forgive us if we all pour sweat through the programme! Let's have

the first question, which will bring sweat to any brow. From

Andrew Collon. Is there any integrity left in British banking?

It is almost like they are not human, isn't it? You look at them

and think, these people do not live in the same world as us! Before the

crisis happened they were decimating the high street banks,

laying off all their staff, putting us all on computers when they

clearly had not developed the technology. They told us they were

doing that to make things better for us. They didn't. They made

things worse for us. It was simply in order to collect up an enormous

amount of money that they could invest in the casino of

international banking and they blew it buzz they did not understand it.

We -- because they did not understand it. They do not end us

money, even though they have promised to do so.

APPLAUSE And they then have the gall to

increase their wages by 12%, to give themselves bonuses and say,

we've got to do this, because if we don't, we'll leave the country. All

the time, actually, in the background, they are committing

acts, which in any other business I think would be seen as criminal.

APPLAUSE I remember a time when the bank

manager, along with the doctor and the magistrate was the person who

signed your passport - the person for whom society had an enormous

amount of respect. I don't know about you, I have no respect for

British bankers and the British banking system at all. They've

dragged us into that situation. It about about time they started

getting us out of it. APPLAUSE

Terry Smith? Yes, it is very difficult. I suppose I've got to

agree with Tony Robinson on one point - which is the criminality

point. Seeing what happens with this scandal which broke today, it

must be very difficult for ordinary people looking at that. If you

defrauded somebody on your mortgage application you would probably go

to jail. This is an action which has been taken which certainly

affected the price you pay for your mortgage. Why isn't anyone going to

go to jail? I have to say, I think there is a case to answer there. As

for the point about bankers leaving the country, I too have heard that

raised many times by them. In relation to the way people have

behaved in recent years - if they do, good. Do you think there should

be criminal prosecutions? Or is it impossible to prosecute people for

lying about interest rates? It is possible. There is the Theft Act,

1968, which was updated in 1986, as the fraud act. It is a good piece

of law that people can employ for that. Going back to the point of

any integrity - I think there are two types of banking I would

distinguish between. One is the trading bit, with the big bonuses

and massive losses. Buried within those banks are some decent people

who operate in the retail branches, who have struggled, even though

they have not been given the tools. APPLAUSE

Justine Greening? I think it does seem hard to find a lot of

integrity left in the banking system at times. What has broken

today, the FSA's investigation and the Barclays is unacceptable. It

shows a culture of greed which had sprung up in the banking industry.

We will look at how we can introduce criminal sanctions to

take action on this sort of behaviour. They are not there at

the moment. We have to look to the last Government as to why they were

so lax on putting any of this infrastructure in place. If these

criminal sanctions had been there before people might have looked

more carefully about their behaviour. We will look at that. In

terms of what happens with these particular individuals, the FSA is

talking to the Serious Fraud Office already about whether we can look

at sanctions that are in place now to tackle what has happened. Going

forward we do need some criminal sanctions. I think that is long

overdue. What is the charge you made against the previous

Government? There was a code of conduct about how they worked in

the labour market. Instead of putting it on the statute books,

which they did and putting teeth on it and saying, if you don't follow

this there will be criminal sanctions against you. They just

did that. It was a light touch. There was no teeth to it. That is

one of the reasons why we've ended up with the culture which has led

to today's investigation. Obviously we have to wait and see about the

20 other institutions which are being looked into. It could be a

wide-ranging investigation. It is utterly shocking to see what has

happened. I agree with Terry - this has affected all of our mortgages

possibly. I am shocked by what has gone on. I hope we can take some

serious action about it. Certainly, in Parliament, this Government will

look at what we can do for criminal sanctions as well. The man in red

there, in the third row from the back.

I think I agree with Tony. It is a very easy excuse for the

Conservative Party to blame the last Labour Government for

absolutely everything. Fraud is fraud. If people are frauding the

British banking system, they should be investigated. They should be

locked up. APPLAUSE

The person in the second row from the back.

Yes. How long does the coalition Government intend on blaming the

last Government for mistakes that have been made and they've done

nothing to rectify? Now you are saying, I think it is a good idea

if we maybe look at this. We are bringing forward regulation of the

banking industry right now. That is why we can take some action on this.

This fraud case which was uncovered and the fine which came out today

related to a fraud which took place during the last Government. Even

Labour in the House of Lords has admitted they sould have had a

criminal offence in place -- should have had a criminal offence in

place already. We can make sure we take action now. This report is now

out. We know there is probably more investigation to happen. That's why

we are determined to take some action. Tessa Jowell? Of course the

point is that when we were the last Government, it was the

Conservatives that were criticising us for being over regulatorry with

the banks and what hindsight has shown is we did not do enough. In

March, when it was Labour who proposed putting the rate that is

now at the centre of the controversy today on the statutory

footing, it was simply brushed aside by the Treasury Minister. The

fact is, this is an appalling situation. What we have to

establish is who knew what? How high up Barclays this went? Over

the next period of few days and weeks, we'll find out whether this

practise was actually operating in other banks as well. It is

absolutely appalling. Do you get the feeling that the bankers run

rings around the politicians? APPLAUSE There is a very important

point here and I think the gentleman already made this point,

you know, you can have all the regulation in the world, but if

people are not acting honestly, with integrity and decency,

respecting and understanding the importance of the money they are

handling on behalf of clients, then most people, if they are set on

that, will beat the system. It was day day day who talked about the

cull -- it was Bob Diamond who talked about the culture of what

happens when no-one is watching. What this revealed is just how

rotten that culture is. There are lots of people are hands up. Paddy

Ashdown you have not spoken. You have hit the nail on the head,

David, that the British public thinks that the bankers and the

rich run rings around politicians. I have to say, it's all too true

and Tessa agreed with that by saying they did too much. One

reason is because of the rich and politics and of the funding of

political parties and their ability... By the way you have seen

it in the press as well. The question is not, how did we get

here? The question is, what do we do next? Andrew said, have we got

any moral trust in the morality of bankers? Listening to the news I

was reminded of a poem by Phillip Larkin. He said "England a cast of

crooks and tarts." In this sense, all those who are the most powerful,

all that we trusted, the establishments of the establishment

seem to fall below the standard of public service. There is something

big here we need to tackle T first question is, how do we tackle this

issue we heard about today? The British public, one of our national

pastimes is moral outrage. We love to do it. On this occasion it is

entirely justified. Here is some things we need to do. I am

delighted the coalition is strengthening regulations. I hope

the Labour Party will, I hope it gets through fast. If there is a

case, and my learned friends tell me they think it is tricky to bring

criminal actions against these people at the moment - but if we

can, we should. Watch out bankers, there are civil cases coming your

way, not least from the United States. Secondly, we should be

limiting. There are more to come out, then their operations in the

speculative marketplace should be limited. I see no reason why that

should not be a sanction taken against banks, who behaved in an

outrageous fashion. The last point is this, and it refers to the

personality of Bob Diamond, there has been a clear, systemic failure

in Barclays and more important than that there has been a complete

breakdown of the moral culture of a bank that allows its supporters to

do that. I am afraid Mr Diamond is in a fool or nave situation. If he

did know, he was a nave and if he didn't, he was a fool. Frankly I

think his position is untenable, unless new facts come to light and

I doubt they will. I hope he'll take the appropriate action.

APPLAUSE The do you agree? I agree. He

touched upon something... I know I am here to answer questions, but I

wanted to ask one. If the Government is serious about dealing

with this, why won't it split these banks between casino and retail

operations? The case would be unanswerable. I agree.

Justine Greening? I am sure we will look carefully at what this shows

for regulation on banking. We are taking a bill through Parliament

right now which tackles a lot of these regulatory problems we

inherited. We had a big inquiry. We are taking on bored those

recommendations. We are clear we need -- on board those

recommendations. We are clear we need to regulate that. The woman in

green at the very back there? got a comment for Justine Greening.

I'm actually fed up of hearing from the Conservative Party, oh we've

inherited this from the previous Government. Can I just ask, why on

earth did you bother to seek power if you could not undo or improve on

what the previous Government did? We are. We are and there are lots

of different things we as a Government need to work on. Sorting

out this regulatory system which failed, which is part of the reason

people get bored of, because they have heard it for two years.

The man there in the blue shirt. Is it not true that as a result of

all this, that the greater the good of the nation have been -- the

great and the good of the nation have been found in not just banks,

for "cash for questions", in mobile phone hacking, the whole, everybody,

all of them seem to be let down the general public over and over again?

Anyone in the audience from the finance or business industry?

brave person ?! You in the spectacles? It's very simple to say

more regulation is needed but more regulation without effective

supervision takes you nowhere. you, Sir? Are you also a banker?

work in accounts but somebody touched on it earlier - Tony said

that they threaten to leave if we dare say anything to them, why

don't we just let them leave? I want to go back to you, Sir. You

said it's all very well to make the changes in regulation, but can't do

anything without it being properly policed. Do you think it's

impossible to be policed? No. a complex thing about understating

the interest rate that you are getting on your money and that sort

of thing and people clearly chatting behind-the-scenes and

bleaking open the champagne and thank you for this and thank you

for that, you don't see that, do you, that's the trouble, it's not

there on the surface? I don't think it's impossible to have effective

supervision, but rather like the poacher being the most effective

gamekeeper, giving control back to the Bank of England so people who

understand the system and know what tricks are being played, they are

in a better position to control the investment part of banking. Do you

think the Bank of England could control things? I think it can

control things better than the authorities. It would be hard to be

worse, wouldn't it? APPLAUSE

There's one other remedy which nobody's mentioned yet, which is

absolute financial transparency. The reason that the libel rate was

fiddled was mainly I think because Barclays wanted to obscure what

kind of cash that it had at that time. In fact, the reason why so

many European countries are doing so badly is because nobody really

knows how much the banks are worth so it becomes, as I said, a casino

with people gambling on who's got how much. The one thing above

everything else I think which would really help us get to grips with

the financial crisis and get the bankers in tow would be financial

transparency, if we knew how much the banks were worth and also if we

split the banks in two between the high street sector and the

commercial sector. APPLAUSE

Let's just remember one thing. I'm a Liberal and used to not being in

the majority, if you wouldn't be a Liberal:

I hesitate to come out and defend the bankers, but let's just

remember one thing. This is one of our nation's great industries.

Before we send them all down the plug hole, we ought to consider how

to make it better. The gentleman's point over here about oversight

reinforces the point made by Terry, the right point by the way. If you

split the speculative from the domestic banks, you have a much

tighter system, it's easier to provide the oversight for it. So

that is one of the key reforms that we have to institute. We'll bring

in a financial conduct authority that will have more teeth and work

effective, more effectively than the FSA. That's been one of the

challenges. You will regulate this issue of Liboy? Eye yes. When?

We'll look at whether we can bring that or other legislation forward -

- Libor. We have a lot to get through.

We always welcome your comments on the programme if you are watching

at home. There was an outcry about me saying texting was under threat,

we are now trying to find ways of keeping it going, so keep talking

about it stopping, because it won't because you did complain. That's

people power for you. We need some of that in the banks. People like

watching this programme with comments underneath. We are trying

to think of a way of putting Twitter on the vein as well but

it's very technical and very important. Keep at it, if you would.

April Saunders, please? scrapping the petrol duty rise a

sensible thing given how much the Government is in debt? Tessa

Jowell? We are glad the Government's decided to defer the

petrol duty until January because it will bring a little bit of

relief to families who're under enormous pressure. We also, Labour,

put forward a proposal as to where the money should come from and we

haven't yet heard that from the Government and this appears to have

been a rather extraordinarily stitched up decision over a couple

of hours. It would be very good to know when Justine was told about it

- was she told about it before George Osborne announced it? But

the fact is that families are facing a terrible squeeze and

deferring yet a further increase on petrol will help. But of course,

whey did they ever get into this position in the first place because

her here is yet another U-turn and we've heard a lot about the

omnishambles of the Budget. Here's another bit, but a bit from which a

specific proposal from which families will benefit. That's a

good thing. Plauz mauz

APPLAUSE Greening,, Justine Greening, you

said this week that you were not going to lobby the Treasury to

delay or abandon the 3p rise, did it come as a surprise to you when

the Chancellor suddenly announced it? No. I was informed before he

made the announcement. I think having spent my time in Treasury

before I went into the Department for Transport, there are several

tax rises that had been pre-laned into the public finances so I spent

a lot of time in Treasury looking at how you can avoid them. -- pre-

planned. We have cut fuel duty so far in one case and worked hard to

delay the other planned increases that were already set in stone.

So I think we have done the right thing and actually... When you say

it wasn't a surprise, on Tuesday you were saying one thing, then the

Chancellor was saying another thing? Well, it's never been my

sense that giving a running commentary on what Government's

thinking of doing maybe is a good idea. I don't think there's any

point in raising expectations if you then don't know that you can

necessarily meet them and I think George Osborne was pretty pragmatic

in saying we'd got a bit of flexibility opening up in this

year's finances so I'm delighted that the first thing he chose to

look at what he could do to help out on was to push back that fuel

duty rise. I think that's absolutely the right thing.

wouldn't want to obsess about when and why and how you knew, but...

Yes you would! You would love to. wouldn't because the process is one

thing but it's the decision that interests me. Paddy Ashdown, what

do you make of the decision and the way it was taken? I'm not sure my

party was terrifically happy because we have to sustain the

attack on the deficit. We also think that there's a real case here

for creating a more fuel efficient society. But on the other hand, let

me put this point to you. If the deficit is the major thing we have

to do, and it is, nevertheless we are largely I think because of

external factors like for instance the euro crisis and the huge rise

in oil prices and commodity prices earlier in the year, the economy's

now in a difficult state. So we've got to get people with more money

in their pockets and able to spend. Talking about attacking the deficit

but also you have to get the economy moving. When you balance

these things out, that was the right thing to do for now in the

present economic situation. The fact that it wasn't a few months

ago was because we were in a dufrpbt situation. At the present

moment, while continuing to attack the deficit, it would have been

wrong to have used the extra money that would have been generated here

to put into deficit Dutting and better to put it into people's

pockets to get the economy moving again. My judgment on balance, the

right decision. There was no knead for any of this. This is what I

find galing. Oil in the oil fields has gone down something like 30% in

the last few months as the economies of the world have got

poorer. And yet, petrol at the pumps has gone down, not by 30%,

but by 6%. If it was the other way around, if the price of oil had

gone back, you could imagine the increase would be in the pumps the

next day. We have seen another example of powerful big business

actually taking advantage of us while the recession is on. We

shouldn't have to have this argument because petrol ought to be

significantly cheaper. You are absolutely right.

APPLAUSE And that was one of the points I

was making earlier on this week, it's why I challenged the petrol

retailers to start passing on the reductions and wholesale prices to

consumers. We have laid down the gauntlet and said it's time for

them to be more transparent about what they are doing. I've already

had a good response for one of the retailers, ASDA. I think we can do

a huge amount more to make sure they play their role alongside what

we are trying to do as a government. Why wouldn't you lobby the Treasury

then to abandon the 3p rise? first port of call is to get the

petrol retailer to play their role, rather than taking money out of

public finances. But I think given that clearly there was some room

opened up in this year's finances, it was absolutely right... Hang on,

you could have taken it off the autumn Budget couldn't you. You are

Secretary of State for Transport, you are involved in everybody's

business on the roads, the cars, the petrol prices and all that.

That's right. At the beginning of the week you said you were not

going to reduce the 3p, it has to stick and suddenly the rug's pulled

out from under you. Because it was going to cost �1.5 billion and now

it costs about �500 million so the figures have shifted. That's

because if you... How do I know? I'm no longer a minister.

reason why is that if you did a long-term cut in fuel duty, it

costs you every year. We've just delayed the rise. Get it again in

January? Less. That's all we can afford to do. It will come in

January? Correct. And you won't be lobbying for the Treasury?

constantly trying to make sure we do our level best to make sure

motoring is affordable. We have challenged the retailers, I'm

working with the Ministry of Justice to tackle whiplash and try

and make sure insurance stays lower. I'm working with the garage

industry to make sure we can keep services your Carloer. I'm sure you

are doing all that. Let's stick with the petrol duty rise. The

woman there? I'm a student and I'm about to sit my driving test in two

weeks' time. What will the cost of fuel be like in 50 years' time when

I've still got a car and need to get about - why are people focusing

on what's happening now instead of what's going to happen in 20 or 30

years' time. How would you want them to do that? Just by saying,

about what they're going to do and what they want to highlight.

Everybody's focusing on what's happening now. You want a strategy

for the use of fuel? For the long- term future. You, Sir?

I personally support the Government. I don't think it's a U-turn, I

think it's the right turn for the Government at the moment for our

suffering and I give them that. Terry Smith? You have got to

distinguish the wood from the trees and Paddy Ashdown said the deficit

is the single biggest problem we face. In the light of that, in

round number terms, as we know, 0s mean nothing so we can take them

off the end, the Government has a basic income of �6 and is spending

�7. In the face of that, do anything that takes the �6 down

strikes me as the wrong decision. So you would have kept that or

increased it? I don't think increasing it is necessarily the

way to go. Why do you think it's been reduced? I don't know.

economy's doing very badly. We are in double-dip recession. Maybe he's

trying to stimulate the economy? I'm not sure we are in a double-dip

recession, I don't think we ever got out of one. If you think the

very modest improvement we had in any kind of economics in the last

year or so were after �500 billion of deficit, �3 25 billion of

quantitive easing and interest rates at their lowest level for 300

years. The economy was only just about alive at that point. Does

this do anything to help the economy? Not really. The order of

magnitude is not capable of touching it. We've got an annual

deficit of �25 billion. surprise me a little. You are a

highly successful businessman. that what surprises you? No, I'm

utterly delighted. The more the better, especially if they'll...

Never mind! Look, you don't run your business on one policy, you

run it on a combination. There is a priority but you run it on a

combination. The Chancellor has to do the right thing. He has to

address the management of the economy, the priority is to bring

down the deficit but also to make sure we get businesses and economic

growth generated again and therefore at this point when we are

tackling the deficit effectively, to do something even quite small,

to get the growth going, to get money in people's pockets, to get

them spending, surely is the right You go into a service station, they

might have adverts saying cheaper petrol, but you go inside they

charge you �8 for a bag of maltesers. You can't win. We can't

advertise! I am staggered by the naivety that

Tony Robinson gave out earlier on. If we reduce the price of petrol,

we reduce the tax take. What services would he like the

Government to cut to make up for the cut taxes? I don't think

reducing the price of petrol is the big issue that people say. I do

agree with you, that the problem with reducing it is that you end up

with half a billion or whatever the money is, which we've got to find

from somewhere else. What I'm saying to you is actually it is the

oil companies which have taken that money out of the economy. We could

have inveed that into boost for -- invested that into boost the growth.

I don't think that is naive, I think it is a justified. On the far

right there? I like to build on someone else's point about the

short-term nature of this. It seems the Government is short-term. This

is a 3p tax they could have cut earlier. Everything is too short-

term, we are not thinking about the long-term. If you realised this was

going to come about then we could have done something about it

earlier. It is similar with the banking thing, you've had two years

in power, you never put the legislation in place. Now the

problem has occurred you are saying that you blame Labour. We need to

get rid of this short-term and look at the long-term. The debt is meant

to rise in 20 years' time because of the pension crisis. We need to

look more at the long-term rather than looking at the short-term.

APPLAUSE Thank you. If you would answer the

question point on the short-term, U-turns and this fuel duty. We need

to stop making... In the terms of short-term, it took two years to go

through the bill on the financial regulation. To the lady's point at

the front, you are right, the best way we can help motorists is to get

them off the petrol hook in the first place... You are not

answering his point. He said you've had U-turns on the Budget, now you

have an announcement on tax. He said you are acting in a short-term

way. Why should this be later? You have done other measures quickly,

like the rise in VAT was done quickly. Why is this taking so much

longer if it is just as important? Especially with the U-turns they

are quite sherp. At the time of -- Therm. At the time of the Budget,

now into this financial year there is head-room opening up. The

Chancellor was able to say, it looks like we might have some money

to spend here,ly use it to try and delay this petrol rise. We can

start to allow people into hybrid and electric cars. That feels like

it is some time off now. I am looking at what we can do to speed

up that process, so people have the choice the next time they buy a car.

One of the big problems is affordability. We have grants

available to help people buy hybrid and electric cars.

Thank you very much. We will move on to a question from Julie Searle.

Why should me and my partner continue working, paying taxes,

struggling on a tight budget when those on benefits do nothing and

get paid a lot more? APPLAUSE

I am not sure you should. I suspect from, the way you asked that

question you are the sort of person who will. You raise an important

point - benefit reform was in the news this week. I think one of the

things that I would hope people would admire and we will see in a

moment is people telling the truth about the situation we're in.

There's been a marked absence of truth and straightforwardness about

the situation of our country in the last couple of years. Given we are

spending �7 for every �6, there'll have to be big cuts. Benefits will

have to be one of them. In terms of anybody who is on the

receiving end of the cuts, one thing I might sympathise is being

told your benefits are going to be cut, by an old Etonian might ring a

little hollow. Do you agree - those on benefits do nothing.... No. No.

You don't agree? You are miss representing what she said. If I

understood you right, Julia, what you were saying was, you work hard,

you look after your family, and why should you bring home less than

people who are on benefits and choose not to go out to work. Of

course we should have a welfare state for people who are unable for

periods of time or in the long-term, unable to provide for themselves.

We shouldn't have a welfare system where it's more financially

beneficial to be out of work and at home, rather than in work. Now,

that is a very easy ambition to state. In order to get to that

point, you have to have very clear commitment over a long period of

time to making sure that young people leave school with the skills,

that there are jobs in a growing economy, that particularly

expensive times of family's lives with childcare and so forth, help

is provided in order to make precisely that degree of self-

sufficientsy and independence that most families want for themselves.

I am absolutely with you. I think the problem with the Prime

Minister's speech this week is that it's like a sort of Christmas tree

of new initiatives and criticisms. Unsubstantiated. Some of these

instances of young people under 25 are very difficult. A lot are kids

who have left care. They are kids who may be orphans, may not have

parents to look after them. So, the hard cases can sometimes defeat the

best argument. That's why you've got to think this through carefully.

Once you embark on it, you've got to be prepared to see it through.

And what we have at the moment is, as the Government - the coalition

Government - promised a radical programme of welfare reform. The

implementation of those changes in two very important respects are

already behind time and over budget. What you are saying to her is that

there's nothing that can be done because you have to wait until....

No, I am not. The people on benefit their lives need to be improved.

She cannot look for any change in the short-term. For instance David

Cameron says you should scrap Housing Benefits for under 25s.

We're struggling. We earn �6 too much to get any more help, so... I

would get �200 a month better off if I was on benefits.

I will come back to you in a moment... Maybe. We all want a fair

benefit system. It must be more than frustrating. It depends what

fair means? It does, absolutely. It depends on how well organised and

policed our benefits are. I think one of the reasons why people get

so angry and frustrated so because so many people appear to receive

benefits that they are not really entitled to. That is again because

of these mad cuts at the Department of Work and Pensions. It's a

nightmare trying to get the benefit that you genuinely ought to receive.

I would remind people that actually we all pay in and most of us have

paid in for the best part of 50 years, not to something called

national handout or national welfare, we pay into national

insurance. That is for when times get hard.

The one thing out of this debate I would hate to see is to feel that

people who do draw benefits and draw them legitimately feel in some

way guilty, feel in some way they shouldn't do it, when that is

something they is worked their lives to guarantee they would get

at the end of it. APPLAUSE

It seems to me we're at risk of getting this interpretation of

poverty, where we say these people deserve benefits and these don't.

We should have a benefit system or none at all. I've gree it should be

national insurance. -- I agree it should be national insurance. Tessa

Jowell said that orphans, for instance, like my father was

orphaned at 12 and worked every day of his life. One cannot say these

people deserve and these don't, and therefore we should scrap it.

OK, the woman up there. I work in a university. A considerable amount

of my salary goes on tax and national insurance. I would like to

see the legal loophole closed that allows people to pay but 1% income

tax. APPLAUSE

I think we should see it as a safety net rather than as a

lifestyle. I think some people see it as a lifestyle rather than a

safety net. There are people older than me who live near me that have

not worked a day in their life. I think that is disgraceful. We need

to change people's attitudes. I feel sorry for the lady who is

worse off than on benefits. At leeths I would say at least it is

more -- at least I would say to her, at least it is self-respecting and

pride. You earn your own money. The man up

there in the short-sleeveed shirt. Don't we think it is almost crazy

that someone wants to work 37.5 hours a week but is better off 30

hours a week. They are better sitting on 30 hours and want to

work more when work is available, but they thid it is not beneficial

- there's no incentive to do that. Paddy Ashdown?

The - let's see if I may have some historical background to this. The

welfare system was set up in 1945/46. It is something that I

think was a most magnificent and wonderful achievement. It gave

people a chance. That system, by the way built on the principal,

which is giving people a hand up rather than a handout has

degenerated. It is tangled and out of sink.

It is shared by all political parties.

Government after Government, since I have been in politics, 20 years

and more, nearly 30 now, have said, we'll reform the system, we'll live

up to the principals of Beveridge, and do it in a new way all have

ducked the challenge. They have fiddled at the edges. You don't

think what Cameron is suggesting... Hang on. I don't want you to talk

forever. I don't think I will talk forever. If you didn't interpret

perhaps I would not have to talk so long. That is a very rude thing to

say. Let's not go on with this argie-bargie. Here is what I have

to say - I am proud that this Government has begun to try and

tackle that. Some ideas from Iain Duncan Smith and Steve Webb, I

think Universal Credit are an attempt to move us back to this.

One of the reasons it has been slowed up is it has been

persistently opposed by Labour in the House of Commons. There is a

change coming. When you change there are some uncomfortable

moments. Individuals will get caught out. I am clear the

proposition is put forward now where they will fundamentally

change this system that you want and everybody else here has sought

as well. I think the idea of a benefit system is valid and no-one

would argue with that. I think the idea about poverty and the

principals of poverty has been skewed. If people can afford to go

out drinking and buy cigarettes and have Sky Television, the idea of

poverty has changed in our country. APPLAUSE

Do you agree with that Justine Greening?

I think, in many respects, I think what you say is correct.

Actually we have introduced the Universal Credit. That is coming in,

precisely to address the point the man made at the back - work has to

pay. At the moment we have a welfare system where it does not

too often. Also, in my experience as an constituency MP, it is about

complexity. It got so complicated that many of my constituents had no

idea what they were and were not entitled to. So, they had no

understanding of how to navigate their way through the benefit

system either. It got out of whack. So the first thing to do is bring

in a welfare cap, so that we actually put an upper limit on how

much people can get in welfare, which is fair. Make sure we make

sure that work does always pay and there is a transition which will go

through. Let's put some money into that transition process, so for the

people who will see a change of benefit, there is some support

there as we go through the process. It is a big change. It massively

matters because the final point is we have to have a welfare system

that people buy into. At some point we lost that and we have to get it

Tony mentioned about national insurance. The figure of over a

million people in this country having not worked for ten years or

more, that's staggering. At the same time we have had immigration

going up exso there have been jobs but obviously some people do not

want to take up the jobs. APPLAUSE

There's another point about the national insurance system. It's

been mentioned several times sofar which is that people who've been

paying into the national insurance contributions for many years are

rightly very upset that they are now being told that whatever it is

they knead in terms of benefits or pensions might not be available

because frankly there is no money any more. That's because the

Government's spent that money at the time. They didn't establish a

fund with investments in it. I think something that would be good

for us all is if Governments in relation to certain things like

pensions had to put investments in to a fund and so that this couldn't

happen in future. It would also hopefully, apart from making sure

you had contributed your pension would be there when you needed it,

would stop people promising things that wouldn't come up in their

lifetime. Tessa Jowell? I'm really worried that we have now a million

young people in our country who're out of work and we all know that if

young people don't get the habit of working, it becomes progressively

more difficult to get them into work and there's a sense of

hopelessness about that. One of the proposals that we've put forward is

a tax on bankers' bonuses to raise �2 billion in order to get more

than 120,000 young people every year into work. That's a very

constructive, positive and specific proposal that will go a long way to

building a long-term solution in response to what I was saying

earlier to you, Julie. OK. Another question, from Tom

Danaher, please? Is the sudden urgency about House

of Lords reform a way of keeping the Liberal Democrats quiet in the

coalition? The sudden urgency about the House of Lords reform?!

APPLAUSE Paddy Ashdown? Well, if you call

asking for House of Lords reform for 100 years urgency, sudden

urgency, then I suppose it is, Tom. Look, let's see if we can make one

or two points quickly - better make them quickly - the first is, is

this a priority. It is a prayerty. You think you have an economic

crisis in the western democracy, there is a desperate crisis growing

up separating Government from Government. You have a second

chamber in this country in which in order to get into the House of

Lords you have got to be a friend of the Prime Minister or your great,

great grandmother had to slaep with the King. Now, in a modern

democracy, sorry, call me old- fashioned but I actually believe

that the principle of democracy is those who make the people's laws

are the people's representatives. I don't think it's acceptable in the

modern democracy like ours to have membership of the House of Lords

based on the fact that you have the Prime Minister's approval or you

are the long-term descendant of an aristocratic lady of uncertain

virtue in the past. We have to try and make our democracy now a

genuine democracy. Young men go out to fight, young British soldiers

for democracy to die and to kill others and yet we don't have a

proper democracy in this country. Now, those who say it's not a

priority, I think that's the most ridiculous excuse there is. Even

leaving aside the democratic crisis for the moment. Take a look back,

when this country was struggling for its very survival, when person

putting troops across the Normandy beaches, the House of Commons was

still able to discuss the better education Act. We should do it! If

we allow a system to continue of pat Ronage in the second chamber

where the second chamber does not do its job? Holding the government

to account, when we have far too weak a House of Commons, the only

thing that will be damaged is our democracy and the only thing that

will continue to grow is the gap which is already dangerous between

Government and Government in this country. This needs to be done and

needs to be done now. APPLAUSE

Tessa Jowell, the accusation against Labour is you were all for

it at the election but now you are not doing the right thing to get it

through, you are not insisting on a timetable for it so that it will

actually happen, you are making mischief with this to disturb the

coalition? No, I mean that's not true. Let me just begin by saying...

In what sense is it not true because you are not doing it, are

you? Nobody's raised House of Lords reform with me on the doorstep but

we need a better Parliament than we have. And so yes we should reform

the House of Lords, we should have an elected House of Lords and we

should have the legislation properly scrutinised. There are

about 1,000 questions that have not been answered by the proposals that

have been published, so we'll support the Bill when it's

introduced... 1,000 questions? least. We'll support the Bill.

There are 845 members of the House of Lords so they've all got at

least a question each. We'll support the Bill when it comes

before Parliament at the beginning of July but we will also to make

sure - make sure that major constitutional change has the

opportunity of being properly scrutinised. We'll also put down

amendments calling for a referendum because we, you know, it's a

convention in this country that we have referenda where there's a

major constitutional change to our country and I think, as my party

thinks, that people should be asked their view on that.

You, Sir? I would like to point out the fact that within the House of

Lords, the positions have also been given to experts, the best in their

field. Mr Ashdown's comment implies that what little progress had been

made is completely pointless, but progress, however little, has been

made. There does need to be reform but it needs to be far more radical.

The current House is a way for people to extend their career and

get a nice cup of tea. It needs to be replaced by a House for the

people. If there can be a jury of 12 ordinary people choose on

someone's life, I think there should be a House for general

people to sit and oversee and bring politicians to account when they

don't doe what they've been voted to do.

Terry Smith? I would tend towards that gentleman's comment which is

to say that I would suggest a much simpler reform of the House of

Lords which is if there is a referendum, I hope this question is

included which is that it's an an act row ni-sm, why not abolish it.

Just have one House? Yes. I think you need a second chamber to lack

at the Bills that the House of Commons is bringing forward, but I

agree, I think it's time to get on with this. I think if you had a

blank piece of paper and proposed what we'd got now, people would say

that's totally unacceptable, it's based on who you know, your birth

and the gentleman's right, there is a role in the House of Lords going

forward for experts and that's why we are proposing 80% should be

elected but 20% should still be apointed and I hope we can really

keep all those people that bring some real expertise. It's time to

get on with this. We've talked about it for a very long time. I

think we've ended up almost in the worst of all worlds where at least

there was some randomness almost with hereditary peers, there's none

know -- none now. It's who you know and to some extent how much money

you have got. It's unacceptable. My ask from Tessa would be don't vote

against this programme motion which will mean we could end up clogging

up the House of Commons, people have other priorities they want us

to work on too. Let's get on with this... The programme motion is the

timetable? How much time we spend and we have pencilled in a lot, so

let's get on with this and get it through and let's come back to

everything else that people need sorting out in this country. What

about the 100 or so Conservatives who don't want it? Well, I respect

their... Will you win them round? respect their Points of View, I

think we'll win many round, I just disagree with them and I think many

of them who were there in 2005 in the last Parliament like me voted

for an 80% elected chamber so. Now is the time to crack on, make this

change and then we'll have a much stronger second chamber and I think

it will do what that gentleman wants which is it will be for

people again which it should be. OK. The woman in green, then you,

Sir. If you have two Houses which have been elected, what happens

within they don't agree? Quite right, a good point. Fundamental

question. A key question. That's why in this Bill we are bringing

forward it's clear that ultimately the House of Commons has the final

say. We've got the Parliament Act at the moment which is, if you like,

how we regulate it right now under the current system, but we'll make

sure we keep that in place so we make sure that isn't the gridlock.

That was a major complaint about the gridlock legislation. The House

of Commons has the final say. heard from the last question that

the country's in deep economic mire, so what practical benefit will the

man in the street deprive from a reform? Do you think there's any

point in it? Absolutely not. Tony Robinson? I beg your pardon, sorry,

David. If you would have had an eelected second chamber, you would

not have had an Iraq war or the poll tax. Tony Robinson? There is a

terribly important principal at stake here which is that those who

write the law ought to be elected by people who live under the law.

It's feeling to me like a principal that goes back to Magna Carta and

the fact that we haven't addressed that seems daft. We have all three

leaders agreeing that we should do some reform. OK, I agree with you,

it's not going to be the perfect reform, it never is going to be the

refect reform, but we've got all three leaders agreeing with it, so

let's go ahead and bite the bullet. Some people say it's the wrong time.

That's the argument that's always levelled. For 100 years people have

been saying it's a good idea but it's not the right time. People say

it's expensive, but if we cut down from 90 representatives to 300 and

they won't get as much money as they get, that would be a non-

starter. I have a caveat. I don't want to see us move from unelected

peers to political cronies. We've got to make really sure that the

system that's put in place doesn't guarantee that the leader of the

party in Government and the Leader of the Opposition can deluf that.

But please -- deliver that. But please, I ask the representatives

of all three political parties, go with this, don't scupper it for

short-term political advantage, please.

Before we finish this, Paddy Ashdown made an interesting point

that I would like to put to the politicians of the other two

parties. He says there would have been no Iraq war if there had been

an elected chamber and he says there would have been no poll tax.

Do you agree? No, I don't agree with either of those assertions.

Why has he got it wrong? Well, I mean I think that's... I don't know

what the evidence is for that quite honestly. Paddy was against the

Iraq war. OK. Be brief? I'll be as brief as I can. The House of

Commons is the executive's poodle and allows the executive to get

away with doing stupid things. If you had a second chamber acting as

a check and balance, those two issues would have been debated

fully and, in my view, none would have got through. You said the

House of Commons has ultimate praim si? But if the House of Lords force

add debate and expressed a democratic view, my view is there

is a... I can't prove it to you but there's a high probability that's

the case. The Tories might have been grateful if there was no poll

tax? Who knows. They rebelled a lot when the Thatcher Government was in

power. It's time to get on with this. The final point I make is

that it's quite South East centric at the moment, the House of Lords,

because of the whole network, if you like, that helps create it. I

think it's time to have it generally more representative of

our country as a whole. Get away from Putney. Our hour is up now, we

have to stop. We'll be in Derby next week, we are not South East

centric by any means. Only panel we'll have Labour's former Home

Secretary, Alan Johnston, so if you would like to come to the last

Question Time of this run and put questions to our panel, you can do

so by applying on the website. You can also call us. Thank you all