:00:36. > :00:40.Morning, folks. Welcome to the Sunday Politics.
:00:41. > :00:43.Labour's been hit hard by scandals at the Co-op. Ed Miliband says the
:00:44. > :00:47.Tories are mudslinging. We'll speak to Conservative Chairman Grant
:00:48. > :00:49.Shapps. Five years on from the financial
:00:50. > :00:53.crisis, and we're still talking about banks in trouble. Why haven't
:00:54. > :00:58.the regulators got the message? We'll ask the man who runs the
:00:59. > :01:01.City's new financial watchdog. And he used to have a windmill on
:01:02. > :01:06.his roof and talked about giving hugs to hoodies and huskies. These
:01:07. > :01:06.days, not so much. Has the plan to make
:01:07. > :01:15.Here: Our mental health services hope you can join `
:01:16. > :01:16.Here: Our mental health services heading towards crisis point because
:01:17. > :01:18.of heading towards crisis point because
:01:19. > :01:19.warned that benefit falls will be to homelessness and population ships.
:01:20. > :01:29.What is the evidence? And as always, the political panel
:01:30. > :01:33.that reaches the parts other shows can only dream of. Janan Ganesh
:01:34. > :01:36.Helen Lewis and Nick Watt. They ll be tweeting faster than England
:01:37. > :01:41.loses wickets to Australia. Yes they're really that fast.
:01:42. > :01:44.First, some big news overnight from Geneva, where Iran has agreed to
:01:45. > :01:48.curb some of its nuclear activities in return for the partial easing of
:01:49. > :01:51.sanctions. Iran will pause the enrichment of uranium to weapons
:01:52. > :02:02.grade and America will free up some funds for Iran to spend. May be up
:02:03. > :02:05.to $10 billion. A more comprehensive deal is supposed to be done in six
:02:06. > :02:11.months. Here's what President Obama had to say about this interim
:02:12. > :02:17.agreement. We have pursued intensive diplomacy, bilaterally with the
:02:18. > :02:22.Iranians, and together with our partners, the United Kingdom,
:02:23. > :02:27.France, Germany, Russia and China, as well as the European Union.
:02:28. > :02:32.Today, that diplomacy opened up a new path towards a world that is
:02:33. > :02:37.more secure, a future in which we can verify that Iraq and's nuclear
:02:38. > :02:44.programme is peaceful, and that it cannot build a nuclear weapon.
:02:45. > :02:50.President Obama spoke from the White House last night. Now the difficulty
:02:51. > :02:53.begins. This is meant to lead to a full-scale agreement which will
:02:54. > :03:00.effectively end all sanctions, and end Iran's ability to have a bomb.
:03:01. > :03:04.The early signs are pretty good The Iranian currency strengthened
:03:05. > :03:10.overnight, which is exactly what the Iranians wanted. Inflation in Iraq
:03:11. > :03:16.is 40%, so they need a stronger currency. -- information in Iran.
:03:17. > :03:20.France has played a blinder. It was there intransigence that led to
:03:21. > :03:25.this. Otherwise, I think the West would have led to a much softer
:03:26. > :03:30.deal. The question now becomes implementation. Here, everything
:03:31. > :03:35.hinges on two questions. First, who is Hassan Rouhani? Is he the
:03:36. > :03:40.Iranians Gorbachev, a serious reformer, or he's here much more
:03:41. > :03:46.tactical and cynical figure? Or within Iran, how powerful is he
:03:47. > :03:53.There are military men and intelligence officials within Iran
:03:54. > :03:57.who may stymie the process. The Western media concentrate on the
:03:58. > :04:00.fact that Mr Netanyahu and the Israelis are not happy about this.
:04:01. > :04:05.They don't often mention that the Arab Gulf states are also very
:04:06. > :04:14.apprehensive about this deal. I read this morning that the enemies of
:04:15. > :04:21.Qatar and Kuwait went to Saudi king. -- the MAs row. That is the key
:04:22. > :04:27.thing to watch in the next couple of weeks. There was a response from
:04:28. > :04:31.Saudi Arabia, but it came from the Prime Minister of Israel, who said
:04:32. > :04:36.this was a historic mistake. The United States said there would be no
:04:37. > :04:40.enrichment of uranium to weapons grade. In the last few minutes, the
:04:41. > :04:49.Iranian Foreign Minister has tweeted to say that there is an inalienable
:04:50. > :04:54.right -- right to enrich. The key thing is the most important thing
:04:55. > :04:59.that President Obama said in his inaugural speech. He reached out to
:05:00. > :05:06.Iran. It failed under President McKenna jab. Under President
:05:07. > :05:10.Rouhani, there seems to be progress. There is potentially now what he
:05:11. > :05:15.talked about in that first inaugural address potentially coming through.
:05:16. > :05:21.In the end, the key issue - and we don't know the answer - is the
:05:22. > :05:24.supreme leader, not the president. Will the supreme leader agreed to
:05:25. > :05:32.Iran giving up its ability to create nuclear weapons? This is the huge
:05:33. > :05:37.ambiguity. Ayatollah Khamenei authorise the position that
:05:38. > :05:40.President Rouhani took to Geneva. That doesn't mean he will sign off
:05:41. > :05:45.on every bit of implementation over the next six months. Even when
:05:46. > :05:52.President Ahmadinejad was president, he wasn't really President. We in
:05:53. > :05:56.the West have to resort to a kind of Iranians version of the study of the
:05:57. > :06:08.Kremlin, to work out what is going on. And the problem the president
:06:09. > :06:14.faces is that if there is any sign... He can unlock these funds by
:06:15. > :06:19.executive order at the moment, but if he needs any more, he has to go
:06:20. > :06:26.to Congress. Both the Democrat and the Republican side have huge
:06:27. > :06:30.scepticism about this. And he has very low credibility now. There s
:06:31. > :06:35.already been angry noises coming from quite a lot of senators. It was
:06:36. > :06:39.quite strange to see that photo of John Kerry hugging Cathy Ashton as
:06:40. > :06:49.if they had survived a ship great together. John Kerry is clearly
:06:50. > :06:52.feeling very happy. We will keep an eye on this. It is a fascinating
:06:53. > :06:55.development. More lurid details about the
:06:56. > :06:59.personal life of the Co-op Bank s disgraced former chairman, the
:07:00. > :07:02.Reverend Paul Flowers. The links between Labour, the bank and the
:07:03. > :07:05.wider Co-op movement have caused big problems for Ed Miliband this week,
:07:06. > :07:10.and the Conservatives have been revelling in it. But do the Tory
:07:11. > :07:19.allegations - Ed Miliband calls them "smears" - stack up? Party Chairman
:07:20. > :07:27.Grant Shapps joins us from Hatfield. Welcome to the programme. When it
:07:28. > :07:33.comes to the Co-op, what are you accusing Labour of knowing and when?
:07:34. > :07:39.I think the simple thing to say here is that the Co-op is an important
:07:40. > :07:43.bank. They have obviously got into difficulty with Reverend flowers,
:07:44. > :07:47.and our primary concern is making sure that that is properly
:07:48. > :07:49.investigated, and that we understand what happened at the bank and how
:07:50. > :07:56.somebody like Paul Flowers could have ended up thing appointed
:07:57. > :08:02.chairman. You wrote to edge Miliband on Tuesday and asked him what he
:08:03. > :08:05.knew and when. -- you wrote to Ed Miliband. But by Prime Minister s
:08:06. > :08:12.Questions on Wednesday, David Cameron claims that you knew that
:08:13. > :08:17.Labour knew about his past all along. What is the evidence for
:08:18. > :08:25.that? We found out by Wednesday that he had been a Labour councillor
:08:26. > :08:28.Reverend Flowers, and had been made to stand down. Certainly, Labour
:08:29. > :08:33.knew about that, but somehow didn't seem to think that that made him
:08:34. > :08:38.less appropriate to be the chairman of the Co-op bank. There was no
:08:39. > :08:45.evidence that Mr Miliband or Mr Balls knew about that. I ask you
:08:46. > :08:55.again, what are you accusing the Labour leadership of knowing? We
:08:56. > :08:59.know now that he stood down for very inappropriate images on his
:09:00. > :09:04.computer, apparently. You are telling me that they didn't know. I
:09:05. > :09:07.am not sure that is clear at all. I have heard conflicting reports.
:09:08. > :09:12.There is a much bigger argument about what they knew and when. There
:09:13. > :09:17.was a much bigger issue here. This morning, Ed Miliband has said that
:09:18. > :09:21.they don't have to answer these questions and that these smears
:09:22. > :09:25.This is ludicrous. These are important questions about an
:09:26. > :09:28.important bank, how it ended up getting into this position, and how
:09:29. > :09:36.a disastrous Britannia -- Italia deal happen. -- Britannia deal
:09:37. > :09:42.happened. And we need to know how the bank came off the rails. To be
:09:43. > :09:46.accused of smears for asking the questions is ridiculous. I am just
:09:47. > :09:49.trying to find out what you are accusing Labour of. You saying that
:09:50. > :10:01.the Labour leadership knew about the drug-taking? Sorry, there was some
:10:02. > :10:06.noise here. I don't know what was known and when. We do know that
:10:07. > :10:09.Labour, the party, certainly knew about these very difficult
:10:10. > :10:15.circumstances in which he resigned as a councillor. I think that the
:10:16. > :10:20.Labour Party knew about it. We knew that Bradford did, but not London.
:10:21. > :10:25.Are you saying that Ed Miliband knew about the inappropriate material on
:10:26. > :10:32.the Reverend's laptop? It is certainly the case that Labour knew
:10:33. > :10:37.about it. But did Mr Miliband know about it, and his predilection for
:10:38. > :10:43.rent boys? He will need to answer those questions. It is quite proper
:10:44. > :10:47.to ask those questions. Surely, asking a perfectly legitimate set of
:10:48. > :10:51.questions, not just about that but about how we have ended up in a
:10:52. > :10:55.situation where this bank has made loans to Labour for millions of
:10:56. > :11:03.pounds, that bank and the Unite bank, who is connected to it. And
:11:04. > :11:07.how they made a ?50,000 donation to Ed Balls' office. Ed Balls says that
:11:08. > :11:13.was nothing to do with Reverend Flowers, and yet Reverend Flowers
:11:14. > :11:17.said that he personally signed that off. Lots of questions to answer.
:11:18. > :11:24.David Cameron has already answered them on Wednesday. He said that you
:11:25. > :11:28.now know that Labour knew about his past all along. You have not been
:11:29. > :11:32.able to present evidence that involve Mr Miliband or Mr Balls in
:11:33. > :11:38.that. So until you get that, surely you should apologise? Hang on. He
:11:39. > :11:43.said that Labour knew about this, and they did, because he stood down
:11:44. > :11:48.as a councillor. If Ed Miliband didn't know about that, then why
:11:49. > :11:53.not? This was quite a serious thing that happened. The wider point is
:11:54. > :11:56.about why it is that when you ask perfectly legitimate questions about
:11:57. > :12:02.this bank, about the Britannia deal, and about the background of Mr
:12:03. > :12:10.flowers, why is the response, it is all smears? There are questions
:12:11. > :12:14.about how Labour failed to deal with the deficit and how it hasn't done
:12:15. > :12:20.anything to support the welfare changes, but there is nothing about
:12:21. > :12:29.that. Let us -- lets: To the wider picture of the Co-operative Bank.
:12:30. > :12:34.Labour wanted the Co-op to take over the Britannia Building Society, and
:12:35. > :12:40.it was a disaster. Do you accept that? The government of the day has
:12:41. > :12:46.to be a part of these discussions for regulatory reason. The
:12:47. > :12:54.government in 2009 - Ed Balls was very pleased... But you supported
:12:55. > :12:59.that decision. There was a later deal, potentially, for the Co-op to
:13:00. > :13:05.buy those Lloyds branches. There was a proper process and it didn't go
:13:06. > :13:09.through just recently. If there had been a proper process back in 2 09,
:13:10. > :13:16.would the Britannia deal have gone through? First, you accept that the
:13:17. > :13:21.Tories were in favour of the Britannia take over. Then your
:13:22. > :13:25.Chancellor Osborne went out of his way to facilitate the purchase of
:13:26. > :13:31.the Lloyds branches, even though you had no idea that the Co-op had the
:13:32. > :13:36.management expertise to become a super medium. Correct? The
:13:37. > :13:43.difference is that that deal didn't go through. There was a proper
:13:44. > :13:49.process that took place. Let's look at the process. There was long
:13:50. > :13:55.indications as far back as January 2012 that the Co-op, as a direct
:13:56. > :14:00.result of the Britannia take over which you will party supported, was
:14:01. > :14:03.unfit to acquire the Lloyds branches. By January 2012, the
:14:04. > :14:11.Chancellor and the Treasury ignored the warnings. Wide? In 2009, there
:14:12. > :14:15.was political pressure for the Britannia to be brought together.
:14:16. > :14:19.Based on the information available, this was supported, but that process
:14:20. > :14:22.ended up with a very, very problematic takeover of the
:14:23. > :14:28.Britannia. Wind forward to this year, and when the same types of
:14:29. > :14:32.issues were being looked at for the purchase of the Lloyds deal, the
:14:33. > :14:37.proper process was followed, this time with us in government, and that
:14:38. > :14:41.purchase didn't go through. It is important that the proper process is
:14:42. > :14:50.followed, and when it was, it transpired that the deal wasn't
:14:51. > :14:53.going to be done. But it was the Treasury and the Chancellor who were
:14:54. > :14:59.the cheerleaders for the acquisition of the Lloyds branches. But there
:15:00. > :15:02.was a warning that the Co-op did not have enough capital on its balance
:15:03. > :15:08.sheet to make those acquisitions, but instead of heeding those
:15:09. > :15:12.warnings, your people went to Brussels to lobby for the
:15:13. > :15:17.requirements to be relaxed - why on earth did you do that? Our
:15:18. > :15:22.Chancellor went to argue for all of Rajesh banking, not specifically for
:15:23. > :15:25.the Co-op. He was arguing for the mutuals to be given a special
:15:26. > :15:31.ruling. The idea was to make sure that every bank in Britain could
:15:32. > :15:35.have a better deal, particularly the mutuals, as you say. That is a
:15:36. > :15:40.proper thing for the Chancellor to be doing. We could go round in
:15:41. > :15:43.circles here, but in the end, there was not a takeover of the Lloyds
:15:44. > :15:48.branches, that is because we followed a proper process. Had that
:15:49. > :15:53.same rigorous process been followed in 2009, the legitimate question to
:15:54. > :15:56.ask is whether the Co-op would have been -- would have taken over the
:15:57. > :16:00.Britannia. That is a proper question to ask. It is no good to have the
:16:01. > :16:04.leader of the opposition say, as soon as you ask any of these
:16:05. > :16:09.questions about anything where there is a problem for them, they come
:16:10. > :16:12.back with, oh, this is all smears. There are questions to ask about
:16:13. > :16:17.what the Labour government did, the debt and the deficit they left the
:16:18. > :16:21.country with, the way they stopped work from paying in this country.
:16:22. > :16:26.The big question your government has two answer is, why, by July 201 ,
:16:27. > :16:31.when it was clear there was a black hole in the Co-op's balance sheet,
:16:32. > :16:35.your government re-confirmed the Co-op as the preferred bidder for
:16:36. > :16:39.Lloyds - why would you do that? Well, look, the good thing is, we
:16:40. > :16:43.can discuss this until the cows come home, but there is going to be a
:16:44. > :16:48.proper, full investigation, so we will find out what happened, all the
:16:49. > :16:52.way back. So, we will be able to get to the bottom of all of this. Grant
:16:53. > :16:56.Shapps, the only reason the Lloyds deal did not go ahead was, despite
:16:57. > :17:01.the Treasury cheerleading, when Lloyds began its due diligence, it
:17:02. > :17:06.found that there was indeed a huge black hole in the balance sheet and
:17:07. > :17:10.that the Co-op was not fit to take over its branches. That wasn't you,
:17:11. > :17:14.it wasn't the Government, it was not the Chancellor, it was Lloyds. You
:17:15. > :17:21.were still cheerleading for the deal to go ahead... Well, as I say, a
:17:22. > :17:25.proper process was followed, which did not result in the purchase of
:17:26. > :17:30.the Lloyds branches. At that proper process been followed with the
:17:31. > :17:35.purchase of the Britannia, under the previous government... Which you
:17:36. > :17:39.supported. Yes, but it may well be that under that previous deal, there
:17:40. > :17:42.was a excess political pressure perhaps put on in order to create
:17:43. > :17:51.that merger, which proved so disastrous. The Tories facilitated
:17:52. > :17:56.it, Grant Shapps, they allowed it to go ahead. I have said, we are going
:17:57. > :18:00.to have a proper, independent review. What I cannot understand is,
:18:01. > :18:07.when you announce a robber, independent review, the response you
:18:08. > :18:12.get to these serious questions. The response is, oh, this is a smear. It
:18:13. > :18:16.is crazy. We are trying to answer the big questions for this country.
:18:17. > :18:25.We have done all of that, and we are out of time. The Reverend Flowers'
:18:26. > :18:29.chairmanship of the Co-op bank was approved by the regulator at the
:18:30. > :18:33.time, which no longer exists. It was swept away by the coalition
:18:34. > :18:37.government in a supposed revolution in regulation. But will its
:18:38. > :18:47.replacement, the Financial Conduct Authority, be different? Adam has
:18:48. > :18:50.been to find out. Come with me for a spin around the Square mile to find
:18:51. > :18:54.out how we regulate our financial sector, which is almost five times
:18:55. > :19:01.bigger than the country's entire annual income. First, let's pick up
:19:02. > :19:04.our guide, journalist Iain Martin, who has just written a book about
:19:05. > :19:10.what went so wrong during the financial crisis. The FSA was an
:19:11. > :19:15.agency which was established to supervise the banks on a day-to day
:19:16. > :19:18.basis. The Bank of England was supposed to have overall responsible
:19:19. > :19:22.at for this to Bolivia the financial system and the Treasury was supposed
:19:23. > :19:27.to take an interest in all of these things. The disaster was that it was
:19:28. > :19:32.not anyone's call responsibility, or main day job, to stay alert as to
:19:33. > :19:36.whether or not the banking system as a whole was being run in a safe
:19:37. > :19:40.manner. And so this April, a new system was set up to police the
:19:41. > :19:48.City. Most of the responsibly delays here, with the Bank of England, and
:19:49. > :19:53.its new Prudential Regulation Authority. And the Financial
:19:54. > :19:58.Services Authority has been replaced with the new Financial Conduct
:19:59. > :20:03.Authority. Can we go to the financial conduct authority, please?
:20:04. > :20:07.Canary Wharf, thank you. Here, it is all about whether the people in
:20:08. > :20:11.financial services are playing by the rules, in particular, how they
:20:12. > :20:16.treat their customers. This place has got new powers, like the ability
:20:17. > :20:20.to ban products it does not like, a new mandate to promote competition
:20:21. > :20:25.in the market, the concept being, more competition means a better
:20:26. > :20:31.market, plus the idea that a new organisation rings a whole new
:20:32. > :20:36.culture. Although these are the old offices of the FSA, so maybe not
:20:37. > :20:40.quite so new after all. It has also inherited the case of the Co-op bank
:20:41. > :20:43.and its disgraced former chairman the Reverend Paul Flowers. The SCA
:20:44. > :20:47.will be part of the investigation into what happened, which will
:20:48. > :20:53.probably involve looking at its own conduct. One member of the
:20:54. > :20:57.Parliamentary commission into banking wonders whether the new
:20:58. > :21:02.regulator, and its new boss, are up to it. I have always said, it is not
:21:03. > :21:06.the architecture which is the issue, it is the powers that the regulator
:21:07. > :21:12.has, and today, it does not seem to me as if there is any increase in
:21:13. > :21:16.that. And with the unfolding scandal at the Co-op, it feels like the new
:21:17. > :21:23.architecture for regulating the City is now facing its first big test.
:21:24. > :21:27.And the chief executive of the Financial Conduct Authority, the
:21:28. > :21:32.SCA, Martin Wheatley, joins me now. Welcome to The Sunday Politics. The
:21:33. > :21:37.failure of bank regulation was one of the clearest lessons of the crash
:21:38. > :21:42.in 2008, and yet two years later, in 2010, Paul Flowers is allowed to
:21:43. > :21:47.become chairman of the Co-op - why have we still not got the regulation
:21:48. > :21:52.right? We have made a lot of changes since then. We have created a new
:21:53. > :21:56.regulator, as you know. At the time, we still had a process which allowed
:21:57. > :21:59.somebody to be appointed to a bank and they would go through a
:22:00. > :22:03.challenge, but in the case of Paul Flowers, there was no need for an
:22:04. > :22:08.additional challenge when he was appointed to chairman, because he
:22:09. > :22:13.was already on the board. But going from being on the board to becoming
:22:14. > :22:17.chairman, that is a big jump, and he only had one interview? That is why
:22:18. > :22:22.today, it would be different. But the truth is, that was the system at
:22:23. > :22:26.the time, the system which the FSA operated. He was challenged, we did
:22:27. > :22:30.challenge him, and we said, you do not have the right experience, but
:22:31. > :22:34.at the time, we would not have opposed the appointment. What we
:22:35. > :22:38.needed was additional representation of the board of people who did have
:22:39. > :22:42.banking experience. You can say that that was then and this is now, but
:22:43. > :22:47.up until April of this year, it was still the plan for the Co-op, under
:22:48. > :22:52.Mr Flowers, and despite being seriously wounded by the Britannia
:22:53. > :22:57.takeover, to take on 632 Lloyds branches. That was the Co-op's
:22:58. > :23:00.plan. They needed to pass our test as to whether we thought they were
:23:01. > :23:05.fit to do that, and frankly, they never passed that test. It was not
:23:06. > :23:09.the regulator that stopped them It was. We were constantly pushing
:23:10. > :23:12.back, saying, you have not got the capital, you have no got the
:23:13. > :23:17.systems, and ultimately, they withdrew, when they could not answer
:23:18. > :23:21.our questions. You were asking the right questions, I accept that, but
:23:22. > :23:27.all of the time, the politicians on all sides, they were pushing for it
:23:28. > :23:32.to happen, and I cannot find anywhere where the regulator said,
:23:33. > :23:36.look, this is just not going to happen. I cannot comment on what the
:23:37. > :23:39.politicians were doing, but I continue what we were doing, which
:23:40. > :23:42.was constantly asking the Co-op have you got the systems in place,
:23:43. > :23:47.have you got the people, have you got the capital? And they didn't.
:23:48. > :23:51.But it only came to a head when Lloyds started its own due diligence
:23:52. > :23:54.on the bank, and they discovered that it was impossible for them to
:23:55. > :23:59.take over the branches, it was not the regulator... In fairness, what
:24:00. > :24:05.we do is ask the questions, can you do this deal? And we kept pushing
:24:06. > :24:12.back, and we never frankly got delivered a business plan which we
:24:13. > :24:23.were happy to approve. Is the SCA going to launch its own inquiry into
:24:24. > :24:27.what happened? -- the FCA. The Chancellor has announced what will
:24:28. > :24:32.be a very broad inquiry. There are a number of specifics which we will be
:24:33. > :24:36.able to look at, relating to events over the last five years. Could
:24:37. > :24:39.there be a police investigation I think the police have already
:24:40. > :24:44.announced an investigation. I am talking about into the handling of
:24:45. > :24:52.the bank. It depends. There might be, if there is grim low activity,
:24:53. > :25:00.which we do not know yet. You worked at the FS eight, didn't you? I did.
:25:01. > :25:04.Some of those people who were signed off on the speedy promotion of Mr
:25:05. > :25:09.Flowers, are they now working there? Yes, we have some. I came to
:25:10. > :25:13.join the Financial Services Authority, to lead it into the
:25:14. > :25:26.creation of the new body, the SCA. We had people who were challenging
:25:27. > :25:30.and they did the job. There was not a requirement to approve the role as
:25:31. > :25:34.chairman. There was not even a requirement to interview at that
:25:35. > :25:38.stage. What we did do was to require that he was interviewed, and that
:25:39. > :25:50.the Co-op should get additional experience. One of the people from
:25:51. > :25:54.the old organisation, who signed up on the promotion of Mr Flowers to
:25:55. > :26:02.become chairman is now a nonexecutive director of the Co op,
:26:03. > :26:05.so how does that work? Welcome he was a senior adviser to our
:26:06. > :26:09.organisation, one of the people who made the challenges, and who said,
:26:10. > :26:14.you need more experience on your board. Subsequently he then went and
:26:15. > :26:18.joined the board. Surely that should not be allowed, the regulator and
:26:19. > :26:23.the regulated should not be like that. Well clearly, you need
:26:24. > :26:27.protection, but we have got to get good people in, and frankly, we want
:26:28. > :26:30.the industry to have good people in the industry, so there will be some
:26:31. > :26:34.movement between the regulator and industry. We all wonder whether you
:26:35. > :26:39.have the power or even the confidence to stand up if you look
:26:40. > :26:43.at all of the really bad bank decisions recently, politicians were
:26:44. > :26:47.behind them. It was Gordon Brown who pushed the disastrous merger of
:26:48. > :26:51.Lloyds and RBS. It was Alex Salmond who egged on RBS to buy the world.
:26:52. > :26:56.All three main parties wanted the Co-op to buy Britannia, even though
:26:57. > :27:00.they did not know the debt it would inherit, and all three wanted the
:27:01. > :27:05.Co-op to buy the Lloyds branches - how do you as a regulator stand up
:27:06. > :27:10.to that little concert party? Well, that political pressure exists, our
:27:11. > :27:14.job at the end of the day is to do a relatively technical job and say,
:27:15. > :27:17.does it stack up? And it didn't and we made that point time and time
:27:18. > :27:21.again to the Co-op board. They did not have a business case that we
:27:22. > :27:28.could approve. The bodies on left and right -- the politicians on left
:27:29. > :27:35.and right gave the Co-op special support. They may have done, but
:27:36. > :27:39.that was not you have made a warning about these payday lenders, but I
:27:40. > :27:43.think what most people would like to see is a limit put on the interest
:27:44. > :27:48.they can charge over a period of time - will you do that? We have got
:27:49. > :27:52.a whole set of powers for payday lenders. We will bring in some
:27:53. > :27:56.changes from April next year, and we will bring in further changes as we
:27:57. > :28:00.see necessary. Will you put a limit on the interest they can charge
:28:01. > :28:05.That is something we can study. You do not sound too keen on it? Well,
:28:06. > :28:10.there are a lot of changes we need to make. One change is limiting
:28:11. > :28:13.rollovers, limiting the use of continuous payment authorities.
:28:14. > :28:19.Simply jumping to one trigger would be a mistake. Finally, an issue
:28:20. > :28:22.which I think is becoming a growing concern, because the Government is
:28:23. > :28:27.thinking of subsidising them, 9 % mortgages are back - should we not
:28:28. > :28:32.be worried about that? I think we should if the market has the same
:28:33. > :28:37.experiences that we had back in 2007 - oh wait. We are bringing a
:28:38. > :28:42.comprehensive package in under our mortgage market review, which will
:28:43. > :28:53.change how people lend and will put affordability back at the heart of
:28:54. > :28:56.lending decisions. -- 2007-08. You have not had your first big
:28:57. > :29:02.challenge yet, have you? We have many challenges.
:29:03. > :29:06.It was once called the battle of the mods and the rockers - the fight
:29:07. > :29:08.between David Cameron-style modernisers and old-style
:29:09. > :29:12.traditional Tories for the direction and soul of the Conservative Party.
:29:13. > :29:21.But have the mods given up on changing the brand? When David
:29:22. > :29:24.Cameron took over in 2005, he promoted himself as a new Tory
:29:25. > :29:31.leader. He said that hoodies need more love. He was talking about
:29:32. > :29:34.something called the big society. He told his party conference that it
:29:35. > :29:39.was time to that sunshine win the day. There was new emphasis on the
:29:40. > :29:44.environment, and an eye-catching trip to a Norwegian glacier to see
:29:45. > :29:49.first-hand, supposedly, the effects of global warming. This week, party
:29:50. > :29:52.modernise and Nick bone has said that the party is still seen as an
:29:53. > :30:00.old-fashioned monolith and hasn t done enough to improve its appeal.
:30:01. > :30:06.The Tories have put some reforms into practice, such as gay marriage,
:30:07. > :30:12.but they have put more into welfare reform band compassionate
:30:13. > :30:16.conservatism. David Cameron wants talked about leading the greenest
:30:17. > :30:25.government ever. Downing Street says that the quote in the Son is not
:30:26. > :30:30.recognised, get rid of the green crap. At this point in the programme
:30:31. > :30:32.we were expecting to hear from the Energy and Climate Change Minister,
:30:33. > :30:37.Greg Barker. Unfortunately, he has pulled out, with Downing Street
:30:38. > :30:43.saying it's for ""family reasons"". Make of that what you will. However,
:30:44. > :30:47.we won't be deterred. We're still doing the story, and we're joined by
:30:48. > :30:53.our very own mod and rocker - David Skelton of the think-tank Renewal,
:30:54. > :30:58.and Conservative MP Peter Bone. Welcome to you both. I'm glad your
:30:59. > :31:02.family is allowed you to come? David Skelton, getting rid of all the
:31:03. > :31:06.green crap, or words to that effect, that David Cameron has been saying.
:31:07. > :31:11.It is just a sign that Tory modernisation has been quietly
:31:12. > :31:16.buried. I do think that's right Modernisation is about reaching out
:31:17. > :31:21.to the voters, and the work to do that is now more relevant than ever.
:31:22. > :31:27.We got the biggest swing since 931, and the thing is we need to do more
:31:28. > :31:33.to reach out to voters in the North. We need to reach out to non-white
:31:34. > :31:39.voters, and show that the concerns of modern Britain and the concerns
:31:40. > :31:43.of ordinary people is something that we share. And what way will racking
:31:44. > :31:47.up electricity bills with green levies get you more votes in the
:31:48. > :31:52.North of England? We have to look at ways to reduce energy bills. The
:31:53. > :31:58.renewable energy directive doesn't do anything to help cut our
:31:59. > :32:03.emissions, but does decrease energy bills by ?45 a year. We should
:32:04. > :32:09.renegotiate that. That is a part of modernisation and doing what
:32:10. > :32:15.ordinarily people want. And old dinosaurs like you are just holding
:32:16. > :32:18.this modernisation process back I am very appreciative of covering on
:32:19. > :32:23.this programme. The Tory party has been reforming itself for more than
:32:24. > :32:27.150 years. This idea of modern eyes a is just some invention. We are
:32:28. > :32:35.changing all the time. I'm nice and cuddly! So you are happy that the
:32:36. > :32:40.party made gay marriage almost a kind of symbol of its modernisation?
:32:41. > :32:48.Fine Mac the gay marriage was a free vote. David Cameron was recorded as
:32:49. > :32:53.a rebel there because more Tories voted against his position than ever
:32:54. > :32:56.before. It was said that this was a split between the old and young but
:32:57. > :33:00.it actually was a split between those who were religious and
:33:01. > :33:06.nonreligious. It is a misinterpretation of what happened.
:33:07. > :33:12.Is a modernisation in retreat? I think modernisation is an
:33:13. > :33:18.invention. Seven years ago, in my part of the world, we got three
:33:19. > :33:24.councillors elected, two were 8 and one was 21. A few months ago, a
:33:25. > :33:28.25-year-old was chosen to fight Corby for the Conservative Party. He
:33:29. > :33:33.came from a comprehensive School. He was one of the youngest. The Tory
:33:34. > :33:39.party is moving on. So you found three young people? Hang on a
:33:40. > :33:47.minute. You can't get away with that. Three in one batch. Does
:33:48. > :33:53.modernisation exist? Modernisation is about watering our appeal and
:33:54. > :33:58.sharing our values are relevant to voters who haven't really thought
:33:59. > :34:01.about voting for us for decades now. Modernisation is about more than
:34:02. > :34:05.windmills and stuff, it is about boosting the life chances of the
:34:06. > :34:12.poorest, it is about putting better schools in poorer areas. It is also
:34:13. > :34:17.saying that modernisation and the Tory party... When has the Tory
:34:18. > :34:22.party been against making poorer people better off? Or against better
:34:23. > :34:26.schools? Do you think Mrs Thatcher was a moderniser when she won all
:34:27. > :34:32.those elections? The problem we have at the moment is that UKIP has
:34:33. > :34:36.grown-up. If we could get all of those people who vote UKIP to vote
:34:37. > :34:41.for us, we would get 47% of the vote. We don't need to worry about
:34:42. > :34:45.voters on the left. We need to worry about the voters in the north, those
:34:46. > :34:53.people who haven't voted for us for decades. Having an EU Referendum
:34:54. > :34:59.Bill is going to get people to vote. We have to reach out to
:35:00. > :35:04.voters, but not by some sort of London based in need. You have to
:35:05. > :35:08.broaden your base. I agree with you on that. We have to broaden our
:35:09. > :35:13.appeal, but this back to the future concept is not going to work. We
:35:14. > :35:18.need something that generally appeals to low and middle-income
:35:19. > :35:22.voters, and something that shows we genuinely care about the life
:35:23. > :35:31.chances of the poorest. Do you think that the people who vote UKIP don't
:35:32. > :35:34.support those aspirations? We are not doing enough to cut immigration.
:35:35. > :35:39.We don't have an EU Referendum Bill stop we have to get the centre right
:35:40. > :35:46.to vote for us again. Do that, and we have it. Tom Pursglove, the 5
:35:47. > :35:59.euros, will be returned in Corby because we cannot win an election
:36:00. > :36:04.there. -- the 25-year-old. Whether you are moderniser or
:36:05. > :36:12.traditionalist, people, particularly in the North, see you as a bunch of
:36:13. > :36:17.rich men. And rich southerners. You are bunch of rich southerners. We
:36:18. > :36:24.need to do more to show that we are building on lifting the poorest out
:36:25. > :36:27.of the tax. We need to build more houses. There is a perception that
:36:28. > :36:34.the leadership at the moment is rich, and public school educated.
:36:35. > :36:40.What we have to do is get more people from state education into the
:36:41. > :36:48.top. You are going the other way at the moment. That is a fair
:36:49. > :36:55.criticism. Modernisers also say that. I went to a combo hedge of
:36:56. > :36:58.school as well. -- do a comprehensive school. We need to
:36:59. > :37:07.show that we are standing up for low income. Thank Q, both of you. You
:37:08. > :37:09.are watching the Sunday Politics. Coming up in just under
:37:10. > :37:32.Coming up: The rising pressure on Tory tie the knot in a partnership.
:37:33. > :37:37.Coming up: The rising pressure on mental health services where
:37:38. > :37:42.patients struggle to find a bed. Recently we have been told beds are
:37:43. > :37:46.far away, as far away, as far`away as Glasgow. Labour takes its message
:37:47. > :37:50.to supporters at its rally in the east. Two become one ` Labour and
:37:51. > :37:54.Tory face the funding cuts together. But first, let's meet our guests.
:37:55. > :37:57.Labour's Corby MP, Andy Sawford and the Conservative leader of Suffolk
:37:58. > :38:01.Council, Mark Bee, who we've just seen. And I'd like to start with the
:38:02. > :38:04.vote this week brought by Essex MP, John Baron, on the changes to our
:38:05. > :38:08.armed forces. He's objecting to government plans for a reduction in
:38:09. > :38:20.regular soldiers and an increase in reservists. The bottom line is
:38:21. > :38:25.sometimes you have two rise above party politics and discuss issues of
:38:26. > :38:28.principle. This is one. Well, Defence Secretary, Philip Hammond
:38:29. > :38:37.managed to head off John Baron's rebellion was that a good thing? I
:38:38. > :38:43.voted with John Barron this week and a number of Conservative MPs from
:38:44. > :38:47.across the region. We are worried that, whilst reservists do a
:38:48. > :38:55.fantastic job, they are not a substitute for full`time soldiers.
:38:56. > :39:01.His argument is that radical plans were approved. How uncomfortable is
:39:02. > :39:05.it, Tory fighting Tory? I perfectly reset `` respect where he is coming
:39:06. > :39:11.from but we have to look at the wider picture. We are no longer in a
:39:12. > :39:17.Cold War situation. We need a more flexible reserve list and Armed
:39:18. > :39:23.Forces. We need to ensure we have got the ability to move to the
:39:24. > :39:28.numbers we require. We are looking to move the reservists to about
:39:29. > :39:34.30,000. As Andrew has just said, they do a fantastic job. A friend of
:39:35. > :39:38.mine was in the territorial Army and he went to Iraq on a six`month tour.
:39:39. > :39:44.They were treated like regular soldiers and he was able to do the
:39:45. > :39:49.job and be respected. What about the concessions? And the annual reports
:39:50. > :39:54.to the house? Through this major defence review and others is that we
:39:55. > :39:57.have seen big decisions taken by the government, perhaps in haste,
:39:58. > :40:08.without thinking of long`term defence needs. We are in a situation
:40:09. > :40:11.now where we have aircraft carriers without aircraft. We could not
:40:12. > :40:13.defend the Falklands if we needed to and we're not sure if we can meet
:40:14. > :40:15.commitments with our troop numbers and there is a real concern about
:40:16. > :40:20.that. Now to the crisis in our mental
:40:21. > :40:41.health service. Work is one that cuts to budgets could cost lives.
:40:42. > :40:46.The Norfolk and Suffolk NHS foundation trust needs to say ?40
:40:47. > :40:52.million. It is planning to reduce beds by another 20%. It aims to lose
:40:53. > :40:56.around 400 jobs. It has emerged that the trust 's new chief executive
:40:57. > :41:01.will not be appointed till next year. Here's Kevin Burch.
:41:02. > :41:04.It's reckoned that one in four of us will experience a problem with
:41:05. > :41:11.mental health at some point in our lives. It's a statistic which
:41:12. > :41:14.reminds us of our fragility and which helps to explain why this
:41:15. > :41:17.radical plan to cut budget, jobs and beds is proving so controversial.
:41:18. > :41:21.Emma Corlett is a mental health nurse in Norfolk and an official
:41:22. > :41:23.with UNISON. She says resources were stretched before this proposed
:41:24. > :41:31.shake`up. Now things have reached breaking point. Since the cuts
:41:32. > :41:37.started, it has been reported that people can't find a bed locally. It
:41:38. > :41:42.might be someone from kindling admitted to great Yarmouth. People
:41:43. > :41:48.recently were told the nearest bed is in Glasgow `` Kings Lynn. This
:41:49. > :41:51.worker has been involved locally in mental health care for seven years.
:41:52. > :41:56.She wanted to talk about her worries, but remain anonymous. Her
:41:57. > :42:02.words are spoken by someone else. The government needs to realise you
:42:03. > :42:06.can't cut the money because it will lead people to suicide. They are
:42:07. > :42:11.putting us under pressure all the time and the people we look after
:42:12. > :42:18.our under stress. You feel choked up when you leave the person at how
:42:19. > :42:24.vulnerable they are. This mental health nurse worked for 35 years and
:42:25. > :42:29.is now helping to assess the impact of the plans changes. A major
:42:30. > :42:33.consultation is planned in January and she is part of the
:42:34. > :42:38.pre`consultation panel. We will have a lot of people slipping through the
:42:39. > :42:44.net. What happens then is people try to manage but they can't see a way
:42:45. > :42:47.out. That is when you get suicidal ideas. It is then a spiral. Looking
:42:48. > :42:50.back down the generations can help give some context for today's
:42:51. > :42:54.debate. This exhibition at the Time and Tide Museum in Great Yarmouth is
:42:55. > :42:57.on until the Spring. It looks at how textiles have been used for
:42:58. > :43:06.centuries to help people struggling with depression, sadness and loss.
:43:07. > :43:10.Throughout history, people have gone through difficult experiences and
:43:11. > :43:16.severe mental ill health problems are not a modern phenomenon. We'll
:43:17. > :43:23.see much `` modern occupational search `` therapy as something that
:43:24. > :43:27.started in the 20th century. Three years ago... Three years ago, this
:43:28. > :43:31.woman's husband was diagnosed with timers and could no longer stay at
:43:32. > :43:35.home. But to assessment wars have been
:43:36. > :43:40.shut and she is worried about what the future holds for him and others
:43:41. > :43:47.like him. Opting more scared in the community, she says, would be a huge
:43:48. > :43:52.mistake `` opting for more care in the community. There would be no one
:43:53. > :43:59.to call on. Carers cannot call on two of us. What will they do? For
:44:00. > :44:04.six years, he was at home and for the last eight months I did not
:44:05. > :44:10.sleep. I know what pitch I got to. I could have hurt him. Who do you go
:44:11. > :44:16.to? Who do you talk to? David is the most precious thing in my life and I
:44:17. > :44:22.need him to be safe. Meanwhile, 79 staff from the Norfolk
:44:23. > :44:26.and Suffolk NHS trust who were expecting redundancy were surprised
:44:27. > :44:49.to learn they are to get a reprieve. There are claims the trust is
:44:50. > :44:54.failing to meet its own target. There are occasions when we have to
:44:55. > :44:58.send people outside the area. Some of those are specialist placements
:44:59. > :45:02.where we don't have the ability to care for them inside the trust and
:45:03. > :45:08.it is right that they are sent somewhere where they can be properly
:45:09. > :45:13.looked after. Within Norfolk, we have had 2000 at missions into our
:45:14. > :45:18.acute wards and there have been 51 occasions where we have had to send
:45:19. > :45:22.people out of area and that is 51 to many. It is not good for the service
:45:23. > :45:29.user or their families and nor does it make sense `` sense financially
:45:30. > :45:33.for the trust. In Suffolk, out of area placements are very rare
:45:34. > :45:39.indeed. I you happy with the way the trust is being run? I am. It is a
:45:40. > :45:43.difficult time and I will not pretend otherwise. We have been
:45:44. > :45:48.confronted with needing to make savings of ?20 million over the next
:45:49. > :45:52.four years. That is the financial envelope within which we have to
:45:53. > :45:57.work. Worryingly, there has been a rise in the number of unexplained
:45:58. > :46:03.deaths in the trust. From April to August this year, there were 20
:46:04. > :46:08.unexplained deaths. What you say to the relatives of those people? Every
:46:09. > :46:13.single one of the incidence is a tragedy for the people involved and
:46:14. > :46:18.I mean that very sincerely. We have done some initial analysis. In
:46:19. > :46:23.Suffolk, the number has gone down. In Norfolk, there was a spike over a
:46:24. > :46:27.short period of time and we have looked at each of these
:46:28. > :46:31.individually. There is a detailed report being done which will come to
:46:32. > :46:37.the board at the end of this year and we will take that report public
:46:38. > :46:41.because I commit to being transparent about this. It is also
:46:42. > :46:44.true to say that if you look at those deaths over a longer period of
:46:45. > :46:51.time, they are not inconsistent with the historic picture, nor the
:46:52. > :46:58.national picture. We also hear that targets are not being met. This was
:46:59. > :47:03.a report and it is a work in progress. Targets are nearer to 80%
:47:04. > :47:07.but that is still not good enough. We are putting on extra staff to
:47:08. > :47:11.work Friday evenings and weekends and early on Monday mornings because
:47:12. > :47:17.the weekend period causes us the problem but I want to hit 100%. What
:47:18. > :47:23.about the cut in bed than how much pressure does that put on services
:47:24. > :47:31.you can offer? Should it be happening? In Suffolk, there have
:47:32. > :47:34.been no reduction in beds as a result of the strategy
:47:35. > :47:40.implementation. In Norfolk, 44 beds have been taken out of service. We
:47:41. > :47:44.are moving towards consultation with the clinical commissioning groups.
:47:45. > :47:51.The first one starts in the New Year. Together with the care quality
:47:52. > :47:56.commission and the public consultation we can decide what
:47:57. > :47:59.number of beds is required. I am sure we will have the right number
:48:00. > :48:05.of beds and we should not take any more out until we are sure we can
:48:06. > :48:07.meet the needs of the people. We have an institutional bias against
:48:08. > :48:12.mental health within the health service. When the last government
:48:13. > :48:16.introduced waiting time targets for people with physical health
:48:17. > :48:21.problems, the 18 week target from referral to treatment... They left
:48:22. > :48:26.out mental health. That means them money flows to acute hospitals and
:48:27. > :48:32.away from mental health. But this trust is missing key targets? It is
:48:33. > :48:36.and that is why I say that I have very real concerns about the way it
:48:37. > :48:40.is being led and that is why I want to bring people together to find a
:48:41. > :48:46.way forward. How does this fit with you personally because this is your
:48:47. > :48:54.responsibility? It is your government making these 20% cuts. It
:48:55. > :48:58.is really important I think for the BBC to be accurate about what the
:48:59. > :49:03.financial position actually is. Throughout this Parliament, this
:49:04. > :49:07.government has maintained and, indeed, slightly increased funding
:49:08. > :49:10.for the health service. There is absolutely no cut imposed by the
:49:11. > :49:16.government on mental health services. There clearly are cuts
:49:17. > :49:21.that are affecting mental health services otherwise we would not be
:49:22. > :49:27.discussing the lack of acute beds. Let me explain. The government has
:49:28. > :49:33.maintained funding for the health service `` mental health service and
:49:34. > :49:36.increased it. At a local level, care trusts and commissioning groups have
:49:37. > :49:40.to decide how to spend the money locally. Because there is an
:49:41. > :49:45.institutional bias against mental health with no rights of access
:49:46. > :49:50.which exist in physical health, and I have changed that from 2015 there
:49:51. > :49:55.will be new access standards for mental health. As long as we have
:49:56. > :49:57.the bias against mental health, local commissioners will
:49:58. > :50:04.disadvantage mental health and that is why cats are happening. They
:50:05. > :50:09.can't find any more money though? If you can tell me where there is more
:50:10. > :50:13.money available then please do so. This government has chosen to
:50:14. > :50:18.protect funding for the NHS. We have to make sure mental health services
:50:19. > :50:22.gets its fair share. That hasn't happened until now because the
:50:23. > :50:28.system sucks money into acute trusts and away from mental health and that
:50:29. > :50:32.is what has to end. This is your mental health trust so
:50:33. > :50:36.how does that make you feel? There are concerns and we need to monitor
:50:37. > :50:41.that and I share the view that Norman Lamb expressed in your film
:50:42. > :50:46.that we need to keep a close eye on this. The great thing about this and
:50:47. > :50:50.the partnership between Norfolk and Suffolk county councils is that we
:50:51. > :50:55.see the Norfolk and Suffolk mental health trust is one we can work
:50:56. > :51:00.together on. Do you feel reassured by his assertion that there is on a
:51:01. > :51:04.budget cut? What I am really reassured by is that we are trying
:51:05. > :51:09.to look at this complex issue of mental health. It is one that is
:51:10. > :51:15.emerging really in the way that has been described in your film because
:51:16. > :51:19.it is a complex subject. We cannot look at simplistic ways of dealing
:51:20. > :51:25.with it. The health trust you are referring to, the mental health
:51:26. > :51:28.trust, has GP referrals which ensure people can be challenged ``
:51:29. > :51:32.channelled in the right way and the commissioning group is happy with
:51:33. > :51:37.that. I hope the trust can move forward. Are you reassured by Norman
:51:38. > :51:43.Lamb saying there is not a budget cut? Clearly there has been a year
:51:44. > :51:47.budget cut in real terms. We know there are 2000 less beds across the
:51:48. > :51:51.country and your own figures show across our region there are fewer
:51:52. > :52:07.beds. Northamptonshire has held onto them for the time being but they are
:52:08. > :52:09.now reviewing it. We have seen a rise in the suicide rent and
:52:10. > :52:12.problems in treating minor had mental health problems. One in five
:52:13. > :52:14.people wait more than 12 months to receive talking therapies and those
:52:15. > :52:16.problems then become my `` major mental health problems. What about
:52:17. > :52:19.the point that money flows to acute hospitals to meet targets which
:52:20. > :52:22.Labour instigated? In terms of the big issue of men `` money moving
:52:23. > :52:30.around the system, is then high number of private butts `` Private
:52:31. > :52:36.beds. I don't want to see money going to private companies. I want
:52:37. > :52:41.to see us getting more money into preventative mental health care in
:52:42. > :52:45.this country and to see this not just as an NHS problem. The CBI
:52:46. > :52:50.ought to be thinking about our workplaces. In is a school this
:52:51. > :52:55.morning we talked about well`being of young people. Mental health
:52:56. > :53:01.well`being is everywhere. You want to have the key person but I want to
:53:02. > :53:07.come back to something that Andrew said. We have to tackle mental
:53:08. > :53:12.health issues on eight case`by`case basis. One thing we are looking at
:53:13. > :53:20.in Suffolk is a care file where GPs can refer people to go and do work
:53:21. > :53:25.on a farm on a farming by prescription basis. And that is
:53:26. > :53:36.helping people on low mental health issues to find back in the
:53:37. > :53:43.community. Thank you. This week, has been a chance for the Labour Party
:53:44. > :53:47.to hone their pre`election issues. Labour has 13 target seats in the
:53:48. > :53:54.Eastern region. Party sources have told us that they will not be happy
:53:55. > :53:58.if they win less than eight of them. The conference was kicked off by Ed
:53:59. > :54:03.Miliband on Friday. What Labour Party members are feeling is that
:54:04. > :54:07.Labour has been setting the agenda, talking about the fact we have a
:54:08. > :54:13.government which says everything is fixed on the economy but ordinary
:54:14. > :54:18.people do not feel that. They think, who will stand up for us? The key
:54:19. > :54:25.issue of energy prices where Labour has set the agenda and we say we
:54:26. > :54:28.will freeze prices until 2017 if we win the election and we will use the
:54:29. > :54:35.time to sort out a broken energy market. That is what I call standing
:54:36. > :54:43.up for ordinary families in this country. Your first year as a Labour
:54:44. > :54:50.MP. How does it feel to a newcomer? We have a big challenge in the
:54:51. > :54:58.Labour Party to win people 's trust. We are making good progress. Ed
:54:59. > :55:02.Miliband has shown at the conference with his pledge to freeze energy
:55:03. > :55:05.prices that we understand the real problem is that people 's living
:55:06. > :55:09.standards are being squeezed and that is getting through to people.
:55:10. > :55:17.They feel the Tories are out of touch. Labour is fighting hard to
:55:18. > :55:23.gain Waverley. Will you hold it? I believe we can and we are working
:55:24. > :55:28.hard to make sure it happens. In this phoney war situation now, in
:55:29. > :55:35.the long run`up to 2015, we are in a unique position because we know the
:55:36. > :55:40.date of the next general election. We are seeing a lot of slow burning
:55:41. > :55:45.campaigning as we build up to the election. Do you think this is the
:55:46. > :55:55.beginning of the real election campaign to mark the Conservatives
:55:56. > :56:04.have hired a man who specialises in dirty campaigning, frankly. I want
:56:05. > :56:09.the next election to be about ideas. To make sure people have good jobs
:56:10. > :56:19.and health services. Not getting down in the gutter. What do think
:56:20. > :56:26.the main issues will be here the East? It is about the economy, jobs
:56:27. > :56:31.and people feeling confident in the future in the money they will have
:56:32. > :56:36.left over each week or month in their pay packet. I can see why
:56:37. > :56:42.Labour are doing what they are doing in trying to ensure people about the
:56:43. > :56:47.cost of living. But we can see and improving economy and I hope by the
:56:48. > :56:53.time we get to 2015 people will feel the benefit. What about the eight
:56:54. > :56:56.seat target? Is it realistic? We need to make significant gains in
:56:57. > :57:02.the Eastern region and we are working hard in seats like Thurrock
:57:03. > :57:07.and Harlow and Ipswich. They are important targets for us. That is
:57:08. > :57:12.why Ed Miliband, Ed balls and Harriet Harman have been here this
:57:13. > :57:17.weekend. A partnership between red and blue to fight for services in
:57:18. > :57:28.the future. That is all in the 62nd round up of the week. 62nd.
:57:29. > :57:34.On the dark side of the street, well Council make a point about litter,
:57:35. > :57:40.cleaning one side only. While objections to the proposed road toll
:57:41. > :57:45.on the a 14 were voiced by one MP at Prime Minister 's questions. They
:57:46. > :57:53.are increasingly fearful that the proposed road toll will put the area
:57:54. > :57:59.at a serious competitive disadvantage. Ed Miliband hit out at
:58:00. > :58:07.cuts to sure start Seth `` centres in Essex. The proposal is to close
:58:08. > :58:10.at 11 centres and downgrade 37. The leaders of Suffolk and Norfolk
:58:11. > :58:17.county council 's are delighted to have signed a partnership agreement
:58:18. > :58:24.to help save money. Tim Yeo has been cleared of any wrongdoing by the
:58:25. > :58:29.Parliamentary standards committee. He was accused of lobbying ministers
:58:30. > :58:34.on behalf of a company. We saw you in the meeting on the
:58:35. > :58:39.bridge. What does the merger mean in practical terms? We are not a
:58:40. > :58:43.merger. We will steal `` still be two councils but we are going to
:58:44. > :58:50.pool resources and find ways of sharing services to meet the
:58:51. > :58:56.challenge we have with the all`important financial situation.
:58:57. > :59:01.Between us we have 30% savings in our budget so, working together and
:59:02. > :59:05.sharing our resources, we can find solutions. From a party political
:59:06. > :59:13.point of view, what do you make of it? I work with both councils and I
:59:14. > :59:19.encourage them to do that and they do. It is to be welcomed that Mark
:59:20. > :59:22.is working closely with Norfolk county council and I hope they can
:59:23. > :59:27.bring benefits in terms of local services. Does it matter what your
:59:28. > :59:32.politics are? It is thought to be the first blending, if you like.
:59:33. > :59:40.Where it is carried `` a collaboration, we have what is
:59:41. > :59:45.unique between county councils although district and borough
:59:46. > :59:51.councils have done it. I think, to answer your question, it is more
:59:52. > :59:58.about us being Norfolk and Suffolk and the historic rivalries that are
:59:59. > :00:01.brought together in politics. Thanks for joining us. You can keep in
:00:02. > :00:06.touch fire our website where you will also find links to all the
:00:07. > :00:08.latest political updates. We are back at the same time next
:00:09. > :00:10.week when we will We are back at the same time next
:00:11. > :00:14.those people who want to cycle. We will be returning to this one. Thank
:00:15. > :00:25.you. A little bit of history was made at
:00:26. > :00:30.Prime Minister's Questions this week. A teensy tiny bit. It wasn't
:00:31. > :00:32.David Cameron accusing one MP of taking "mind-altering substances" -
:00:33. > :00:36.they're always accusing each other of doing that. No, it was the first
:00:37. > :00:39.time a Prime Minister used a live tweet sent from someone watching the
:00:40. > :00:48.session as ammunition at the dispatch box. Let's have a look We
:00:49. > :00:54.have had some interesting interventions from front edges past
:00:55. > :00:58.and present. I hope I can break records by explaining that a tweet
:00:59. > :01:02.has just come in from Tony McNulty, the former Labour security
:01:03. > :01:07.minister, saying that the public are desperate for a PM in waiting who
:01:08. > :01:12.speaks for them, not a Leader of the Opposition in dodging in partisan
:01:13. > :01:16.Westminster Village knock about So I would stay up with the tweets if
:01:17. > :01:21.you want to get on the right side of this one! We are working on how the
:01:22. > :01:25.Prime Minister managed to get that wheat in the first place. What did
:01:26. > :01:32.you think when you saw it being read out? I was certainly watching the
:01:33. > :01:36.Daily Politics. I almost fell off my chair! It was quite astonishing He
:01:37. > :01:41.didn't answer the question - he didn't do that the whole time. But I
:01:42. > :01:46.stand by what the tweets said. I have tweeted for a long time on
:01:47. > :01:52.PMQs. Normally I am praising Ed Miliband to the hilt, but no one
:01:53. > :01:56.announces that in Parliament! Because the Prime Minister picked up
:01:57. > :02:01.on what you said, it unleashed some attacks on you from the Labour side.
:02:02. > :02:05.It did, minor attacks from some very junior people. Most people were
:02:06. > :02:11.supportive of what I said. They took issue with the notion of not doing
:02:12. > :02:16.it until 12:30pm, when it wasn't available for the other side to use.
:02:17. > :02:21.Instant history, and instantly forgettable, I would say. Do you
:02:22. > :02:25.think you have started a bit of a trend? I hope not, because the
:02:26. > :02:35.dumbing down of PMQs is already on its way. Most people tweet like mad
:02:36. > :02:39.through PMQs! Is a measure of how post-modern we have become, we have
:02:40. > :02:45.journalists tweeting about someone talking about a tweet. That is the
:02:46. > :02:48.level of British politics. I am horrified by this development. The
:02:49. > :02:55.whole of modern life has become about observing people -- people
:02:56. > :03:00.observing themselves doing things. Do we know what happened? Somebody
:03:01. > :03:05.is monitoring the tweets on behalf of the Prime Minister or the Tory
:03:06. > :03:09.party. They see Tony's tweet. They then print it out and give it to
:03:10. > :03:13.him? There was a suggestion that Michael Goves had spotted it, but
:03:14. > :03:24.Craig Oliver from the BBC had this great sort of... Craig Oliver was
:03:25. > :03:28.holding up his iPad to take pictures of the Prime Minister, which he then
:03:29. > :03:32.tweeted, from the Prime Minister. People will now be tweeting in the
:03:33. > :03:38.hope that they will be quoted by the Prime Minister, or the Leader of the
:03:39. > :03:44.Opposition. I wasn't doing that I'm just talking about the monster you
:03:45. > :03:49.have unleashed! I hope it dies a miserable death. I think Tony is a
:03:50. > :03:58.good analysis -- a good analyst of PMQs on Twitter. Moving onto the
:03:59. > :04:07.Co-op. You were a Co-op-backed MP, white you? I was a Co-op party
:04:08. > :04:11.member. There are two issues here about the Co-op and the Labour
:04:12. > :04:16.Party. All the new music suggests that the Co-op will now have to
:04:17. > :04:21.start pulling back from lending or donating to the Labour Party, which,
:04:22. > :04:24.at a time when Mr Miliband is going through changes that are going to
:04:25. > :04:30.cut of the union funds, it seems quite dangerous. There are three
:04:31. > :04:34.things going on. There's the relationship that the party has
:04:35. > :04:39.politically with the Co-op party, there is the commercial relationship
:04:40. > :04:43.you referred to, and then there is this enquiry into the comings and
:04:44. > :04:50.goings of Flowers and everybody else. The Tories, at their peril,
:04:51. > :04:54.will mix the three up. There's a lot of things going on with a bang.
:04:55. > :04:59.Labour has some issues around funding generally, and they are
:05:00. > :05:07.potentially exacerbated by the Co-op issue. The Labour Party gets soft
:05:08. > :05:14.loans from the Co-op bank, and it gets donations. ?800,000 last year.
:05:15. > :05:18.Ed Balls got about ?50,000 for his private office. You get the feeling,
:05:19. > :05:24.given the state of the Co-operative Bank now, that that money could dry
:05:25. > :05:28.up. We will see. There's lots of speculation in the papers today At
:05:29. > :05:33.the core, the relationship between the Co-op party and the Labour Party
:05:34. > :05:38.is a proud one, and a legitimate one. I don't think others always
:05:39. > :05:43.understand that. Here is an even bigger issue. Is it not possible
:05:44. > :05:50.that the Co-op bank will cease to exist in any meaningful way as a
:05:51. > :06:01.Co-op bank? Is the bane out means it is 70% owned -- the bail out means
:06:02. > :06:06.that it is 70% owned, or 35% going to a hedge fund, I think I read
:06:07. > :06:10.Yes, there is a move from the mutualism of the Co-op. But don t
:06:11. > :06:21.confuse the Co-op bank with the Co-op Group. Others have done that.
:06:22. > :06:29.I haven't. Here's the rub. The soft loans that Labour gets. They got
:06:30. > :06:38.?1.2 million from this. And 2.4 million. They are secured against
:06:39. > :06:44.future union membership fees of the party. What is Mr Miliband doing? He
:06:45. > :06:49.is trying to end that? You have this very difficult confluence of events,
:06:50. > :06:53.which is, could these wonderful soft loans that Labour has had from the
:06:54. > :06:59.Co-op, could they be going? And these union reforms, where Ed
:07:00. > :07:04.Miliband is trying to create a link between individuals and donations to
:07:05. > :07:08.the Labour Party... Clearly, there could be real financial difficulties
:07:09. > :07:11.here. The government needs to be careful, because George Osborne
:07:12. > :07:14.launched one of his classic blunderbuss operations this week,
:07:15. > :07:22.which is that the Labour Party is to blame for Paul Flowers' private
:07:23. > :07:28.life. No, it's not. And that all the problems, essentially... Look at
:07:29. > :07:32.what George Osborne was doing in Europe. He was trying to change the
:07:33. > :07:38.capital requirement rules that would make it easier for the Co-op to take
:07:39. > :07:40.over Lloyd's. If there is to be a big investigation, George Osborne
:07:41. > :07:45.needs to be careful of what he wishes for. This is another example
:07:46. > :07:49.of the Westminster consensus. All of the Westminster parties were in
:07:50. > :07:54.favour of the Britannia takeover. This is how the Co-op ended up with
:07:55. > :07:58.all this toxic rubbish on its balance sheet. All the major parties
:07:59. > :08:02.were in favour of going to get the Lloyds branches. The Tories tried to
:08:03. > :08:09.outdo Labour in being more pro-Co-op. There was nobody in
:08:10. > :08:15.Westminster saying, hold on, this doesn't work. It is like the
:08:16. > :08:20.financial bubble all over again Everyone was in favour of that at
:08:21. > :08:24.the time. I think there is no evidence so far that the storm is
:08:25. > :08:29.cutting through to the average voter. If I were Ed Miliband, I
:08:30. > :08:33.would let it die a natural death. I would not write to an editorial
:08:34. > :08:39.column for a national newspaper on a Sunday. That keeps the issue alive,
:08:40. > :08:47.and it makes him look oversensitive and much better at dishing it out
:08:48. > :08:50.than taking it. I agree about that. The Labour press team tweeted this
:08:51. > :09:00.week saying that it was a new low for the times. And this was
:09:01. > :09:06.re-tweeted by Ed Miliband. It isn't a great press attitude. It is very
:09:07. > :09:11.Moni. Bill Clinton went out there and fought and made the case. So did
:09:12. > :09:17.Tony Blair. If you just say, they are being horrible to us, it looks
:09:18. > :09:23.pathetic. And it will cut through on Osborne and the financial
:09:24. > :09:32.dimensional is, not political. I shall tweet that later! While we
:09:33. > :09:38.have been talking, Mr Miliband has been on Desert Island Discs. He
:09:39. > :09:46.might still be on it. Let's have a listen to what he had to say.
:09:47. > :09:58.# Take on me, take me on. # And threw it all, she offers me
:09:59. > :10:09.protection. # A lot of love and affection.
:10:10. > :10:25.# Whether I'm right or wrong #. # Je Ne Regrette Rien. #.
:10:26. > :10:31.Obviously, that was the music that Ed Miliband chose. Who thought -
:10:32. > :10:41.you would have thought he would choose Norman Lamont's theme tune!
:10:42. > :10:51.He chose Jerusalem... He has no classical background at all. He had
:10:52. > :11:00.no Beethoven, no Elgar. David Cameron had Mendelssohn. And Ernie,
:11:01. > :11:11.the fastest Notman in the West. -- fastest milkman. Tony Blair chose
:11:12. > :11:13.the theme tune to a movie. Tony Blair's list was chosen by young
:11:14. > :11:24.staffers in his office. It absolutely was. Tony Blair's list
:11:25. > :11:28.was chosen by staff. The Ed Miliband this was clearly chosen by himself,
:11:29. > :11:38.because who would allow politician to go out there and say that they
:11:39. > :11:42.like Aha. I am the same age as Ed Miliband, and of course he likes
:11:43. > :11:53.Aha. That was the tumour was played in the 80s. Sweet Caroline. It is
:11:54. > :12:02.Angels by Robbie Williams. I was 14-year-old girl when that came out.
:12:03. > :12:09.I thought Angels was the staple of hen nights and chucking out time in
:12:10. > :12:12.pubs. The really good thing about his list is that the Smiths to not
:12:13. > :12:17.appear. The Smiths were all over David Cameron's list. The absolutely
:12:18. > :12:27.miserable music of Morris he was not there. What was his luxury? And
:12:28. > :12:33.Indian takeaway! Again, chosen for political reasons. I would agree
:12:34. > :12:41.with the panel about Aha, but I would expect -- I would respect his
:12:42. > :12:46.right to choose. Have you been on Desert Island Discs? I have. It took
:12:47. > :12:50.me three weeks to choose the music. It was the most difficult decision
:12:51. > :12:56.in my life. What was the most embarrassing thing you chose? I
:12:57. > :13:01.didn't choose anything embarrassing. I chose Beethoven, Elgar, and some
:13:02. > :13:13.proper modern jazz. Anything from the modern era? Pet Shop Boys.
:13:14. > :13:16.That's all for today. The Daily Politics will be on BBC Two at
:13:17. > :13:20.lunchtime every day next week, and we'll be back here on BBC One at
:13:21. > :13:23.11am next week. My luxury, by the way, was a wind-up radio! Remember,
:13:24. > :13:30.if it's Sunday, it's the Sunday Politics.