24/11/2013 Sunday Politics East

Morning, folks. Welcome to the Sunday Politics.

Labour's been hit hard by scandals at the Co-op. Ed Miliband says the

Tories are mudslinging. We'll speak to Conservative Chairman Grant

Shapps. Five years on from the financial

crisis, and we're still talking about banks in trouble. Why haven't

the regulators got the message? We'll ask the man who runs the

City's new financial watchdog. And he used to have a windmill on

his roof and talked about giving hugs to hoodies and huskies. These

days, not so much. Has the plan to make

Here: Our mental health services hope you can join `

Here: Our mental health services heading towards crisis point because

of heading towards crisis point because

warned that benefit falls will be to homelessness and population ships.

What is the evidence? And as always, the political panel

that reaches the parts other shows can only dream of. Janan Ganesh

Helen Lewis and Nick Watt. They ll be tweeting faster than England

loses wickets to Australia. Yes they're really that fast.

First, some big news overnight from Geneva, where Iran has agreed to

curb some of its nuclear activities in return for the partial easing of

sanctions. Iran will pause the enrichment of uranium to weapons

grade and America will free up some funds for Iran to spend. May be up

to $10 billion. A more comprehensive deal is supposed to be done in six

months. Here's what President Obama had to say about this interim

agreement. We have pursued intensive diplomacy, bilaterally with the

Iranians, and together with our partners, the United Kingdom,

France, Germany, Russia and China, as well as the European Union.

Today, that diplomacy opened up a new path towards a world that is

more secure, a future in which we can verify that Iraq and's nuclear

programme is peaceful, and that it cannot build a nuclear weapon.

President Obama spoke from the White House last night. Now the difficulty

begins. This is meant to lead to a full-scale agreement which will

effectively end all sanctions, and end Iran's ability to have a bomb.

The early signs are pretty good The Iranian currency strengthened

overnight, which is exactly what the Iranians wanted. Inflation in Iraq

is 40%, so they need a stronger currency. -- information in Iran.

France has played a blinder. It was there intransigence that led to

this. Otherwise, I think the West would have led to a much softer

deal. The question now becomes implementation. Here, everything

hinges on two questions. First, who is Hassan Rouhani? Is he the

Iranians Gorbachev, a serious reformer, or he's here much more

tactical and cynical figure? Or within Iran, how powerful is he

There are military men and intelligence officials within Iran

who may stymie the process. The Western media concentrate on the

fact that Mr Netanyahu and the Israelis are not happy about this.

They don't often mention that the Arab Gulf states are also very

apprehensive about this deal. I read this morning that the enemies of

Qatar and Kuwait went to Saudi king. -- the MAs row. That is the key

thing to watch in the next couple of weeks. There was a response from

Saudi Arabia, but it came from the Prime Minister of Israel, who said

this was a historic mistake. The United States said there would be no

enrichment of uranium to weapons grade. In the last few minutes, the

Iranian Foreign Minister has tweeted to say that there is an inalienable

right -- right to enrich. The key thing is the most important thing

that President Obama said in his inaugural speech. He reached out to

Iran. It failed under President McKenna jab. Under President

Rouhani, there seems to be progress. There is potentially now what he

talked about in that first inaugural address potentially coming through.

In the end, the key issue - and we don't know the answer - is the

supreme leader, not the president. Will the supreme leader agreed to

Iran giving up its ability to create nuclear weapons? This is the huge

ambiguity. Ayatollah Khamenei authorise the position that

President Rouhani took to Geneva. That doesn't mean he will sign off

on every bit of implementation over the next six months. Even when

President Ahmadinejad was president, he wasn't really President. We in

the West have to resort to a kind of Iranians version of the study of the

Kremlin, to work out what is going on. And the problem the president

faces is that if there is any sign... He can unlock these funds by

executive order at the moment, but if he needs any more, he has to go

to Congress. Both the Democrat and the Republican side have huge

scepticism about this. And he has very low credibility now. There s

already been angry noises coming from quite a lot of senators. It was

quite strange to see that photo of John Kerry hugging Cathy Ashton as

if they had survived a ship great together. John Kerry is clearly

feeling very happy. We will keep an eye on this. It is a fascinating

development. More lurid details about the

personal life of the Co-op Bank s disgraced former chairman, the

Reverend Paul Flowers. The links between Labour, the bank and the

wider Co-op movement have caused big problems for Ed Miliband this week,

and the Conservatives have been revelling in it. But do the Tory

allegations - Ed Miliband calls them "smears" - stack up? Party Chairman

Grant Shapps joins us from Hatfield. Welcome to the programme. When it

comes to the Co-op, what are you accusing Labour of knowing and when?

I think the simple thing to say here is that the Co-op is an important

bank. They have obviously got into difficulty with Reverend flowers,

and our primary concern is making sure that that is properly

investigated, and that we understand what happened at the bank and how

somebody like Paul Flowers could have ended up thing appointed

chairman. You wrote to edge Miliband on Tuesday and asked him what he

knew and when. -- you wrote to Ed Miliband. But by Prime Minister s

Questions on Wednesday, David Cameron claims that you knew that

Labour knew about his past all along. What is the evidence for

that? We found out by Wednesday that he had been a Labour councillor

Reverend Flowers, and had been made to stand down. Certainly, Labour

knew about that, but somehow didn't seem to think that that made him

less appropriate to be the chairman of the Co-op bank. There was no

evidence that Mr Miliband or Mr Balls knew about that. I ask you

again, what are you accusing the Labour leadership of knowing? We

know now that he stood down for very inappropriate images on his

computer, apparently. You are telling me that they didn't know. I

am not sure that is clear at all. I have heard conflicting reports.

There is a much bigger argument about what they knew and when. There

was a much bigger issue here. This morning, Ed Miliband has said that

they don't have to answer these questions and that these smears

This is ludicrous. These are important questions about an

important bank, how it ended up getting into this position, and how

a disastrous Britannia -- Italia deal happen. -- Britannia deal

happened. And we need to know how the bank came off the rails. To be

accused of smears for asking the questions is ridiculous. I am just

trying to find out what you are accusing Labour of. You saying that

the Labour leadership knew about the drug-taking? Sorry, there was some

noise here. I don't know what was known and when. We do know that

Labour, the party, certainly knew about these very difficult

circumstances in which he resigned as a councillor. I think that the

Labour Party knew about it. We knew that Bradford did, but not London.

Are you saying that Ed Miliband knew about the inappropriate material on

the Reverend's laptop? It is certainly the case that Labour knew

about it. But did Mr Miliband know about it, and his predilection for

rent boys? He will need to answer those questions. It is quite proper

to ask those questions. Surely, asking a perfectly legitimate set of

questions, not just about that but about how we have ended up in a

situation where this bank has made loans to Labour for millions of

pounds, that bank and the Unite bank, who is connected to it. And

how they made a ?50,000 donation to Ed Balls' office. Ed Balls says that

was nothing to do with Reverend Flowers, and yet Reverend Flowers

said that he personally signed that off. Lots of questions to answer.

David Cameron has already answered them on Wednesday. He said that you

now know that Labour knew about his past all along. You have not been

able to present evidence that involve Mr Miliband or Mr Balls in

that. So until you get that, surely you should apologise? Hang on. He

said that Labour knew about this, and they did, because he stood down

as a councillor. If Ed Miliband didn't know about that, then why

not? This was quite a serious thing that happened. The wider point is

about why it is that when you ask perfectly legitimate questions about

this bank, about the Britannia deal, and about the background of Mr

flowers, why is the response, it is all smears? There are questions

about how Labour failed to deal with the deficit and how it hasn't done

anything to support the welfare changes, but there is nothing about

that. Let us -- lets: To the wider picture of the Co-operative Bank.

Labour wanted the Co-op to take over the Britannia Building Society, and

it was a disaster. Do you accept that? The government of the day has

to be a part of these discussions for regulatory reason. The

government in 2009 - Ed Balls was very pleased... But you supported

that decision. There was a later deal, potentially, for the Co-op to

buy those Lloyds branches. There was a proper process and it didn't go

through just recently. If there had been a proper process back in 2 09,

would the Britannia deal have gone through? First, you accept that the

Tories were in favour of the Britannia take over. Then your

Chancellor Osborne went out of his way to facilitate the purchase of

the Lloyds branches, even though you had no idea that the Co-op had the

management expertise to become a super medium. Correct? The

difference is that that deal didn't go through. There was a proper

process that took place. Let's look at the process. There was long

indications as far back as January 2012 that the Co-op, as a direct

result of the Britannia take over which you will party supported, was

unfit to acquire the Lloyds branches. By January 2012, the

Chancellor and the Treasury ignored the warnings. Wide? In 2009, there

was political pressure for the Britannia to be brought together.

Based on the information available, this was supported, but that process

ended up with a very, very problematic takeover of the

Britannia. Wind forward to this year, and when the same types of

issues were being looked at for the purchase of the Lloyds deal, the

proper process was followed, this time with us in government, and that

purchase didn't go through. It is important that the proper process is

followed, and when it was, it transpired that the deal wasn't

going to be done. But it was the Treasury and the Chancellor who were

the cheerleaders for the acquisition of the Lloyds branches. But there

was a warning that the Co-op did not have enough capital on its balance

sheet to make those acquisitions, but instead of heeding those

warnings, your people went to Brussels to lobby for the

requirements to be relaxed - why on earth did you do that? Our

Chancellor went to argue for all of Rajesh banking, not specifically for

the Co-op. He was arguing for the mutuals to be given a special

ruling. The idea was to make sure that every bank in Britain could

have a better deal, particularly the mutuals, as you say. That is a

proper thing for the Chancellor to be doing. We could go round in

circles here, but in the end, there was not a takeover of the Lloyds

branches, that is because we followed a proper process. Had that

same rigorous process been followed in 2009, the legitimate question to

ask is whether the Co-op would have been -- would have taken over the

Britannia. That is a proper question to ask. It is no good to have the

leader of the opposition say, as soon as you ask any of these

questions about anything where there is a problem for them, they come

back with, oh, this is all smears. There are questions to ask about

what the Labour government did, the debt and the deficit they left the

country with, the way they stopped work from paying in this country.

The big question your government has two answer is, why, by July 201 ,

when it was clear there was a black hole in the Co-op's balance sheet,

your government re-confirmed the Co-op as the preferred bidder for

Lloyds - why would you do that? Well, look, the good thing is, we

can discuss this until the cows come home, but there is going to be a

proper, full investigation, so we will find out what happened, all the

way back. So, we will be able to get to the bottom of all of this. Grant

Shapps, the only reason the Lloyds deal did not go ahead was, despite

the Treasury cheerleading, when Lloyds began its due diligence, it

found that there was indeed a huge black hole in the balance sheet and

that the Co-op was not fit to take over its branches. That wasn't you,

it wasn't the Government, it was not the Chancellor, it was Lloyds. You

were still cheerleading for the deal to go ahead... Well, as I say, a

proper process was followed, which did not result in the purchase of

the Lloyds branches. At that proper process been followed with the

purchase of the Britannia, under the previous government... Which you

supported. Yes, but it may well be that under that previous deal, there

was a excess political pressure perhaps put on in order to create

that merger, which proved so disastrous. The Tories facilitated

it, Grant Shapps, they allowed it to go ahead. I have said, we are going

to have a proper, independent review. What I cannot understand is,

when you announce a robber, independent review, the response you

get to these serious questions. The response is, oh, this is a smear. It

is crazy. We are trying to answer the big questions for this country.

We have done all of that, and we are out of time. The Reverend Flowers'

chairmanship of the Co-op bank was approved by the regulator at the

time, which no longer exists. It was swept away by the coalition

government in a supposed revolution in regulation. But will its

replacement, the Financial Conduct Authority, be different? Adam has

been to find out. Come with me for a spin around the Square mile to find

out how we regulate our financial sector, which is almost five times

bigger than the country's entire annual income. First, let's pick up

our guide, journalist Iain Martin, who has just written a book about

what went so wrong during the financial crisis. The FSA was an

agency which was established to supervise the banks on a day-to day

basis. The Bank of England was supposed to have overall responsible

at for this to Bolivia the financial system and the Treasury was supposed

to take an interest in all of these things. The disaster was that it was

not anyone's call responsibility, or main day job, to stay alert as to

whether or not the banking system as a whole was being run in a safe

manner. And so this April, a new system was set up to police the

City. Most of the responsibly delays here, with the Bank of England, and

its new Prudential Regulation Authority. And the Financial

Services Authority has been replaced with the new Financial Conduct

Authority. Can we go to the financial conduct authority, please?

Canary Wharf, thank you. Here, it is all about whether the people in

financial services are playing by the rules, in particular, how they

treat their customers. This place has got new powers, like the ability

to ban products it does not like, a new mandate to promote competition

in the market, the concept being, more competition means a better

market, plus the idea that a new organisation rings a whole new

culture. Although these are the old offices of the FSA, so maybe not

quite so new after all. It has also inherited the case of the Co-op bank

and its disgraced former chairman the Reverend Paul Flowers. The SCA

will be part of the investigation into what happened, which will

probably involve looking at its own conduct. One member of the

Parliamentary commission into banking wonders whether the new

regulator, and its new boss, are up to it. I have always said, it is not

the architecture which is the issue, it is the powers that the regulator

has, and today, it does not seem to me as if there is any increase in

that. And with the unfolding scandal at the Co-op, it feels like the new

architecture for regulating the City is now facing its first big test.

And the chief executive of the Financial Conduct Authority, the

SCA, Martin Wheatley, joins me now. Welcome to The Sunday Politics. The

failure of bank regulation was one of the clearest lessons of the crash

in 2008, and yet two years later, in 2010, Paul Flowers is allowed to

become chairman of the Co-op - why have we still not got the regulation

right? We have made a lot of changes since then. We have created a new

regulator, as you know. At the time, we still had a process which allowed

somebody to be appointed to a bank and they would go through a

challenge, but in the case of Paul Flowers, there was no need for an

additional challenge when he was appointed to chairman, because he

was already on the board. But going from being on the board to becoming

chairman, that is a big jump, and he only had one interview? That is why

today, it would be different. But the truth is, that was the system at

the time, the system which the FSA operated. He was challenged, we did

challenge him, and we said, you do not have the right experience, but

at the time, we would not have opposed the appointment. What we

needed was additional representation of the board of people who did have

banking experience. You can say that that was then and this is now, but

up until April of this year, it was still the plan for the Co-op, under

Mr Flowers, and despite being seriously wounded by the Britannia

takeover, to take on 632 Lloyds branches. That was the Co-op's

plan. They needed to pass our test as to whether we thought they were

fit to do that, and frankly, they never passed that test. It was not

the regulator that stopped them It was. We were constantly pushing

back, saying, you have not got the capital, you have no got the

systems, and ultimately, they withdrew, when they could not answer

our questions. You were asking the right questions, I accept that, but

all of the time, the politicians on all sides, they were pushing for it

to happen, and I cannot find anywhere where the regulator said,

look, this is just not going to happen. I cannot comment on what the

politicians were doing, but I continue what we were doing, which

was constantly asking the Co-op have you got the systems in place,

have you got the people, have you got the capital? And they didn't.

But it only came to a head when Lloyds started its own due diligence

on the bank, and they discovered that it was impossible for them to

take over the branches, it was not the regulator... In fairness, what

we do is ask the questions, can you do this deal? And we kept pushing

back, and we never frankly got delivered a business plan which we

were happy to approve. Is the SCA going to launch its own inquiry into

what happened? -- the FCA. The Chancellor has announced what will

be a very broad inquiry. There are a number of specifics which we will be

able to look at, relating to events over the last five years. Could

there be a police investigation I think the police have already

announced an investigation. I am talking about into the handling of

the bank. It depends. There might be, if there is grim low activity,

which we do not know yet. You worked at the FS eight, didn't you? I did.

Some of those people who were signed off on the speedy promotion of Mr

Flowers, are they now working there? Yes, we have some. I came to

join the Financial Services Authority, to lead it into the

creation of the new body, the SCA. We had people who were challenging

and they did the job. There was not a requirement to approve the role as

chairman. There was not even a requirement to interview at that

stage. What we did do was to require that he was interviewed, and that

the Co-op should get additional experience. One of the people from

the old organisation, who signed up on the promotion of Mr Flowers to

become chairman is now a nonexecutive director of the Co op,

so how does that work? Welcome he was a senior adviser to our

organisation, one of the people who made the challenges, and who said,

you need more experience on your board. Subsequently he then went and

joined the board. Surely that should not be allowed, the regulator and

the regulated should not be like that. Well clearly, you need

protection, but we have got to get good people in, and frankly, we want

the industry to have good people in the industry, so there will be some

movement between the regulator and industry. We all wonder whether you

have the power or even the confidence to stand up if you look

at all of the really bad bank decisions recently, politicians were

behind them. It was Gordon Brown who pushed the disastrous merger of

Lloyds and RBS. It was Alex Salmond who egged on RBS to buy the world.

All three main parties wanted the Co-op to buy Britannia, even though

they did not know the debt it would inherit, and all three wanted the

Co-op to buy the Lloyds branches - how do you as a regulator stand up

to that little concert party? Well, that political pressure exists, our

job at the end of the day is to do a relatively technical job and say,

does it stack up? And it didn't and we made that point time and time

again to the Co-op board. They did not have a business case that we

could approve. The bodies on left and right -- the politicians on left

and right gave the Co-op special support. They may have done, but

that was not you have made a warning about these payday lenders, but I

think what most people would like to see is a limit put on the interest

they can charge over a period of time - will you do that? We have got

a whole set of powers for payday lenders. We will bring in some

changes from April next year, and we will bring in further changes as we

see necessary. Will you put a limit on the interest they can charge

That is something we can study. You do not sound too keen on it? Well,

there are a lot of changes we need to make. One change is limiting

rollovers, limiting the use of continuous payment authorities.

Simply jumping to one trigger would be a mistake. Finally, an issue

which I think is becoming a growing concern, because the Government is

thinking of subsidising them, 9 % mortgages are back - should we not

be worried about that? I think we should if the market has the same

experiences that we had back in 2007 - oh wait. We are bringing a

comprehensive package in under our mortgage market review, which will

change how people lend and will put affordability back at the heart of

lending decisions. -- 2007-08. You have not had your first big

challenge yet, have you? We have many challenges.

It was once called the battle of the mods and the rockers - the fight

between David Cameron-style modernisers and old-style

traditional Tories for the direction and soul of the Conservative Party.

But have the mods given up on changing the brand? When David

Cameron took over in 2005, he promoted himself as a new Tory

leader. He said that hoodies need more love. He was talking about

something called the big society. He told his party conference that it

was time to that sunshine win the day. There was new emphasis on the

environment, and an eye-catching trip to a Norwegian glacier to see

first-hand, supposedly, the effects of global warming. This week, party

modernise and Nick bone has said that the party is still seen as an

old-fashioned monolith and hasn t done enough to improve its appeal.

The Tories have put some reforms into practice, such as gay marriage,

but they have put more into welfare reform band compassionate

conservatism. David Cameron wants talked about leading the greenest

government ever. Downing Street says that the quote in the Son is not

recognised, get rid of the green crap. At this point in the programme

we were expecting to hear from the Energy and Climate Change Minister,

Greg Barker. Unfortunately, he has pulled out, with Downing Street

saying it's for ""family reasons"". Make of that what you will. However,

we won't be deterred. We're still doing the story, and we're joined by

our very own mod and rocker - David Skelton of the think-tank Renewal,

and Conservative MP Peter Bone. Welcome to you both. I'm glad your

family is allowed you to come? David Skelton, getting rid of all the

green crap, or words to that effect, that David Cameron has been saying.

It is just a sign that Tory modernisation has been quietly

buried. I do think that's right Modernisation is about reaching out

to the voters, and the work to do that is now more relevant than ever.

We got the biggest swing since 931, and the thing is we need to do more

to reach out to voters in the North. We need to reach out to non-white

voters, and show that the concerns of modern Britain and the concerns

of ordinary people is something that we share. And what way will racking

up electricity bills with green levies get you more votes in the

North of England? We have to look at ways to reduce energy bills. The

renewable energy directive doesn't do anything to help cut our

emissions, but does decrease energy bills by ?45 a year. We should

renegotiate that. That is a part of modernisation and doing what

ordinarily people want. And old dinosaurs like you are just holding

this modernisation process back I am very appreciative of covering on

this programme. The Tory party has been reforming itself for more than

150 years. This idea of modern eyes a is just some invention. We are

changing all the time. I'm nice and cuddly! So you are happy that the

party made gay marriage almost a kind of symbol of its modernisation?

Fine Mac the gay marriage was a free vote. David Cameron was recorded as

a rebel there because more Tories voted against his position than ever

before. It was said that this was a split between the old and young but

it actually was a split between those who were religious and

nonreligious. It is a misinterpretation of what happened.

Is a modernisation in retreat? I think modernisation is an

invention. Seven years ago, in my part of the world, we got three

councillors elected, two were 8 and one was 21. A few months ago, a

25-year-old was chosen to fight Corby for the Conservative Party. He

came from a comprehensive School. He was one of the youngest. The Tory

party is moving on. So you found three young people? Hang on a

minute. You can't get away with that. Three in one batch. Does

modernisation exist? Modernisation is about watering our appeal and

sharing our values are relevant to voters who haven't really thought

about voting for us for decades now. Modernisation is about more than

windmills and stuff, it is about boosting the life chances of the

poorest, it is about putting better schools in poorer areas. It is also

saying that modernisation and the Tory party... When has the Tory

party been against making poorer people better off? Or against better

schools? Do you think Mrs Thatcher was a moderniser when she won all

those elections? The problem we have at the moment is that UKIP has

grown-up. If we could get all of those people who vote UKIP to vote

for us, we would get 47% of the vote. We don't need to worry about

voters on the left. We need to worry about the voters in the north, those

people who haven't voted for us for decades. Having an EU Referendum

Bill is going to get people to vote. We have to reach out to

voters, but not by some sort of London based in need. You have to

broaden your base. I agree with you on that. We have to broaden our

appeal, but this back to the future concept is not going to work. We

need something that generally appeals to low and middle-income

voters, and something that shows we genuinely care about the life

chances of the poorest. Do you think that the people who vote UKIP don't

support those aspirations? We are not doing enough to cut immigration.

We don't have an EU Referendum Bill stop we have to get the centre right

to vote for us again. Do that, and we have it. Tom Pursglove, the 5

euros, will be returned in Corby because we cannot win an election

there. -- the 25-year-old. Whether you are moderniser or

traditionalist, people, particularly in the North, see you as a bunch of

rich men. And rich southerners. You are bunch of rich southerners. We

need to do more to show that we are building on lifting the poorest out

of the tax. We need to build more houses. There is a perception that

the leadership at the moment is rich, and public school educated.

What we have to do is get more people from state education into the

top. You are going the other way at the moment. That is a fair

criticism. Modernisers also say that. I went to a combo hedge of

school as well. -- do a comprehensive school. We need to

show that we are standing up for low income. Thank Q, both of you. You

are watching the Sunday Politics. Coming up in just under

Coming up: The rising pressure on Tory tie the knot in a partnership.

Coming up: The rising pressure on mental health services where

patients struggle to find a bed. Recently we have been told beds are

far away, as far away, as far`away as Glasgow. Labour takes its message

to supporters at its rally in the east. Two become one ` Labour and

Tory face the funding cuts together. But first, let's meet our guests.

Labour's Corby MP, Andy Sawford and the Conservative leader of Suffolk

Council, Mark Bee, who we've just seen. And I'd like to start with the

vote this week brought by Essex MP, John Baron, on the changes to our

armed forces. He's objecting to government plans for a reduction in

regular soldiers and an increase in reservists. The bottom line is

sometimes you have two rise above party politics and discuss issues of

principle. This is one. Well, Defence Secretary, Philip Hammond

managed to head off John Baron's rebellion was that a good thing? I

voted with John Barron this week and a number of Conservative MPs from

across the region. We are worried that, whilst reservists do a

fantastic job, they are not a substitute for full`time soldiers.

His argument is that radical plans were approved. How uncomfortable is

it, Tory fighting Tory? I perfectly reset `` respect where he is coming

from but we have to look at the wider picture. We are no longer in a

Cold War situation. We need a more flexible reserve list and Armed

Forces. We need to ensure we have got the ability to move to the

numbers we require. We are looking to move the reservists to about

30,000. As Andrew has just said, they do a fantastic job. A friend of

mine was in the territorial Army and he went to Iraq on a six`month tour.

They were treated like regular soldiers and he was able to do the

job and be respected. What about the concessions? And the annual reports

to the house? Through this major defence review and others is that we

have seen big decisions taken by the government, perhaps in haste,

without thinking of long`term defence needs. We are in a situation

now where we have aircraft carriers without aircraft. We could not

defend the Falklands if we needed to and we're not sure if we can meet

commitments with our troop numbers and there is a real concern about

that. Now to the crisis in our mental

health service. Work is one that cuts to budgets could cost lives.

The Norfolk and Suffolk NHS foundation trust needs to say ?40

million. It is planning to reduce beds by another 20%. It aims to lose

around 400 jobs. It has emerged that the trust 's new chief executive

will not be appointed till next year. Here's Kevin Burch.

It's reckoned that one in four of us will experience a problem with

mental health at some point in our lives. It's a statistic which

reminds us of our fragility and which helps to explain why this

radical plan to cut budget, jobs and beds is proving so controversial.

Emma Corlett is a mental health nurse in Norfolk and an official

with UNISON. She says resources were stretched before this proposed

shake`up. Now things have reached breaking point. Since the cuts

started, it has been reported that people can't find a bed locally. It

might be someone from kindling admitted to great Yarmouth. People

recently were told the nearest bed is in Glasgow `` Kings Lynn. This

worker has been involved locally in mental health care for seven years.

She wanted to talk about her worries, but remain anonymous. Her

words are spoken by someone else. The government needs to realise you

can't cut the money because it will lead people to suicide. They are

putting us under pressure all the time and the people we look after

our under stress. You feel choked up when you leave the person at how

vulnerable they are. This mental health nurse worked for 35 years and

is now helping to assess the impact of the plans changes. A major

consultation is planned in January and she is part of the

pre`consultation panel. We will have a lot of people slipping through the

net. What happens then is people try to manage but they can't see a way

out. That is when you get suicidal ideas. It is then a spiral. Looking

back down the generations can help give some context for today's

debate. This exhibition at the Time and Tide Museum in Great Yarmouth is

on until the Spring. It looks at how textiles have been used for

centuries to help people struggling with depression, sadness and loss.

Throughout history, people have gone through difficult experiences and

severe mental ill health problems are not a modern phenomenon. We'll

see much `` modern occupational search `` therapy as something that

started in the 20th century. Three years ago... Three years ago, this

woman's husband was diagnosed with timers and could no longer stay at

home. But to assessment wars have been

shut and she is worried about what the future holds for him and others

like him. Opting more scared in the community, she says, would be a huge

mistake `` opting for more care in the community. There would be no one

to call on. Carers cannot call on two of us. What will they do? For

six years, he was at home and for the last eight months I did not

sleep. I know what pitch I got to. I could have hurt him. Who do you go

to? Who do you talk to? David is the most precious thing in my life and I

need him to be safe. Meanwhile, 79 staff from the Norfolk

and Suffolk NHS trust who were expecting redundancy were surprised

to learn they are to get a reprieve. There are claims the trust is

failing to meet its own target. There are occasions when we have to

send people outside the area. Some of those are specialist placements

where we don't have the ability to care for them inside the trust and

it is right that they are sent somewhere where they can be properly

looked after. Within Norfolk, we have had 2000 at missions into our

acute wards and there have been 51 occasions where we have had to send

people out of area and that is 51 to many. It is not good for the service

user or their families and nor does it make sense `` sense financially

for the trust. In Suffolk, out of area placements are very rare

indeed. I you happy with the way the trust is being run? I am. It is a

difficult time and I will not pretend otherwise. We have been

confronted with needing to make savings of ?20 million over the next

four years. That is the financial envelope within which we have to

work. Worryingly, there has been a rise in the number of unexplained

deaths in the trust. From April to August this year, there were 20

unexplained deaths. What you say to the relatives of those people? Every

single one of the incidence is a tragedy for the people involved and

I mean that very sincerely. We have done some initial analysis. In

Suffolk, the number has gone down. In Norfolk, there was a spike over a

short period of time and we have looked at each of these

individually. There is a detailed report being done which will come to

the board at the end of this year and we will take that report public

because I commit to being transparent about this. It is also

true to say that if you look at those deaths over a longer period of

time, they are not inconsistent with the historic picture, nor the

national picture. We also hear that targets are not being met. This was

a report and it is a work in progress. Targets are nearer to 80%

but that is still not good enough. We are putting on extra staff to

work Friday evenings and weekends and early on Monday mornings because

the weekend period causes us the problem but I want to hit 100%. What

about the cut in bed than how much pressure does that put on services

you can offer? Should it be happening? In Suffolk, there have

been no reduction in beds as a result of the strategy

implementation. In Norfolk, 44 beds have been taken out of service. We

are moving towards consultation with the clinical commissioning groups.

The first one starts in the New Year. Together with the care quality

commission and the public consultation we can decide what

number of beds is required. I am sure we will have the right number

of beds and we should not take any more out until we are sure we can

meet the needs of the people. We have an institutional bias against

mental health within the health service. When the last government

introduced waiting time targets for people with physical health

problems, the 18 week target from referral to treatment... They left

out mental health. That means them money flows to acute hospitals and

away from mental health. But this trust is missing key targets? It is

and that is why I say that I have very real concerns about the way it

is being led and that is why I want to bring people together to find a

way forward. How does this fit with you personally because this is your

responsibility? It is your government making these 20% cuts. It

is really important I think for the BBC to be accurate about what the

financial position actually is. Throughout this Parliament, this

government has maintained and, indeed, slightly increased funding

for the health service. There is absolutely no cut imposed by the

government on mental health services. There clearly are cuts

that are affecting mental health services otherwise we would not be

discussing the lack of acute beds. Let me explain. The government has

maintained funding for the health service `` mental health service and

increased it. At a local level, care trusts and commissioning groups have

to decide how to spend the money locally. Because there is an

institutional bias against mental health with no rights of access

which exist in physical health, and I have changed that from 2015 there

will be new access standards for mental health. As long as we have

the bias against mental health, local commissioners will

disadvantage mental health and that is why cats are happening. They

can't find any more money though? If you can tell me where there is more

money available then please do so. This government has chosen to

protect funding for the NHS. We have to make sure mental health services

gets its fair share. That hasn't happened until now because the

system sucks money into acute trusts and away from mental health and that

is what has to end. This is your mental health trust so

how does that make you feel? There are concerns and we need to monitor

that and I share the view that Norman Lamb expressed in your film

that we need to keep a close eye on this. The great thing about this and

the partnership between Norfolk and Suffolk county councils is that we

see the Norfolk and Suffolk mental health trust is one we can work

together on. Do you feel reassured by his assertion that there is on a

budget cut? What I am really reassured by is that we are trying

to look at this complex issue of mental health. It is one that is

emerging really in the way that has been described in your film because

it is a complex subject. We cannot look at simplistic ways of dealing

with it. The health trust you are referring to, the mental health

trust, has GP referrals which ensure people can be challenged ``

channelled in the right way and the commissioning group is happy with

that. I hope the trust can move forward. Are you reassured by Norman

Lamb saying there is not a budget cut? Clearly there has been a year

budget cut in real terms. We know there are 2000 less beds across the

country and your own figures show across our region there are fewer

beds. Northamptonshire has held onto them for the time being but they are

now reviewing it. We have seen a rise in the suicide rent and

problems in treating minor had mental health problems. One in five

people wait more than 12 months to receive talking therapies and those

problems then become my `` major mental health problems. What about

the point that money flows to acute hospitals to meet targets which

Labour instigated? In terms of the big issue of men `` money moving

around the system, is then high number of private butts `` Private

beds. I don't want to see money going to private companies. I want

to see us getting more money into preventative mental health care in

this country and to see this not just as an NHS problem. The CBI

ought to be thinking about our workplaces. In is a school this

morning we talked about well`being of young people. Mental health

well`being is everywhere. You want to have the key person but I want to

come back to something that Andrew said. We have to tackle mental

health issues on eight case`by`case basis. One thing we are looking at

in Suffolk is a care file where GPs can refer people to go and do work

on a farm on a farming by prescription basis. And that is

helping people on low mental health issues to find back in the

community. Thank you. This week, has been a chance for the Labour Party

to hone their pre`election issues. Labour has 13 target seats in the

Eastern region. Party sources have told us that they will not be happy

if they win less than eight of them. The conference was kicked off by Ed

Miliband on Friday. What Labour Party members are feeling is that

Labour has been setting the agenda, talking about the fact we have a

government which says everything is fixed on the economy but ordinary

people do not feel that. They think, who will stand up for us? The key

issue of energy prices where Labour has set the agenda and we say we

will freeze prices until 2017 if we win the election and we will use the

time to sort out a broken energy market. That is what I call standing

up for ordinary families in this country. Your first year as a Labour

MP. How does it feel to a newcomer? We have a big challenge in the

Labour Party to win people 's trust. We are making good progress. Ed

Miliband has shown at the conference with his pledge to freeze energy

prices that we understand the real problem is that people 's living

standards are being squeezed and that is getting through to people.

They feel the Tories are out of touch. Labour is fighting hard to

gain Waverley. Will you hold it? I believe we can and we are working

hard to make sure it happens. In this phoney war situation now, in

the long run`up to 2015, we are in a unique position because we know the

date of the next general election. We are seeing a lot of slow burning

campaigning as we build up to the election. Do you think this is the

beginning of the real election campaign to mark the Conservatives

have hired a man who specialises in dirty campaigning, frankly. I want

the next election to be about ideas. To make sure people have good jobs

and health services. Not getting down in the gutter. What do think

the main issues will be here the East? It is about the economy, jobs

and people feeling confident in the future in the money they will have

left over each week or month in their pay packet. I can see why

Labour are doing what they are doing in trying to ensure people about the

cost of living. But we can see and improving economy and I hope by the

time we get to 2015 people will feel the benefit. What about the eight

seat target? Is it realistic? We need to make significant gains in

the Eastern region and we are working hard in seats like Thurrock

and Harlow and Ipswich. They are important targets for us. That is

why Ed Miliband, Ed balls and Harriet Harman have been here this

weekend. A partnership between red and blue to fight for services in

the future. That is all in the 62nd round up of the week. 62nd.

On the dark side of the street, well Council make a point about litter,

cleaning one side only. While objections to the proposed road toll

on the a 14 were voiced by one MP at Prime Minister 's questions. They

are increasingly fearful that the proposed road toll will put the area

at a serious competitive disadvantage. Ed Miliband hit out at

cuts to sure start Seth `` centres in Essex. The proposal is to close

at 11 centres and downgrade 37. The leaders of Suffolk and Norfolk

county council 's are delighted to have signed a partnership agreement

to help save money. Tim Yeo has been cleared of any wrongdoing by the

Parliamentary standards committee. He was accused of lobbying ministers

on behalf of a company. We saw you in the meeting on the

bridge. What does the merger mean in practical terms? We are not a

merger. We will steal `` still be two councils but we are going to

pool resources and find ways of sharing services to meet the

challenge we have with the all`important financial situation.

Between us we have 30% savings in our budget so, working together and

sharing our resources, we can find solutions. From a party political

point of view, what do you make of it? I work with both councils and I

encourage them to do that and they do. It is to be welcomed that Mark

is working closely with Norfolk county council and I hope they can

bring benefits in terms of local services. Does it matter what your

politics are? It is thought to be the first blending, if you like.

Where it is carried `` a collaboration, we have what is

unique between county councils although district and borough

councils have done it. I think, to answer your question, it is more

about us being Norfolk and Suffolk and the historic rivalries that are

brought together in politics. Thanks for joining us. You can keep in

touch fire our website where you will also find links to all the

latest political updates. We are back at the same time next

week when we will We are back at the same time next

those people who want to cycle. We will be returning to this one. Thank

you. A little bit of history was made at

Prime Minister's Questions this week. A teensy tiny bit. It wasn't

David Cameron accusing one MP of taking "mind-altering substances" -

they're always accusing each other of doing that. No, it was the first

time a Prime Minister used a live tweet sent from someone watching the

session as ammunition at the dispatch box. Let's have a look We

have had some interesting interventions from front edges past

and present. I hope I can break records by explaining that a tweet

has just come in from Tony McNulty, the former Labour security

minister, saying that the public are desperate for a PM in waiting who

speaks for them, not a Leader of the Opposition in dodging in partisan

Westminster Village knock about So I would stay up with the tweets if

you want to get on the right side of this one! We are working on how the

Prime Minister managed to get that wheat in the first place. What did

you think when you saw it being read out? I was certainly watching the

Daily Politics. I almost fell off my chair! It was quite astonishing He

didn't answer the question - he didn't do that the whole time. But I

stand by what the tweets said. I have tweeted for a long time on

PMQs. Normally I am praising Ed Miliband to the hilt, but no one

announces that in Parliament! Because the Prime Minister picked up

on what you said, it unleashed some attacks on you from the Labour side.

It did, minor attacks from some very junior people. Most people were

supportive of what I said. They took issue with the notion of not doing

it until 12:30pm, when it wasn't available for the other side to use.

Instant history, and instantly forgettable, I would say. Do you

think you have started a bit of a trend? I hope not, because the

dumbing down of PMQs is already on its way. Most people tweet like mad

through PMQs! Is a measure of how post-modern we have become, we have

journalists tweeting about someone talking about a tweet. That is the

level of British politics. I am horrified by this development. The

whole of modern life has become about observing people -- people

observing themselves doing things. Do we know what happened? Somebody

is monitoring the tweets on behalf of the Prime Minister or the Tory

party. They see Tony's tweet. They then print it out and give it to

him? There was a suggestion that Michael Goves had spotted it, but

Craig Oliver from the BBC had this great sort of... Craig Oliver was

holding up his iPad to take pictures of the Prime Minister, which he then

tweeted, from the Prime Minister. People will now be tweeting in the

hope that they will be quoted by the Prime Minister, or the Leader of the

Opposition. I wasn't doing that I'm just talking about the monster you

have unleashed! I hope it dies a miserable death. I think Tony is a

good analysis -- a good analyst of PMQs on Twitter. Moving onto the

Co-op. You were a Co-op-backed MP, white you? I was a Co-op party

member. There are two issues here about the Co-op and the Labour

Party. All the new music suggests that the Co-op will now have to

start pulling back from lending or donating to the Labour Party, which,

at a time when Mr Miliband is going through changes that are going to

cut of the union funds, it seems quite dangerous. There are three

things going on. There's the relationship that the party has

politically with the Co-op party, there is the commercial relationship

you referred to, and then there is this enquiry into the comings and

goings of Flowers and everybody else. The Tories, at their peril,

will mix the three up. There's a lot of things going on with a bang.

Labour has some issues around funding generally, and they are

potentially exacerbated by the Co-op issue. The Labour Party gets soft

loans from the Co-op bank, and it gets donations. ?800,000 last year.

Ed Balls got about ?50,000 for his private office. You get the feeling,

given the state of the Co-operative Bank now, that that money could dry

up. We will see. There's lots of speculation in the papers today At

the core, the relationship between the Co-op party and the Labour Party

is a proud one, and a legitimate one. I don't think others always

understand that. Here is an even bigger issue. Is it not possible

that the Co-op bank will cease to exist in any meaningful way as a

Co-op bank? Is the bane out means it is 70% owned -- the bail out means

that it is 70% owned, or 35% going to a hedge fund, I think I read

Yes, there is a move from the mutualism of the Co-op. But don t

confuse the Co-op bank with the Co-op Group. Others have done that.

I haven't. Here's the rub. The soft loans that Labour gets. They got

?1.2 million from this. And 2.4 million. They are secured against

future union membership fees of the party. What is Mr Miliband doing? He

is trying to end that? You have this very difficult confluence of events,

which is, could these wonderful soft loans that Labour has had from the

Co-op, could they be going? And these union reforms, where Ed

Miliband is trying to create a link between individuals and donations to

the Labour Party... Clearly, there could be real financial difficulties

here. The government needs to be careful, because George Osborne

launched one of his classic blunderbuss operations this week,

which is that the Labour Party is to blame for Paul Flowers' private

life. No, it's not. And that all the problems, essentially... Look at

what George Osborne was doing in Europe. He was trying to change the

capital requirement rules that would make it easier for the Co-op to take

over Lloyd's. If there is to be a big investigation, George Osborne

needs to be careful of what he wishes for. This is another example

of the Westminster consensus. All of the Westminster parties were in

favour of the Britannia takeover. This is how the Co-op ended up with

all this toxic rubbish on its balance sheet. All the major parties

were in favour of going to get the Lloyds branches. The Tories tried to

outdo Labour in being more pro-Co-op. There was nobody in

Westminster saying, hold on, this doesn't work. It is like the

financial bubble all over again Everyone was in favour of that at

the time. I think there is no evidence so far that the storm is

cutting through to the average voter. If I were Ed Miliband, I

would let it die a natural death. I would not write to an editorial

column for a national newspaper on a Sunday. That keeps the issue alive,

and it makes him look oversensitive and much better at dishing it out

than taking it. I agree about that. The Labour press team tweeted this

week saying that it was a new low for the times. And this was

re-tweeted by Ed Miliband. It isn't a great press attitude. It is very

Moni. Bill Clinton went out there and fought and made the case. So did

Tony Blair. If you just say, they are being horrible to us, it looks

pathetic. And it will cut through on Osborne and the financial

dimensional is, not political. I shall tweet that later! While we

have been talking, Mr Miliband has been on Desert Island Discs. He

might still be on it. Let's have a listen to what he had to say.

# Take on me, take me on. # And threw it all, she offers me

protection. # A lot of love and affection.

# Whether I'm right or wrong #. # Je Ne Regrette Rien. #.

Obviously, that was the music that Ed Miliband chose. Who thought -

you would have thought he would choose Norman Lamont's theme tune!

He chose Jerusalem... He has no classical background at all. He had

no Beethoven, no Elgar. David Cameron had Mendelssohn. And Ernie,

the fastest Notman in the West. -- fastest milkman. Tony Blair chose

the theme tune to a movie. Tony Blair's list was chosen by young

staffers in his office. It absolutely was. Tony Blair's list

was chosen by staff. The Ed Miliband this was clearly chosen by himself,

because who would allow politician to go out there and say that they

like Aha. I am the same age as Ed Miliband, and of course he likes

Aha. That was the tumour was played in the 80s. Sweet Caroline. It is

Angels by Robbie Williams. I was 14-year-old girl when that came out.

I thought Angels was the staple of hen nights and chucking out time in

pubs. The really good thing about his list is that the Smiths to not

appear. The Smiths were all over David Cameron's list. The absolutely

miserable music of Morris he was not there. What was his luxury? And

Indian takeaway! Again, chosen for political reasons. I would agree

with the panel about Aha, but I would expect -- I would respect his

right to choose. Have you been on Desert Island Discs? I have. It took

me three weeks to choose the music. It was the most difficult decision

in my life. What was the most embarrassing thing you chose? I

didn't choose anything embarrassing. I chose Beethoven, Elgar, and some

proper modern jazz. Anything from the modern era? Pet Shop Boys.

That's all for today. The Daily Politics will be on BBC Two at

lunchtime every day next week, and we'll be back here on BBC One at

11am next week. My luxury, by the way, was a wind-up radio! Remember,

if it's Sunday, it's the Sunday Politics.