16/03/2014

:00:37. > :00:44.Morning folks. Welcome to the Sunday Politics. George Osborne's fifth

:00:45. > :00:47.Budget will offer more tax relief for the lower paid but not for

:00:48. > :00:49.middle income earners being thrust into the 40p tax bracket. That's our

:00:50. > :00:54.top story. Ed Balls says millions of people

:00:55. > :00:56.aren't feeling any benefit from the recovery. We'll discuss the economy

:00:57. > :01:04.with big political beasts from Labour, the Conservatives, and the

:01:05. > :01:07.Lib Dems. Now that Ed Miliband has effectively ruled out an in/out EU

:01:08. > :01:08.referendum, how does UKIP deal with Tory claims that a vote for UKIP

:01:09. > :01:20.means no Here in the east, unlocking growth

:01:21. > :01:21.and creating jobs. What will the government

:01:22. > :01:24.restoring confidence in the safety of cycling. The three areas of

:01:25. > :01:33.London getting a cash boost to try something different.

:01:34. > :01:37.And with me as always our top political panel - Nick Watt, Helen

:01:38. > :01:40.Lewis and Janan Ganesh. They'll be tweeting their thoughts using the

:01:41. > :01:45.hashtag #bbcsp throughout the programme. So, just three months

:01:46. > :01:48.after his last major financial statement, George Osborne will be at

:01:49. > :01:53.the despatch box again on Wednesday, delivering his 2014 Budget. The

:01:54. > :02:02.Chancellor has already previewed his own speech, pledging to build what

:02:03. > :02:07.he calls a "resilient economy". The message I will give in the Budget is

:02:08. > :02:11.the economic plan is working but the job is far from done. We need to

:02:12. > :02:14.build resilient economy which means addressing the long-term weaknesses

:02:15. > :02:18.in Britain that we don't export enough, invest enough, build enough,

:02:19. > :02:22.make enough. Those are the things I will address because we want Britain

:02:23. > :02:25.to earn its way in the world. George Osborne's opposite number, Ed Balls,

:02:26. > :02:28.has also been talking ahead of the Budget. He says not everyone is

:02:29. > :02:31.feeling the benefit of the economic recovery, and again attacked the

:02:32. > :02:38.Government's decision to reduce the top rate of tax from 50 to 45%.

:02:39. > :02:42.George Osborne is only ever tough when he's having a go at the week

:02:43. > :02:45.and the voiceless. Labour is willing to face up to people on the highest

:02:46. > :02:52.incomes and say, I'm sorry, justifying a big tax cut at this

:02:53. > :02:56.time is not fair. We will take away the winter allowance from the richer

:02:57. > :02:59.pensioners, and I think that's the right thing to do. George Osborne

:03:00. > :03:04.might agree, but he's not allowed to say so. That was the Chancellor and

:03:05. > :03:09.the shadow chancellor. Janan, it seems like we are in a race against

:03:10. > :03:12.time. No one argues that the recovery is not under way, in fact

:03:13. > :03:16.it looks quite strong after a long wait, but will it feed through to

:03:17. > :03:22.the living standards of ordinary people in time for the May election?

:03:23. > :03:26.They only have 14 months to do it. The big economic variable is

:03:27. > :03:30.business investment. Even during the downturn, businesses hoarded a lot

:03:31. > :03:34.of cash. The question is, are they confident enough to release that

:03:35. > :03:38.into investment and wages? Taking on new people, giving them higher pay

:03:39. > :03:41.settlements. That could make the difference and the country will feel

:03:42. > :03:48.more prosperous and this time next year. But come to think of it, it

:03:49. > :03:52.strikes me, that how anticipated it is, it's the least talked about

:03:53. > :03:56.Budget for many years. I think that is because the economy has settled

:03:57. > :04:00.down a bit, but also because people have got used to the idea that there

:04:01. > :04:04.is no such thing as a giveaway. Anything that is a tax cut will be

:04:05. > :04:08.taken away as a tax rise or spending cut. That's true during the good

:04:09. > :04:10.times but during fiscal consolidation, it's avoidable. --

:04:11. > :04:17.consolidation, it's avoidable. - unavoidable. There is a plus and

:04:18. > :04:21.minus for the Conservatives here. 49% of people think the government

:04:22. > :04:24.is on roughly the right course, but only 16% think that their financial

:04:25. > :04:29.circumstances will improve this year. It will be a tough one for the

:04:30. > :04:35.Labour Party to respond to. I agree with Janan. Everyone seems bored

:04:36. > :04:40.with the run-up to the Budget. The front page of the Sunday Times was

:04:41. > :04:45.about fox hunting, the front page of the Sunday Telegraph was about EU

:04:46. > :04:50.renegotiation. Maybe we are saying this because there have not been

:04:51. > :04:55.many leaks. We have got used to them, and most of the George Osborne

:04:56. > :04:59.chat on Twitter was about how long his tie was. Freakishly long. I

:05:00. > :05:06.wouldn't dare to speculate why. Anything we should read into that? I

:05:07. > :05:13.don't know. For a long while there was no recovery, then it was it is a

:05:14. > :05:16.weak recovery, and now, all right, it's strong but not reaching

:05:17. > :05:22.everyone in the country. That is where we are in the debate. That's

:05:23. > :05:28.right, and the Conservative MPs are so anxious and they are making

:05:29. > :05:29.George Osborne announcing the rays in the personal allowance will go

:05:30. > :05:34.up, saying it might go up to 10,750 up, saying it might go up to 10 750

:05:35. > :05:42.from next year, and Conservative MPs say that that's OK but we need to

:05:43. > :05:45.think about the middle voters. People are saying the economy is

:05:46. > :05:50.recovering but no one is feeling it in their pocket. These are people

:05:51. > :05:54.snagged in at a 40p tax rate. The Tories are saying these are our

:05:55. > :05:58.people and we have to get to them. He has given the Lib Dems more than

:05:59. > :06:04.they could have hoped for on raising the threshold. Why is he not saying

:06:05. > :06:08.we have done a bit for you, now we have to look after our people and

:06:09. > :06:15.get some of these people out of that 40% bracket? Partly because the Lib

:06:16. > :06:18.Dems have asked for it so insistently behind-the-scenes.

:06:19. > :06:21.Somebody from the Treasury this week told me that these debates behind

:06:22. > :06:25.the scenes between the Lib Dems and Tories are incredibly tenacious and

:06:26. > :06:28.get more so every year. The Lib Dems have been insistent about going

:06:29. > :06:33.further on the threshold. The second reason is that the Tories think the

:06:34. > :06:40.issue can work for them in the next election. They can take the credit.

:06:41. > :06:42.If they enthusiastically going to ?12,000 and make it a manifesto

:06:43. > :06:48.pledge, they can claim ownership of the policy. The Liberal Democrats

:06:49. > :06:52.want to take it to 12,500, which means you are getting into minimum

:06:53. > :06:56.wage territory. It's incredibly expensive and the Tories are saying

:06:57. > :07:01.that maybe you would be looking at the 40p rate. The Tories have played

:07:02. > :07:06.as well. There have been authorised briefings about the 40p rate, and

:07:07. > :07:08.Cameron and Osborne have said that their priority was helping the

:07:09. > :07:11.lowest paid which is a useful statement to make and it appeals to

:07:12. > :07:18.the UKIP voters who are the blue-collar workers. And we are

:07:19. > :07:20.right, the economy will determine the next election? You assume so. It

:07:21. > :07:24.was ever that is. It didn't in 992 was ever that is. It didn't in 1992

:07:25. > :07:34.or 1987. It did in 1992. Ed Miliband's announcement last week

:07:35. > :07:37.that a Labour government would not hold a referendum on Europe unless

:07:38. > :07:39.there's another transfer of powers from Britain to Brussels has

:07:40. > :07:44.certainly clarified matters. UKIP say it just shows the mainstream

:07:45. > :07:47.parties can't be trusted. The Conservatives think it means UKIP

:07:48. > :07:50.voters might now flock back to them as the only realistic chance of

:07:51. > :07:54.securing a referendum. Giles Dilnot reports.

:07:55. > :07:58.When it comes to Europe and Britain's relation to it, the

:07:59. > :08:02.question is whether the answer is answered by a question. To be in or

:08:03. > :08:05.not to be in, that is the question, and our politicians have seemed less

:08:06. > :08:09.interested in question itself but whether they want to let us answer

:08:10. > :08:21.it. Labour clarified their position last week. There will be no transfer

:08:22. > :08:24.of powers without an in out referendum, without a clear choice

:08:25. > :08:30.as to whether Britain will stay in the EU. That seems yes to a

:08:31. > :08:34.referendum, but hold on. I believe it is unlikely that this lock will

:08:35. > :08:37.be used in the next Parliament. So that's a no. The Conservatives say

:08:38. > :08:47.yes to asking, in 2017, if re-elected, but haven't always. In

:08:48. > :08:50.2011, 81 Tory MPs defied the PM by voting for a referendum on EU

:08:51. > :08:53.membership: the largest rebellion against a Tory prime minister over

:08:54. > :09:03.Europe. Prompted by a petition from over 100,000 members of the public.

:09:04. > :09:06.The wrong question at the wrong time said the Foreign Secretary of a

:09:07. > :09:08.coalition Government including selfie-conciously-pro European Lib

:09:09. > :09:11.Dems, who had a referendum pledge in their 2010 manifesto, but only in

:09:12. > :09:14.certain circumstances. So we have the newspapers, and the public

:09:15. > :09:17.meeting leaflets. UKIP have always wanted the question put regardless.

:09:18. > :09:25.But Labour's new position may change things and The Conservatives think

:09:26. > :09:28.so. I think it does, because, you know, we are saying very clearly,

:09:29. > :09:32.like UKIP, we want a referendum, but like UKIP, we want a referendum but

:09:33. > :09:40.only a Conservative government can deliver it because most suffer

:09:41. > :09:47.largest would say it is possible in the first past the post system to

:09:48. > :09:54.have a UKIP government -- sophologists. And then it's easy for

:09:55. > :10:02.as to say that if a UKIP vote lets in a Conservative government, then

:10:03. > :10:05.they won't hold a referendum. UKIP seem undaunted by the clarifications

:10:06. > :10:07.of the other parties, campaigning like the rest but with a "tell it

:10:08. > :10:10.how it is, just saying what you re how it is, just saying what you're

:10:11. > :10:16.thinking, we aren't like them" attitude. They seem more worried

:10:17. > :10:21.about us and what we want, and I don't see that in the other parties.

:10:22. > :10:27.In parts of the UK, like South Essex, it's a message they think is

:10:28. > :10:31.working. They are taking the voters for granted again and people have

:10:32. > :10:38.had enough. People are angry, they see people saying they will get a

:10:39. > :10:43.vote on the European Union, but then it just comes down the road. They

:10:44. > :10:48.were quick to capitalise on the announcements, saying only the

:10:49. > :10:54.Conservatives will give you say, so does it change things? Not really.

:10:55. > :10:58.We have been talking about a referendum and having a debate on

:10:59. > :11:02.the European Union for years, and the other parties are playing catch

:11:03. > :11:06.up. They have a trust issue. Nobody trusts them on the European Union

:11:07. > :11:09.and that is why people come to us. Who the average UKIP voter is, or

:11:10. > :11:12.how they voted before is complicated, and what dent they

:11:13. > :11:14.might make on Conservative and Labour votes in 2015 is trickier

:11:15. > :11:23.still, but someone's been crunching the numbers anyway. We reckon it is

:11:24. > :11:26.between 25 and 30% of the electorate broadly share the UKIP motivation,

:11:27. > :11:30.so to top out at that level would be difficult. That's an awful lot of

:11:31. > :11:35.voters, but it's not the majority, and this is the reason why the main

:11:36. > :11:38.parties can't afford to just openly appealed to the UKIP electorate too

:11:39. > :11:43.hard because the elections are won and lost amongst the other 70%, the

:11:44. > :11:49.middle-class, the graduate, the younger, ethnic minorities. An

:11:50. > :11:52.appeal to the values of UKIP voters will alienate some of the other

:11:53. > :11:56.groups, and they are arguably more significant in winning the election.

:11:57. > :11:59.Whatever, the numbers UKIPers seem doggedly determined to dig away at

:12:00. > :12:02.any support the other parties have previously enjoyed.

:12:03. > :12:05.Giles Dilnot reporting. UKIP's leader, Nigel Farage, joins me now

:12:06. > :12:22.for the Sunday Interview. Nigel Farage, welcome back. Good

:12:23. > :12:25.morning. So the Labour Party has shot a fox. If Ed Miliband is the

:12:26. > :12:29.next by Minister, there will not be a referendum customer there's a long

:12:30. > :12:33.way between now and the next election, and Conservative party

:12:34. > :12:36.jobs and changes. We had a cast-iron guarantee of a referendum from

:12:37. > :12:40.camera, then he three line whip people to vote against it, and now

:12:41. > :12:44.they are for it. What the Labour Party has done is open up a huge

:12:45. > :12:47.blank to us, and that is what we will go for in the European

:12:48. > :12:51.elections this coming year in May. I think there is a very strong chance

:12:52. > :12:55.that Labour will match the Conservative pledge by the next

:12:56. > :13:00.general election. There may be, but at the moment he has ruled it out,

:13:01. > :13:03.and if he does not change his mind and goes into the election with the

:13:04. > :13:10.policy as it is, the only chance of a referendum is a Tory government.

:13:11. > :13:14.If you think the Tories will form a majority, which I think is unlikely.

:13:15. > :13:17.Remember, two thirds of our voters would never vote Conservative

:13:18. > :13:22.anyway. There is still this line of questioning that assumes UKIP voters

:13:23. > :13:25.are middle-class Tories. We have some voters like that, but most of

:13:26. > :13:31.them are coming to us from Labour, some from the Lib Dems and a lot of

:13:32. > :13:37.nonvoters. But it come the election you failed to change Mr Miliband's

:13:38. > :13:40.line, I repeat, the only chance of a referendum, if you want a

:13:41. > :13:44.referendum, if that is what matters, and the polls suggest it doesn't

:13:45. > :13:47.matter to that many people, but if that is what matters, the only way

:13:48. > :13:52.you can get one is to vote Conservative. No, because you have a

:13:53. > :13:56.situation in key marginals, especially where all three parties

:13:57. > :14:00.are getting a good share, where we will see, and this depends a lot on

:14:01. > :14:07.the local elections and the European elections, there are target

:14:08. > :14:10.constituencies where UKIP has a reasonably good chance of winning a

:14:11. > :14:17.seat, and that will change the agenda. Every vote for UKIP makes a

:14:18. > :14:20.Tory government less likely. Arab voters are not Tory. Only a third of

:14:21. > :14:27.the UKIP boat comes from the Conservative party -- our voters are

:14:28. > :14:31.not Tory. -- the UKIP vote. It was mentioned earlier, about blue-collar

:14:32. > :14:33.voters. We pick up far more Labour Party and nonvoters than

:14:34. > :14:37.conservatives. On the balance of what the effect of the UKIP boat

:14:38. > :14:41.is, the Tories should worry about us, they should worry about the fact

:14:42. > :14:44.they have lost faith with their own electorate. Even if there is a

:14:45. > :14:45.minority Ed Miliband government, electorate. Even if there is a

:14:46. > :14:48.minority Ed Miliband government it minority Ed Miliband government, it

:14:49. > :14:52.means no referendum. Labour and the Liberal Democrats are now at one on

:14:53. > :14:57.the matter. The next election is in a few weeks time, the European

:14:58. > :15:00.elections. What happens in those elections will likely change the

:15:01. > :15:04.party stands and position on a referendum. The fact that Ed

:15:05. > :15:09.Miliband has said this means, for us, our big target on the 22nd of

:15:10. > :15:12.May will be the Labour voters in the Midlands and northern cities, and if

:15:13. > :15:15.we do hammer into that boat and we are able to beat Labour on the day,

:15:16. > :15:28.there's a good chance of their policy changing. One poll this

:15:29. > :15:35.morning suggests Labour is close to you at 28, the Conservatives down at

:15:36. > :15:39.21, the Lib Dems down at eight. You are taking votes from the

:15:40. > :15:47.Conservatives and the Liberal Democrats. We are certainly taking

:15:48. > :15:52.votes from the Lib Dems but that is comparing the poll with one year ago

:15:53. > :15:57.when I don't think most people knew what the question really was. You

:15:58. > :16:00.seem to be in an impossible position because the better you do in a

:16:01. > :16:05.general election, the less chance there will be a referendum by 2020.

:16:06. > :16:10.there will be a referendum by 2 20. No, look at the numbers. Only a

:16:11. > :16:16.third of our voters are Conservatives. When we have polled

:16:17. > :16:20.voters that have come to us, we asked them if there was no UKIP

:16:21. > :16:25.candidate who would you vote for, less than one in five said

:16:26. > :16:30.Conservative. Less than one in five UKIP voters would be tempted to vote

:16:31. > :16:35.Conservative under any circumstances so the arithmetic does not suggest

:16:36. > :16:39.we are the Conservative problem it suggests we are hurting all of the

:16:40. > :16:44.parties and the reason the Tories are in trouble is because they have

:16:45. > :16:51.lost their traditional base. Why do you think Nick Clegg is debating

:16:52. > :16:59.Europe? I think they are in trouble, at 8% they could be wiped

:17:00. > :17:04.out, they could go from 12 to nothing and I think it is a chance

:17:05. > :17:10.for Nick Clegg to raise their profile. They are fringe party with

:17:11. > :17:15.respect to this contest so I see why he wants to do it. One of our big

:17:16. > :17:19.criticisms is that we have not been able to have a full debate on

:17:20. > :17:24.national television on the alternatives of the European Union

:17:25. > :17:38.so I am looking forward to it. How are you preparing? I think you can

:17:39. > :17:44.be over scripted with these things. Are you not doing mock debates? No,

:17:45. > :17:48.I am checking my facts and figures and making sure that I can show the

:17:49. > :17:54.British people that in terms of jobs, we would be far better off not

:17:55. > :17:58.being within the European Union, not being within its rule book, not

:17:59. > :18:04.suffering from some of the green taxes they are putting on the

:18:05. > :18:06.manufacturing industry. The idea that 3 million jobs are at risk,

:18:07. > :18:06.manufacturing industry. The idea that 3 million jobs are at risk I

:18:07. > :18:13.that 3 million jobs are at risk, I want to show why that is nonsense.

:18:14. > :18:19.Who do you think is playing you in their mock debates? They probably

:18:20. > :18:25.went to the pub and found someone! We will see. You have promised to do

:18:26. > :18:31.whatever it takes to fund your European election campaign, how much

:18:32. > :18:36.has been given so far? Just give it a few weeks and you will see what

:18:37. > :18:46.Paul is planning to do. He has made a substantial investment in the

:18:47. > :18:51.campaign already. How much? I'm not answering that for now. We are well

:18:52. > :18:55.on our way to a properly funded campaign and our big target will be

:18:56. > :19:01.the big cities and the working vote in those communities. Your deputy

:19:02. > :19:06.chairman Neil Hamilton is another former Tory, he says so far we

:19:07. > :19:13.haven't seen the colour of his money. Exactly two weeks ago, and

:19:14. > :19:21.things have changed since then. Mr Sykes has written a cheque since

:19:22. > :19:27.then? Yes. This morning's papers saying you will be asking MEPs to

:19:28. > :19:35.contribute ?50,000 each, is that true? Over the next five years, yes.

:19:36. > :19:42.Not for the European campaign. So lack of money will not be an excuse.

:19:43. > :19:46.We will have a properly funded campaign. How we raise the kind of

:19:47. > :19:56.money needed to fund the general election afterwards is another

:19:57. > :20:01.question. What is UKIP's policy on paying family members? We don't

:20:02. > :20:06.encourage it and I didn't employ any family member for years. My wife

:20:07. > :20:13.ended up doing the job and paid for the first seven years of my job She

:20:14. > :20:21.is paid now? Until May, then she comes off the payroll am which

:20:22. > :20:29.leaves me with a huge problem. In 2004 you said, UKIP MEPs will not

:20:30. > :20:33.employ wives and there will be no exceptions. An exception was made

:20:34. > :20:36.because I became leader of the National party as well as a leader

:20:37. > :20:41.of the group in European Parliament. Things do change in

:20:42. > :20:46.life, and you can criticise me for whatever you like, but I cannot be

:20:47. > :20:51.criticised for not having a big enough workload. No, but you didn't

:20:52. > :20:59.employ your wife when you had told others not to do it your party.

:21:00. > :21:04.Nobody else in my party has a big job in Europe and the UK. We made

:21:05. > :21:09.the exception for this because of very unusual circumstances. It also

:21:10. > :21:16.looks like there was a monetary calculation. Listen to this clip

:21:17. > :21:21.from a BBC documentary in 2000. It is a good job. I worked it out

:21:22. > :21:25.because so much of what you get is after tax that if you used the

:21:26. > :21:31.secretarial allowances to pay your wife on top of the other games you

:21:32. > :21:37.can play, I reckon this job in Stirling term is over a quarter of

:21:38. > :21:42.?1 million a year. That is what you would need to earn working for

:21:43. > :21:46.Goldman Sachs or someone like that. I agree with that. More importantly

:21:47. > :21:50.the way you really make money in the European Parliament is being their

:21:51. > :21:57.five days a week, because you sign in every day, you get 300 euros

:21:58. > :22:01.every day, and that is how people maxed out. The criticism of me is

:22:02. > :22:05.that I am not there enough so whatever good or bad I have done in

:22:06. > :22:09.the European Parliament, financial gain has not been one of the

:22:10. > :22:15.benefits. There have been allegations of you also employing a

:22:16. > :22:22.former mistress on the same European Parliamentary allowance, you deny

:22:23. > :22:26.that? I am very upset with the BBC coverage of this. The ten o'clock

:22:27. > :22:30.news run this as a story without explaining that that allegation was

:22:31. > :22:38.made using Parliamentary privilege by somebody on bail facing serious

:22:39. > :22:46.fraud charges. I thought that was pretty poor. You have a chance to do

:22:47. > :22:51.that and you deny you have employed a former mistress? Yes, but if you

:22:52. > :22:55.look at many of the things said over the last week, I think it is

:22:56. > :22:59.becoming pretty clear to voters that the establishment are becoming

:23:00. > :23:07.terrified of UKIP and they will use anything they can find to do us down

:23:08. > :23:13.in public. Is an MEP employs his wife and his former mistress, that

:23:14. > :23:17.would be resigning matter, wouldn't it? Yes, particularly if the

:23:18. > :23:23.assumption was that money was being taped for work but was not being

:23:24. > :23:31.done. Who do you think is behind these stories? It is all about

:23:32. > :23:35.negative, it is all about attacks, but I don't think it is actually

:23:36. > :23:40.going to work because so much of what has been said in the last week

:23:41. > :23:45.is nonsense. A reputable daily newspaper said I shouldn't be

:23:46. > :23:49.trusted because I had stored six times for the Conservative party, I

:23:50. > :23:55.have never even stored in a local council election. I think if you

:23:56. > :24:04.keep kicking an underdog, it will make the British people rally around

:24:05. > :24:10.us. Is it the Conservatives? Yes, and the idea that all of our voters

:24:11. > :24:20.are retired colonels is simply not true. We get some voters from the

:24:21. > :24:25.Labour side as well. Would you consider standing in a Labour seat

:24:26. > :24:33.if you are so sure you are getting Labour votes? Yes, but the key for

:24:34. > :24:39.UKIP is that it has to be marginal. Just for your own future, if you

:24:40. > :24:45.fail to win a single soul -- single seat in the general election, if Ed

:24:46. > :24:51.Miliband fails to win an outright majority, will you stand down as

:24:52. > :24:57.UKIP leader? I would think within about 12 hours, yes. I will have

:24:58. > :25:01.failed, I got into politics not because I wanted a career in

:25:02. > :25:05.politics, far from it. I did it because I don't think this European

:25:06. > :25:09.entanglement is right for our country. I think a lot of people

:25:10. > :25:14.have woken up to the idea we have lost control of our borders and now

:25:15. > :25:21.is the moment for UKIP to achieve what it set out to do. Will UKIP

:25:22. > :25:26.continue without you if you stand down? Of course it will. I know that

:25:27. > :25:35.everyone says it is a one-man band but it is far from that. We have had

:25:36. > :25:38.some painful moments, getting rid of old UKIP, new UKIP is more

:25:39. > :25:45.professional, less angry and it is going places. Nigel Farage, thank

:25:46. > :25:47.you for being with us. So, what else should we be looking

:25:48. > :25:50.out for in Wednesday's Budget statement? We've compiled a Sunday

:25:51. > :25:52.Politics guide to the Chancellor's likely announcements.

:25:53. > :25:56.Eyes down everyone, it's time for a bit of budget bingo. Let's see what

:25:57. > :25:59.we will get from the man who lives at legs 11. Despite some good news

:26:00. > :26:03.on the economy, George Osborne says that this will be a Budget of hard

:26:04. > :26:06.truths with more pain ahead in order to get the public finances back

:26:07. > :26:08.under control. But many in the Conservative party, including the

:26:09. > :26:11.former chancellor Norman Lamont, want Mr Osborne to help the middle

:26:12. > :26:18.classes by doing something about the 4.4 million people who fall into the

:26:19. > :26:22.40% bracket. Around one million more people pay tax at that rate compared

:26:23. > :26:27.to 2010 because the higher tax threshold hasn't increased in line

:26:28. > :26:29.with inflation. Mr Osborne has indicated he might tackle the issue

:26:30. > :26:36.in the next Conservative manifesto, but for now he is focused on helping

:26:37. > :26:39.the low paid. It's likely we will see another increase in the amount

:26:40. > :26:43.you can earn before being taxed, perhaps up another ?500 to ?10, 00.

:26:44. > :26:46.perhaps up another ?500 to ?10,500. The Chancellor is going to flesh out

:26:47. > :26:49.the details of a tax break for childcare payments, and there could

:26:50. > :27:06.be cries of 'house' with the promise of more help for the building

:27:07. > :27:10.industry. The Help To Buy scheme will be extended to 2020 and there

:27:11. > :27:13.could be the go-ahead for the first Garden City in 40 years. Finally,

:27:14. > :27:15.bingo regulars could be celebrating a full house with a possible cut in

:27:16. > :27:18.bingo tax. And I've been joined in the studio

:27:19. > :27:20.by the former Conservative chancellor Norman Lamont, in Salford

:27:21. > :27:23.by the former Labour Cabinet minister Hazel Blears, and in

:27:24. > :27:26.Aberdeen by the Lib Dem deputy leader, Malcolm Bruce. Let me come

:27:27. > :27:33.to Norman Lamont first, you and another former Tory Chancellor,

:27:34. > :27:43.Nigel Lawson, have called in the fall in the threshold for the rate

:27:44. > :27:48.at which the 40p clicks in. I would have preferred an adjustment in the

:27:49. > :27:53.Budget but I agree with what you are saying, it sounds like the

:27:54. > :27:58.Chancellor will not do that. My main point is that you cannot go on

:27:59. > :28:01.forever and forever increasing the personal allowance and not

:28:02. > :28:07.increasing the 40% tax threshold because you are driving more and

:28:08. > :28:10.more people into that band. It is an expensive policy because in order to

:28:11. > :28:16.keep the number of people not paying tax constant, you have to keep

:28:17. > :28:23.adjusting it each year. When this was introduced by Nigel Lawson, it

:28:24. > :28:30.applied to one in 20 people, the 40% rate, it now applies to one in six

:28:31. > :28:34.people. By next year, there will be 6 million people paying base. Why do

:28:35. > :28:40.you think your Tory colleagues seem happy to go along with the Lib Dems

:28:41. > :28:54.and target whatever money there is for tax cuts rather -- on the lower

:28:55. > :29:00.paid rather than the middle incomes? They are not helping the lowest

:29:01. > :29:03.paid. If you wanted to really help the lowest paid people you would

:29:04. > :29:10.raise the threshold for national insurance contributions, which is

:29:11. > :29:19.around ?6,000. Is it the Lib Dems stopping any rise in the 40p

:29:20. > :29:25.threshold? We are concentrating on raising the lower threshold because

:29:26. > :29:31.we believe that is the way to help those on lower incomes. Whilst they

:29:32. > :29:34.haven't benefited as much as the lower paid they have participated

:29:35. > :29:39.and I think people understand right now, if you were going to prioritise

:29:40. > :29:44.the high earners, when we are still trying to help those on lower and

:29:45. > :29:48.middle incomes who haven't enjoyed great pay increases but have got the

:29:49. > :29:53.benefit of these tax increases, that is why we would like to do it for

:29:54. > :30:00.the minimum wage level. But the poorest will not benefit at all. The

:30:01. > :30:04.poorest 16% already don't pay tax. Why don't you increase the threshold

:30:05. > :30:14.at which National Insurance starts? You only have two earned ?5,500

:30:15. > :30:18.before you start to pay it. You ve got to remember that the raising of

:30:19. > :30:23.the threshold to ?10,000 or more was something the Tories said we could

:30:24. > :30:30.not afford. Why are you continuing to do it? If you want to help the

:30:31. > :30:36.working poor, the way would be to take the lowest out of national

:30:37. > :30:40.insurance. The view we take is they are benefiting, and have benefited

:30:41. > :30:42.from, the raising of the tax threshold. You now have to earn

:30:43. > :30:47.?10,000, we hope eventually 12, 00, ?10,000, we hope eventually 12,500,

:30:48. > :30:51.and that means only people on very low wages. If you opt out of

:30:52. > :30:56.national insurance, you're saying to people that you make no contribution

:30:57. > :31:00.to the welfare system, so there is a general principle that people should

:31:01. > :31:06.participate and paying, and also claim when they need something out.

:31:07. > :31:09.We thought raising the threshold was simple and effective at a time of

:31:10. > :31:15.economic austerity and the right way to deliver a helpful support to

:31:16. > :31:19.welcoming people. -- working people. With the Labour Party continue to

:31:20. > :31:23.raise the threshold, or do they think there is a case that there are

:31:24. > :31:29.too many people being dragged into the 40p tax bracket? If Norman

:31:30. > :31:32.Lamont thinks this is the right time to benefit people who are reasonably

:31:33. > :31:36.well off rather than those who are struggling to make ends meet, then

:31:37. > :31:40.genuinely, I say it respectfully, I don't think he's living in the world

:31:41. > :31:45.the rest of us are. Most working people have seen their wages

:31:46. > :31:49.effectively reduced by about ?1600 because they have been frozen, so

:31:50. > :31:54.the right thing is to help people on modest incomes. I also understand

:31:55. > :31:58.that if the 40% threshold went up, the people who would benefit the

:31:59. > :32:03.most, as ever, are the people who are really well off, not the people

:32:04. > :32:09.in the middle. The Conservatives have already reduced the 50p tax on

:32:10. > :32:12.people over ?150,000 a year, and we have to concentrate on the people

:32:13. > :32:15.going out to work, doing their best to bring their children up and have

:32:16. > :32:20.a decent life and need a bit of help. I think raising the threshold

:32:21. > :32:24.is a good thing. We would bring back the 10p tax, which we should never

:32:25. > :32:29.have abolished, and do things with regard to childcare. At the moment,

:32:30. > :32:34.childcare costs the average family as much as their mortgage, for

:32:35. > :32:37.goodness sake. We would give 25 hours free childcare for youngsters

:32:38. > :32:43.over three and four years old. That would be a massive boost the working

:32:44. > :32:47.families. We are talking about nurses, tube drivers, warrant

:32:48. > :32:52.officers in the army. There are many people who are not well off but have

:32:53. > :32:57.been squeezed in the way everybody has been squeezed and they are

:32:58. > :33:00.finding it continuing. I am stunned by Malcolm's argument where

:33:01. > :33:03.everybody should pay something so you should not take people out of

:33:04. > :33:08.national insurance, but the principle doesn't apply to income

:33:09. > :33:13.tax. You can stand that argument on its head and apply it to income tax.

:33:14. > :33:16.Most people don't see a difference between income tax and national

:33:17. > :33:21.insurance, it's the same thing to most people. It is true that it

:33:22. > :33:24.isn't really an insurance fund and there is an argument from merging

:33:25. > :33:29.both of them. But we have concentrated on a simple tax

:33:30. > :33:36.proposition. Norman is ignoring the fact the people on the 40% rate have

:33:37. > :33:40.benefited by the raising of the personal allowance. To say they have

:33:41. > :33:43.been squeezed is unfair. The calculation is that an ordinary

:33:44. > :33:49.taxpayer will be ?700 better off at the current threshold, and about

:33:50. > :33:52.?500 better off at the higher rate. It is misleading to say the better

:33:53. > :33:58.off we'll be paying more. I agree with Hazel, if you go to the 40%

:33:59. > :34:01.rate, it's the higher earners who benefit the most, and we won't do

:34:02. > :34:07.that when the economy is not where it was before the crash. How much

:34:08. > :34:14.will the lower paid be better off if you reintroduce the 10p rate?

:34:15. > :34:20.Significantly better off. I don t have the figure myself, but they'd

:34:21. > :34:23.be significantly better off and the Budget should be a mixture of

:34:24. > :34:27.measures to help people who work hard. That is why I think the

:34:28. > :34:30.childcare issue has to be addressed. ?100 a week of the people

:34:31. > :34:37.with childcare payments. It is a massive issue. We want the job is

:34:38. > :34:40.guaranteed to get young people back into work. There's been hardly any

:34:41. > :34:44.discussion about that, and we have nearly 1 million people who have

:34:45. > :34:49.been out of work for six months or more, and as a country we need to do

:34:50. > :34:55.something to help that. 350,000 full-time students, so it is a

:34:56. > :34:58.misleading figure. It is not a million including full-time

:34:59. > :35:03.students. All parties do this. It sounds to me, Malcolm Bruce, you

:35:04. > :35:06.have more in common with the Labour Party than you do with the

:35:07. > :35:12.Conservatives. You want an annual levy on houses over ?2 million, so

:35:13. > :35:15.does Labour. A lot of your members want to scrap the so-called bedroom

:35:16. > :35:20.tax and so does labour. You think every teacher should have a teaching

:35:21. > :35:24.qualification, and so does Labour. Your policy on the EU referendum is

:35:25. > :35:30.the same. Let me go on. And you want to scrap the winter fuel allowance

:35:31. > :35:33.for wealthy pensioners. We want to make sure we get the public finances

:35:34. > :35:39.in order and we have grave reservations about the Labour Party

:35:40. > :35:46.promises. But they followed your spending plans in the first year.

:35:47. > :35:50.The point we are making is we can make a fairer society and stronger

:35:51. > :35:51.economy if you keep the public finances moving towards balance. We

:35:52. > :35:55.finances moving towards balance We don't think the Labour Party will

:35:56. > :35:58.take a stand that track. It is interesting that the Labour Party

:35:59. > :36:04.want to introduce the 10p rate that Gordon Brown abolished. We consider

:36:05. > :36:11.that before we can -- committed to the 0% rate -- we considered that.

:36:12. > :36:16.It makes a complicated system difficult and we think it's better

:36:17. > :36:20.doing it that way. As a fiscal conservative, why are you talking

:36:21. > :36:23.about any tax cuts when the deficit is over ?100 billion, and

:36:24. > :36:28.effectively, anything you propose today can only be financed by more

:36:29. > :36:30.borrowing. I totally agree with you. I said that this week. I thought the

:36:31. > :36:33.best thing would have no Budget. I said that this week. I thought the

:36:34. > :36:35.best thing would have no Budget The best thing would have no Budget. The

:36:36. > :36:39.main thing is to get the deficit down. My argument is is that you

:36:40. > :36:41.have an adjustment in tax rates it should be shared between the

:36:42. > :36:48.allowances and the higher rate, but I don't think that the progress on

:36:49. > :36:54.the deficit is something we can give up on. This is still a very long way

:36:55. > :36:59.to go. We're only halfway through. Hazel, does it make sense to borrow

:37:00. > :37:06.for tax cuts? I am reluctant to do this, but I agree with both Norman

:37:07. > :37:11.and Malcolm. Malcolm Bruce wants to borrow for tax cuts. We absolutely

:37:12. > :37:14.need to get the deficit down and get finances on a strong footing. But we

:37:15. > :37:18.also have to think about having some spending in the system that in the

:37:19. > :37:21.longer run saves us money. We all know we need to build new homes I

:37:22. > :37:25.know we need to build new homes. I don't think it's necessarily the

:37:26. > :37:30.right priority to give people in London mortgage relief in terms of

:37:31. > :37:34.?600,000. We have to get the balance right. Sometimes it is right to

:37:35. > :37:40.spend to save. I'm afraid we have run out of time. There will be

:37:41. > :37:43.plenty more discussion in the lead up to the Budget on Wednesday.

:37:44. > :37:47.It's just gone 11:35am. You're watching the Sunday Politics. We say

:37:48. > :37:51.goodbye to viewers in Scotland who leave us now for Sunday Politics

:37:52. > :37:54.Scotland. Coming up here in 20 minutes, Frances O'Grady, the

:37:55. > :38:00.General Secretary of the TUC, joins us

:38:01. > :38:07.Hello and welcome to the part of Sunday politics just for us here in

:38:08. > :38:08.the East. Coming up: the government's plan for prosperous

:38:09. > :38:12.government's plan for prospdrous cities. It is called the city deal

:38:13. > :38:15.but what difference can rem`ke? cities. It is called the city deal

:38:16. > :38:19.but what difference can rem`ke? If it was not for the city deal then

:38:20. > :38:23.business would be different, it would be owned half the sizd.

:38:24. > :38:23.business would be different, it would be owned half the size. And

:38:24. > :38:28.would be owned half the sizd. And after a recession and cutbacks to

:38:29. > :38:32.the arts, is there a glimmer of hope for our regional theatres in the

:38:33. > :38:37.budget? Our message to George Osborne is that more investlent in

:38:38. > :38:39.the arts need a better experience for audiences and the greater

:38:40. > :38:49.for audiences and the greatdr cultural economy for the UK.

:38:50. > :38:54.Lets meet our guests. Mark Lancaster the Conservative MP for Milton

:38:55. > :38:59.Keynes North, a part`time soldier and former company director and now

:39:00. > :39:03.a government whip. And Simon Wright represents Norwich South for the

:39:04. > :39:06.Liberal Democrats, he was a maths teacher and political agent before

:39:07. > :39:10.the entered Parliament in 2010. Welcome to both of you. Let's begin

:39:11. > :39:15.with a big boost to the region 's with a big boost to the reghon s

:39:16. > :39:16.school budgets because the government has announced th`t local

:39:17. > :39:17.government has announced that local authorities with long`term

:39:18. > :39:20.underfunding will now get whnd authorities with long`term

:39:21. > :39:21.underfunding will now get wind of underfunding will now get whnd of

:39:22. > :39:25.pounds extra. Nine councils across the East will receive nearlx ?7

:39:26. > :39:29.the East will receive nearly ?70 million more every year. Thd biggest

:39:30. > :39:34.million more every year. The biggest beneficiaries are Cambridgeshire

:39:35. > :39:35.with 20.5 million and Norfolk with 16 million. It is all additional

:39:36. > :39:41.16 million. It is all addithonal money. The authorities that did not

:39:42. > :39:44.get more will not face any cuts. Simon, you are a former teacher.

:39:45. > :39:49.Doesn't this prove that dec`des of Doesn't this prove that decades of

:39:50. > :39:50.pupils have been missing out? Absolutely it does in this

:39:51. > :39:51.announcement is very important for announcement is very important for

:39:52. > :39:55.schools in Norfolk, a colle`gue schools in Norfolk, a colle`gue

:39:56. > :39:58.Julian Huppert has been campaigning very hard to redress the balance

:39:59. > :40:03.where our areas have been ldt down where our areas have been ldt down

:40:04. > :40:07.by underinvestment, underfunding compare to the national average

:40:08. > :40:09.This extra money will mean that headteachers can put the wee

:40:10. > :40:11.This extra money will mean that headteachers can put the wed sources

:40:12. > :40:17.into the classroom that can make a real difference. Mark, is it a real

:40:18. > :40:20.difference? ?8 per pupil? Yds, real difference. Mark, is it a real

:40:21. > :40:22.difference? ?8 per pupil? Yes, we difference? ?8 per pupil? Yds, we

:40:23. > :40:26.are fortunate in Milton Keynes where we are already packed ?4500 per

:40:27. > :40:32.pupil across the country. We have a pupil across the country. We have a

:40:33. > :40:36.different problem, we are a rapidly growing city and that is having a

:40:37. > :40:38.spare school places is so that when people move into the city we

:40:39. > :40:42.spare school places is so that when people move into the city wd can

:40:43. > :40:46.actually find a place for them. We must find this infrastructure before

:40:47. > :40:51.expansion so we have places for pupils before they come in. That is

:40:52. > :40:54.why I am pleased that the government has announced this funding. Simon,

:40:55. > :40:59.if the money is spent on teacher if the money is spent on te`cher

:41:00. > :41:04.salaries is that enough? 's I think it depends on how house choose to

:41:05. > :41:10.spend it. They will now how this will make the biggest impact in

:41:11. > :41:12.their schools. If they use the money to attract the best teachers to the

:41:13. > :41:13.schools that will clearly h`ve to attract the best teachers to the

:41:14. > :41:18.schools that will clearly h`ve an enormous possible impact. ``

:41:19. > :41:25.enormous positive impact. They could spend it on development or training.

:41:26. > :41:26.Whatever the needs of the schools, headteachers will have to have a

:41:27. > :41:29.flexible at it. Here is a qtestion. flexible at it. Here is a question.

:41:30. > :41:36.`` flexibility. Do you remelber the `` flexibility. Do you remelber the

:41:37. > :41:42.East of England development agency? It was abolished in 2012. The

:41:43. > :41:48.Coalition wanted everything more local and centralised. They brought

:41:49. > :41:51.in local enterprise partnerships and more recently the city deal. Under

:41:52. > :41:52.this programme individual chties more recently the city deal. Under

:41:53. > :41:54.this programme individual cities bid this programme individual chties bid

:41:55. > :41:55.for money to create jobs and infrastructure in their loc`l

:41:56. > :41:57.for money to create jobs and infrastructure in their local area.

:41:58. > :42:02.infrastructure in their loc`l area. In the East five cities put

:42:03. > :42:05.themselves forward, Norwich, Ipswich and Southend have had their bid is

:42:06. > :42:11.accepted. The Cambridge deal is expected to be confirmed in this

:42:12. > :42:13.week 's budget. There is a slow progress on the Milton Keynds bid.

:42:14. > :42:14.progress on the Milton Keynes bid. Our political correspondent has been

:42:15. > :42:19.to Nottingham where the city deal is to Nottingham where the city deal is

:42:20. > :42:26.already up and running to sde if it has made any difference.

:42:27. > :42:30.E 70 men and women treats their jobs with the enthusiasm... 100 years ago

:42:31. > :42:39.this is what Nottingham was famous for. Text fails. Particularly late.

:42:40. > :42:40.`` textiles. Today, a completely different industry is prettx

:42:41. > :42:45.different industry is pretty Nottingham on the map. In the old

:42:46. > :42:47.textile factories dozens of high`tech companies are sprhnging

:42:48. > :42:53.high`tech companies are springing up. This firm is apps for

:42:54. > :42:55.smartphones. Just two years old it already has 2000 clients on its

:42:56. > :43:00.books and hopes to be emploxing 50 books and hopes to be emploxing 50

:43:01. > :43:03.staff in the next three years. If it was not for the city deal we

:43:04. > :43:03.staff in the next three years. If it was not for the city deal wd would

:43:04. > :43:07.was not for the city deal we would be around half the size and not on

:43:08. > :43:10.the project as we are in terms of growth. Key to setting up, a

:43:11. > :43:15.the project as we are in terms of growth. Key to setting up, ` grant

:43:16. > :43:16.of ?150,000. The order said the business would not have gond off the

:43:17. > :43:18.business would not have gone off the ground without it. If this loney

:43:19. > :43:20.business would not have gond off the ground without it. If this money had

:43:21. > :43:23.not been available he would have found it somewhere? Absolutdly, we

:43:24. > :43:30.found it somewhere? Absolutely, we would probably be in London or

:43:31. > :43:35.Berlin but certainly not Nottingham. They call this area of the creative

:43:36. > :43:39.quarter, he plans to regenerate this part of the city have been `round

:43:40. > :43:44.for a while but city deal status made it all happen. A series of

:43:45. > :43:46.financial incentives is attracting new firms and encouraging those

:43:47. > :43:51.already here to grow. Any help you already here to grow. Any hdlp you

:43:52. > :43:53.can get to nudge forward in terms of doing something positive is a

:43:54. > :43:56.tremendous help, gives you ` doing something positive is a

:43:57. > :43:59.tremendous help, gives you a spring tremendous help, gives you a spring

:44:00. > :44:04.in your step and you can sed, rather than battling against red tape,

:44:05. > :44:06.people are actually giving us something to help us drive the

:44:07. > :44:11.business forward. With ?60 million business forward. With ?60 lillion

:44:12. > :44:15.of money from the government the council has been able to set up a

:44:16. > :44:16.venture capital fund to help new businesses and install superfast

:44:17. > :44:22.broadband. Old warehouses have been broadband. Old warehouses have been

:44:23. > :44:25.transformed into office space. More than 700 jobs have been cre`ted

:44:26. > :44:26.transformed into office space. More than 700 jobs have been created, ?22

:44:27. > :44:29.than 700 jobs have been cre`ted ?22 million of private investment

:44:30. > :44:30.brought in. ?1 million has been spent creating eight skills and

:44:31. > :44:36.apprenticeship, help young into apprenticeship, help young into

:44:37. > :44:40.jobs. Last year it placed 520 apprentices, but 80% among `` above

:44:41. > :44:45.the national average. We are clear the national average. We ard clear

:44:46. > :44:46.about what we wanted to do, develop infrastructure, skills, bushness

:44:47. > :44:49.infrastructure, skills, business support. What we have managdd

:44:50. > :44:53.infrastructure, skills, bushness support. What we have managed to do

:44:54. > :44:57.is get in place and certain things. For example a ?50 million venture

:44:58. > :45:01.capital fund. That is something we have never had. It is something most

:45:02. > :45:06.cities have never had and it makes it an attractive place to come to as

:45:07. > :45:07.the city. Critics will point out that we used to have regional

:45:08. > :45:08.development agencies for thhs that we used to have region`l

:45:09. > :45:11.development agencies for this but development agencies for this but

:45:12. > :45:15.the Coalition did away with them because it's not them too

:45:16. > :45:17.bureaucratic and unfocused. City deal status is seen as the new way

:45:18. > :45:20.to help areas grow economically. to help areas grow economic`lly

:45:21. > :45:26.There is one other big benefits, There is one other big benefits

:45:27. > :45:29.local councils are allowed to keep all of the business rates is

:45:30. > :45:34.collected in the creative quarter. The extra money is used to fund an

:45:35. > :45:40.extension to the Khan network. The council says ?760 million is being

:45:41. > :45:42.invested in the city infrastructure. But it is not all going to plan.

:45:43. > :45:46.But it is not all going to plan There is a lot of frustration that

:45:47. > :45:48.many places still do not have superfast broadband. The Cotncil

:45:49. > :45:50.superfast broadband. The Council complains about weight being slow to

:45:51. > :45:56.make decisions and release loney. We make decisions and release money. We

:45:57. > :45:59.have not seen the progress from city deal is that I wanted to see. There

:46:00. > :46:04.is an awareness of that but ministers will have to take all the

:46:05. > :46:08.their weight machines and ensure that localism is delivered on the

:46:09. > :46:13.ground because that is what delivers growth. `` Whitehall machinds. Where

:46:14. > :46:16.Nottingham leads, Norwich, Ipswich, Nottingham leads, Norwich, Hpswich,

:46:17. > :46:19.Southend and soon Cambridge will follow. It will be a fewer years

:46:20. > :46:20.follow. It will be a fewer xears before the full impact of city

:46:21. > :46:23.follow. It will be a fewer years before the full impact of chty deal

:46:24. > :46:28.status can be assessed at the feeling here is that it is working.

:46:29. > :46:30.We are joined by Richard have it the Labour MEP for the East of England

:46:31. > :46:32.Labour MEP for the East of Dngland who fought hard to retain the

:46:33. > :46:34.development agency which used who fought hard to retain the

:46:35. > :46:36.development agency which usdd to development agency which used to

:46:37. > :46:40.access lots of funds from Etrope. We were feeling there that this is

:46:41. > :46:46.working well in Nottingham, so it will be a big boost for the region?

:46:47. > :46:48.It is certainly important in cities like knowledge and Ipswich run by

:46:49. > :46:50.Labour councils, of course they're Labour councils, of course they re

:46:51. > :46:55.going to embrace any money that is going. Councils have been hht by

:46:56. > :46:55.three times the level of cuts converge to central governmdnt

:46:56. > :46:59.converge to central government departments. But those councils are

:47:00. > :47:03.seeking to provide leadership to seeking to provide leadership to

:47:04. > :47:07.help the business community to provide for the future. What about

:47:08. > :47:09.the other cities and towns hn the region that used to get access

:47:10. > :47:09.the other cities and towns in the region that used to get accdss to

:47:10. > :47:11.region that used to get access to the national and European money

:47:12. > :47:17.through regional development agencies? What about London? Their

:47:18. > :47:26.time will come, wanted? `` what about Luton. It is slight of hand.

:47:27. > :47:28.They were spending ?100 million per year. The comparison is difficult

:47:29. > :47:32.cause there is a lot of slehght hand cause there is a lot of sleight hand

:47:33. > :47:33.by the government trying to be present things. You are seehng

:47:34. > :47:37.by the government trying to be present things. You are seeing next

:47:38. > :47:44.week in the budget we hope Cambridge will get it. Nick Clegg was in

:47:45. > :47:45.Cambridge six months ago. Isn't it better to let the individual cities

:47:46. > :47:50.represent themselves, decidd for represent themselves, decidd for

:47:51. > :47:51.themselves rather than having one agencies thinking what is best

:47:52. > :47:51.themselves rather than having one agencies thinking what is bdst for

:47:52. > :47:57.agencies thinking what is best for the whole region? Yes and Ed

:47:58. > :48:01.Miliband unveiled Labour 's task force for local government last

:48:02. > :48:02.week. We would go much further in terms of whole place budgeting,

:48:03. > :48:04.terms of whole place budgethng, getting as much public money

:48:05. > :48:05.terms of whole place budgeting, getting as much public monex being

:48:06. > :48:06.spent together in the interest getting as much public money being

:48:07. > :48:10.spent together in the interest of communities. You have heard from

:48:11. > :48:16.Nottingham in Andrew 's piece that they are experiencing the government

:48:17. > :48:21.holding them back. I know from speaking with the councils that have

:48:22. > :48:25.been successful that the original proposals in terms of powers and

:48:26. > :48:32.budgets where will what are bound by this government. Isn't it good to

:48:33. > :48:37.have healthy, petition betwden the various NAS? `` healthy competition.

:48:38. > :48:42.The unemployed people in a region do not want to compete with other

:48:43. > :48:43.cities for sparse amounts of money, they want to be successful

:48:44. > :48:49.everywhere and anywhere. What about everywhere and anywhere. Wh`t about

:48:50. > :48:52.the role all areas? The only money coming in as European Union money

:48:53. > :48:57.that I am helping to get for our rural communities. Before you have a

:48:58. > :49:01.system whereby the money av`ilable national and European was available

:49:02. > :49:03.to anyone and everyone in a transparent way with the needs could

:49:04. > :49:05.transparent way with the nedds could best be met. I am glad for the

:49:06. > :49:09.cities and good luck to them for cities and good luck to thel for

:49:10. > :49:12.doing it, I think there is ` big problem about Milton Keynes two

:49:13. > :49:16.years late and ?70 million short in their budget so even with the

:49:17. > :49:20.programmes in our region discovered is. Briefly, if Labour get in

:49:21. > :49:22.programmes in our region discovered is. Briefly, if Labour get hn in

:49:23. > :49:23.2015 would you bring somethhng similar to the regional development

:49:24. > :49:29.similar to the regional devdlopment agency back? I think we should build

:49:30. > :49:32.on what is there. I have worked with local enterprise partnerships and

:49:33. > :49:36.many are doing the very best job possible. We are hoping to deliver

:49:37. > :49:37.very significant European ftnding very significant European ftnding

:49:38. > :49:38.programmes that I have worked hard programmes that I have worked hard

:49:39. > :49:40.for in Brussels to them so H programmes that I have workdd hard

:49:41. > :49:44.for in Brussels to them so I think the voters are not that intdrested

:49:45. > :49:46.the voters are not that interested in redesigning the architecture,

:49:47. > :49:51.what you are interested in his results. People come back to you

:49:52. > :49:53.soon. Mark Lancaster we have heard soon. Mark Lancaster we havd heard

:49:54. > :49:54.that in Milton Keynes the city soon. Mark Lancaster we have heard

:49:55. > :49:58.that in Milton Keynes the chty deal that in Milton Keynes the chty deal

:49:59. > :50:00.has stalled, what is going on? There is a hard negotiation between Milton

:50:01. > :50:03.is a hard negotiation betwedn Milton Keynes and the government, we are

:50:04. > :50:08.very clear that we are keen to build new homes. We have 20,000

:50:09. > :50:10.outstanding planning applic`tions and once he gets the money as they

:50:11. > :50:14.and once he gets the money `s they are built for the new infrastructure

:50:15. > :50:18.but tends to lag behind is the revenue. The deal with government is

:50:19. > :50:21.that the revenue will be brought forward. What I must say is that the

:50:22. > :50:26.concept that it is only for the cities, their constituency

:50:27. > :50:29.represents nearly 35,000 rural electorates in the are all part of

:50:30. > :50:33.Milton Keynes and they will benefit from the city deal. Equally the deal

:50:34. > :50:39.stretches into Central Bedfordshire so it is not just the ardent

:50:40. > :50:44.conurbations. Mark rate, but you feel the rural areas are missing

:50:45. > :50:50.out? Watch this package means is that the city deal, the citx will

:50:51. > :50:51.that the city deal, the city will have the freedom and flexibhlity to

:50:52. > :50:56.have the freedom and flexibility to capitalise on what we do so well and

:50:57. > :51:01.ensure we have the ability to capitalise on the jobs we know the

:51:02. > :51:05.city can deliver. This is expertise based on the research Park and the

:51:06. > :51:10.creative sector and aviation skills. Knowledge has an awful lot but it is

:51:11. > :51:13.a local community and local councils that know how best to delivdr that.

:51:14. > :51:19.that know how best to deliver that. `` Norwich has an awful lot. This is

:51:20. > :51:23.a local bodies that know wh`t is best to deliver for the economy. And

:51:24. > :51:24.want to talk about Cambridgd best to deliver for the economy And

:51:25. > :51:27.want to talk about Cambridge because that is a special case, we `re

:51:28. > :51:28.that is a special case, we are expecting a big budget annotncement

:51:29. > :51:29.expecting a big budget announcement this week about the Cambridge city

:51:30. > :51:33.deal. In December the Deputy this week about the Cambridge city

:51:34. > :51:34.deal. In December the Deputx Prime deal. In December the Deputx Prime

:51:35. > :51:37.Minister came to sign a memorandum of understanding, the deal hs

:51:38. > :51:40.of understanding, the deal is expected to bring in millions of

:51:41. > :51:43.pounds of training, transport and housing schemes so Cambridge

:51:44. > :51:44.pounds of training, transport and housing schemes so Cambridgd already

:51:45. > :51:53.the economic powerhouse of the Eastern region, in a way our version

:51:54. > :51:57.of London. Mark, don't other cities need The Stig? It is no good putting

:51:58. > :52:05.all your eggs in one basket. `` need boosting. We must recognise that

:52:06. > :52:09.each city is unique, and face different challenges. What the city

:52:10. > :52:10.deal process does is allow individual communities to see what

:52:11. > :52:13.individual communities to sde what their priorities are. You simply

:52:14. > :52:18.their priorities are. You shmply cannot treat each community in the

:52:19. > :52:22.same way and I am pleased that from the earlier comments Labour seem to

:52:23. > :52:23.be embracing localism. Isn't Cambridge is success damaging

:52:24. > :52:29.knowledge? We can feed off each knowledge? We can feed off each

:52:30. > :52:34.other and feed their own economies so we are both prosperous and

:52:35. > :52:36.successful in future. Both Cambridge and Norwich have significant

:52:37. > :52:41.expertise in the science and research communities and we can

:52:42. > :52:43.support one another to ensure the tyre region prosperous. Richard,

:52:44. > :52:47.tyre region prosperous. Richard what about the European money

:52:48. > :52:52.implications? Will it come through in the same way? As far as Cambridge

:52:53. > :52:56.is concerned according to the Labour group leader who I hope will be the

:52:57. > :52:58.leader of the council, it is only about half the money that Cambridge

:52:59. > :53:04.about half the money that C`mbridge needs, as far as the European

:53:05. > :53:10.funding is concerned the danger is that because we do not have the

:53:11. > :53:11.people or expertise or capacity to claim the funds to help the big

:53:12. > :53:15.school and then we will losd money school and then we will losd money

:53:16. > :53:19.to Europe. We have seen signs of that and I have spoken with local

:53:20. > :53:23.enterprise partnerships including the one concerning greater

:53:24. > :53:26.Cambridge, helped host visits from Cambridge recently in Brussdls. We

:53:27. > :53:31.Cambridge recently in Brussels. We are doing our best. Irrespective of

:53:32. > :53:35.politics, we are doing our best to help our local areas clean these

:53:36. > :53:39.funds. Unless you get expert people on the ground with sufficient

:53:40. > :53:44.capacity to be able to do that work then we might see you looking

:53:45. > :53:46.funding goal. I am not just saying that as a Labour member of the

:53:47. > :53:51.European Parliament, that is what the business people who are members

:53:52. > :53:54.of the boards of these local at a price partnerships are saying to me

:53:55. > :53:58.and to government. Richard, thank you for pointing that out. Couldn't

:53:59. > :54:03.let it all without mentioning the sad death of Tony Benn. What did he

:54:04. > :54:05.mean to you? Issued installation. sad death of Tony Benn. What did he

:54:06. > :54:05.mean to you? Issued install`tion. I mean to you? Issued installation. I

:54:06. > :54:09.first met him when he `` whdn I was first met him when he `` when I was

:54:10. > :54:16.a student. `` huge inspirathon. I a student. `` huge inspiration. I

:54:17. > :54:20.saw him two years ago at at the TUC march against the cuts. He was there

:54:21. > :54:24.with his picnic box. I remelber his with his picnic box. I remelber his

:54:25. > :54:28.late`night chats over a cup of tea in the Labour Party conference,

:54:29. > :54:31.which were phenomenal occashons I remember him saying in politics we

:54:32. > :54:36.must be teachers and I think that is a lesson I have taken into

:54:37. > :54:40.politics. But most of all for us in East Anglia he used to come very

:54:41. > :54:44.regularly to the rallies, the trade union rally we hold each September

:54:45. > :54:45.and many hundreds and thousands union rally we hold each September

:54:46. > :54:49.and many hundreds and thousands have come to listen to him there and the

:54:50. > :54:53.fact that I will never hear a speech again by one of the greatest orators

:54:54. > :55:01.in the history of the Labour Party is one greater sadness. Thank you.

:55:02. > :55:06.Our theatres are hoping that the budget might help them, too. The

:55:07. > :55:09.government has promised a consultation into tax breaks for

:55:10. > :55:14.touring productions. The arts Council wants to strengthen funding

:55:15. > :55:18.outside London where art investment pierhead is ?44. `` art invdstment

:55:19. > :55:32.pierhead is ?44. `` art investment per head.

:55:33. > :55:34.This is the Mercury Theatre in Colchester where the production of

:55:35. > :55:39.table eyes as just opened before table eyes as just opened bdfore

:55:40. > :55:44.going on tour, first to Ipswich and then to knowledge. Reductions like

:55:45. > :55:46.this benefits the theatre and the local economy. The sets were built

:55:47. > :55:50.local economy. The sets werd built in the local workshops and local

:55:51. > :55:54.restaurants enjoyed trade from theatre`goers. More investmdnt in

:55:55. > :56:02.the arts means we have opportunities for new talent, that we can be more

:56:03. > :56:04.ambitious and put on great shows. We are hopeful after the budget that

:56:05. > :56:11.regional theatre will see more funding, the investment in the east

:56:12. > :56:12.as part of the load anywherd in England the arts Council could

:56:13. > :56:13.England the arts Council cotld definitely be investing more

:56:14. > :56:14.England the arts Council could definitely be investing mord in

:56:15. > :56:14.England the arts Council cotld definitely be investing more in the

:56:15. > :56:15.definitely be investing mord in the East of England but our hope is that

:56:16. > :56:19.East of England but our hopd is that it will not be at the expense of

:56:20. > :56:24.London and other parts of the UK. Our message is that more investment

:56:25. > :56:25.in the arts means more opportunities for new talent, bigger ambitions for

:56:26. > :56:31.regional theatre, which experiences regional theatre, which expdriences

:56:32. > :56:39.for audience and a greater cultural economy for the UK. Both of you have

:56:40. > :56:44.successful theatres in your regions, but this is about spreading the

:56:45. > :56:45.benefits? Absolutely, we must do that more effectively. Arts Council

:56:46. > :56:50.England has been biased towards England has been biased tow`rds

:56:51. > :57:00.London with spending, 86040 split where most funds are allocated to

:57:01. > :57:06.London. You get just 7%! Indeed and it is not good enough. In the past

:57:07. > :57:09.few years the split has been more like 70/30, but there must be

:57:10. > :57:12.further measures to identify this further measures to identifx this

:57:13. > :57:17.and support theatres across the region so they are able to compete

:57:18. > :57:22.in a `` and attract good tr`ding companies and put on innovative

:57:23. > :57:26.programmes. Is it important that we support theatres? Vital, Milton

:57:27. > :57:28.Keynes Stater is at the heart of our cultural community in the chty.

:57:29. > :57:30.Keynes Stater is at the heart of our cultural community in the city. It

:57:31. > :57:31.is not just the activity in the theatre but the whole area `round

:57:32. > :57:32.is not just the activity in the theatre but the whole area around it

:57:33. > :57:34.theatre but the whole area `round it from Milton Keynes Gallery to the

:57:35. > :57:39.shops and restaurants. If wd look at shops and restaurants. If wd look at

:57:40. > :57:42.a similar model with the government introduced credits for the film

:57:43. > :57:45.industry, we can see the success that has had over the past three or

:57:46. > :57:49.four years investing in indtstry four years investing in indtstry

:57:50. > :57:51.fourfold, it is a good model to use and the same that this is sensible.

:57:52. > :57:57.So this could make a differdnce So this could make a differdnce

:57:58. > :58:03.Absolutely. An enormous difference. We must support the areas where

:58:04. > :58:07.investment has been hard to come by. Touring companies have found it

:58:08. > :58:12.harder to attract investment and introducing tax credits would go a

:58:13. > :58:14.long way to worse helping that. You will have heard of the Valley

:58:15. > :58:14.long way to worse helping that. You will have heard of the Valldy of

:58:15. > :58:14.long way to worse helping that. You will have heard of the Valley of the

:58:15. > :58:16.will have heard of the Valldy of the Kings in Egypt, but what about the

:58:17. > :58:33.village of the Kings closer to home? The case to be open the Bralley line

:58:34. > :58:37.to Wisbech was taken to Westminster by local politicians and as those

:58:38. > :58:42.leaders who were told it has priority. Eli is there, working on

:58:43. > :58:44.this track does not interfere with other parts of the network and so

:58:45. > :58:44.this track does not interfere with other parts of the network `nd so it

:58:45. > :58:49.is something we can move quickly is something we can move quhckly

:58:50. > :58:51.on. Hertfordshire has been named the least affordable place to lhve

:58:52. > :58:51.on. Hertfordshire has been named the least affordable place to live in

:58:52. > :58:54.the region, according to thd the region, according to thd

:58:55. > :58:58.National Housing Federation house prices and rents are among the

:58:59. > :59:00.highest in the country. In the flagship three school run bx a

:59:01. > :59:01.flagship three school run by a Swedish company in Suffolk has been

:59:02. > :59:07.put into special measures bx Ofstead put into special measures by Ofstead

:59:08. > :59:10.just 18 months after it opened. The school in Brandon has been

:59:11. > :59:15.criticised for teaching and bad behaviour from pupils. Steps must be

:59:16. > :59:21.taken to turn around this school and the school has started on that

:59:22. > :59:24.journey but there is a long way to go and more to do. Norwich council

:59:25. > :59:28.has been named as the most hmproved has been named as the most hmproved

:59:29. > :59:30.in the country but it cannot compete with Rendlesham in Suffolk where

:59:31. > :59:36.baseless treasures suggest ht was baseless treasures suggest it was

:59:37. > :59:39.the village of the Kings. Mark, let's talk about houshng. Your

:59:40. > :59:46.Mark, let's talk about housing. Your government has failed to address the

:59:47. > :59:50.problem. We have 28,000 outstanding planning applications in Milton

:59:51. > :59:54.Keynes, have proved more new homes and are building at a faster rate

:59:55. > :59:58.than in the past six years. Milton Keynes is one place where wd are

:59:59. > :00:00.building and not only that with the government Help To Buy schele in the

:00:01. > :00:05.government Help To Buy scheme in the right to buy scheme we are helping.

:00:06. > :00:12.Isn't happening quickly enough? It is speeding up dramatically. Simon

:00:13. > :00:15.Wright, the scene in Norwich? Yes, we must continue to increasd

:00:16. > :00:17.we must continue to increase house`building, there is a big

:00:18. > :00:20.deficit in terms of need versus supply. There is a turnaround now

:00:21. > :00:24.and we are seeing the revitalisation and we are seeing the revitalisation

:00:25. > :00:28.of the construction sector but we were left with an enormous challenge

:00:29. > :00:30.and if you were that social housing in particular, under 13 years of

:00:31. > :00:33.Labour there were 420,000 fewer Labour there were 420,000 fdwer

:00:34. > :00:36.social homes when they came out of office than when they went hn

:00:37. > :00:36.social homes when they came out of office than when they went in so

:00:37. > :00:41.office than when they went hn so that is a shocking problem that we

:00:42. > :00:44.are picking up the pieces of. I am pleased that this government will be

:00:45. > :00:46.the first from 30 years to leave office with more social homes at the

:00:47. > :00:50.office with more social homds at the end than the beginning.

:00:51. > :00:52.Thank you both very much. That is all for now. You can keep in touch

:00:53. > :01:00.through a website for and for industrial action is a sign of

:01:01. > :01:10.failure marked success. -- not success. Andrew, back to you.

:01:11. > :01:15.Has George Osborne got a rabbit in his Budget hat? Will the Chancellor

:01:16. > :01:16.find a way to help the squeezed middle? And how do Labour respond?

:01:17. > :01:28.All questions for The Week Ahead. And joining Helen, Janan and Nick to

:01:29. > :01:30.discuss the budget is the general secretary of the Trades Union

:01:31. > :01:35.Congress Frances O'Grady. Welcome back to the programme. I know the

:01:36. > :01:39.TUC has a submission, but if you could pick one thing that you wanted

:01:40. > :01:45.the Chancellor to do above all, what would it be? We want a budget for

:01:46. > :01:49.working people, which means we have to crack the long-term problem of

:01:50. > :01:57.investment in the British economy. Certainly I would like the

:01:58. > :01:59.Chancellor to merit that title they want of the new workers party, and

:02:00. > :02:02.take action on living standards but take action on living standards, but

:02:03. > :02:12.if they're going to do that it's got to be about unlocking investment. In

:02:13. > :02:15.the period where the economy has been flat-lining there has been

:02:16. > :02:19.little business investment, but there are signs towards the end of

:02:20. > :02:25.last year that it is beginning to pick up. But a long way to go. The

:02:26. > :02:27.problem is we have key industries like construction and manufacturing

:02:28. > :02:34.that are still smaller than they were before the recession. The

:02:35. > :02:39.government itself, of course, has slashed its own capital investment

:02:40. > :02:43.budget by half. There is plenty of good and important work that needs

:02:44. > :02:48.to be done from building houses to improving the transport system, to

:02:49. > :02:53.improving our schools. And the government really needs to pick up

:02:54. > :02:57.that shovel and start investing in our economy to get the decent jobs

:02:58. > :03:03.we need, the pay increases we need, and that in itself will help

:03:04. > :03:09.stimulate demand. It was Alistair Darling who cut in 2011, and it's

:03:10. > :03:13.interesting that Ed Balls in his plans for the next parliament would

:03:14. > :03:17.run a current budget surplus by the end of the parliament as opposed to

:03:18. > :03:22.George Osborne who would have an overall budget surplus. That gives

:03:23. > :03:25.Ed Balls or -- more wriggle room to do what you talk about, but he is

:03:26. > :03:28.reticent to talk about it. He does not want to say that he has an

:03:29. > :03:31.opportunity to spend on investment because he fears if he says it he

:03:32. > :03:35.will be attacked by the Conservatives for being

:03:36. > :03:42.irresponsible. Why is business doing this? The recession was deeper than

:03:43. > :03:47.any since the war and the recovery was slower than almost any since the

:03:48. > :03:53.war. The lag, the time it takes to get over that is longer than anyone

:03:54. > :03:57.expected. I read the same evidence as you towards the end of last year

:03:58. > :04:01.pointing to money being released, and it depends what it is released

:04:02. > :04:05.on, whether it is capital investment or bringing in people on higher

:04:06. > :04:11.wages. The one surprise in the downturn is how well the employment

:04:12. > :04:14.figures have done, but they have not invested in new capacity and they

:04:15. > :04:18.are sitting on a lot of dosh. I looked at one set of figures that

:04:19. > :04:24.said if you took the biggest company in Britain, they have about 715

:04:25. > :04:28.billion pounds in corporate treasury -- the biggest companies. I think

:04:29. > :04:34.it's reduced a little but they are sitting on a mountain in dash of

:04:35. > :04:38.skills. Yes, but they're not investing in skills, wages, or

:04:39. > :04:44.sustainable jobs. The new jobs we have seen created since 2010, the

:04:45. > :04:49.vast majority of them have been in low paid industries, and they are

:04:50. > :04:52.often zero hours, or insecure, or part-time. So it's not delivering a

:04:53. > :04:58.recovery for ordinary working people. Government ministers, as you

:04:59. > :05:01.know when you lobby them, they are anxious to make out that they know

:05:02. > :05:07.the job is not done and the recovery has just begun, but the one bit they

:05:08. > :05:12.are privately proud of, although they can't explain it, is how many

:05:13. > :05:16.private-sector jobs have been created. A lot of unions have done

:05:17. > :05:19.sensible deals with employers to protect jobs through this period,

:05:20. > :05:24.but it's not sustainable. The average worker in Britain today is

:05:25. > :05:31.now ?2000 a year worse off in real terms than they were. On a pay

:05:32. > :05:39.against price comparison? It doesn't take into account tax cuts. The

:05:40. > :05:47.raising of the personal allowance is far outweighed by the raising VAT.

:05:48. > :05:50.Does the raising of the threshold which the Lib Dems are proud of and

:05:51. > :05:55.the Tories are trying to trade credit for, does it matter to your

:05:56. > :06:00.members? -- take credit for. It matters that it is eclipsed by the

:06:01. > :06:03.cuts in benefits and know what is conned any more. We're going to hear

:06:04. > :06:09.a lot about the raising of the allowance, but as long as the real

:06:10. > :06:13.value of work, tax credits, things like that, people won't feel it in

:06:14. > :06:16.their pocket, and they will find it harder and harder to look after

:06:17. > :06:20.their family. When you look at the other things that could take over

:06:21. > :06:24.from consumer spending which has driven the recovery, held by house

:06:25. > :06:27.price rising in the south, it is exports and business investment, and

:06:28. > :06:32.you look at the state of the Eurozone and the emerging markets

:06:33. > :06:36.which are now in trouble, and the winter seems to have derailed the US

:06:37. > :06:43.recovery. It won't be exports. Indeed, the Obie Eich does not think

:06:44. > :06:47.that will contribute to growth until 2015 -- OBI. So the figures we

:06:48. > :06:55.should be looking at our business investment. And also the deficit.

:06:56. > :06:58.The deficit is 111 billion, and that is a problem, because we are not at

:06:59. > :07:03.the end of the cutting process, there are huge cuts to be made. I

:07:04. > :07:06.understand we are only a third of the way through. That will

:07:07. > :07:10.definitely affect business confidence. It is clear that the

:07:11. > :07:13.strategy has failed. Borrowing has gone up and it's not delivered

:07:14. > :07:21.improved living standards and better quality jobs, so cutting out of the

:07:22. > :07:24.recession is not going to work. The structural budget deficit was going

:07:25. > :07:30.to be eliminated three weeks today under the original plan. They missed

:07:31. > :07:36.target after target. Every economist has their own definition of that. I

:07:37. > :07:41.think Mark Carney is right when he says that fundamentally the economy

:07:42. > :07:45.is unbalanced and it is not sustainable, growth is not

:07:46. > :07:51.sustainable. But if it clicked on, it would be more balanced. It is not

:07:52. > :07:54.just north and south and manufacturing a way out with

:07:55. > :08:00.services, but it is also between the rich and everybody else. What do you

:08:01. > :08:03.make of the fact that there will effectively be another freezing

:08:04. > :08:11.public sector pay, or at least no more than 1%? Not even that for

:08:12. > :08:14.nurses and health workers. But they will get 3% progression pay. 70%

:08:15. > :08:14.nurses and health workers. But they will get 3% progression pay. 70 of

:08:15. > :08:18.will get 3% progression pay. 70% of nurses will not get any pay rise at

:08:19. > :08:24.all. They get no progression pay at all. I think this is smack in the

:08:25. > :08:28.mouth. Smack in the mouth to dedicated health care workers who

:08:29. > :08:34.will feel very, very discontented about the decision. Danny

:08:35. > :08:38.Alexander, I saw him appealing to health workers do not move to strike

:08:39. > :08:45.ballots and said they should talk to their department. But about what? Is

:08:46. > :08:50.that real pay cut has been imposed, what are workers left with? So do

:08:51. > :08:57.you expect as a result of yet more tough controls on public sector pay

:08:58. > :09:01.that unrest is inevitable? I know some unions will be consulting with

:09:02. > :09:06.their members, but ultimately it's always members who decide what to

:09:07. > :09:11.do. It does seem to me insulting not to at least be honest and say that

:09:12. > :09:19.we are cutting real pay of nurses, health care workers, on the back of

:09:20. > :09:25.a ?3 billion reorganisation of the NHS that nobody wanted and nobody

:09:26. > :09:29.voted for. Their long-term changes taking place here that almost talks

:09:30. > :09:38.about -- there are long-term changes. It is how lower percentage

:09:39. > :09:41.wages have become of GDP on how big the percentage of profits is. It

:09:42. > :09:46.seems to me there is a strong case for some kind of realignment there.

:09:47. > :09:50.The biggest event of my life, in this world, is the entry of a couple

:09:51. > :09:54.of billion more people into the labour supply. At the end of the

:09:55. > :09:59.Cold War, India and China plugged into the global economy. If there is

:10:00. > :10:02.a greater supply of that factor of production, logically you conclude

:10:03. > :10:06.that wages will fall or stagnate and that has been the story in this

:10:07. > :10:09.country and America and large parts of Western Europe in the last

:10:10. > :10:14.generation. What is not possible is for governments to do much about

:10:15. > :10:16.it. They can ameliorate it at the margins, but the idea that the

:10:17. > :10:20.government controls living standards, which has become popular

:10:21. > :10:25.over the last six months, and the Labour Party have in establishing

:10:26. > :10:30.that, and I don't think it's true. George Osborne's options are

:10:31. > :10:35.astonishingly limited compared to public expectations. If wages have

:10:36. > :10:40.reached a modern record low as percentage of GDP, who is going to

:10:41. > :10:47.champion the wage earner? We have lost Bob Crow, Tony Benn passed

:10:48. > :10:52.away, so who is the champion? The trade union movement is the champion

:10:53. > :10:57.of ordinary workers. We need those larger-than-life figures that we

:10:58. > :11:01.will mess. Have you got them yet? We have a generation of workers coming

:11:02. > :11:05.through. One thing about the loss of Bob Crow is that the whole union

:11:06. > :11:09.movement has responded strongly to that, and we want to say that we are

:11:10. > :11:14.strong and united and here to stand up for working people and we will

:11:15. > :11:18.fight as hard as Bob Crow did. Whoever replaces Bob Crow or Tony

:11:19. > :11:22.Benn, we can be sure they will not come from Eton because they all have

:11:23. > :11:25.jobs in the government. I want to put up on the screen what even

:11:26. > :11:35.Michael Gove was saying about this coterie of Old Etonian 's.

:11:36. > :11:44.He's right, is he not? He's absolutely right. We have the idea

:11:45. > :11:50.of the manifesto being written by five people from Eton and one from

:11:51. > :11:54.Saint Pauls. A remarkable example of social mobility that George Osborne,

:11:55. > :11:59.who had the disadvantage of going to Saint Pauls has made it into that

:12:00. > :12:04.inner circle. Here is the question, what is Michael Gove up to? If you

:12:05. > :12:06.saw the response from George Osborne, there was no slap down,

:12:07. > :12:06.saw the response from George Osborne, there was no slap down and

:12:07. > :12:09.Osborne, there was no slap down, and they know this is an area they are

:12:10. > :12:14.weak on an David Cameron will not comment on it. If this had been a

:12:15. > :12:19.Labour shadow minister making a similarly disloyal statement, they

:12:20. > :12:22.might have been shot at dawn. But there is a real tolerance from

:12:23. > :12:26.Michael Gove to go freelance which comes from George Osborne. It's

:12:27. > :12:29.about highlighting educational reforms that he wants to turn every

:12:30. > :12:33.school in to eat and so it won't happen in the future. But it's also

:12:34. > :12:37.pointing out who did not go to Eton school and who would be the best

:12:38. > :12:41.candidate to replace David Cameron as leader, George Osborne, and who

:12:42. > :12:45.did go to Eton school, Boris Johnson. Michael Gove is on

:12:46. > :12:52.manoeuvres to destroy Boris Johnson's chances of being leader.

:12:53. > :12:58.It's a good job they don't have an election to worry about. Hold on. I

:12:59. > :13:01.think they are out of touch with businesses as well as working

:13:02. > :13:05.people. You ask about who is talking about wage earners. Businesses are.

:13:06. > :13:10.They are worried that unless living standards rise again there will be

:13:11. > :13:16.nobody there to buy anything. We are running out of time, but the TUC,

:13:17. > :13:21.are enthusiastic about HS2? We supported. We think it's the kind of

:13:22. > :13:25.infrastructure project that we need to invest in long-term. He could, if

:13:26. > :13:29.we get it right, rebalance north and south and create good jobs along the

:13:30. > :13:36.way -- it could. Thank you very much tool. I have to say that every week

:13:37. > :13:39.-- thank you very much to you all. That's all for today. I'll be back

:13:40. > :13:44.next Sunday at 11am, and Jo Coburn will be on BBC Two tomorrow at

:13:45. > :13:46.midday with the Daily Politics. Remember if it's Sunday, it's the

:13:47. > :13:49.Sunday Politics.