16/03/2014 Sunday Politics East


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Morning folks. Welcome to the Sunday Politics. George Osborne's fifth


Budget will offer more tax relief for the lower paid but not for


middle income earners being thrust into the 40p tax bracket. That's our


top story. Ed Balls says millions of people


aren't feeling any benefit from the recovery. We'll discuss the economy


with big political beasts from Labour, the Conservatives, and the


Lib Dems. Now that Ed Miliband has effectively ruled out an in/out EU


referendum, how does UKIP deal with Tory claims that a vote for UKIP


means no Here in the east, unlocking growth


and creating jobs. What will the government


restoring confidence in the safety of cycling. The three areas of


London getting a cash boost to try something different.


And with me as always our top political panel - Nick Watt, Helen


Lewis and Janan Ganesh. They'll be tweeting their thoughts using the


hashtag #bbcsp throughout the programme. So, just three months


after his last major financial statement, George Osborne will be at


the despatch box again on Wednesday, delivering his 2014 Budget. The


Chancellor has already previewed his own speech, pledging to build what


he calls a "resilient economy". The message I will give in the Budget is


the economic plan is working but the job is far from done. We need to


build resilient economy which means addressing the long-term weaknesses


in Britain that we don't export enough, invest enough, build enough,


make enough. Those are the things I will address because we want Britain


to earn its way in the world. George Osborne's opposite number, Ed Balls,


has also been talking ahead of the Budget. He says not everyone is


feeling the benefit of the economic recovery, and again attacked the


Government's decision to reduce the top rate of tax from 50 to 45%.


George Osborne is only ever tough when he's having a go at the week


and the voiceless. Labour is willing to face up to people on the highest


incomes and say, I'm sorry, justifying a big tax cut at this


time is not fair. We will take away the winter allowance from the richer


pensioners, and I think that's the right thing to do. George Osborne


might agree, but he's not allowed to say so. That was the Chancellor and


the shadow chancellor. Janan, it seems like we are in a race against


time. No one argues that the recovery is not under way, in fact


it looks quite strong after a long wait, but will it feed through to


the living standards of ordinary people in time for the May election?


They only have 14 months to do it. The big economic variable is


business investment. Even during the downturn, businesses hoarded a lot


of cash. The question is, are they confident enough to release that


into investment and wages? Taking on new people, giving them higher pay


settlements. That could make the difference and the country will feel


more prosperous and this time next year. But come to think of it, it


strikes me, that how anticipated it is, it's the least talked about


Budget for many years. I think that is because the economy has settled


down a bit, but also because people have got used to the idea that there


is no such thing as a giveaway. Anything that is a tax cut will be


taken away as a tax rise or spending cut. That's true during the good


times but during fiscal consolidation, it's avoidable. --


consolidation, it's avoidable. - unavoidable. There is a plus and


minus for the Conservatives here. 49% of people think the government


is on roughly the right course, but only 16% think that their financial


circumstances will improve this year. It will be a tough one for the


Labour Party to respond to. I agree with Janan. Everyone seems bored


with the run-up to the Budget. The front page of the Sunday Times was


about fox hunting, the front page of the Sunday Telegraph was about EU


renegotiation. Maybe we are saying this because there have not been


many leaks. We have got used to them, and most of the George Osborne


chat on Twitter was about how long his tie was. Freakishly long. I


wouldn't dare to speculate why. Anything we should read into that? I


don't know. For a long while there was no recovery, then it was it is a


weak recovery, and now, all right, it's strong but not reaching


everyone in the country. That is where we are in the debate. That's


right, and the Conservative MPs are so anxious and they are making


George Osborne announcing the rays in the personal allowance will go


up, saying it might go up to 10,750 up, saying it might go up to 10 750


from next year, and Conservative MPs say that that's OK but we need to


think about the middle voters. People are saying the economy is


recovering but no one is feeling it in their pocket. These are people


snagged in at a 40p tax rate. The Tories are saying these are our


people and we have to get to them. He has given the Lib Dems more than


they could have hoped for on raising the threshold. Why is he not saying


we have done a bit for you, now we have to look after our people and


get some of these people out of that 40% bracket? Partly because the Lib


Dems have asked for it so insistently behind-the-scenes.


Somebody from the Treasury this week told me that these debates behind


the scenes between the Lib Dems and Tories are incredibly tenacious and


get more so every year. The Lib Dems have been insistent about going


further on the threshold. The second reason is that the Tories think the


issue can work for them in the next election. They can take the credit.


If they enthusiastically going to ?12,000 and make it a manifesto


pledge, they can claim ownership of the policy. The Liberal Democrats


want to take it to 12,500, which means you are getting into minimum


wage territory. It's incredibly expensive and the Tories are saying


that maybe you would be looking at the 40p rate. The Tories have played


as well. There have been authorised briefings about the 40p rate, and


Cameron and Osborne have said that their priority was helping the


lowest paid which is a useful statement to make and it appeals to


the UKIP voters who are the blue-collar workers. And we are


right, the economy will determine the next election? You assume so. It


was ever that is. It didn't in 992 was ever that is. It didn't in 1992


or 1987. It did in 1992. Ed Miliband's announcement last week


that a Labour government would not hold a referendum on Europe unless


there's another transfer of powers from Britain to Brussels has


certainly clarified matters. UKIP say it just shows the mainstream


parties can't be trusted. The Conservatives think it means UKIP


voters might now flock back to them as the only realistic chance of


securing a referendum. Giles Dilnot reports.


When it comes to Europe and Britain's relation to it, the


question is whether the answer is answered by a question. To be in or


not to be in, that is the question, and our politicians have seemed less


interested in question itself but whether they want to let us answer


it. Labour clarified their position last week. There will be no transfer


of powers without an in out referendum, without a clear choice


as to whether Britain will stay in the EU. That seems yes to a


referendum, but hold on. I believe it is unlikely that this lock will


be used in the next Parliament. So that's a no. The Conservatives say


yes to asking, in 2017, if re-elected, but haven't always. In


2011, 81 Tory MPs defied the PM by voting for a referendum on EU


membership: the largest rebellion against a Tory prime minister over


Europe. Prompted by a petition from over 100,000 members of the public.


The wrong question at the wrong time said the Foreign Secretary of a


coalition Government including selfie-conciously-pro European Lib


Dems, who had a referendum pledge in their 2010 manifesto, but only in


certain circumstances. So we have the newspapers, and the public


meeting leaflets. UKIP have always wanted the question put regardless.


But Labour's new position may change things and The Conservatives think


so. I think it does, because, you know, we are saying very clearly,


like UKIP, we want a referendum, but like UKIP, we want a referendum but


only a Conservative government can deliver it because most suffer


largest would say it is possible in the first past the post system to


have a UKIP government -- sophologists. And then it's easy for


as to say that if a UKIP vote lets in a Conservative government, then


they won't hold a referendum. UKIP seem undaunted by the clarifications


of the other parties, campaigning like the rest but with a "tell it


how it is, just saying what you re how it is, just saying what you're


thinking, we aren't like them" attitude. They seem more worried


about us and what we want, and I don't see that in the other parties.


In parts of the UK, like South Essex, it's a message they think is


working. They are taking the voters for granted again and people have


had enough. People are angry, they see people saying they will get a


vote on the European Union, but then it just comes down the road. They


were quick to capitalise on the announcements, saying only the


Conservatives will give you say, so does it change things? Not really.


We have been talking about a referendum and having a debate on


the European Union for years, and the other parties are playing catch


up. They have a trust issue. Nobody trusts them on the European Union


and that is why people come to us. Who the average UKIP voter is, or


how they voted before is complicated, and what dent they


might make on Conservative and Labour votes in 2015 is trickier


still, but someone's been crunching the numbers anyway. We reckon it is


between 25 and 30% of the electorate broadly share the UKIP motivation,


so to top out at that level would be difficult. That's an awful lot of


voters, but it's not the majority, and this is the reason why the main


parties can't afford to just openly appealed to the UKIP electorate too


hard because the elections are won and lost amongst the other 70%, the


middle-class, the graduate, the younger, ethnic minorities. An


appeal to the values of UKIP voters will alienate some of the other


groups, and they are arguably more significant in winning the election.


Whatever, the numbers UKIPers seem doggedly determined to dig away at


any support the other parties have previously enjoyed.


Giles Dilnot reporting. UKIP's leader, Nigel Farage, joins me now


for the Sunday Interview. Nigel Farage, welcome back. Good


morning. So the Labour Party has shot a fox. If Ed Miliband is the


next by Minister, there will not be a referendum customer there's a long


way between now and the next election, and Conservative party


jobs and changes. We had a cast-iron guarantee of a referendum from


camera, then he three line whip people to vote against it, and now


they are for it. What the Labour Party has done is open up a huge


blank to us, and that is what we will go for in the European


elections this coming year in May. I think there is a very strong chance


that Labour will match the Conservative pledge by the next


general election. There may be, but at the moment he has ruled it out,


and if he does not change his mind and goes into the election with the


policy as it is, the only chance of a referendum is a Tory government.


If you think the Tories will form a majority, which I think is unlikely.


Remember, two thirds of our voters would never vote Conservative


anyway. There is still this line of questioning that assumes UKIP voters


are middle-class Tories. We have some voters like that, but most of


them are coming to us from Labour, some from the Lib Dems and a lot of


nonvoters. But it come the election you failed to change Mr Miliband's


line, I repeat, the only chance of a referendum, if you want a


referendum, if that is what matters, and the polls suggest it doesn't


matter to that many people, but if that is what matters, the only way


you can get one is to vote Conservative. No, because you have a


situation in key marginals, especially where all three parties


are getting a good share, where we will see, and this depends a lot on


the local elections and the European elections, there are target


constituencies where UKIP has a reasonably good chance of winning a


seat, and that will change the agenda. Every vote for UKIP makes a


Tory government less likely. Arab voters are not Tory. Only a third of


the UKIP boat comes from the Conservative party -- our voters are


not Tory. -- the UKIP vote. It was mentioned earlier, about blue-collar


voters. We pick up far more Labour Party and nonvoters than


conservatives. On the balance of what the effect of the UKIP boat


is, the Tories should worry about us, they should worry about the fact


they have lost faith with their own electorate. Even if there is a


minority Ed Miliband government, electorate. Even if there is a


minority Ed Miliband government it minority Ed Miliband government, it


means no referendum. Labour and the Liberal Democrats are now at one on


the matter. The next election is in a few weeks time, the European


elections. What happens in those elections will likely change the


party stands and position on a referendum. The fact that Ed


Miliband has said this means, for us, our big target on the 22nd of


May will be the Labour voters in the Midlands and northern cities, and if


we do hammer into that boat and we are able to beat Labour on the day,


there's a good chance of their policy changing. One poll this


morning suggests Labour is close to you at 28, the Conservatives down at


21, the Lib Dems down at eight. You are taking votes from the


Conservatives and the Liberal Democrats. We are certainly taking


votes from the Lib Dems but that is comparing the poll with one year ago


when I don't think most people knew what the question really was. You


seem to be in an impossible position because the better you do in a


general election, the less chance there will be a referendum by 2020.


there will be a referendum by 2 20. No, look at the numbers. Only a


third of our voters are Conservatives. When we have polled


voters that have come to us, we asked them if there was no UKIP


candidate who would you vote for, less than one in five said


Conservative. Less than one in five UKIP voters would be tempted to vote


Conservative under any circumstances so the arithmetic does not suggest


we are the Conservative problem it suggests we are hurting all of the


parties and the reason the Tories are in trouble is because they have


lost their traditional base. Why do you think Nick Clegg is debating


Europe? I think they are in trouble, at 8% they could be wiped


out, they could go from 12 to nothing and I think it is a chance


for Nick Clegg to raise their profile. They are fringe party with


respect to this contest so I see why he wants to do it. One of our big


criticisms is that we have not been able to have a full debate on


national television on the alternatives of the European Union


so I am looking forward to it. How are you preparing? I think you can


be over scripted with these things. Are you not doing mock debates? No,


I am checking my facts and figures and making sure that I can show the


British people that in terms of jobs, we would be far better off not


being within the European Union, not being within its rule book, not


suffering from some of the green taxes they are putting on the


manufacturing industry. The idea that 3 million jobs are at risk,


manufacturing industry. The idea that 3 million jobs are at risk I


that 3 million jobs are at risk, I want to show why that is nonsense.


Who do you think is playing you in their mock debates? They probably


went to the pub and found someone! We will see. You have promised to do


whatever it takes to fund your European election campaign, how much


has been given so far? Just give it a few weeks and you will see what


Paul is planning to do. He has made a substantial investment in the


campaign already. How much? I'm not answering that for now. We are well


on our way to a properly funded campaign and our big target will be


the big cities and the working vote in those communities. Your deputy


chairman Neil Hamilton is another former Tory, he says so far we


haven't seen the colour of his money. Exactly two weeks ago, and


things have changed since then. Mr Sykes has written a cheque since


then? Yes. This morning's papers saying you will be asking MEPs to


contribute ?50,000 each, is that true? Over the next five years, yes.


Not for the European campaign. So lack of money will not be an excuse.


We will have a properly funded campaign. How we raise the kind of


money needed to fund the general election afterwards is another


question. What is UKIP's policy on paying family members? We don't


encourage it and I didn't employ any family member for years. My wife


ended up doing the job and paid for the first seven years of my job She


is paid now? Until May, then she comes off the payroll am which


leaves me with a huge problem. In 2004 you said, UKIP MEPs will not


employ wives and there will be no exceptions. An exception was made


because I became leader of the National party as well as a leader


of the group in European Parliament. Things do change in


life, and you can criticise me for whatever you like, but I cannot be


criticised for not having a big enough workload. No, but you didn't


employ your wife when you had told others not to do it your party.


Nobody else in my party has a big job in Europe and the UK. We made


the exception for this because of very unusual circumstances. It also


looks like there was a monetary calculation. Listen to this clip


from a BBC documentary in 2000. It is a good job. I worked it out


because so much of what you get is after tax that if you used the


secretarial allowances to pay your wife on top of the other games you


can play, I reckon this job in Stirling term is over a quarter of


?1 million a year. That is what you would need to earn working for


Goldman Sachs or someone like that. I agree with that. More importantly


the way you really make money in the European Parliament is being their


five days a week, because you sign in every day, you get 300 euros


every day, and that is how people maxed out. The criticism of me is


that I am not there enough so whatever good or bad I have done in


the European Parliament, financial gain has not been one of the


benefits. There have been allegations of you also employing a


former mistress on the same European Parliamentary allowance, you deny


that? I am very upset with the BBC coverage of this. The ten o'clock


news run this as a story without explaining that that allegation was


made using Parliamentary privilege by somebody on bail facing serious


fraud charges. I thought that was pretty poor. You have a chance to do


that and you deny you have employed a former mistress? Yes, but if you


look at many of the things said over the last week, I think it is


becoming pretty clear to voters that the establishment are becoming


terrified of UKIP and they will use anything they can find to do us down


in public. Is an MEP employs his wife and his former mistress, that


would be resigning matter, wouldn't it? Yes, particularly if the


assumption was that money was being taped for work but was not being


done. Who do you think is behind these stories? It is all about


negative, it is all about attacks, but I don't think it is actually


going to work because so much of what has been said in the last week


is nonsense. A reputable daily newspaper said I shouldn't be


trusted because I had stored six times for the Conservative party, I


have never even stored in a local council election. I think if you


keep kicking an underdog, it will make the British people rally around


us. Is it the Conservatives? Yes, and the idea that all of our voters


are retired colonels is simply not true. We get some voters from the


Labour side as well. Would you consider standing in a Labour seat


if you are so sure you are getting Labour votes? Yes, but the key for


UKIP is that it has to be marginal. Just for your own future, if you


fail to win a single soul -- single seat in the general election, if Ed


Miliband fails to win an outright majority, will you stand down as


UKIP leader? I would think within about 12 hours, yes. I will have


failed, I got into politics not because I wanted a career in


politics, far from it. I did it because I don't think this European


entanglement is right for our country. I think a lot of people


have woken up to the idea we have lost control of our borders and now


is the moment for UKIP to achieve what it set out to do. Will UKIP


continue without you if you stand down? Of course it will. I know that


everyone says it is a one-man band but it is far from that. We have had


some painful moments, getting rid of old UKIP, new UKIP is more


professional, less angry and it is going places. Nigel Farage, thank


you for being with us. So, what else should we be looking


out for in Wednesday's Budget statement? We've compiled a Sunday


Politics guide to the Chancellor's likely announcements.


Eyes down everyone, it's time for a bit of budget bingo. Let's see what


we will get from the man who lives at legs 11. Despite some good news


on the economy, George Osborne says that this will be a Budget of hard


truths with more pain ahead in order to get the public finances back


under control. But many in the Conservative party, including the


former chancellor Norman Lamont, want Mr Osborne to help the middle


classes by doing something about the 4.4 million people who fall into the


40% bracket. Around one million more people pay tax at that rate compared


to 2010 because the higher tax threshold hasn't increased in line


with inflation. Mr Osborne has indicated he might tackle the issue


in the next Conservative manifesto, but for now he is focused on helping


the low paid. It's likely we will see another increase in the amount


you can earn before being taxed, perhaps up another ?500 to ?10, 00.


perhaps up another ?500 to ?10,500. The Chancellor is going to flesh out


the details of a tax break for childcare payments, and there could


be cries of 'house' with the promise of more help for the building


industry. The Help To Buy scheme will be extended to 2020 and there


could be the go-ahead for the first Garden City in 40 years. Finally,


bingo regulars could be celebrating a full house with a possible cut in


bingo tax. And I've been joined in the studio


by the former Conservative chancellor Norman Lamont, in Salford


by the former Labour Cabinet minister Hazel Blears, and in


Aberdeen by the Lib Dem deputy leader, Malcolm Bruce. Let me come


to Norman Lamont first, you and another former Tory Chancellor,


Nigel Lawson, have called in the fall in the threshold for the rate


at which the 40p clicks in. I would have preferred an adjustment in the


Budget but I agree with what you are saying, it sounds like the


Chancellor will not do that. My main point is that you cannot go on


forever and forever increasing the personal allowance and not


increasing the 40% tax threshold because you are driving more and


more people into that band. It is an expensive policy because in order to


keep the number of people not paying tax constant, you have to keep


adjusting it each year. When this was introduced by Nigel Lawson, it


applied to one in 20 people, the 40% rate, it now applies to one in six


people. By next year, there will be 6 million people paying base. Why do


you think your Tory colleagues seem happy to go along with the Lib Dems


and target whatever money there is for tax cuts rather -- on the lower


paid rather than the middle incomes? They are not helping the lowest


paid. If you wanted to really help the lowest paid people you would


raise the threshold for national insurance contributions, which is


around ?6,000. Is it the Lib Dems stopping any rise in the 40p


threshold? We are concentrating on raising the lower threshold because


we believe that is the way to help those on lower incomes. Whilst they


haven't benefited as much as the lower paid they have participated


and I think people understand right now, if you were going to prioritise


the high earners, when we are still trying to help those on lower and


middle incomes who haven't enjoyed great pay increases but have got the


benefit of these tax increases, that is why we would like to do it for


the minimum wage level. But the poorest will not benefit at all. The


poorest 16% already don't pay tax. Why don't you increase the threshold


at which National Insurance starts? You only have two earned ?5,500


before you start to pay it. You ve got to remember that the raising of


the threshold to ?10,000 or more was something the Tories said we could


not afford. Why are you continuing to do it? If you want to help the


working poor, the way would be to take the lowest out of national


insurance. The view we take is they are benefiting, and have benefited


from, the raising of the tax threshold. You now have to earn


?10,000, we hope eventually 12, 00, ?10,000, we hope eventually 12,500,


and that means only people on very low wages. If you opt out of


national insurance, you're saying to people that you make no contribution


to the welfare system, so there is a general principle that people should


participate and paying, and also claim when they need something out.


We thought raising the threshold was simple and effective at a time of


economic austerity and the right way to deliver a helpful support to


welcoming people. -- working people. With the Labour Party continue to


raise the threshold, or do they think there is a case that there are


too many people being dragged into the 40p tax bracket? If Norman


Lamont thinks this is the right time to benefit people who are reasonably


well off rather than those who are struggling to make ends meet, then


genuinely, I say it respectfully, I don't think he's living in the world


the rest of us are. Most working people have seen their wages


effectively reduced by about ?1600 because they have been frozen, so


the right thing is to help people on modest incomes. I also understand


that if the 40% threshold went up, the people who would benefit the


most, as ever, are the people who are really well off, not the people


in the middle. The Conservatives have already reduced the 50p tax on


people over ?150,000 a year, and we have to concentrate on the people


going out to work, doing their best to bring their children up and have


a decent life and need a bit of help. I think raising the threshold


is a good thing. We would bring back the 10p tax, which we should never


have abolished, and do things with regard to childcare. At the moment,


childcare costs the average family as much as their mortgage, for


goodness sake. We would give 25 hours free childcare for youngsters


over three and four years old. That would be a massive boost the working


families. We are talking about nurses, tube drivers, warrant


officers in the army. There are many people who are not well off but have


been squeezed in the way everybody has been squeezed and they are


finding it continuing. I am stunned by Malcolm's argument where


everybody should pay something so you should not take people out of


national insurance, but the principle doesn't apply to income


tax. You can stand that argument on its head and apply it to income tax.


Most people don't see a difference between income tax and national


insurance, it's the same thing to most people. It is true that it


isn't really an insurance fund and there is an argument from merging


both of them. But we have concentrated on a simple tax


proposition. Norman is ignoring the fact the people on the 40% rate have


benefited by the raising of the personal allowance. To say they have


been squeezed is unfair. The calculation is that an ordinary


taxpayer will be ?700 better off at the current threshold, and about


?500 better off at the higher rate. It is misleading to say the better


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


rate, it's the higher earners who benefit the most, and we won't do


that when the economy is not where it was before the crash. How much


will the lower paid be better off if you reintroduce the 10p rate?


Significantly better off. I don t have the figure myself, but they'd


be significantly better off and the Budget should be a mixture of


measures to help people who work hard. That is why I think the


childcare issue has to be addressed. ?100 a week of the people


with childcare payments. It is a massive issue. We want the job is


guaranteed to get young people back into work. There's been hardly any


discussion about that, and we have nearly 1 million people who have


been out of work for six months or more, and as a country we need to do


something to help that. 350,000 full-time students, so it is a


misleading figure. It is not a million including full-time


students. All parties do this. It sounds to me, Malcolm Bruce, you


have more in common with the Labour Party than you do with the


Conservatives. You want an annual levy on houses over ?2 million, so


does Labour. A lot of your members want to scrap the so-called bedroom


tax and so does labour. You think every teacher should have a teaching


qualification, and so does Labour. Your policy on the EU referendum is


the same. Let me go on. And you want to scrap the winter fuel allowance


for wealthy pensioners. We want to make sure we get the public finances


in order and we have grave reservations about the Labour Party


promises. But they followed your spending plans in the first year.


The point we are making is we can make a fairer society and stronger


economy if you keep the public finances moving towards balance. We


finances moving towards balance We don't think the Labour Party will


take a stand that track. It is interesting that the Labour Party


want to introduce the 10p rate that Gordon Brown abolished. We consider


that before we can -- committed to the 0% rate -- we considered that.


It makes a complicated system difficult and we think it's better


doing it that way. As a fiscal conservative, why are you talking


about any tax cuts when the deficit is over ?100 billion, and


effectively, anything you propose today can only be financed by more


borrowing. I totally agree with you. I said that this week. I thought the


best thing would have no Budget. I said that this week. I thought the


best thing would have no Budget The best thing would have no Budget. The


main thing is to get the deficit down. My argument is is that you


have an adjustment in tax rates it should be shared between the


allowances and the higher rate, but I don't think that the progress on


the deficit is something we can give up on. This is still a very long way


to go. We're only halfway through. Hazel, does it make sense to borrow


for tax cuts? I am reluctant to do this, but I agree with both Norman


and Malcolm. Malcolm Bruce wants to borrow for tax cuts. We absolutely


need to get the deficit down and get finances on a strong footing. But we


also have to think about having some spending in the system that in the


longer run saves us money. We all know we need to build new homes I


know we need to build new homes. I don't think it's necessarily the


right priority to give people in London mortgage relief in terms of


?600,000. We have to get the balance right. Sometimes it is right to


spend to save. I'm afraid we have run out of time. There will be


plenty more discussion in the lead up to the Budget on Wednesday.


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


goodbye to viewers in Scotland who leave us now for Sunday Politics


Scotland. Coming up here in 20 minutes, Frances O'Grady, the


General Secretary of the TUC, joins us


Hello and welcome to the part of Sunday politics just for us here in


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


government's plan for prospdrous cities. It is called the city deal


but what difference can rem`ke? cities. It is called the city deal


but what difference can rem`ke? If it was not for the city deal then


business would be different, it would be owned half the sizd.


business would be different, it would be owned half the size. And


would be owned half the sizd. And after a recession and cutbacks to


the arts, is there a glimmer of hope for our regional theatres in the


budget? Our message to George Osborne is that more investlent in


the arts need a better experience for audiences and the greater


for audiences and the greatdr cultural economy for the UK.


Lets meet our guests. Mark Lancaster the Conservative MP for Milton


Keynes North, a part`time soldier and former company director and now


a government whip. And Simon Wright represents Norwich South for the


Liberal Democrats, he was a maths teacher and political agent before


the entered Parliament in 2010. Welcome to both of you. Let's begin


with a big boost to the region 's with a big boost to the reghon s


school budgets because the government has announced th`t local


government has announced that local authorities with long`term


underfunding will now get whnd authorities with long`term


underfunding will now get wind of underfunding will now get whnd of


pounds extra. Nine councils across the East will receive nearlx ?7


the East will receive nearly ?70 million more every year. Thd biggest


million more every year. The biggest beneficiaries are Cambridgeshire


with 20.5 million and Norfolk with 16 million. It is all additional


16 million. It is all addithonal money. The authorities that did not


get more will not face any cuts. Simon, you are a former teacher.


Doesn't this prove that dec`des of Doesn't this prove that decades of


pupils have been missing out? Absolutely it does in this


announcement is very important for announcement is very important for


schools in Norfolk, a colle`gue schools in Norfolk, a colle`gue


Julian Huppert has been campaigning very hard to redress the balance


where our areas have been ldt down where our areas have been ldt down


by underinvestment, underfunding compare to the national average


This extra money will mean that headteachers can put the wee


This extra money will mean that headteachers can put the wed sources


into the classroom that can make a real difference. Mark, is it a real


difference? ?8 per pupil? Yds, real difference. Mark, is it a real


difference? ?8 per pupil? Yes, we difference? ?8 per pupil? Yds, we


are fortunate in Milton Keynes where we are already packed ?4500 per


pupil across the country. We have a pupil across the country. We have a


different problem, we are a rapidly growing city and that is having a


spare school places is so that when people move into the city we


spare school places is so that when people move into the city wd can


actually find a place for them. We must find this infrastructure before


expansion so we have places for pupils before they come in. That is


why I am pleased that the government has announced this funding. Simon,


if the money is spent on teacher if the money is spent on te`cher


salaries is that enough? 's I think it depends on how house choose to


spend it. They will now how this will make the biggest impact in


their schools. If they use the money to attract the best teachers to the


schools that will clearly h`ve to attract the best teachers to the


schools that will clearly h`ve an enormous possible impact. ``


enormous positive impact. They could spend it on development or training.


Whatever the needs of the schools, headteachers will have to have a


flexible at it. Here is a qtestion. flexible at it. Here is a question.


`` flexibility. Do you remelber the `` flexibility. Do you remelber the


East of England development agency? It was abolished in 2012. The


Coalition wanted everything more local and centralised. They brought


in local enterprise partnerships and more recently the city deal. Under


this programme individual chties more recently the city deal. Under


this programme individual cities bid this programme individual chties bid


for money to create jobs and infrastructure in their loc`l


for money to create jobs and infrastructure in their local area.


infrastructure in their loc`l area. In the East five cities put


themselves forward, Norwich, Ipswich and Southend have had their bid is


accepted. The Cambridge deal is expected to be confirmed in this


week 's budget. There is a slow progress on the Milton Keynds bid.


progress on the Milton Keynes bid. Our political correspondent has been


to Nottingham where the city deal is to Nottingham where the city deal is


already up and running to sde if it has made any difference.


E 70 men and women treats their jobs with the enthusiasm... 100 years ago


this is what Nottingham was famous for. Text fails. Particularly late.


`` textiles. Today, a completely different industry is prettx


different industry is pretty Nottingham on the map. In the old


textile factories dozens of high`tech companies are sprhnging


high`tech companies are springing up. This firm is apps for


smartphones. Just two years old it already has 2000 clients on its


books and hopes to be emploxing 50 books and hopes to be emploxing 50


staff in the next three years. If it was not for the city deal we


staff in the next three years. If it was not for the city deal wd would


was not for the city deal we would be around half the size and not on


the project as we are in terms of growth. Key to setting up, a


the project as we are in terms of growth. Key to setting up, ` grant


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


business would not have gone off the ground without it. If this loney


business would not have gond off the ground without it. If this money had


not been available he would have found it somewhere? Absolutdly, we


found it somewhere? Absolutely, we would probably be in London or


Berlin but certainly not Nottingham. They call this area of the creative


quarter, he plans to regenerate this part of the city have been `round


for a while but city deal status made it all happen. A series of


financial incentives is attracting new firms and encouraging those


already here to grow. Any help you already here to grow. Any hdlp you


can get to nudge forward in terms of doing something positive is a


tremendous help, gives you ` doing something positive is a


tremendous help, gives you a spring tremendous help, gives you a spring


in your step and you can sed, rather than battling against red tape,


people are actually giving us something to help us drive the


business forward. With ?60 million business forward. With ?60 lillion


of money from the government the council has been able to set up a


venture capital fund to help new businesses and install superfast


broadband. Old warehouses have been broadband. Old warehouses have been


transformed into office space. More than 700 jobs have been cre`ted


transformed into office space. More than 700 jobs have been created, ?22


than 700 jobs have been cre`ted ?22 million of private investment


brought in. ?1 million has been spent creating eight skills and


apprenticeship, help young into apprenticeship, help young into


jobs. Last year it placed 520 apprentices, but 80% among `` above


the national average. We are clear the national average. We ard clear


about what we wanted to do, develop infrastructure, skills, bushness


infrastructure, skills, business support. What we have managdd


infrastructure, skills, bushness support. What we have managed to do


is get in place and certain things. For example a ?50 million venture


capital fund. That is something we have never had. It is something most


cities have never had and it makes it an attractive place to come to as


the city. Critics will point out that we used to have regional


development agencies for thhs that we used to have region`l


development agencies for this but development agencies for this but


the Coalition did away with them because it's not them too


bureaucratic and unfocused. City deal status is seen as the new way


to help areas grow economically. to help areas grow economic`lly


There is one other big benefits, There is one other big benefits


local councils are allowed to keep all of the business rates is


collected in the creative quarter. The extra money is used to fund an


extension to the Khan network. The council says ?760 million is being


invested in the city infrastructure. But it is not all going to plan.


But it is not all going to plan There is a lot of frustration that


many places still do not have superfast broadband. The Cotncil


superfast broadband. The Council complains about weight being slow to


make decisions and release loney. We make decisions and release money. We


have not seen the progress from city deal is that I wanted to see. There


is an awareness of that but ministers will have to take all the


their weight machines and ensure that localism is delivered on the


ground because that is what delivers growth. `` Whitehall machinds. Where


Nottingham leads, Norwich, Ipswich, Nottingham leads, Norwich, Hpswich,


Southend and soon Cambridge will follow. It will be a fewer years


follow. It will be a fewer xears before the full impact of city


follow. It will be a fewer years before the full impact of chty deal


status can be assessed at the feeling here is that it is working.


We are joined by Richard have it the Labour MEP for the East of England


Labour MEP for the East of Dngland who fought hard to retain the


development agency which used who fought hard to retain the


development agency which usdd to development agency which used to


access lots of funds from Etrope. We were feeling there that this is


working well in Nottingham, so it will be a big boost for the region?


It is certainly important in cities like knowledge and Ipswich run by


Labour councils, of course they're Labour councils, of course they re


going to embrace any money that is going. Councils have been hht by


three times the level of cuts converge to central governmdnt


converge to central government departments. But those councils are


seeking to provide leadership to seeking to provide leadership to


help the business community to provide for the future. What about


the other cities and towns hn the region that used to get access


the other cities and towns in the region that used to get accdss to


region that used to get access to the national and European money


through regional development agencies? What about London? Their


time will come, wanted? `` what about Luton. It is slight of hand.


They were spending ?100 million per year. The comparison is difficult


cause there is a lot of slehght hand cause there is a lot of sleight hand


by the government trying to be present things. You are seehng


by the government trying to be present things. You are seeing next


week in the budget we hope Cambridge will get it. Nick Clegg was in


Cambridge six months ago. Isn't it better to let the individual cities


represent themselves, decidd for represent themselves, decidd for


themselves rather than having one agencies thinking what is best


themselves rather than having one agencies thinking what is bdst for


agencies thinking what is best for the whole region? Yes and Ed


Miliband unveiled Labour 's task force for local government last


week. We would go much further in terms of whole place budgeting,


terms of whole place budgethng, getting as much public money


terms of whole place budgeting, getting as much public monex being


spent together in the interest getting as much public money being


spent together in the interest of communities. You have heard from


Nottingham in Andrew 's piece that they are experiencing the government


holding them back. I know from speaking with the councils that have


been successful that the original proposals in terms of powers and


budgets where will what are bound by this government. Isn't it good to


have healthy, petition betwden the various NAS? `` healthy competition.


The unemployed people in a region do not want to compete with other


cities for sparse amounts of money, they want to be successful


everywhere and anywhere. What about everywhere and anywhere. Wh`t about


the role all areas? The only money coming in as European Union money


that I am helping to get for our rural communities. Before you have a


system whereby the money av`ilable national and European was available


to anyone and everyone in a transparent way with the needs could


transparent way with the nedds could best be met. I am glad for the


cities and good luck to them for cities and good luck to thel for


doing it, I think there is ` big problem about Milton Keynes two


years late and ?70 million short in their budget so even with the


programmes in our region discovered is. Briefly, if Labour get in


programmes in our region discovered is. Briefly, if Labour get hn in


2015 would you bring somethhng similar to the regional development


similar to the regional devdlopment agency back? I think we should build


on what is there. I have worked with local enterprise partnerships and


many are doing the very best job possible. We are hoping to deliver


very significant European ftnding very significant European ftnding


programmes that I have worked hard programmes that I have worked hard


for in Brussels to them so H programmes that I have workdd hard


for in Brussels to them so I think the voters are not that intdrested


the voters are not that interested in redesigning the architecture,


what you are interested in his results. People come back to you


soon. Mark Lancaster we have heard soon. Mark Lancaster we havd heard


that in Milton Keynes the city soon. Mark Lancaster we have heard


that in Milton Keynes the chty deal that in Milton Keynes the chty deal


has stalled, what is going on? There is a hard negotiation between Milton


is a hard negotiation betwedn Milton Keynes and the government, we are


very clear that we are keen to build new homes. We have 20,000


outstanding planning applic`tions and once he gets the money as they


and once he gets the money `s they are built for the new infrastructure


but tends to lag behind is the revenue. The deal with government is


that the revenue will be brought forward. What I must say is that the


concept that it is only for the cities, their constituency


represents nearly 35,000 rural electorates in the are all part of


Milton Keynes and they will benefit from the city deal. Equally the deal


stretches into Central Bedfordshire so it is not just the ardent


conurbations. Mark rate, but you feel the rural areas are missing


out? Watch this package means is that the city deal, the citx will


that the city deal, the city will have the freedom and flexibhlity to


have the freedom and flexibility to capitalise on what we do so well and


ensure we have the ability to capitalise on the jobs we know the


city can deliver. This is expertise based on the research Park and the


creative sector and aviation skills. Knowledge has an awful lot but it is


a local community and local councils that know how best to delivdr that.


that know how best to deliver that. `` Norwich has an awful lot. This is


a local bodies that know wh`t is best to deliver for the economy. And


want to talk about Cambridgd best to deliver for the economy And


want to talk about Cambridge because that is a special case, we `re


that is a special case, we are expecting a big budget annotncement


expecting a big budget announcement this week about the Cambridge city


deal. In December the Deputy this week about the Cambridge city


deal. In December the Deputx Prime deal. In December the Deputx Prime


Minister came to sign a memorandum of understanding, the deal hs


of understanding, the deal is expected to bring in millions of


pounds of training, transport and housing schemes so Cambridge


pounds of training, transport and housing schemes so Cambridgd already


the economic powerhouse of the Eastern region, in a way our version


of London. Mark, don't other cities need The Stig? It is no good putting


all your eggs in one basket. `` need boosting. We must recognise that


each city is unique, and face different challenges. What the city


deal process does is allow individual communities to see what


individual communities to sde what their priorities are. You simply


their priorities are. You shmply cannot treat each community in the


same way and I am pleased that from the earlier comments Labour seem to


be embracing localism. Isn't Cambridge is success damaging


knowledge? We can feed off each knowledge? We can feed off each


other and feed their own economies so we are both prosperous and


successful in future. Both Cambridge and Norwich have significant


expertise in the science and research communities and we can


support one another to ensure the tyre region prosperous. Richard,


tyre region prosperous. Richard what about the European money


implications? Will it come through in the same way? As far as Cambridge


is concerned according to the Labour group leader who I hope will be the


leader of the council, it is only about half the money that Cambridge


about half the money that C`mbridge needs, as far as the European


funding is concerned the danger is that because we do not have the


people or expertise or capacity to claim the funds to help the big


school and then we will losd money school and then we will losd money


to Europe. We have seen signs of that and I have spoken with local


enterprise partnerships including the one concerning greater


Cambridge, helped host visits from Cambridge recently in Brussdls. We


Cambridge recently in Brussels. We are doing our best. Irrespective of


politics, we are doing our best to help our local areas clean these


funds. Unless you get expert people on the ground with sufficient


capacity to be able to do that work then we might see you looking


funding goal. I am not just saying that as a Labour member of the


European Parliament, that is what the business people who are members


of the boards of these local at a price partnerships are saying to me


and to government. Richard, thank you for pointing that out. Couldn't


let it all without mentioning the sad death of Tony Benn. What did he


mean to you? Issued installation. sad death of Tony Benn. What did he


mean to you? Issued install`tion. I mean to you? Issued installation. I


first met him when he `` whdn I was first met him when he `` when I was


a student. `` huge inspirathon. I a student. `` huge inspiration. I


saw him two years ago at at the TUC march against the cuts. He was there


with his picnic box. I remelber his with his picnic box. I remelber his


late`night chats over a cup of tea in the Labour Party conference,


which were phenomenal occashons I remember him saying in politics we


must be teachers and I think that is a lesson I have taken into


politics. But most of all for us in East Anglia he used to come very


regularly to the rallies, the trade union rally we hold each September


and many hundreds and thousands union rally we hold each September


and many hundreds and thousands have come to listen to him there and the


fact that I will never hear a speech again by one of the greatest orators


in the history of the Labour Party is one greater sadness. Thank you.


Our theatres are hoping that the budget might help them, too. The


government has promised a consultation into tax breaks for


touring productions. The arts Council wants to strengthen funding


outside London where art investment pierhead is ?44. `` art invdstment


pierhead is ?44. `` art investment per head.


This is the Mercury Theatre in Colchester where the production of


table eyes as just opened before table eyes as just opened bdfore


going on tour, first to Ipswich and then to knowledge. Reductions like


this benefits the theatre and the local economy. The sets were built


local economy. The sets werd built in the local workshops and local


restaurants enjoyed trade from theatre`goers. More investmdnt in


the arts means we have opportunities for new talent, that we can be more


ambitious and put on great shows. We are hopeful after the budget that


regional theatre will see more funding, the investment in the east


as part of the load anywherd in England the arts Council could


England the arts Council cotld definitely be investing more


England the arts Council could definitely be investing mord in


England the arts Council cotld definitely be investing more in the


definitely be investing mord in the East of England but our hope is that


East of England but our hopd is that it will not be at the expense of


London and other parts of the UK. Our message is that more investment


in the arts means more opportunities for new talent, bigger ambitions for


regional theatre, which experiences regional theatre, which expdriences


for audience and a greater cultural economy for the UK. Both of you have


successful theatres in your regions, but this is about spreading the


benefits? Absolutely, we must do that more effectively. Arts Council


England has been biased towards England has been biased tow`rds


London with spending, 86040 split where most funds are allocated to


London. You get just 7%! Indeed and it is not good enough. In the past


few years the split has been more like 70/30, but there must be


further measures to identify this further measures to identifx this


and support theatres across the region so they are able to compete


in a `` and attract good tr`ding companies and put on innovative


programmes. Is it important that we support theatres? Vital, Milton


Keynes Stater is at the heart of our cultural community in the chty.


Keynes Stater is at the heart of our cultural community in the city. It


is not just the activity in the theatre but the whole area `round


is not just the activity in the theatre but the whole area around it


theatre but the whole area `round it from Milton Keynes Gallery to the


shops and restaurants. If wd look at shops and restaurants. If wd look at


a similar model with the government introduced credits for the film


industry, we can see the success that has had over the past three or


four years investing in indtstry four years investing in indtstry


fourfold, it is a good model to use and the same that this is sensible.


So this could make a differdnce So this could make a differdnce


Absolutely. An enormous difference. We must support the areas where


investment has been hard to come by. Touring companies have found it


harder to attract investment and introducing tax credits would go a


long way to worse helping that. You will have heard of the Valley


long way to worse helping that. You will have heard of the Valldy of


long way to worse helping that. You will have heard of the Valley of the


will have heard of the Valldy of the Kings in Egypt, but what about the


village of the Kings closer to home? The case to be open the Bralley line


to Wisbech was taken to Westminster by local politicians and as those


leaders who were told it has priority. Eli is there, working on


this track does not interfere with other parts of the network and so


this track does not interfere with other parts of the network `nd so it


is something we can move quickly is something we can move quhckly


on. Hertfordshire has been named the least affordable place to lhve


on. Hertfordshire has been named the least affordable place to live in


the region, according to thd the region, according to thd


National Housing Federation house prices and rents are among the


highest in the country. In the flagship three school run bx a


flagship three school run by a Swedish company in Suffolk has been


put into special measures bx Ofstead put into special measures by Ofstead


just 18 months after it opened. The school in Brandon has been


criticised for teaching and bad behaviour from pupils. Steps must be


taken to turn around this school and the school has started on that


journey but there is a long way to go and more to do. Norwich council


has been named as the most hmproved has been named as the most hmproved


in the country but it cannot compete with Rendlesham in Suffolk where


baseless treasures suggest ht was baseless treasures suggest it was


the village of the Kings. Mark, let's talk about houshng. Your


Mark, let's talk about housing. Your government has failed to address the


problem. We have 28,000 outstanding planning applications in Milton


Keynes, have proved more new homes and are building at a faster rate


than in the past six years. Milton Keynes is one place where wd are


building and not only that with the government Help To Buy schele in the


government Help To Buy scheme in the right to buy scheme we are helping.


Isn't happening quickly enough? It is speeding up dramatically. Simon


Wright, the scene in Norwich? Yes, we must continue to increasd


we must continue to increase house`building, there is a big


deficit in terms of need versus supply. There is a turnaround now


and we are seeing the revitalisation and we are seeing the revitalisation


of the construction sector but we were left with an enormous challenge


and if you were that social housing in particular, under 13 years of


Labour there were 420,000 fewer Labour there were 420,000 fdwer


social homes when they came out of office than when they went hn


social homes when they came out of office than when they went in so


office than when they went hn so that is a shocking problem that we


are picking up the pieces of. I am pleased that this government will be


the first from 30 years to leave office with more social homes at the


office with more social homds at the end than the beginning.


Thank you both very much. That is all for now. You can keep in touch


through a website for and for industrial action is a sign of


failure marked success. -- not success. Andrew, back to you.


Has George Osborne got a rabbit in his Budget hat? Will the Chancellor


find a way to help the squeezed middle? And how do Labour respond?


All questions for The Week Ahead. And joining Helen, Janan and Nick to


discuss the budget is the general secretary of the Trades Union


Congress Frances O'Grady. Welcome back to the programme. I know the


TUC has a submission, but if you could pick one thing that you wanted


the Chancellor to do above all, what would it be? We want a budget for


working people, which means we have to crack the long-term problem of


investment in the British economy. Certainly I would like the


Chancellor to merit that title they want of the new workers party, and


take action on living standards but take action on living standards, but


if they're going to do that it's got to be about unlocking investment. In


the period where the economy has been flat-lining there has been


little business investment, but there are signs towards the end of


last year that it is beginning to pick up. But a long way to go. The


problem is we have key industries like construction and manufacturing


that are still smaller than they were before the recession. The


government itself, of course, has slashed its own capital investment


budget by half. There is plenty of good and important work that needs


to be done from building houses to improving the transport system, to


improving our schools. And the government really needs to pick up


that shovel and start investing in our economy to get the decent jobs


we need, the pay increases we need, and that in itself will help


stimulate demand. It was Alistair Darling who cut in 2011, and it's


interesting that Ed Balls in his plans for the next parliament would


run a current budget surplus by the end of the parliament as opposed to


George Osborne who would have an overall budget surplus. That gives


Ed Balls or -- more wriggle room to do what you talk about, but he is


reticent to talk about it. He does not want to say that he has an


opportunity to spend on investment because he fears if he says it he


will be attacked by the Conservatives for being


irresponsible. Why is business doing this? The recession was deeper than


any since the war and the recovery was slower than almost any since the


war. The lag, the time it takes to get over that is longer than anyone


expected. I read the same evidence as you towards the end of last year


pointing to money being released, and it depends what it is released


on, whether it is capital investment or bringing in people on higher


wages. The one surprise in the downturn is how well the employment


figures have done, but they have not invested in new capacity and they


are sitting on a lot of dosh. I looked at one set of figures that


said if you took the biggest company in Britain, they have about 715


billion pounds in corporate treasury -- the biggest companies. I think


it's reduced a little but they are sitting on a mountain in dash of


skills. Yes, but they're not investing in skills, wages, or


sustainable jobs. The new jobs we have seen created since 2010, the


vast majority of them have been in low paid industries, and they are


often zero hours, or insecure, or part-time. So it's not delivering a


recovery for ordinary working people. Government ministers, as you


know when you lobby them, they are anxious to make out that they know


the job is not done and the recovery has just begun, but the one bit they


are privately proud of, although they can't explain it, is how many


private-sector jobs have been created. A lot of unions have done


sensible deals with employers to protect jobs through this period,


but it's not sustainable. The average worker in Britain today is


now ?2000 a year worse off in real terms than they were. On a pay


against price comparison? It doesn't take into account tax cuts. The


raising of the personal allowance is far outweighed by the raising VAT.


Does the raising of the threshold which the Lib Dems are proud of and


the Tories are trying to trade credit for, does it matter to your


members? -- take credit for. It matters that it is eclipsed by the


cuts in benefits and know what is conned any more. We're going to hear


a lot about the raising of the allowance, but as long as the real


value of work, tax credits, things like that, people won't feel it in


their pocket, and they will find it harder and harder to look after


their family. When you look at the other things that could take over


from consumer spending which has driven the recovery, held by house


price rising in the south, it is exports and business investment, and


you look at the state of the Eurozone and the emerging markets


which are now in trouble, and the winter seems to have derailed the US


recovery. It won't be exports. Indeed, the Obie Eich does not think


that will contribute to growth until 2015 -- OBI. So the figures we


should be looking at our business investment. And also the deficit.


The deficit is 111 billion, and that is a problem, because we are not at


the end of the cutting process, there are huge cuts to be made. I


understand we are only a third of the way through. That will


definitely affect business confidence. It is clear that the


strategy has failed. Borrowing has gone up and it's not delivered


improved living standards and better quality jobs, so cutting out of the


recession is not going to work. The structural budget deficit was going


to be eliminated three weeks today under the original plan. They missed


target after target. Every economist has their own definition of that. I


think Mark Carney is right when he says that fundamentally the economy


is unbalanced and it is not sustainable, growth is not


sustainable. But if it clicked on, it would be more balanced. It is not


just north and south and manufacturing a way out with


services, but it is also between the rich and everybody else. What do you


make of the fact that there will effectively be another freezing


public sector pay, or at least no more than 1%? Not even that for


nurses and health workers. But they will get 3% progression pay. 70%


nurses and health workers. But they will get 3% progression pay. 70 of


will get 3% progression pay. 70% of nurses will not get any pay rise at


all. They get no progression pay at all. I think this is smack in the


mouth. Smack in the mouth to dedicated health care workers who


will feel very, very discontented about the decision. Danny


Alexander, I saw him appealing to health workers do not move to strike


ballots and said they should talk to their department. But about what? Is


that real pay cut has been imposed, what are workers left with? So do


you expect as a result of yet more tough controls on public sector pay


that unrest is inevitable? I know some unions will be consulting with


their members, but ultimately it's always members who decide what to


do. It does seem to me insulting not to at least be honest and say that


we are cutting real pay of nurses, health care workers, on the back of


a ?3 billion reorganisation of the NHS that nobody wanted and nobody


voted for. Their long-term changes taking place here that almost talks


about -- there are long-term changes. It is how lower percentage


wages have become of GDP on how big the percentage of profits is. It


seems to me there is a strong case for some kind of realignment there.


The biggest event of my life, in this world, is the entry of a couple


of billion more people into the labour supply. At the end of the


Cold War, India and China plugged into the global economy. If there is


a greater supply of that factor of production, logically you conclude


that wages will fall or stagnate and that has been the story in this


country and America and large parts of Western Europe in the last


generation. What is not possible is for governments to do much about


it. They can ameliorate it at the margins, but the idea that the


government controls living standards, which has become popular


over the last six months, and the Labour Party have in establishing


that, and I don't think it's true. George Osborne's options are


astonishingly limited compared to public expectations. If wages have


reached a modern record low as percentage of GDP, who is going to


champion the wage earner? We have lost Bob Crow, Tony Benn passed


away, so who is the champion? The trade union movement is the champion


of ordinary workers. We need those larger-than-life figures that we


will mess. Have you got them yet? We have a generation of workers coming


through. One thing about the loss of Bob Crow is that the whole union


movement has responded strongly to that, and we want to say that we are


strong and united and here to stand up for working people and we will


fight as hard as Bob Crow did. Whoever replaces Bob Crow or Tony


Benn, we can be sure they will not come from Eton because they all have


jobs in the government. I want to put up on the screen what even


Michael Gove was saying about this coterie of Old Etonian 's.


He's right, is he not? He's absolutely right. We have the idea


of the manifesto being written by five people from Eton and one from


Saint Pauls. A remarkable example of social mobility that George Osborne,


who had the disadvantage of going to Saint Pauls has made it into that


inner circle. Here is the question, what is Michael Gove up to? If you


saw the response from George Osborne, there was no slap down,


saw the response from George Osborne, there was no slap down and


Osborne, there was no slap down, and they know this is an area they are


weak on an David Cameron will not comment on it. If this had been a


Labour shadow minister making a similarly disloyal statement, they


might have been shot at dawn. But there is a real tolerance from


Michael Gove to go freelance which comes from George Osborne. It's


about highlighting educational reforms that he wants to turn every


school in to eat and so it won't happen in the future. But it's also


pointing out who did not go to Eton school and who would be the best


candidate to replace David Cameron as leader, George Osborne, and who


did go to Eton school, Boris Johnson. Michael Gove is on


manoeuvres to destroy Boris Johnson's chances of being leader.


It's a good job they don't have an election to worry about. Hold on. I


think they are out of touch with businesses as well as working


people. You ask about who is talking about wage earners. Businesses are.


They are worried that unless living standards rise again there will be


nobody there to buy anything. We are running out of time, but the TUC,


are enthusiastic about HS2? We supported. We think it's the kind of


infrastructure project that we need to invest in long-term. He could, if


we get it right, rebalance north and south and create good jobs along the


way -- it could. Thank you very much tool. I have to say that every week


-- thank you very much to you all. That's all for today. I'll be back


next Sunday at 11am, and Jo Coburn will be on BBC Two tomorrow at


midday with the Daily Politics. Remember if it's Sunday, it's the


Sunday Politics.


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