19/11/2017 Sunday Politics East

Morning everyone, and welcome

to the Sunday Politics.

I'm Sarah Smith.

And this is your guide

to all the big stories that

are shaping politics this weekend,

and a few of the smaller ones too.

Philip Hammond is getting ready

to deliver his latest Budget

on Wednesday and he's not short

of advice - to spend more,

show restraint, even

to stop being an Eyore -

but can he change the direction

of the country and his government?

Conservative Party darling

Jacob Rees-Mogg has

some advice of his own.

He thinks the Chancellor

is being far too gloomy about Brexit

- he joins me live to explain why.

The former Leave campaign leader,

Gisela Stuart, will be here debating

with pro-EU campaigner

Alastair Campbell, after taking

a trip to her native Germany

to speak to businesses

about Brexit.

And, as we wait to find out what's

on the menu for this week's budget,

we're in a diner off

the A1 in Peterborough,

finding out who people most trust

with the economy -

Philip Hammond or John McDonnell?

Here in the east, new homes for old,

but could regeneration

means fewer green spaces?

And hopes the budget might improve

transport links across our region.

All that coming up in the programme.

And with me for for all of it,

three journalists who've promised

not to show off like Michael Gove

by using any long economicky words -

although I'm not sure they really

know that many anyway -

it's Tom Newton Dunn,

Gaby Hinsliff and Iain Martin.

Let's take a look at the big

political stories making the news

this Sunday morning,

and as you might expect there's

plenty of speculation

about what might or not might be

in Philip Hammond's Budget.

The Chancellor is promising a big

investment in new technology,

including driverless cars -

which could be on the road by 2021.

He's been interviewed

in the Sunday Times,

where he talks about plans to reach

the target of building

300,000 homes every year,

or the equivalent of a city

the size of Leeds.

That paper speculates that he's

attempting to turn from "fiscal

Phil" into "hopeful Hammond"

as he tries to set out

a vision for the country,

not just a list of numbers.

The Sunday Telegraph thinks that

Mr Hammond is planning to offer

a pay rise to nurses as part

of a bid to take on Labour.

But that hasn't impressed

Shadow Chancellor John McDonnell.

He's spoken to a number of papers

and is calling for an emergency

budget to invest in public services

and help struggling households.

So that's a taste of what you might

hear on Wednesday and Mr Hammond

and Mr McDonnell have both been

appearing this morning

on the Andrew Marr Show.

I think Britain has a very

bright future ahead of it,

and we have to embrace

the opportunities that

a post-Brexit world will offer.

They will be opportunities that

are based on huge change,

huge technological evolution.

It's not always going to be easy,

but the British people have shown

time and time again that we're up

for these challenges.

For many people out there,

this is a depression.

We've had people whose wages

have been cut by 10%.

Nurses, for example.

We've had people who are now...

1.25 million food parcels handed out

in the sixth richest

country in the world.

That's what I call a recession

for large numbers of people.

We will be talking about Labour and

their economic policies in a moment,

but let's start with what we might

expect from the budget. We will talk

to our panel of political observers.

Philip Hammond is under pressure to

set out a bold vision and reset the

government's programme. Can we

expect that?

No, we can't. We have

heard enough from the Chancellor

across various broadcast and his

article in the Sunday Times. I think

we will not be getting a bold

budget. His precise words short... A

short time ago were a balanced

budget. Some Tory hearts will think.

They desperately want something to

go out and shout about, something to

capture people's imagination, and do

big and bold things, like how on

earth are they going to build those

new 300,000 houses a year? There are

good reasons why he has chosen what

appears to be a pretty staid,

Conservative budget, and that is

that they are probably unable to get

anything bold through Parliament.

His capital is so low among Tory

MPs. If you have a minority

government, it is tricky.

We have

seen ministers on programmes like

this in the last few weeks putting

in the bids for what they would like

spending on, whether it be payment

for nurses or parliament. Would he

struggled to get something radical

through the Commons?

Big ideas cost

money. That's the problem. Bold

ideas are controversial. In some

ways, Tory MPs are asking their

Chancellor to do the impossible.

Government is already doing

something big and bold, which is

Brexit. That has implications for

how much money is available, how

many risks you want to take with

everything else. What is crucial is

that he demonstrates a reputation

for competence. The reputation that

the Conservative government has for

economic competence, that many

people prefer them to Labour on the

issue of economic competence. The

worst thing he could do is come up

with a big, bold idea that

unravelled quickly. What they

absolutely don't want is to come up

with an exciting idea that falls

apart three days after the budget.

He is under pressure from

Brexiteers, who are suspicious of

him. Does he have to offer them

something?

Part of his problem is he

has to offer so many different

people different things. This is

Philip Hammond trying to be and

dynamic.

It is hard to tell

sometimes.

At least in theoretical

terms. His longer-term difficulty is

that, if you look at the economic

cycle, we are getting to a point

where we are probably overdue, if

you put Brexit to one side, overdue

some kind of correction or downturn,

if you look what has happened to

asset prices globally. What will be

worrying for the Treasury is, just

as everyone is saying we should turn

on the taps and build this or that,

we might be at the top of a cycle,

and the Treasury will want to lose

something in the armoury in terms of

probably growing the deficit if

there are economic difficulties in

the next two years, and then there

is Brexit as well.

It sounds

impossible.

I think so. Talking to

his friends and colleagues over the

last few days, he had to make a

call, which was precisely how much

can I get away with, with my

political capital being as low as it

is, with the mixed problems he had

at the last budget, and a lot of the

party disliking his approach to

Brexit. He is damned if he is,

damned if he doesn't. Universal

Credit, we are expecting a reduction

in the time it takes to wait,

business rates, affected by high

inflation... I think we will see a

problem fixing budget which will

probably do quite a lot of important

spadework in many areas.

We will

pick up on some of this later in the

programme.

Let's speak now to the Conservative

MP Jacob Rees-Mogg, this week

he helpfully launched an alternative

"budget for Brexit" and advised

the Chancellor to be less gloomy

about the consequences

of leaving the EU.

Thank you for joining us. Your

alternative budget is pretty

radical. Almost half corporation

tax, Cap Stamp duty to help the

London market. It seems you are

advocating the opposite from what we

will hear from your Chancellor on

Wednesday.

There are two parts to

the proposals I suggested. One is

that we should show that after we

have left the European Union, the UK

is open to the rest of the world. It

is about opening up to the rest of

the world. Secondly, looking at the

modelling that has been done by the

Treasury and some other forecasters,

which has been so comprehensively

wrong. The forecasts made about what

would happen after Brexit have

turned out to be hopelessly false.

The team at Cardiff University have

done some modelling based on the

classical economic principles and

what happens if you move to free

trade that would be very positive

for the economy.

You are predicting

a Brexit dividend of £135 billion,

which sounds fantastic. Why are you

right, and everybody else, including

the Bank of England and the

Institute for Fiscal Studies, why

are they all wrong?

It depends on

the type of modelling. The modelling

that have been done by the Treasury

have been based on gravity models,

which work on the basis of the

nearness of the market and the size

of the economy you are trading with.

These have been wrong in the past.

They predicted that if we joined the

euro, trade would grow by 300%. That

was then revised down to 200%, but

it is fantasyland. The model I am

working on, by Sir Patrick Minford,

who has a record of getting these

things right. He was right about the

exchange rate mechanism, right about

the euro.

Being right in the past

doesn't mean you are right about the

future. Why do you think the

Treasury will not pick up the same

numbers, if this is so obvious to

you?

I think the Treasury was

humiliated by the errors in its

forecast prior to Brexit, and is

trying to defend its position. The

short-term economic consequences of

a vote to leave was one of the most

dishonest documents to come out of

the Treasury, purely a piece of

political propaganda. They are

wounded by that and sticking to the

same script, rather than looking at

other forecasts and other experts.

You think the governor of the Bank

of England is an enemy of Brexit,

and it sounds like you think the

Treasury is opposed to it. As the

Chancellor fallen under their spell

as well, and been persuaded to be an

enemy of Brexit?

I have admiration

the Chancellor, but George Osborne,

his predecessor, was the architect

of Project Fear. He was too close to

the Bank of England and lost his

independence. That is what needs to

change. It is an opportunity in the

budget for Philip Hammond to show he

is putting aside the Treasury's

mistakes in the past. It is very

encouraging what he is saying this

morning, about a more positive

approach to Brexit.

Lord Lawson has

accused Philip Hammond of being very

close to sabotage on Brexit. He says

we need a can-do man at the Treasury

and not a prophet of doom.

I think

that Philip Hammond is an

exceptionally intelligent man, a

very thoughtful man. It is not a bad

thing to have a Chancellor who is

serious minded and steady, rather

than one who is a showman and uses

the Exchequer to interfere in

absolutely everything.

I have a lot

of confidence in the Chancellor.

When you launched your budget for

Brexit, you said the government has

to deliver the £350 million for the

NHS that was delivered during the

referendum, even though you didn't

think that promise should have been

made. Is that something they now

need to deliver wrong?

It is. This

only happens once we have left.

Politicians have to recognise that

voters don't look at the small print

of electoral policies. If you put

£350 million on the side of a bus

and say it may be available for the

NHS, it is reasonable for people to

think that is a promise. Brexit was

won by the Leave campaign, so it it

is important that they deliver on

that promise. Politicians must keep

faith with voters and deliver on

implied promises, as well as ones

that are set out in detail.

The

Cabinet will move on to talk about

the Brexit bill this week, and we

understand they may need to come up

with more money to satisfy EU

demands. The more money spent on

that is less money available for

things like spending on the NHS. Are

you worried about the size of the

exit bill?

You have your finger on

the important point. The government

will have to choose whether to give

lots of money to the European Union,

or whether to spend money on UK

public services, and that will be

part of the negotiation. On all

these issues, it comes down to

choice is the government makes. I

would encourage the government to

choose our own domestic public

services rather than expensive

schemes in continent or Europe.

Why

are you advocating that the

government should spend up to £2.5

billion on a no deal scenario?

It is important that we are ready to

leave in the event of no deal. If we

left with no deal we would on

current figures still be saving the

remains of 18 billion so we would be

saving 15 and a half billion against

paying for the financial framework.

To show we're ready on day one would

be money well spent and most would

be needed any way. We need to have

new customs arrangements in place

even if it is not for a no deal

situation.

There are suggestions

that the Government might back down

on the idea of putting the time and

date of leaving the EU on the face

of the bill. Would you be Exxon

certained if that was -- concerned

if that was remove prd the bill?

It

is in Article 50, unless Article 50

is extended by the Council of Europe

we leave on 20th March 2019 and it

makes accepts that should be the

same in -- sense that should be in

same in domestic law. But that is a

secondary concern from my point of

view. It is important that we leave

on that date.

Stay there if you

would.

We're joined in the studio

by the former minister

Stephen Hammond.

He's no relation to the Chancellor,

but he is a member

of the Treasury Select Committee

and he's one of the Tory MPs named

as "Brexit mutineers"

by the Daily Telegraph

this week - lucky him.

I'm assured you're no relation to

the Chancellor. Let's just pick up

on what Jacob Rees Mogg was saying.

How important is it to you as a

rebel that the Government does put

the date on.

I agree with Jacob it

is in the Article 50 process, the

key reason it is important is the

negotiations look like they're going

to be tricky and longer than we

expected and it may well be that we

are still negotiating up until March

2019. We could have a short couple

of weeks period of extension. Why do

harm to the economy by falling out

on a precise time? If those

negotiations need to be extended.

They won't go on for more than a

couple of weeks, because there will

be elections in Europe in June 2019

and there is no chance of a new

commission or Parliament dealing

with this. Giving it flexibility and

with this flexibility the government

said it wants flexibility in

negotiations, why give all the

advantage to the other side? Part of

that was evidenced yesterday by

somebody suggesting they will ask

for the Margaret Thatcher rebate to

be suspended. That is as a result of

putting the date on the bill.

You

did not agree with the Brexit

committee and think it is important

that we set the date and time?

I

think it is perfectly reasonable to

set the date and time and I think

these negotiations fill the time

available. The United States and

Australia agreed a free trade deal

between April 2003 and February

2004. These things don't need to be

interm Knabl if both sides want to

agree. I think the British

electorate would be very concerned

if nearly three years after the vote

to leave, we still hadn't left. I

think most people expected that we

would have left by now. The

negotiations realistically to get

through the approval of the European

Parliament and so on need to be

completed by at the end of next

year, going up to the last minute I

don't think is real is tick.

To move

on to talk about a trade deal and

getting that done, the EU need to

agree to move on and we need to

settle the divorce, cabinet are

going to be talking about the amount

that needs to be spent on that,

Stephen what manned, are you happy

for the Government to offer more?

I

hope that the Government will stick

to the Florence speech in terms of

ensuring that we fulfil our

liabilities and obligations. I'm not

clear exactly whether that is 20

billion or 40 billion and I'm not

sure the government is. If part of

the divorce bill is then some

settlement for getting the trade

deal, we will need to examine that

carefully.

Jacob Rees Mogg, is this

that might spark another war in the

party if the cabinet suggest they're

prepared to pay more?

I think we

need to go back to what you said,

that the - the EU said they want us

to settle the money first. The

Government doesn't need to follow

that. They need our money. If we

don't pay any money for the final 21

months of the framework, the EU has

about 20 billion pounds gap in its

finances and it has no legal

requirement to borrow. So it

insolvents or the Germans and the

others pay more. So our position on

money is very strong and we

shouldn't fall into the trap of

thinking just because Mr Barnier

said it it is as if he has received

tablets of stone like Moses, he has

not.

There is a sense that the

Government feels a mo generous offer

would set a good tone, the kind of

approach that Jacob Rees Mogg

suggests would not make for smooth

relations.

It probably wouldn't. But

we have to be clear what we are

paying for and what we are getting.

No one is suggesting we should hand

over money without proper scrutiny.

It may be appropriate to put money

to facilitate international trade to

secure jobs. We have to be careful

about the analysis about what the

scale and size of Brexit dividend is

and the size of payments will be.

You mustn't confuse gross and net

and there is disagreement about some

of the numbers.

On that, Jacob Rees

Mogg in his budget for Brexit

suggests in five years time we would

have a 135 billion Brexit bonus. Do

you think it is real is tick.

He is

using some analysis that has some

flaws. It is predicting a price drop

in the United Kingdom of 10%. Tariff

drops will only be 3 or 4%. It is

predicting huge productivity gains,

the likes of which we have not seen

in 20 years. Thirdly, despite his

view on modellers there is evidence

that they weren't and if you go into

the detail of the analysis, some of

the data is 14 years out of date.

Jacob Rees Mogg, you're being

hopelessly optimistic?

I don't think

that right. I think the fall in

prices comes because you make the

economy more competitive and you

take away tariffs which reduces the

price of food by 20%. That is a big

reduction. Bear in mind that the

biggest tariffs hit food, clothing

and foot wear that, harm the poorest

in society the most. The gains from

productivity come from is in

additional tariffs. Leading to other

saving and further investment I

think the modelling done by the

professor is as good as modelling

can be. That doesn't mean it is

infallible. The failure of gravity

model is well known.

Michael Gove

was accused of auditioning for the

job of Chancellor by using long

words. Do you know any good long

economic words?

I don't think that

we want to get into this type of

business actually. I think all

Conservatives and Steven and I very

much agree on this, want to show as

united a front as we can manage.

There are differences on some

aspects of policy, but in terms of

individuals we want to stand

together and support the best

interests of the government.

Thank

you.

Brexit Secretary David Davis

was in Berlin this week trying

to win the support of business

leaders there for a comprehensive

free trade deal with the EU.

He warned them against putting

'politics above prosperity'

and reportedly got a bit

of a frosty reception.

Well, the former Labour MP

Gisela Stuart was one of the leaders

of the Vote Leave referendum

campaign.

We travelled with Gisela to Germany

to meet the business leaders

she says will help secure a good

trade deal for the UK.

Here's her film.

I was born and brought up

in this part of Germany,

and although I've lived in the UK

for the past 40 years,

and represented the constituency

of Birmingham and Edgbaston for 20

years, my family still live here,

and I've kept many links.

I was chair of Vote Leave,

and together with only a handful

of other Labour MPs,

we campaigned to leave

the European Union because we

thought the country would be

better off outside.

It's hard to remember now, but back

in the 1970s, when we joined

the European Economic Community,

people thought that by joining

the club we would see the kind

of economic miracle Germany

experienced in the '70s back home.

The "Deutsche Wirtschaftswunder"

would come to Britain.

But, of course, it didn't.

Within a few short years

of the devastation of World War II,

Germany had emerged as

the largest economy in Europe.

Germany's extraordinary

success is down to

the pragmatism of its business.

German Mittelstand is family

dominated, forward-thinking,

long-term thinking, reliability,

are very important values.

Changing moods on a political

landscape and changing frameworks

are toxic for our way of doing

business, and we want

that to go away.

German business is not given

to making big political statements

out of step with government policy,

but talk to those in decision-making

positions, and it is clear

that they want to secure a good deal

with the United Kingdom.

BMW employs almost 90,000

people here in Germany,

and exports just under

1 million cars annually.

The UK is a vital market.

What we are really seeking right now

is more clarity, more certainty,

because in our cycle of investment,

cycle of development,

it's about a seven-year or so period

that we look at,

but we are now, of course, starting

to think about what comes next,

and what we need to see now

is what is going to be

the trading relationship,

how are the logistics going to look,

what is going to be

the requirements for people

moving across the continent?

Because all of these things

are important to us today.

And, by the way, they will be just

as important tomorrow.

Berlin is well aware that

if the European Commission

is allowed to put up trade barriers

against Britain, it will be

German business, German consumers

and German employees

who will suffer.

TRANSLATION:

I think it's very

important that we complete

the first phase successfully.

The first phase of the negotiations,

which looks at the financial

consequences of Great Britain

leaving the EU.

And then it's not a question

of punishment payments.

It's about when you are part

of a multilayer, contractual

obligation and you want to leave

that, then of course it takes

a whole lot of obligations

which you have to deal with,

so both sides are satisfied and can

live with the consequences.

It isn't everyone's interests

for the UK to part on good terms.

Of course there was going to be

upset when the UK voted to leave,

but creating uncertainty over

the terms of UK's exit will simply

have a disruptive effect

on exports to UK markets.

Far better to have a sensible,

amicable negotiation that results

both sides being able to trade

together and work

together post-Brexit.

Markus Krall is managing

director of Goetzpartners,

and heads the Financial

Institution Industry Group.

Is it true to say that,

if we negotiate Brexit well,

then a good Brexit can actually

strengthen the United Kingdom,

the European Union and Germany?

It's absolutely true.

I think that this

is about two things.

One, about proving that

free trade is possible

between a European Union that is

smaller and a former member country.

If you don't prove that free

trade is possible there,

then the question becomes,

what is Europe standing for?

Number two is, I also

believe the free trade,

free market and democratic and less

bureaucratic approach that Britain

has chosen as the path

into the future is a role

model for Europe.

The time has come both

for the United Kingdom

and for the EU to be more clear

about what kind of

deal we can achieve.

Both sides need to be bold.

As long as we remain open to free

trade and sensible co-operation,

we can arrive at something that

will benefit both sides.

But one thing's obvious -

if we are an open and free trading

economy, we've got one big

cheerleader on our side,

and that is German business.

That was Gisela Stuart

setting out her case

and we'll be hearing

from the opposite side

of the argument in the coming weeks.

Gisela Stuart joins us in the studio

now, as does Alastair Campbell.

He used to work for Tony Blair

in Number 10, set up

the New European Newspaper

to campaign against Brexit,

and is so pro-European that at this

year's Labour conference

he was heard playing Ode

to Joy on the bagpipes.

Welcome both of you.

We will start with your point in the

film, that you think the German

business once the EU to offer the UK

a generous deal because it is in

their interests, yet the president

of the German equivalent of the CBI

said that defending the single

market must be the priority for the

EU, and another says that the

cohesion of the remaining member

states remains the highest priority.

The president of the CBI just after

the referendum said that it would be

in nobody 's interest to introduce

tariffs and trade barriers. On the

UK side, I don't think there's a

full understanding that economic

interests are incredibly important,

that they are trying to cover

economic interests on the cohesion

of the 27. I think different

economic interests will raise the

head of different countries. The

German auto industry is as important

as the financial sector is here. The

banking crisis is far from over, but

the big riffs which were going on is

that the E U is losing its second

biggest net contributor. Countries

like Germany want a deal with the UK

that is a free open market. There

are other tensions in the EU that

wants to become more protectionist,

and that is a bad thing.

Looking at

the film there with the Jacob

Rees-Mogg interview. No matter what

side of leave you are, it is

delusional and all driven by wishful

thinking. You could find a

businessman who says Brexit will be

good for Germany. The vast bulk of

British businesses think this is a

disaster, as do the vast bulk of

European businesses. One of the

delusions on which they ran their

campaign is the idea that they need

us more than we need them. That is

not true.

Be you self about £80

billion more in goods and services

into the UK than we do to them, and

Germany has one of the biggest

deficits. It is in their interest.

Of course it is, but it is a myth

that they need us more than we need

them. The damage that will be done

to us, even with a good deal. Let's

be frank, where these negotiations

are, Theresa May is either going to

end up with a bad deal and dumber or

no Deal. A bad deal is bad, and a no

deal is a catastrophe.

You are

setting up ideas that which were not

there to begin with and knocking

them down. Delusional.

35 billion,

the Brexit bonus.

If we had a

referendum, it was a democratic

decision. I know you don't like it

and that a lot of business would

have preferred to stay with the

status quo. We have had the

referendum. Undermining political

institutions is in no one's

interests. It is functioning

democracies which lead to economic

stability.

Theresa May fought an

election Inc on a hard Brexit that

was rejected.

As we heard from BMW,

there is uncertainty for business.

There will be elections, European

elections, in 2019. There will be a

change of the Commission and the

parliament. We have a narrow window

to implement the mandate for the

referendum which Parliament voted

for. So rather than you undermining

this country, why don't you work

together to get the best deal?

Because we totally disagree.

You

don't want a good deal?

I'm in

favour of a good deal, and I could

give them some advice as to how they

get a good deal. First, you have a

cabinet that has an agreed strategy.

18 months in, they don't have that.

I am not undermining a deal. I am

continuing to pose questions about

what they are trying to do and how

they are trying to do it. This is

democracy. Democracy is the ability

for Parliament, which is not doing

its job properly, and the public, to

keep scrutinising, and if they want

to change their mind, having the

right to do that.

You were trying to

encourage the Taoiseach yesterday to

play hardball with the UK.

I am on

the side of the UK, and I am worried

that if we go down the path that we

are being taken down, and Theresa

May and Boris Johnson and the rest

of them, this shambolic path, we are

going to do fundamental, lasting

damage to the country we love. I

don't care about the Civil Aviation

Authority. I care about Britain. --

I don't care about the European

Union. If every lorry going into the

UK today was stopped for just two

minutes, we would create an instant

17 mile traffic jam. These people

just don't care...

I am not these

people! Let us not conflate... You

either decide that you are

implementing a democratic decision

of a referendum that was called and

over 17 million voted.

You will not

stop me debating it. Just as Nigel

Farage...

Stop talking about Nigel

Farrell Raj. Vote Leave was not

Nigel Farage. There is no desire in

Germany to punish the United

Kingdom.

They are behaving

reasonably.

There is a battle of

protectionism and free market going

on. If we implement this properly,

give businesses the kind of

incentives they want, we can get a

good deal. So you want a bad deal?

You are driven by wishful thinking.

Gisela Stuart, you are saying that

business will intervene to prevent

things like tariffs being put in

place? They are leaving it a bit

late to put pressure on.

You will

find that business is laying out the

kind of things they need to get

those deals. I can find as much

fault with the speed of the

progress, but what I really do

resent is that you are actually

encouraging other countries to

undermine...

Know I am not! I spoke

out in support of the Irish

Taoiseach because I spent a lot of

time with Tony Blair and his team on

the Good Friday Agreement. The

people who are driving this hard

Brexit without thinking it through,

still no answer on how you do Brexit

in our island without a hard border.

I think the Irish Taoiseach is right

to call out the government on the

incompetence and the fact they have

not thought it through.

You accept

the result of the referendum and the

fact that we will be leaving the EU?

I accept the result of the

referendum, but I do not accept that

the country will definitely leave,

because the country is entitled to

change its mind. As the chaos and

costs mount, the public is entitled

to change its mind and will change

its mind.

There is no evidence at

the moment.

Come out with me!

Allow

me to finish the sentence. There is

a changing of mind happening, a

crystallisation. Unlike you, I have

fought five elections and I have won

five elections. I have probably

spoken to more people like you.

You

may do, I'm just saying, come out on

the road with me...

40% of the

population in the middle just want

us to get on with it. What that film

showed is that if you want to make

it a self-fulfilling prophecy that

it's a disaster, which I don't. I

want to implement a deal that is

good for British jobs. The rest of

the world is changing in terms of

technology. Currently, Germany

hasn't even got a government, and

nobody is laughing about that.

And

they are stable without a

government!

Let's leave it there.

It's coming up to 11.40,

you're watching the Sunday Politics.

Coming up on the programme,

we'll be looking at the latest

opinion polls and we'll bring

you the results of our moodbox

asking whether Phllip Hammond

or John McDonnell should be running

the economy.

Hello welcome to

Sunday Politics East.

Later in the programme

we take a trip from east

to west to see how

the Chancellor could make

a difference in the budget

on

Wednesday.

In Great Yarmouth we are right

here out on the edge of

England and without that major

infrastructure investment we will

stay just as we are, without

the possibility of expanding.

With us this week,

Dave Hodgson, the elected

mayor for Bedford,

and Mark Lancaster, defence

minister and MP for

Milton Keynes.

50 years after it was established

as a new town, Milton Keynes wants

to revamp seven housing estates.

The scheme would cost £1 billion.

There will be a local referendum,

believed to be the first

of its kind, to be held

before work starts.

The scheme could include the

building of up to 1250 new homes.

Some of those could be built

on existing green spaces.

Here's Andy Holmes.

Barry Wilde on

Fullers Slade estate,

which is surrounded by a large

green space.

I've come to see why it's now

at risk of redevelopment.

Good morning, Barry.

Nice to meet you.

Shall we go and have a look?

This is one of the estates in Milton

Keynes earmarked for regeneration.

It's a long-standing community

which, a lot around the town,

values these communal green areas.

I love it.

I've been here long enough

and I walked around

who mostly daily.

And it is just great.

You're walking in the

countryside, you're

in a housing estate but you're

walking in the countryside.

Why would you want

to get rid of this?

It's a real attribute.

It's quite beautiful.

There are concerns that lots more

houses will be built here

as one of the ways of paying

for the regeneration could be

from the sale of new private

property on the

estate.

We've got to regenerate the estate

by putting new properties to

pay for the refurbishment

of the old.

So we've got to have 1000 plus

houses to refurbish 278.

But it's also worries

about people having to

downsize if they are moved,

and residents like Tony

Smith are very unhappy

about their uncertain future.

Moving out?

They will have to carry me out.

I just don't want to move.

I won't move.

Of course, if I have

to, I have to do.

But I will be one of the last to go.

So what do you think

of what you have heard about

the regeneration plans?

What do I think about it?

It stinks, for a start.

So many rumours.

Here on a Fullers Slade

estate, one of seven

estates in Milton Keynes that is set

to be degenerated over the next 15

Here on a Fullers Slade

estate, one of seven

estates in Milton Keynes that is set

to be regenerated over the next 15

years, there are 453 properties,

of which 278 on council owned.

And it is those 278

that are set to be

at the centre of this

regeneration project.

Helen has lived here for the last 18

years and won awards for

her work on the estate.

I will miss the community.

We built this community

and if they decide to

bring in more houses and things

like this they will destroy this

community.

Because they will put too

many people in here.

Yeah, it is upsetting,

it really is upsetting

me.

I have gone to meetings and actually

broken down into tears at

these meetings because we don't know

ourselves, as residents, what's

going on.

The company that might

have the answers is Your MK.

Who are responsible

for regenerating the

estate.

It has to be

a community-led process.

We cannot be seen to be doing things

to people, they have to

determine what the future

looks like for them,

it is their community.

We have spoken to residents

who are worried about green spaces

disappearing.

I think you are absolutely correct.

There is a significant

proportion of this

estate that is currently

green, open spaces.

Those are lots of probably

underutilised open space on the

estate and that has got to be

factored into what we are

determining, going forward.

So it sounds like we

are not ruling out

building houses on some

of that green space?

No, and I think it would be

foolish to say we are not.

Your MK also disputes

the future of 1000 new homes,

saying the numbers being built

haven't been

decided yet.

When all the questions are answered

and the final plans put

together, Milton Keynes Council will

hold a referendum on the scheme.

And there is a promise

that those plans

can be rejected.

If we can't build that trust

and we go to a referendum

and is no vote then

Milton Keynes Council has failed.

Your MK has failed and I

don't want to get into

that situation.

And I think we are the first

council to offer a binding

yes - no referendum for regeneration

and I think that puts the onus on

Milton Keynes Council

and Your MK to get it right.

I don't want to fail

but I think the backstop is the

referendum, to make

sure we won't fail.

As I say, it's a win-win situation.

By next summer, when

the plans for Fullers

Slade should be ready,

they

will find out if the residents

actually think they are winners

or not.

It's a palace, it's my palace.

It's my home, you know what I mean?

It's not just bricks

and mortar, that is my home.

Why would I want to move?

I'd be a stranger anywhere else.

Mark Lancaster, somebody said

in there, "it stinks."

It's not been handled

very well, is it?

I think there have been

issue by Milton Keynes

Council about not

communicating the plans very

well with constituents

in

Milton Keynes.

I think we have to accept that

many of the homes in

Milton Keynes were built 50 years

ago as temporary housing for the

workers who built the city

and there is a need to regenerate.

But we do have to be very

sensitive about this

and I am very conscious that it is

the right decision to have a

referendum at the end of it.

Also, what people

don't realise is the

unique way that green space

is looked after in Milton Keynes

through the Parks Trust.

This land is not owned

by Milton Keynes

Council, Milton Keynes is one

of the greenest cities in the UK

and we do have a practice

where if green space

is used and effectively is swapped

out to maintain that balance of

green space with the Milton Keynes.

Just to get that clear,

so unless we trust

--the trust says you can build

on the

green space, it cannot be built on?

Well, the trust effectively

owns the green space.

Not all the green space

in Milton Keynes, but most of it.

And there has been deals in the past

where it has released lands

to be built on, but then new green

spaces is taken to compensate.

So we get that balance

in Milton Keynes to

continue to enjoy that

wonderful balance

we have of being one

of the

greenest cities in the UK.

I suppose it depends

on where that

green space is.

If it is outside your door

step and then it is not

outside your doorstep then

it is not there for you.

Indeed, but the important

thing about the binding

referendum, it is

important it is done

with the residents, not

to the

residents.

It sounds as if that is

what the council is trying to do.

Sorry, which way are the council

trying to do it, as far as you're

concerned?

With the residents.

Because the binding referendum

is, as the councillor

said in the clip, it is about trying

to work with them and if they fail

to get the referendum then

the council and Your MK have failed.

So I hope they succeed

in terms of making sure

they work with the residents to

have a satisfactory outcome for the

residents and for the council.

The repairs and

renovations have to be

paid for somehow, don't they?

How would that be in Bedford?

Our stock, we transferred

it to a housing

association back in the '90s,

so we do not have

that issue.

BPHAR, our housing

provider, does that

through borrowing and through some

regeneration as well

selling some properties.

So a mixture of things.

And in Milton Keynes

has got to be paid

for somehow.

Absolutely, and there is no doubt

work needs to be done on these

properties.

The crucial thing

is to be sensitive.

I have offered my assistance

in hoping to mediate

through this process but this

binding referendum, I think, is

crucial.

We both agreed we need more houses,

but it is difficult getting

people to agree to have them

outside their house.

And it's difficult to get

the agreement in the wider

community in terms of

when you have got big

congestion issues that

are

very localised, that

can create a problem.

That is the big one,

as far as you're concerned?

Building new houses is one

thing, but actually

having infrastructure

there is more important.

And infrastructure upfront.

So we have had promised

infrastructure and then the houses

built on the back of it, and

sometimes the infrastructure hasn't

arrived.

I think people feel let down

by that, I know people feel let

down by that.

For years, the principal in

Milton Keynes has been, I before E.

Infrastructure before expansion.

We are not NIMBYs

in Milton Keynes but

you must get that I,

the infrastructure.

Milton Keynes was built

for the car and for traffic

and infrastructure,

whereas I suspect Bedford wasn't.

Indeed.

It wasn't planned,

it has been around

for about 850 years.

Let's move on.

Wednesday is a budget day,

the Chancellor has a lot on his mind

with Brexit just 16 months away.

So what do people

here want from

Philip Hammond?

High on the wish list,

money for infrastructure.

Andrew Sinclair has

been taking a trip from

east to west to see where that

money could be spent.

At every budget time,

we always talk a lot about

infrastructure and

particularly transport

infrastructure.

Why?

Because that's what keeps us,

and more importantly,

the economy moving.

And as a largely rural region,

we often struggle to

get from A to B.

In next week's budget,

the big infrastructure focus

is likely to be here,

the River Yare in Great Yarmouth.

Ipswich has been promised a river

crossing, so too has

Lowestoft.

Now it seems that Great Yarmouth

is going to get one as

well.

I'm hoping it will it will be high

enough so the regular shipping

can go underneath it.

There's been a campaign

for a third river crossing

for Yarmouth for the ten years.

Plans have been drawn up,

the initial funding found.

Now it's up to the Government.

In Great Yarmouth we are right

here on the edge of

England and without that major

infrastructure investment we will

stay just as we are without

the possibility of expanding.

We can expand and offer

so much more to

Great Britain PLC if we

have the infrastructure.

And one bridge make

such a difference?

Absolutely.

I have been told the bridge could be

on the Chancellor's list.

Back on dry land, it's time

to start heading west.

As the train to Norwich pulls

out of Great Yarmouth

there is a good view

of the A47, one of the

region's main arteries,

in

desperate need of improvement.

Some upgrade work

will start next year,

but more is needed.

Among my fellow passengers,

the main concern is

about another form

of infrastructure.

Trying to get on the property

ladder myself and finding

it quite tough, I'm in my

early 30s, and to do

on my own

is quite a struggle.

having to go to a better job

and the 70 hours a week,

maybe, to start saving.

But that is only going

to be renting, still.

Not to be able to get

money away for a

mortgage.

It's a big issue for our region.

So as we pull into Norwich it's time

to transfer to the car

for a while.

As you travel west through

places like Wyndham,

Attleborough and Thetford,

you are struck by how

much house building

is

going on at the moment.

But despite that, there

is still a desperately

-need for housing across the region.

The Chancellor is expected to

announce incentives in his budget to

encourage developers to build

more and buyers to buy.

There may also be measures

to help tenants, and that

is important in a region like ours,

where rent is now rising

faster than anywhere

else in the country.

Next stop, Barton Mills in Suffolk,

where we come across

Andy Arnold filling up.

The local haulier spends

£1000 a week on fuel

for his four trucks.

In our region the level

of fuel duty has always

been a contentious issue.

The Government always

think about how

much tax they can get

out of people, I don't

think they realise how

that

hurts people in the transport

industry with the fuel duty.

The industry is hoping

for another freeze.

At least if it's

frozen we can carry on

operating the way we are.

If it was to go up, it

eats into our profit

margin and you have got to do cut

back somewhere, whether it is

drivers' wages or whatever.

At nearby Brandon, it's time

to get back on the train.

Through the Ely junction,

still waiting for its

upgrade, and then the Cambridge

science Park, the place in recent

years that has done very

well at budget time.

Cambridge is becoming so busy

and important there is now

talk of a third

station for the city.

If the Chancellor can afford it.

It would have been

nice to continue this

journey further west,

to

Bedford and Milton Keynes.

But the line which used

to run from here to

Oxford, the so-called Varsity Line,

was closed 50 years ago.

There is a project

underway to reopen it,

but it needs more money.

We understand that

on Wednesday's budget that will

be extra funding to help make East -

West rail more of a reality.

But for now, my journey

across the region has

to come to premature end.

Dave Hodgson, how important

would that Varsity line be?

The intermediary stops,

Bedford to Milton Keynes,

Milton Keynes to the west,

and Bedford to Cambridge, they

are very important to try

and get some traffic

off the road, help

the

growth of the towns.

We have had this problem before.

We were promised it

would be completed by

2017 by George Osborne.

The proposal is for 2023

and that is the western

section at the Bedford-

Cambridge section 2030.

I think it is critical

in terms of for the

existing growth.

If we are to have more

of it is then even more

important.

There was talk it was just

going to go from Oxford or

Cambridge but now stopping at places

like Milton Keynes and Bedford,

very important for the economy.

It's so exciting.

We had the Lord Adonis report this

week, he thinks if we get this

link right it could mean an extra

£160 million a year to our economy.

Potentially making this link

between Oxford and Cambridge,

the Silicon Valley of the UK.

We have seen money announced

last year, 100 million.

The start of the western end.

I am confident we will

see more this time.

There really is...

He's just looking at

you because, as he said,

George Osborne said 2017.

100 million was for

the business case,

not for the actual building.

We did get hard money

allocated to this and

the superhighway last year.

We do need more but the key

thing is collectively

across the region

the

local authorities and

politicians work together.

We have been lobbying very hard

and we saw the first

impact of that last year and I think

the public Dave and I need to

continue to work together

to tell the Chancellor

that this is what we want

and

what we need.

And then in return this will benefit

the whole of the UK economy.

I know you are very

worried about the

effect of road congestion

in various parts.

This would help?

It would help in terms

of moving between

major towns but it is

getting to that link.

So Highways England have talked

a lot about and that may be

some money in the budget for Oxford

for the first mile, last mile.

So people spending some 50%

of their journey time

in the first and last bit.

So some of those junctions

we all know about, the blackout

roundabout, junction

13, people spent most

of their journey time

in

that, not in the connectivity.

So we need to look

at those issues as

well.

Does it help being an elected

mayor, because the

Government loves elected mayors.

Even though you are

a Liberal Democrat.

Does it help?

The flavour of the day

is the metro mayors in

terms of bigger areas and strategic

areas so we may be getting a little

bit of a look in, but I

think the ask for us

now is a lot of houses

and currently we are not

coping in a borough

has not been designed

for the car in terms of the existing

pressure on our road structures.

Do you get the feeling

the Government

is now aware or is concerned more

money needs to come out of London

and into areas like Bedford

and Milton Keynes?

Absolutely, and we have seen

that in recent budgets.

I have been the MP

for 12 years and in

the early years the local

Milton Keynes economy was generating

a net surplus for the Government

which was

then taken out of the city

and spread to northern cities and

elsewhere.

If we can just keep some

of the money we are generating our

region to invest in our region

we will generate even more.

Can I just touch on the

other point that was

raised in the film about housing?

That is key, that will put greater

pressure on our infrastructure.

But I think we need to be more

innovative about how we can get

young people onto

the housing ladder.

One of the ways is perhaps

through pensions.

We all make contributions

now to workplace

pensions, if you could use that

money to invest in equity in your

own home and slowly build up

the equity in your own home and then

ultimately release it

again when you retire,

that is an innovative way

that we could potentially help

people.

Is that something the Government

is thinking about?

It's certainly

something we are Milton

Keynes are encouraging the

Government to think about and it is

high up on my agenda.

Is the Government listening?

The Government always listens!

But we also need to look

at the mix of houses, so not

just houses to buy, it is affordable

housing, houses to rent.

And looking at the skills.

We have got 10,000 with planning

permission already in

Bedford Borough and

the ability to build

out is very difficult

because

there isn't the skills

and raw materials to build.

The housing companies

at the moment do not want

to build because actually

affects their bottom line.

We come back to what you say,

in a way you do not

want those house is because you

don't have the infrastructure.

It's a more complicated

picture than just

building houses.

We do need them because we have

lots of people that

are homeless and people living

with parents way beyond the age

they used to and we need to have

houses for

those people to move out

and start their life on their own.

But we need to look

at the first - last mile so

they can get the infrastructure.

This is the point, the driver

for our growth should be economic

growth, not simply building houses.

And we need to get our

fair share of money,

which we do not get

at the

moment.

You're not going to let him

have the last word.

Head teachers, including those

from Essex, marched on Downing

Street this week to lobby for

a fairer funding for their schools.

Problems with policing in

Hertfordshire and Bedfordshire were

raised in front of the home affairs

select committee, where the county's

police and crime commissioners

called for more money.

We are only talking

around about £1 a week.

I think even those

who are just about

managing can probably

find a pound a week.

The MP for Bury St Edmunds caused

consternation in the Commons

over this weekend's

Saint Edmunds Day celebrations.

This weekend celebrates

Saint Edmunds Day,

commemorating Edmund

the martry, Some of whom

think he should be the first patron

saint of the UK and not St George.

While Priti Patel,

who recently resigned

as Secretary of State

for International Aid, following a

little trouble over

unauthorised meetings

in Israel, made light

of

her plight.

I am speaking today in this debate

following an intensive

course over the past week,

it's fair to say, on how

on how to stage an exit.

Which was the focus of a degree

of international attention.

Let's just talk about

that hole in the police

budgets.

Because you are one of the areas

where there has been lots of

consternation about it.

It's not going away, is it?

No, but the whole public

sector is, so I think it's

right the commissioner

asked for more money.

It's ironic that in her campaign

she actually criticised the

previous commissioner

for asking for more money

but she is right now to ask.

But it has cost the public sector,

trying to deliver social

services, it's remarkably difficult

when we have the massive cuts that

we're having.

Police budgets, there is not

a police force that has

enough money.

Let's remind ourselves

that police budgets

are effectively fixed

until 2019-20 in real terms.

That is good news.

In Milton Keynes we have just

got 15 extra officers.

I was speaking to our

police commander this

week and there is a major

refurbishment of the police station

going on.

Of course there is pressure

on public sector,

particularly pay, which is why

we have the eight independent

commissions looking at that

and the Chancellor has already

indicated we will be moving away

from the 1%.

You have a police forces

across the region either

cutting or doing away

with their extra police.

Forgive me, I speak

from Milton Keynes, where we

have just got 15 extra front

when police officers.

There are innovative

things you can do...

Cloud are going across the region.

-- PSCOs.

Not in Milton Keynes. There is

innovative things so we have police

officers based in the town hall and

so we are shipping facilities with

them. There is so much more for them

to have to do these days.

I am not dismissing the challenge

but there is innovations we can

carry out and as we both said, there

is more police officers in both of

our humanities.

But you will talk to people in the

street and they will say they want

to see a policeman on the beat.

There are challenges and this is one

of the things the Chancellor will be

looking at in the budget.

More money for police, do you think?

Well, I hope we will work across a

range of things. Are you looking

forward to the budget? I always look

forward to the budget.

Of course.

Let's see what comes. I would rather

be doing this programme this week

than next week.

Does that tell us something? Thank

you to both of you. That is all from

us. You can watch this programme on

the BBC iPlayer on our website. We

will be back at the

Philip Hammond will deliver his

Budget on Wednesday -

he's moved it to the Autumn

if you remember - and he'll be

hoping it can help re-define

the Government in the eyes

of the public.

But when it comes to

the economy, do people trust

the Conservatives, or Labour?

Here's Ellie Price

with the moodbox.

MUSIC: The Road to Nowhere

by Talking Heads.

All eyes will be on the Chancellor

this week as we find out

what he has been cooking

up in his Budget.

So we have pulled off the A1

near Peterborough to ask people here

who they trust with the economy -

is it the Chancellor,

Philip Hammond, or is it

Labour's John McDonnell?

No 7.

Which one's Tory?

I voted Conservative

for the last two

elections, don't feel very confident

now, so I'm going to swap.

If I said to you which

of these characters

would you trust with the economy,

what would you say?

The one who's currently

running it, because they

seem to be bringing

the deficit down.

Labour.

Why?

Because I'm an NHS worker.