27/10/2013 Sunday Politics North East and Cumbria


27/10/2013

Andrew Neil and Richard Moss with the latest political news, interviews and debate. With Lord Heseltine and shadow energy secretary Caroline Flint.


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Morning, folks. Welcome to the Sunday Politics. Hope you enjoyed

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the extra hour in bed, and that you've realised it's not 12:45. It's

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11:45! It's getting stormy outside. you've realised it's not 12:45. It's

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But they're already battening down the hatches at Number Ten because

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coalition splits are back, with the hatches at Number Ten because

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bust-ups over free schools and power bills. We'll speak to the Lib Dems,

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and ask Labour who's conning whom over energy.

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EU leaders have been meeting in Brussels. But how's David Cameron

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getting on with that plan to change Brussels. But how's David Cameron

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our relationship with Europe? We were there to ask him. Have we got

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any powers back yet? DS! Foreign companies own everything

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from our energy companies to our railways. Does it

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And in our region: It could cost ?50 Look North And

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And in our region: It could cost ?50 million but well high`speed rail

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And in our region: It could cost ?50 as many daily journeys made by bus

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than by tube, so why is the planned investment in buses not keeping

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pace? And with me, three journalists

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who've bravely agreed to hunker down in the studio while Britain braces

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itself for massive storm winds, tweeting their political forecasts

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with all the accuracy of Michael Fish on hurricane watch. Helen

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Lewis, Janan Ganesh and Nick Watt. Now, sometimes coalition splits are

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over-egged, or dare we say even occasionally stage-managed. But this

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week, we've seen what looks like the genuine article. It turns out Nick

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Clegg has his doubts about the coalition's flagship free schools

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policy. David Cameron doesn't much like the green levies on our energy

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bills championed by the Lib Dems. Neither of them seems to have

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bothered to tell the other that they had their doubts. Who better to

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discuss these flare-ups than Lib Dem Deputy Leader Simon Hughes? He joins

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me now. Welcome. Good morning. The Lib Dems spent three years of

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sticking up for the coalition when times were grim. Explain to me the

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logic of splitting from them when times look better. We will stick

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with it for five years. It is working arrangement, but not

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surprisingly, where there right areas on which we disagree over

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where to go next, we will stand up. It is going to be hard enough for

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the Lib Dems to get any credit for the recovery, what ever it is. It

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will be even harder if you seem to be semidetached and picky. The

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coalition has led on economic policy, some of which were entirely

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from our stable. The one you have heard about most often, a Lib Dem

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initiative, was to take people on blowing comes out of tax. The

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recovery would not have happened, there would not have been confidence

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in Britain, had there not been a coalition government with us in it,

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making sure the same policies produced fair outcomes. We are not

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going to leave the credit for any growth - and there has been very

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good news this week. We have played a part in that, and without us, it

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would not have happened. Does it not underline the trust problem you

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have? You promised to abolish tuition fees. You oppose nuclear

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power, now you are cheerleading the first multi-billion pounds

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investment in nuclear generation. You are dying out on your enthusiasm

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on green levies, and now they are up for renegotiation. Why should we

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trust a word you say? In relation to green levies, as you well know, just

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under 10% is to do with helping energy and helping people. Unless

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there is continuing investment in renewables, we will not have the

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British produced energy at cheaper cost to keep those bills down in the

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future. At cheaper cost? Explain that to me. Off-shore energy is

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twice the market rate. The costs of renewables will increasingly come

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down. We have fantastic capacity to produce the energy and deliver lots

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of jobs in the process. The parts of the energy bill that may be up for

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renegotiation seems to be the part where we subsidise to help either

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poor people pay less, or where we do other things. Too insulated the

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homes? Are you up to putting that to general taxation? Wouldn't that be

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progressive? I would. It would be progressive. I would like to do for

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energy bills what the Chancellor has done for road traffic users,

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drivers, which is too fuelled motor fuel -- to freeze new to fall. That

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would mean there would be an immediate relief this year, not

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waiting for the election. So there is a deal to be done there? Yes We

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understand we have to take the burden off the consumer, and also

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deal with the energy companies, who look as if they are not paying all

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the tax they should be, and the regulator, which doesn't regulate

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quickly enough to deal with the issues coming down the track. We can

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toughen the regulator, and I hope that the Chancellor, in the Autumn

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statement, was signalled that energy companies will not be allowed to get

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away with not paying the taxes they should. And this deal will allow

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energy prices to come down? Yes How could David Laws, one of your

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ministers, proudly defend the record of unqualified teachers working in

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free schools, and then stand side-by-side with Mr Clegg, as he

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says he is against them? David Laws was not proudly defending the fact

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that it is unqualified teachers He said that some of the new,

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unqualified teachers in free schools are doing a superb job. But you want

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to get rid of them? We want to make sure that everybody coming into a

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free school ends up being qualified. Ends up? Goes through a process that

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means they have qualifications. Just as we said very clearly at the last

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election that the manifesto curriculum in free schools should be

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the same as other schools. It looks like Mr Clegg is picking a fight

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just for the sake of it. Mr Clegg was taught by people who didn't have

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teaching qualifications in one of the greatest schools in the land, if

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not the world. It didn't seem to do him any harm. What is the problem?

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If you pay to go to a school, you know what you're getting. But that

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is what a free school is. No, you don't pay fees. A free school is

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parents taking the decisions, not you, the politicians. We believe

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they would expect to guarantee is, firstly that the minimum curriculum

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taught across the country is taught in the free schools, and secondly,

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that the teachers there are qualified. Someone who send their

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kids to private schools took a decision to take -- to send their

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children there, even if the teachers were unqualified, because they are

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experts in their field. Someone who send their kids to free schools is

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because -- is their decision, not yours. Because some of the free

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schools are new, and have never been there before, parents need a

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guarantee that there are some basics in place, whatever sort of school.

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So they need you to hold their hand? It is not about holding hands, it is

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about having a minimum guarantee. Our party made clear at our

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conference that this is a priority for us. Nick Clegg reflects the view

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of the party, and I believe it is an entirely rational thing to do. Nick

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Clegg complained that the Prime Minister gave him only 30 minutes

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notice on the Prime Minister Buzz 's U-turn on green levies. That is

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almost as little time as Nick Clegg gave the Prime Minister on his

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U-turn on free schools. Aren't you supposed to be partners? Green

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levies were under discussion in the ministerial group before Wednesday,

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because we identified this as an issue. We do that in a practical

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way. Sometimes there is only half an hour's notice. We had even less than

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half an hour this morning! Simon Hughes, thank you.

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So the price of energy is the big battle ground in politics at the

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moment. 72% of people say that high bills will influence the way they

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vote at the next election. Ed Miliband has promised a price freeze

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after the next election, but will the coalition turned the tables on

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Labour, with its proposal to roll back green levies. Caroline Flint

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joins us from Sheffield. It looks like the coalition will be able to

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take ?50 of energy bills, by removing green levies. It is quite

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clear that different parts of the government are running round waking

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up to the fact that the public feel that this government has not done

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enough to listen to their concerns. Last week, there was a classic case

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of the Prime Minister making up policy literally at the dispatch

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box. Let's see what they say in the autumn statement. The truth is,

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whatever the debate around green levies, and I have always said we

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should look at value for money at those green levies. Our argument is

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about acknowledging there is something wrong with the way the

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market works, and the way those companies are regulated. Behind our

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freeze for 20 months is a package of proposals to reform this market I

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understand that, but you cannot tell as the details about that. I can.

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You cannot give us the details about reforming the market. We are going

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to do three things, and I think I said this last time I was on the

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programme. First, we are going to separate out the generation side

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from the supply side within the big six. Secondly, we will have a energy

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pool, or power exchange, where all energy will have to be traded in

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that pool. Thirdly, we will establish a tougher regulator,

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because Ofgem is increasingly being seen as not doing the job right I

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notice that you didn't mention any reform of the current green and

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social taxes on the energy bill Is it Labour's policy to maintain the

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existing green levies? In 2011, the government chose to get rid of warm

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front, which was the publicly funded through tracks a scheme to support

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new installation. When they got rid of that, it was the first time we

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had a government since the 70s that didn't have such a policy. What is

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your policy? We voted against that because we believe it is wrong. We

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believe that the eco-scheme, a government intervention which is ?47

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of the ?112 on our bills each year, is expensive, bureaucratic and isn't

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going to the fuel poor. I am up for a debate on these issues. I am up

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for a discussion on what the government should do and what these

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energy companies should do. We cannot let Cameron all the energy

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companies off the hook from the way in which they organise their

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businesses, and expect us to pay ever increasing rises in our bills.

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There is ?112 of green levies on our bills at the moment. Did you vote

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against any of them? We didn't, but what I would say ease these were

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government imposed levies. When they got rid of the government funded

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programme, Warm Front, they introduced the eco-scheme. The

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eco-project is one of the ones where the energy companies are saying

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it's too bureaucratic, and it is proving more expensive than

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government estimates, apparently doubled the amount the government

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thought. These things are all worth looking at, but don't go to the

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heart of the issue. According to official figures, on current plans,

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which you support, which you voted for, households will be paying 1%

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more per unit of electricity by 2030. It puts your temporary freeze

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as just a blip. You support a 4 % rise in our bills. I support making

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sure we secure for the future access to energy that we can grow here in

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the UK, whether it is through nuclear, wind or solar, or other

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technologies yet to be developed. We should protect ourselves against

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energy costs we cannot control. The truth is, it is every fair for you

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to put that point across, and I accept that, but we need to hear the

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other side about the cost for bill payers if we didn't invest in new,

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indigenous sources of energy supply for the future, which, in the long

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run, will be cheaper and more secure, and create the jobs we

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need. I think it is important to have a debate about these issues,

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but they have to be seen in the right context. If we stay stuck in

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the past, we will pay more and we will not create jobs. How can you

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criticise the coalition's plans for a new nuclear station, when jeering

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13 years of a Labour government you did not invest in a single nuclear

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plant? You sold off all our nuclear technology to foreign companies

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Energy provision was put out to private hands and there has been no

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obstacle in British law against ownership outside the UK. Part of

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this is looking ahead. Because your previous track record is so bad

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What we did decide under the previous government, we came to the

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view, and there were discussions in our party about this, that we did

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need to support a nuclear future. At the time of that, David Cameron

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was one of those saying that nuclear power should be a last

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resort. And as you said, the Liberals did not support it. We

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stood up for that. We set in train the green light of 10 sites,

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including Hinkley Point, for nuclear development. I am glad to

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see that is making progress and we should make more progress over the

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years ahead. We took a tough decision when other governments had

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not done. You did not build a new nuclear station. When you get back

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into power, will you build HS2? That has not had a blank cheque

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from the Labour Party. I am in favour of good infrastructure. Are

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you in favour of?, answer the question? I have answered the

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question. It does not have a blank cheque. If the prices are too high,

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we will review the decision when we come back to vote on it. We will be

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looking at it closely. We have to look for value for money and how it

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benefits the country. Have you stocked up on jumpers this winter?

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I am perfectly all right with my clothing. What is important, it is

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ridiculous for the Government to suggest that the answer to the loss

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of trust in the energy companies is to put on another jumper.

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The coalition has taken a long time to come up with anything that can

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trump Ed Miliband's simple freezing energy prices, vote for us. Are

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they on the brink of doing so? I do not think so. They have had a

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problem that has dominated the debate, talking about GDP, the

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figures came out on Friday and said, well, and went back to talking

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about energy. My problem with what David Cameron proposes is he agrees

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with the analysis that the Big Six make too many profits. He wants to

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move the green levies into general taxation, so that he looks like he

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is protecting the profits of the energy companies. If the coalition

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can say they will take money off the bills, does that change the

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game? I do not think the Liberal Democrats are an obstacle to

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unwinding the green levies. I think Nick Clegg is open to doing a deal,

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but the real obstacle is the carbon reduction targets that we signed up

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to during the boom years. They were ambitious I thought at the time

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From that we have the taxes and clocking up of the supply-side of

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the economy. Unless he will revise that, and build from first

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principles a new strategy, he cannot do more than put a dent into

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green levies. He might say as I have got to ?50 now and if you

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voters in in an overall majority, I will look up what we have done in

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the better times and give you more. I am sure he will do that. It might

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be ?50 of the Bill, but it will be ?50 on your general taxation bill,

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which would be more progressive They will find it. We will never

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see it in general taxation. The problem for the Coalition on what

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Ed Miliband has done is that it is five weeks since he made that

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speech and it is all we are talking about. David Cameron spent those

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five weeks trying to work out whether Ed Miliband is a Marxist or

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whether he is connected to Middle Britain. That is why Ed Miliband

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set the agenda. The coalition are squabbling among themselves,

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looking petulant, on energy, and on schools. Nobody is taking notice of

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the fact the economy is under way, the recovery is under way. Ed

:19:51.:19:56.

Miliband has made the weather on this.

:19:57.:20:02.

It UK has a relaxed attitude about selling off assets based -- to

:20:03.:20:12.

companies based abroad. But this week we have seen the Swiss owner

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of one of Scotland's largest industrial sites, Grangemouth, come

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within a whisker of closing part of it down. So should we care whether

:20:19.:20:21.

British assets have foreign owners? Britain might be a nation of

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homeowners, but we appear to have lost our taste for owning some of

:20:24.:20:28.

our biggest businesses. These are among the crown jewels sold off in

:20:29.:20:31.

the past three decades to companies based abroad. Roughly half of

:20:32.:20:38.

Britain's essential services have overseas owners. The airport owner,

:20:39.:20:41.

British Airports Authority, is owned by a Spanish company.

:20:42.:20:43.

Britain's largest water company Thames, is owned by a consortium

:20:44.:20:47.

led by an Australian bank. Four out of six of Britain's biggest energy

:20:48.:20:50.

companies are owned by overseas giants, and one of these, EDF

:20:51.:20:52.

Energy, which is owned by the French state, is building Britain's

:20:53.:20:55.

first nuclear power plant in a generation, backed by Chinese

:20:56.:21:03.

investors. It's a similar story for train operator Arriva, bought by a

:21:04.:21:08.

company owned by the German state. So part of the railways privatised

:21:09.:21:10.

by the British government was effectively re-nationalised by the

:21:11.:21:19.

German government. But does it matter who owns these companies as

:21:20.:21:22.

long as the lights stay on, the trains run on time, and we can

:21:23.:21:28.

still eat Cadbury's Dairy Milk? We are joined by the general

:21:29.:21:32.

secretary of the RMT, Bob Crow, and by venture capitalist Julie Meyer.

:21:33.:21:39.

They go head to head. Have we seen the consequences of

:21:40.:21:46.

relying for essential services to be foreign-owned? Four of the Big

:21:47.:21:53.

Six energy companies, Grangemouth, owned by a tax exile in Switzerland.

:21:54.:21:59.

It is not good. I do not think there is a cause and effect

:22:00.:22:04.

relationship between foreign ownership and consumer prices. That

:22:05.:22:08.

is not the right comparison. We need to be concerned about

:22:09.:22:13.

businesses represented the future, businesses we are good at

:22:14.:22:16.

innovating for example in financial services and the UK has a history

:22:17.:22:23.

of building businesses, such as Monotypes. If we were not creating

:22:24.:22:34.

businesses here -- Monotise. Like so many businesses creating

:22:35.:22:40.

products and services and creating the shareholders. Should we allow

:22:41.:22:48.

hour essential services to be in foreign ownership? It was

:22:49.:22:53.

demonstrated this week at Grangemouth. If you do not own the

:22:54.:22:58.

industry, you do not own it. The MPs of this country and the

:22:59.:23:03.

politicians in Scotland have no say, they were consultants.

:23:04.:23:06.

Multinationals decide whether to shut a company down. If that had

:23:07.:23:13.

been Unite union, they are the ones who saved the jobs. They

:23:14.:23:19.

capitulated. They will come back, like they have for the past 150

:23:20.:23:23.

years, and capture again what they lost. If it had closed, they would

:23:24.:23:29.

have lost their jobs for ever. If the union had called the members up

:23:30.:23:33.

without a ballot for strike action, there would have been uproar. This

:23:34.:23:38.

person in Switzerland can decide to shut the entire industry down. The

:23:39.:23:43.

coalition, the Labour Party, as well, when Labour was in government,

:23:44.:23:49.

they played a role of allowing industries to go abroad, and it

:23:50.:23:53.

should be returned to public ownership. Nestor. It has

:23:54.:24:05.

demonstrated that the Net comes from new businesses. We must not

:24:06.:24:14.

be... When Daly motion was stopped by the French government to be sold,

:24:15.:24:20.

it was an arrow to the heart of French entrepreneurs. We must not

:24:21.:24:25.

create that culture in the UK. Every train running in France is

:24:26.:24:29.

built in France. 90% of the trains running in Germany are built in

:24:30.:24:36.

Germany. In Japan, it has to be built in that country, and now an

:24:37.:24:44.

energy company in France is reducing its nuclear capability in

:24:45.:24:48.

its own country and wants to make profits out of the British industry

:24:49.:24:52.

to put back into it state industry. That happened with the railway

:24:53.:24:56.

industry. They want to make money at the expense of their own state

:24:57.:25:02.

companies. We sold off energy production. How did we end up in a

:25:03.:25:10.

position where our nuclear capacity will be built by a company owned by

:25:11.:25:15.

a socialist date, France, and funded by a communist one, China,

:25:16.:25:24.

for vital infrastructure? I am not suggesting that is in the national

:25:25.:25:27.

interest. I am saying we can pick any one example and say it is a

:25:28.:25:33.

shame. The simple matter of the fact is the owners are having to

:25:34.:25:36.

make decisions. Not just Grangemouth, businesses are making

:25:37.:25:41.

decisions about what is the common good. Not just in the shareholders'

:25:42.:25:48.

interest. For employees, customers. What is in the common good when

:25:49.:25:52.

prices go up by 10% and the reason is that 20 years ago they shut

:25:53.:25:56.

every coal pit down in this country, the Germans kept theirs open and

:25:57.:26:01.

subsidised it and now we have the Germans doing away with nuclear

:26:02.:26:07.

power and they have coal. Under the Labour government, in 2008, the

:26:08.:26:14.

climate change Act was passed. Well before that, and you know yourself,

:26:15.:26:19.

they shut down the coal mines to smash the National Union of

:26:20.:26:23.

Mineworkers because they dared to stand up for people in their

:26:24.:26:28.

community. Even if we wanted to reopen the coalmines, it would be

:26:29.:26:32.

pointless. Under the 2008 Act, we are not meant to burn more coal

:26:33.:26:40.

The can, as if you spent some of the profits, you could have carbon

:26:41.:26:47.

catch up. That does not exist on a massive scale. You are arguing the

:26:48.:26:51.

case, Julie Meyer, for entrepreneurs to come to this

:26:52.:26:57.

country. Even Bob Crow is not against that. We are trying to

:26:58.:27:02.

argue, should essential services be in foreign hands? Not those in

:27:03.:27:10.

Silicon round about doing start ups. I am trying to draw a broader

:27:11.:27:16.

principle than just energy. Something like broadband services,

:27:17.:27:19.

also important to the functioning of the economy. I believe in the

:27:20.:27:27.

UK's ability to innovate. When we have businesses that play off

:27:28.:27:31.

broadband companies to get the best prices for consumers. These new

:27:32.:27:36.

businesses and business models are the best way. Not to control, but

:27:37.:27:43.

to influence. It will be a disaster. Prices will go up and up as a

:27:44.:27:49.

result. Nissan in Sunderland, a Japanese factory, some of the best

:27:50.:27:54.

cars and productivity. You want that to be nationalised and bring

:27:55.:27:57.

it down to the standard of British Leyland? It is not bring it down to

:27:58.:28:02.

the standard. The car manufacturing base in this country has been

:28:03.:28:07.

wrecked. We make more cars now for 20 years -- than in 20 years.

:28:08.:28:13.

Ford's Dagenham produced some of the best cars in the world. Did you

:28:14.:28:21.

buy one? I cannot drive. They moved their plants to other countries

:28:22.:28:27.

where it was cheaper labour. Would you nationalise Nissan? There

:28:28.:28:32.

should be one car industry that produces cars for people. This week

:28:33.:28:39.

the EU summit was about Angela Merkel's mobile phone being tapped,

:28:40.:28:45.

they call it a handy. We sent Adam to Brussels and told him to ignore

:28:46.:28:49.

the business about phone-tapping and investigate the Prime

:28:50.:28:52.

Minister's policy on Europe instead. I have come to my first EU summit to

:28:53.:29:08.

see how David Cameron is getting on with his strategy to claim power was

:29:09.:29:12.

back from Brussels. Got any powers back yet? Yes! Which ones? Sadly,

:29:13.:29:21.

his fellow leaders were not as forthcoming. Chancellor, are you

:29:22.:29:26.

going to give any powers back to Britain? Has David Cameron asked you

:29:27.:29:33.

for any powers back? The president of the commission just laughed, and

:29:34.:29:39.

listen to the Lithuanian President. How is David Cameron's renegotiation

:29:40.:29:50.

strategy going? What's that? He wants powers back for Britain. No

:29:51.:29:55.

one knows what powers David Cameron actually wants. Even our usual

:29:56.:30:00.

allies, like Sweden, are bit baffled. We actually don't know yet

:30:01.:30:07.

what is going through the UK membership. We will await the

:30:08.:30:14.

finalisation of that first. You should ask him, and then tell us!

:30:15.:30:20.

Here is someone who must know, the Dutch Prime Minister, he is doing

:30:21.:30:25.

what we are doing, carrying out a review of the EU powers, known as

:30:26.:30:30.

competencies in the jargon, before negotiating to get some back. Have

:30:31.:30:35.

you had any negotiations with David Cameron over what powers you can

:30:36.:30:40.

bring back from Brussels? That is not on the agenda of this summit.

:30:41.:30:46.

Have you talked to him about it This is not on the schedule for this

:30:47.:30:50.

summit. David Cameron's advises tummy it is

:30:51.:30:59.

because he is playing the long game. -- David Cameron's advisers tell me.

:31:00.:31:08.

At this summit, there was a task force discussing how to cut EU red

:31:09.:31:15.

tape. Just how long this game is was explained to me outside the summit,

:31:16.:31:20.

by the leader of the Conservatives in the European Parliament. I think

:31:21.:31:25.

the behind-the-scenes negotiations will start happening when the new

:31:26.:31:28.

commissioner is appointed later next year. I think the detailed

:31:29.:31:34.

negotiations will start to happen bubbly after the UK general

:31:35.:31:38.

election. That is when we will start getting all of the detail of the

:31:39.:31:43.

horse trading, and real, Lake night negotiations. Angela Merkel seems

:31:44.:31:50.

keen to rewrite the EU's main treaties to deal with changes in the

:31:51.:31:55.

Eurozone, and that is the mechanism David Cameron would use to

:31:56.:31:59.

renegotiate our membership. Everyone here says his relationship with the

:32:00.:32:03.

German Chancellor is strong. So after days in this building, here is

:32:04.:32:08.

how it looks. David Cameron has a mountain to climb. It is climbable,

:32:09.:32:14.

but he isn't even in the foothills yet. Has he even started packing his

:32:15.:32:19.

bags for the trip? Joining us now, a man who knows a

:32:20.:32:24.

thing or two about the difficulties Prime Minister 's face in Europe.

:32:25.:32:29.

Former Deputy Prime Minister, Michael Heseltine. We are nine

:32:30.:32:33.

months from David Cameron's defining speech on EU renegotiation. Can you

:32:34.:32:41.

think of one area of progress? I don't know. And you don't know. And

:32:42.:32:46.

that's a good thing. Why is it a good thing? Because the real

:32:47.:32:52.

progress goes on behind closed doors. And only the most naive,

:32:53.:33:03.

because the real progress goes on behind closed doors. Because, in

:33:04.:33:11.

this weary world, you and I, Andrew, know full well that the moment you

:33:12.:33:16.

say, I making progress, people say, where? And the machine goes to work

:33:17.:33:21.

to show that the progress isn't enough. So you are much better off

:33:22.:33:28.

making progress as best you can in the privacy of private diplomacy. It

:33:29.:33:37.

is a long journey ahead. In this long journey, do you have a clear

:33:38.:33:41.

sense of the destination? Do you have a clear sense of what powers Mr

:33:42.:33:48.

Cameron wants to negotiate? I have a clear sense of the destination,

:33:49.:33:52.

which is a victory for the campaign that he will win to stay inside the

:33:53.:33:58.

European community. That is the agenda, and I have total support for

:33:59.:34:07.

that. I understand that, but if he is incapable of getting any tangible

:34:08.:34:12.

sign of renegotiation, if he is able only to do what Wilson did in 1 75,

:34:13.:34:18.

which was to get a couple of token changes to our membership status, he

:34:19.:34:23.

goes into that referendum without much to argue for. He has everything

:34:24.:34:29.

to argue for. He's got Britain's vital role as a major contributor to

:34:30.:34:37.

the community. He's got Britain s self interest as a major

:34:38.:34:43.

beneficiary, and Britain's vital role in the City of London. He's got

:34:44.:34:49.

everything to argue for. He could argue for that now. He could have a

:34:50.:34:55.

referendum now. He doesn't want one now. I haven't any doubt that he

:34:56.:35:02.

will come back with something to talk about. But it may be slightly

:35:03.:35:11.

different to what his critics, the UK isolationist party people, want.

:35:12.:35:17.

He may, for example, have found that allies within the community want

:35:18.:35:23.

change as well, and he may secure changes in the way the community

:35:24.:35:29.

works, which would be a significant argument within the referendum

:35:30.:35:32.

campaign. Let me give you an example. I think it is a scandal

:35:33.:35:37.

that the European Commission don't secure the auditing of some of the

:35:38.:35:44.

accounts. Perhaps that could be on the agenda. He might find a lot of

:35:45.:35:49.

contributing countries, like Germany, like Colin and, would be

:35:50.:35:51.

very keen. -- like Holland. David Germany, like Colin and, would be

:35:52.:35:59.

vetoed the increase in the European budgets the other day, and he had a

:36:00.:36:07.

lot of allies. So working within Europe on the things that people

:36:08.:36:12.

paying the European bills want is fertile ground. Is John Major right

:36:13.:36:16.

to call for a windfall tax on the energy companies? John is a very

:36:17.:36:22.

cautious fellow. He doesn't say things without thinking them out. So

:36:23.:36:28.

I was surprised that he went for a windfall tax. First of all, it is

:36:29.:36:34.

retrospective, and secondly, it is difficult to predict what the

:36:35.:36:39.

consequences will be. I am, myself, more interested in the other part of

:36:40.:36:43.

his speech, which was talking about the need for the Conservative Party

:36:44.:36:49.

to seek a wider horizon, to recognise what is happening to the

:36:50.:36:53.

Conservative Party in the way in which its membership is shrinking

:36:54.:37:01.

into a southeastern enclave. Are you in favour of a windfall tax? I am

:37:02.:37:05.

not in favour of increasing any taxes. Do you share Iain Duncan

:37:06.:37:17.

Smith's point of view on welfare reform? I think Iain Duncan Smith is

:37:18.:37:27.

right. It is extremely difficult to do, but he is right to try. I think

:37:28.:37:33.

public opinion is behind him, but it isn't easy, because on the fringe of

:37:34.:37:43.

these issues there are genuine hard luck stories, and they are the ones

:37:44.:37:48.

that become the focus of attention the moment you introduce change It

:37:49.:37:53.

requires a lot of political skill to negotiate your way through that But

:37:54.:37:59.

isn't Iain Duncan Smith right to invoke the beverage principle, that

:38:00.:38:04.

you should be expected to make a contribution for the welfare you

:38:05.:38:10.

depend on? Yes, he is. I will let you get your Sunday lunch. Thanks

:38:11.:38:14.

for joining us. Coming up in just over 20 minutes, I

:38:15.:38:16.

will In Welcome to the programme here.

:38:17.:38:45.

Coming up: The Derby but should we get more of a say in the running of

:38:46.:38:52.

her clubs? We have a lifelong Newcastle fan and a Labour MP with

:38:53.:38:58.

us who joins us in the studio. Also a Conservative candidate for buried.

:38:59.:39:05.

Let us start by talking rail. The government has taken the first step

:39:06.:39:09.

towards free privatising the East Coast mainline. It has been in

:39:10.:39:14.

public hands for the last four years. Presumably you think this is

:39:15.:39:21.

a very bad idea? It is a very bad idea. The profits made by the East

:39:22.:39:30.

Coast mainline have been an excess of ?800 million since they have been

:39:31.:39:36.

in the hand `` hands of the public. That is a fantastic amount of money.

:39:37.:39:41.

Why should be looking to get that type of profit to private industry?

:39:42.:39:47.

Should we not be looking at investing, as a government, into the

:39:48.:39:52.

East Coast Main line and maximising that profit. At the same time the

:39:53.:39:59.

East Coast mainline have invested into the infrastructure so it is a

:40:00.:40:05.

good deal for everyone. Why should we privatise it? It is like selling

:40:06.:40:11.

the family silver. Get me one good reason why it should be handed back

:40:12.:40:18.

to public hands? `` private hands. We want a strong support of private

:40:19.:40:24.

investment. We want to put it back with good operators. We have to make

:40:25.:40:33.

sure that what the customers need on the East Coast is provided, we need

:40:34.:40:38.

long`term capital investment and I think private investment is always

:40:39.:40:43.

the way forward. Now we have a dispute over whether to press ahead

:40:44.:40:49.

with a ?50 million high`speed railway from London to Manchester.

:40:50.:40:53.

It has been said it will boost economy even for areas in Cumbria

:40:54.:41:01.

that are not on the route. Others say it will suck the lifeblood out

:41:02.:41:08.

of the deal system and leads to longer journey times. Some say it

:41:09.:41:17.

will impact on transport spending in the region. It is a disaster. Other

:41:18.:41:27.

projects will have to be forgotten about if this goes ahead. We

:41:28.:41:33.

contacted MPs right across the North East and Cumbria to find out how

:41:34.:41:42.

they felt. 43% of MPs remain in favour of high`speed rail but one

:41:43.:41:47.

third are against, the rest declined to say. We asked about the top

:41:48.:41:56.

transport priorities. Half said better bus links, improvements to be

:41:57.:42:07.

one and a 66 were mentioned. We'll all parts of our region benefit

:42:08.:42:12.

economically? This is one company that is keen, it provides parts and

:42:13.:42:17.

equipment for the real industry and it plans to bid for this. It

:42:18.:42:21.

believes benefits could go much wider. It is definitely the way

:42:22.:42:32.

forward. We need spending on infrastructure. For a long time

:42:33.:42:37.

beware of the poor man of Europe when it came to deal. The French

:42:38.:42:42.

have hired high`speed rail for a long time and so have the Japanese.

:42:43.:42:50.

`` we where the poor man of Europe. It has got to be done. Many feel

:42:51.:43:00.

high`speed rail will have no impact on productivity in the region. They

:43:01.:43:08.

will come up the motorway and over to Scotland or even towards Penrith.

:43:09.:43:16.

If we play the road network or was mainline or cross`country services,

:43:17.:43:19.

infrastructure spend is vital and we could spread it out and do you not

:43:20.:43:33.

more good. `` do you not more good. Some say we should spread it around

:43:34.:43:37.

rather than spending all that money on one project? Investment in the

:43:38.:43:45.

north`east has been severely lacking for decades. I hope the Chancellor

:43:46.:43:49.

will now understand this is a key economic value. In terms of real

:43:50.:43:56.

infrastructure there is a need to improve capacity across the country.

:43:57.:44:00.

I was disappointed when the legislation came through at the

:44:01.:44:04.

second phase which comes up to the northern part of the UK has not been

:44:05.:44:10.

set out. It is key for us that it comes across to the east coast and

:44:11.:44:16.

up into Scotland. I think the government has not done a good job

:44:17.:44:20.

of explaining just how important the increased capacity is to make sure

:44:21.:44:25.

that we get the real infrastructure. You cannot see that we want

:44:26.:44:32.

structural investment in roads and other real services and also see you

:44:33.:44:39.

want HS two. I think it is a perfectly reasonable amount of

:44:40.:44:43.

money. You are looking at a couple of billion every year. 50 billion

:44:44.:44:47.

for other projects, so I do not think it is one or the other. It is

:44:48.:44:56.

a long`term project. North`east companies stand to benefit from

:44:57.:45:03.

this, economists say the Bijan will benefit from it, it is a no`brainer?

:45:04.:45:12.

I am not sure I can agree. `` the region will benefit. It is ?20 more

:45:13.:45:22.

in the south than it is in the north`east, the spending. In the

:45:23.:45:30.

south it is 200 and ?700 per head compared by ?5 here in the

:45:31.:45:38.

north`east. It is outrageous. Of the suggestions are that it will bring

:45:39.:45:44.

economic benefit, RU saying we should ditch it? I am not seeing

:45:45.:45:52.

ditch it but things like dealing of the A1, the metro, there are other

:45:53.:46:05.

projects which would benefit us because it gives access. The problem

:46:06.:46:15.

is that the East Coast mainline is filling up. You might be able to get

:46:16.:46:21.

to Newcastle but you will have a very slow journey to London. I know

:46:22.:46:26.

that from experience, I travel from Newcastle station to London most

:46:27.:46:33.

Mondays. The regional infrastructure programmes which are short already

:46:34.:46:44.

need work. But would this help? The people in this region have the right

:46:45.:46:50.

to ask if this is value for money. ?50 billion, is it right to spend

:46:51.:46:55.

that kind of finance to get from London to Birmingham? Why are we not

:46:56.:47:03.

included in that? What about a fear allocation to deliver things in this

:47:04.:47:06.

region so that people can benefit economically. The reality is that

:47:07.:47:15.

the places that will benefit most are Birmingham, Leeds and

:47:16.:47:20.

Manchester, not Newcastle. Without a doubt but it is the government

:47:21.:47:25.

appreciating that there needs to be investment in infrastructure across

:47:26.:47:27.

the country, not just the South West. A huge amount has been sucked

:47:28.:47:34.

into the south`east over the past few years. We need to see a broad

:47:35.:47:42.

investment in rail and roads. You might not need me to tell you that

:47:43.:47:47.

it is Derby weekend. The rivalry will be intense with no love lost on

:47:48.:47:54.

either side. One thing the sense of supporters will actually agree on is

:47:55.:48:03.

the chance for supporters on both sides to get more oversea in what

:48:04.:48:13.

those on. It is what happens of the pitch that is really interesting

:48:14.:48:18.

here. Fans really happier say. Della macro fans can turn up, they can

:48:19.:48:29.

vote on everything. If they are not doing a very good job and someone

:48:30.:48:34.

comes in the can vote you out. It is as easy as that. Here dealers rather

:48:35.:48:43.

different mood, there have been a series of protests from Newcastle

:48:44.:48:51.

United fans against the club owner. The board have never really taken

:48:52.:48:57.

the support seriously and sought to develop it. It is almost as if the

:48:58.:49:03.

fans have supported the club despite what is going on at board level. Say

:49:04.:49:13.

it is a wonderful city. Recently the club have been disengaged from the

:49:14.:49:16.

people who are putting money into the club. I think it would make a

:49:17.:49:26.

big difference and stop the clock making disastrous decisions. `` the

:49:27.:49:36.

club. The government said it wanted to give fans a bigger say in the

:49:37.:49:40.

running of football clubs but we have heard that idea has since been

:49:41.:49:46.

shelved, there not enough time in Parliament schedule. People over

:49:47.:49:58.

there want action. A conference at Newcastle University business

:49:59.:50:05.

School. It is just an fear to raise expectations, to go with what

:50:06.:50:11.

appears to be a populist idea and then for someone to say we do not

:50:12.:50:20.

have time. It is just not high enough on the agenda. It is

:50:21.:50:28.

different in Germany. These fans have something to cheer them up,

:50:29.:50:33.

they have a big say on the running of the club, there is a national ban

:50:34.:50:37.

on anyone owning more than half a football club. We, the members, the

:50:38.:50:47.

club belongs to us. At the EGM we can change the club statute. If you

:50:48.:50:52.

are a member of the club you QB club belongs to you. You are not just a

:50:53.:50:57.

fan. It is our club, not something we just support. The players show

:50:58.:51:05.

the skills but it is the fans who call the shots. It is simply the way

:51:06.:51:11.

English football works these days, tackling it could be a challenge.

:51:12.:51:21.

With me now is a lecturer of finance from the University business School.

:51:22.:51:27.

How realistic is it to think that this German fan model could work in

:51:28.:51:34.

Newcastle, Sutherland or Carlisle? It is interesting to look at how the

:51:35.:51:38.

models have evolved over time, the German model has been built on a

:51:39.:51:45.

history of fans being involved in the club structure. In the UK we

:51:46.:51:51.

have a more industrial background where there was typically a singular

:51:52.:51:54.

owner so football has evolved as being a business over at time.

:51:55.:52:01.

Politicians fall over themselves to say be like this idea but there's a

:52:02.:52:10.

beer the downside? It is to do with commercial brands, if you look at

:52:11.:52:15.

Manchester United and Chelsea which have domestic and international fan

:52:16.:52:20.

bases. If you have the tradition to fan base controlled membership

:52:21.:52:26.

structure the problem is the sustainability of the financial side

:52:27.:52:35.

of the UK clubs even higher wages. Perhaps they're not surprising the

:52:36.:52:41.

government has gone cold on this? The government, in terms of trying

:52:42.:52:46.

to be involved, it is difficult, particularly given the stands of

:52:47.:52:50.

fief up on the reluctance for the government to get involved. I think

:52:51.:52:57.

the government's involvement is something that is crucial but needs

:52:58.:53:01.

to be done through the associations themselves. The Premier league is

:53:02.:53:06.

the envy of Europe, why change anything? That is the argument. The

:53:07.:53:14.

UK have traditionally done very well in terms of domestic and European

:53:15.:53:19.

competitions. The German models have been successful, and the Spanish and

:53:20.:53:30.

other countries. This idea sounds great of course but what difference

:53:31.:53:37.

will it make to these clubs? The government promised supporters they

:53:38.:53:41.

would legislate to make sure there was more engagement with supporters

:53:42.:53:45.

in the clubs. They should look at that again and get the commitment to

:53:46.:53:51.

support. In Newcastle 52,000 supporters attend every game. I am

:53:52.:53:56.

not sure it is good enough to see just one person on the board.

:53:57.:54:04.

Generations of families have been going and they should have a say.

:54:05.:54:12.

With the have any more say effing big businesses should anyone who

:54:13.:54:26.

shops in Tesco beyond the board? Why shouldn't these people who spend

:54:27.:54:30.

hard earned money to watch the team through bad times and good not happy

:54:31.:54:37.

voice in how it is run? It would benefit the clubs if the sat back

:54:38.:54:43.

and listened to deal people in the real world. There is populist

:54:44.:54:49.

posturing by the government but it has been ditched now, why is that? I

:54:50.:54:58.

am not as added a football fan as Ian, but my mother`in`law is. They

:54:59.:55:04.

are enormous huge profit`making businesses. The fact that they were

:55:05.:55:10.

once local football teams seems to have been largely lost. If there is

:55:11.:55:17.

a way to get them a better relationship that gives them a

:55:18.:55:20.

practical consideration with the fan base, I think the football

:55:21.:55:26.

Association and the clubs themselves can take that decision. There does

:55:27.:55:31.

not need to be drive to encourage, if they are genuinely concerned, by

:55:32.:55:37.

the members, the people who turn out every Saturday whatever the weather.

:55:38.:55:46.

Are you saying get some shoppers on board for supermarkets? YouTube

:55:47.:55:53.

Tesco's as an example, I have the Tesco Clubcard, if they choose

:55:54.:55:58.

things I do not like I would take my business elsewhere. Football is a

:55:59.:56:03.

monstrous business but if you are a fan are you going to stop supporting

:56:04.:56:09.

them? The reality is that there needs to be a better relationship

:56:10.:56:13.

between the directors of an individual football club to build a

:56:14.:56:18.

stronger grouping. You see it in the smaller clubs more effectively than

:56:19.:56:22.

the big ones. Newcastle fans could stay a way. But when it comes to it,

:56:23.:56:35.

they do not. Fans at Newcastle, like teams up and down the country, have

:56:36.:56:40.

a strong allegiance. Not the type of allegiance you might have at Tesco.

:56:41.:56:46.

That is a ridiculous analogy! They are dyed in the will supporters, it

:56:47.:56:54.

is what they live and breed for. The directors and owners of the club

:56:55.:56:57.

should just listen to what these people have got to see. `` say. If

:56:58.:57:06.

you listen to them, they might get more success. There are not many

:57:07.:57:17.

issues that unite country sport enthusiasts. They have all joined up

:57:18.:57:26.

to stop them campaigning. Now if the rest of the political news in 62nd

:57:27.:57:32.

seed as our reporter. Tyne and we are fired and rescue services to

:57:33.:57:36.

consult on plans to cut firefighter posts and close existing firefighter

:57:37.:57:45.

stations. This new nation 's depot has been earmarked for closure in

:57:46.:57:50.

Cumbria. Some jobs might still go but the site should remain open.

:57:51.:57:56.

There are concerns about the government's new lobbying bill. The

:57:57.:58:02.

big lobbyists working for energy firms and drinks companies would be

:58:03.:58:09.

unaffected but some people's work would be hit. The private lobbying

:58:10.:58:18.

group will still go on. And in Newcastle beer was history with a

:58:19.:58:23.

minister in a committee of the French parliament. They were

:58:24.:58:30.

discussing ways to tackle youth unemployment. Now let's look in a

:58:31.:58:38.

bit more detail at the first of those stories. The lobbying bill,

:58:39.:58:44.

some have accused them of overreaction, what do you think? I

:58:45.:58:50.

have had more correspondence on this bill than any other issue in the

:58:51.:58:57.

last 8.5 years. It is not correspondence from raving militants

:58:58.:59:02.

who want a revolution, it is from local and national charities,

:59:03.:59:06.

campaign groups. They are concerns are that they are being stopped from

:59:07.:59:17.

using the boys to change policies at the national level. It is the run`up

:59:18.:59:24.

to the national election that they have to get in there and get

:59:25.:59:28.

commitment from the party they believe will be in government after

:59:29.:59:35.

the election. This is a gagging law there to prevent local people from

:59:36.:59:38.

holding to account the government for the decisions it has made. The

:59:39.:59:46.

government says they are starting out with good intentions but have

:59:47.:59:49.

they turned this into a dog 's breakfast? It seems to me to be

:59:50.:59:59.

quite confused bit of legislation. You need to be the assurances for

:00:00.:00:06.

the average charity. Part of the purpose of the bill is to enforce

:00:07.:00:11.

the union structures to make a clean record of their membership so there

:00:12.:00:15.

is a much clearer source of information on that side of things.

:00:16.:00:23.

They are bashing the unions? Absolutely not, transparency is the

:00:24.:00:31.

key, where there's money going and how is it being spent? Whether it is

:00:32.:00:37.

a big charity or a union. Trade unions should be accountable. We

:00:38.:00:45.

should see where they are influencing your party leader for

:00:46.:00:51.

example? You can have a look at every evening which has come from a

:00:52.:00:55.

trade union and look down the financial line to see where it has

:00:56.:00:58.

come from, the lollipop ladies, dinner ladies, you can hardly say

:00:59.:01:04.

that its financing of the parties which come from lobbyists and big

:01:05.:01:09.

business. That is it from us. Next Sunday we will be supporting the

:01:10.:01:17.

funding policy. That is on health spending. For

:01:18.:01:19.

free school area for into that category. Thank you.

:01:20.:01:31.

Is Labour about to drop its support category. Thank you.

:01:32.:01:32.

Is Labour about to drop its support for High Speed 2, a rail line the

:01:33.:01:36.

party approved while in government? for High Speed 2, a rail line the

:01:37.:01:47.

these green shoots? These are all questions for The Week Ahead.

:01:48.:01:59.

So, HS2. Miss Flint wouldn't answer the question. She's in northern MP

:02:00.:02:04.

too. Ed Balls is comparing it to the Millennium Dome.

:02:05.:02:09.

too. Ed Balls is comparing it to the minute's silence for HS2? It will

:02:10.:02:14.

not be quite as crude as that. They will not stand up and say, we

:02:15.:02:19.

not be quite as crude as that. They senior Labour person said to me it

:02:20.:02:19.

would be a bit senior Labour person said to me it

:02:20.:02:22.

that Gordon Brown and Ed Balls set for the euro back in 97. They will

:02:23.:02:28.

be chucking lots of questions into the air, and the questions will

:02:29.:02:32.

create doubt, and will create the grounds for Labour to say, at some

:02:33.:02:38.

point, we think there is a much much better way of spending the money. It

:02:39.:02:43.

isn't ?42 billion, because that includes a contingency. Let's see

:02:44.:02:50.

what Peter Mandelson had to say about HS2. He was in the government

:02:51.:02:57.

when Labour supported it. Frankly, there was too much of the argument

:02:58.:03:01.

that if everyone else has got a high-speed train, we should have won

:03:02.:03:08.

too. Regardless of need, regardless of cost, and regardless of

:03:09.:03:14.

alternatives. As a party, to be frank, we didn't feel like being

:03:15.:03:19.

trumped by the zeal of the then opposition's support for the

:03:20.:03:26.

high-speed train. We wanted, if anything, to upstage them. So they

:03:27.:03:30.

didn't really need it, and we're only talking about ?50 billion. Why

:03:31.:03:38.

would you take a decision involving ?50 billion in a serious way? For

:03:39.:03:42.

David Cameron, if it becomes clear Labour is against it, he cannot

:03:43.:03:48.

proceed. He indicated last week that he wouldn't proceed if the certainty

:03:49.:03:52.

wasn't there. For Labour, HS2 is really a debate about the deficit by

:03:53.:03:56.

proxy. They think that if you don't go ahead with HS2, that releases

:03:57.:04:01.

tens of billions of pounds to spend on other things, such as public

:04:02.:04:06.

services, without going into boring. I don't think that works because

:04:07.:04:28.

there was a difference between cancelling something that already

:04:29.:04:30.

exists to pay for something else, and cancelling something that does

:04:31.:04:32.

not yet exist and will be paid for over decades to pay for something

:04:33.:04:35.

here and now. Can Labour do this? I know that the line will be, we are

:04:36.:04:38.

not going to build this railway because we are going to build

:04:39.:04:41.

200,000 houses a year. Can they do this without political cost? I think

:04:42.:04:43.

there will be political costs, but they will play this card of we have

:04:44.:04:48.

changed our mind. I think Cameron's line has been very clever, saying we

:04:49.:04:53.

cannot do it without labour. You can put it in two ways. Sorry, we cannot

:04:54.:04:58.

go ahead with it, but Labour has ruined your chance of prosperity, or

:04:59.:05:02.

they can tie themselves to it, and then Labour cannot attack it on

:05:03.:05:09.

great grounds when costs do spire. You can write Labour's script right

:05:10.:05:14.

now. They can say, if we were in charge, the financial management

:05:15.:05:22.

would be much better. This raises some really important questions for

:05:23.:05:27.

the government. They have utterly failed to make the case for HS2

:05:28.:05:33.

There is a real case to make. Between London and Birmingham it is

:05:34.:05:37.

about capacity not speed. North of Birmingham, it is about

:05:38.:05:42.

connectivity. It is a simple case to make, but it is only in the last

:05:43.:05:46.

month that they have been making that case. It shows really terrible

:05:47.:05:49.

complacency in the coalition that they haven't done that. We'll HS2

:05:50.:05:57.

happen or not? I think it will. For the reasons that Nick outlined,

:05:58.:06:01.

there is not of a constituency for it amongst Northern areas. -- there

:06:02.:06:10.

is enough of a constituency for it. There is private investment as well.

:06:11.:06:17.

It isn't like Heathrow. I say no, because I think Labour will drop

:06:18.:06:24.

their support for it. Caroline Flint said she was in favour of the

:06:25.:06:27.

concept of trains generally, but will it go further than that? It is

:06:28.:06:32.

difficult to see how it will go ahead if Labour will not support it

:06:33.:06:38.

after setting five tests that it clearly will not meet. Some will

:06:39.:06:46.

breathe a sigh of relief. Some will say, even in the 20th century, we

:06:47.:06:51.

cannot build a proper rail network. The economy was another big story of

:06:52.:06:56.

the week. We had those GDP figures. There is a video the Tories are

:06:57.:07:01.

releasing. The world premiere is going to be here. Where's the red

:07:02.:07:05.

carpet? It gives an indication of how the Tories will hand Mr Miliband

:07:06.:07:10.

and labour in the run-up to the election. Let's have a look at it.

:07:11.:07:43.

These graphics are even worse than the ones we use on our show! How on

:07:44.:07:49.

earth would you expect that to go viral? It did have a strange feel

:07:50.:07:58.

about it. It doesn't understand the Internet at all. Who is going to

:07:59.:08:03.

read those little screens between it? Put a dog in it! However,

:08:04.:08:14.

putting that aside, I have no idea that that is going to go viral. The

:08:15.:08:20.

Tories are now operating - and I say Tories rather than the coalition -

:08:21.:08:26.

on the assumption that the economy is improving and will continue to

:08:27.:08:30.

improve, and that that will become more obvious as 2014 goes on. We

:08:31.:08:36.

just saw their how they will fight the campaign. Yes, and at the

:08:37.:08:42.

crucial moment, you will reach the point where wages. To rise at a

:08:43.:08:47.

faster pace than inflation, and then people will start to, in the words

:08:48.:08:51.

of Harold Macmillan, feel that they have never had it so good. That is

:08:52.:08:57.

the key moment. If the economy is growing, there is a rule of thumb

:08:58.:09:05.

that the government should get a benefit. But it doesn't always work

:09:06.:09:08.

like that. The fundamental point here is that Ed Miliband has had a

:09:09.:09:11.

great month. He has totally set the agenda. He has set the agenda with

:09:12.:09:17.

something - freezing energy prices - that may not work. That video shows

:09:18.:09:22.

that the Conservatives want to get the debate back to the

:09:23.:09:25.

fundamentals. That this is a party that told us for three years that

:09:26.:09:33.

this coalition was telling us to -- was taking us to hell on a handcart.

:09:34.:09:37.

That doesn't seem to have happened. The energy price was a very clever

:09:38.:09:45.

thing, at the party conference season, which now seems years ago.

:09:46.:09:49.

They saw that the recovery was going to happen, so they changed the

:09:50.:09:56.

debate to living standards. Some economists are now privately

:09:57.:10:00.

expecting growth to be 3% next year, which was inconceivable for five

:10:01.:10:05.

months ago. If growth is 3% next year, living standards will start to

:10:06.:10:07.

rise again. Where does Labour go then? I would go further, and say

:10:08.:10:14.

that even though Ed Miliband has made a small political victory on

:10:15.:10:18.

living standards, it hasn't registered in the polls. Those polls

:10:19.:10:25.

have been contracted since April -- have been contracting since April.

:10:26.:10:29.

That macro economic story matters more than the issue of living

:10:30.:10:34.

standards. The interesting thing about the recovery is it confounds

:10:35.:10:38.

everybody. No one was predicting, not the Treasury, not the media not

:10:39.:10:44.

the IMF, not the academics, and the only people I can think of... I fit

:10:45.:10:51.

-- I thought they knew everything! The only people I know who did are

:10:52.:10:57.

one adviser who is very close to George Osborne, and the clever hedge

:10:58.:11:00.

fund is who were buying British equities back in January. Because

:11:01.:11:05.

the Treasury's record is so appalling, no one believe them, but

:11:06.:11:09.

they were saying around February, March this year, that by the end of

:11:10.:11:14.

the summer, the recovery would be gathering momentum. For once, they

:11:15.:11:23.

turned out to be right! They said that the economy would be going gang

:11:24.:11:26.

bust is! Where did the new Tory voters come from? I agree, if the

:11:27.:11:33.

economic recovery continues, the coalition will be stronger. But

:11:34.:11:42.

where will they get new voters from? For people who sign up to help to

:11:43.:11:47.

buy, they will be locked into nice mortgages at a low interest rate,

:11:48.:11:51.

and just as you go into a general election, if you are getting 3%

:11:52.:11:57.

growth and unemployment is down the Bank of England will have to review

:11:58.:12:00.

their interest rates. People who are getting nice interest rates now may

:12:01.:12:04.

find that it is not like that in a few months time. The point John

:12:05.:12:11.

Major was making implicitly was that Mrs Thatcher could speak to people

:12:12.:12:16.

on low incomes. John Major could not speak to them -- John Major could

:12:17.:12:21.

speak to them. But this coalition cannot speak to them. This idea

:12:22.:12:25.

about the reshuffle was that David Cameron wanted more Northern voices,

:12:26.:12:33.

more women, to make it look like it was not a party of seven men. When

:12:34.:12:38.

David Cameron became leader, John Major said, I do not speak very

:12:39.:12:43.

often, but when I do, I will help you, because I think you are good

:12:44.:12:47.

thing and I do not want to be like Margaret Thatcher. But that speech

:12:48.:12:52.

was clearly a lament for the party he believed that David Cameron was

:12:53.:12:56.

going to lead and create, but that isn't happening. And energy prices

:12:57.:13:02.

continue into this coming week. We have the companies going before a

:13:03.:13:07.

select committee. My information is they are sending along the secondary

:13:08.:13:11.

division, not the boss. How can they get along -- get away with that I

:13:12.:13:16.

got the letter through from British Gas this week explaining why my

:13:17.:13:21.

bills are going up, and at no point since this became a story have any

:13:22.:13:25.

of the big companies handled it well. I will have to leave it there.

:13:26.:13:30.

Make sure you pay your bill! That's it for today. The Daily Politics is

:13:31.:13:37.

back on BBC Two tomorrow. I will be back here on BBC One next Sunday.

:13:38.:13:44.

Remember, if it's Sunday, it is The Sunday Politics.

:13:45.:13:51.

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