24/11/2013 Sunday Politics North East and Cumbria

Morning, folks. Welcome to the Sunday Politics.

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

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

Shapps. Five years on from the financial

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

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

City's new financial watchdog. We'll ask the man who runs the

And he used to have a windmill on his roof and talked about giving

hugs to hoodies and huskies. These days, not so much. Has the plan to

And here: 600 jobs go at Middlesbrough Council. We

homelessness and population ships. What is the evidence?

And as always, the political panel that reaches the parts other shows

can only dream of. Janan Ganesh Helen Lewis and Nick Watt. They ll

be tweeting faster than England loses wickets to Australia. Yes

they're really that fast. First, some big news overnight from

Geneva, where Iran has agreed to curb some of its nuclear activities

in return for the partial easing of sanctions. Iran will pause the

enrichment of uranium to weapons grade and America will free up some

funds for Iran to spend. May be up to $10 billion. A more comprehensive

deal is supposed to be done in six months. Here's what President Obama

had to say about this interim agreement. We have pursued intensive

diplomacy, bilaterally with the Iranians, and together with our

partners, the United Kingdom, France, Germany, Russia and China,

as well as the European Union. Today, that diplomacy opened up a

new path towards a world that is more secure, a future in which we

can verify that Iraq and's nuclear programme is peaceful, and that it

cannot build a nuclear weapon. President Obama spoke from the White

House last night. Now the difficulty begins. This is meant to lead to a

full-scale agreement which will effectively end all sanctions, and

end Iran's ability to have a bomb. The early signs are pretty good The

Iranian currency strengthened overnight, which is exactly what the

Iranians wanted. Inflation in Iraq is 40%, so they need a stronger

currency. -- information in Iran. France has played a blinder. It was

there intransigence that led to this. Otherwise, I think the West

would have led to a much softer deal. The question now becomes

implementation. Here, everything hinges on two questions. First, who

is Hassan Rouhani? Is he the Iranians Gorbachev, a serious

reformer, or he's here much more tactical and cynical figure? Or

within Iran, how powerful is he There are military men and

intelligence officials within Iran who may stymie the process. The

Western media concentrate on the fact that Mr Netanyahu and the

Israelis are not happy about this. They don't often mention that the

Arab Gulf states are also very apprehensive about this deal. I read

this morning that the enemies of Qatar and Kuwait went to Saudi king.

-- the MAs row. That is the key thing to watch in the next couple of

weeks. There was a response from Saudi Arabia, but it came from the

Prime Minister of Israel, who said this was a historic mistake. The

United States said there would be no enrichment of uranium to weapons

grade. In the last few minutes, the Iranian Foreign Minister has tweeted

to say that there is an inalienable right -- right to enrich. The key

thing is the most important thing that President Obama said in his

inaugural speech. He reached out to Iran. It failed under President

McKenna jab. Under President Rouhani, there seems to be progress.

There is potentially now what he talked about in that first inaugural

address potentially coming through. In the end, the key issue - and we

don't know the answer - is the supreme leader, not the president.

Will the supreme leader agreed to Iran giving up its ability to create

nuclear weapons? This is the huge ambiguity. Ayatollah Khamenei

authorise the position that President Rouhani took to Geneva.

That doesn't mean he will sign off on every bit of implementation over

the next six months. Even when President Ahmadinejad was president,

he wasn't really President. We in the West have to resort to a kind of

Iranians version of the study of the Kremlin, to work out what is going

on. And the problem the president faces is that if there is any

sign... He can unlock these funds by executive order at the moment, but

if he needs any more, he has to go to Congress. Both the Democrat and

the Republican side have huge scepticism about this. And he has

very low credibility now. There s already been angry noises coming

from quite a lot of senators. It was quite strange to see that photo of

John Kerry hugging Cathy Ashton as if they had survived a ship great

together. John Kerry is clearly feeling very happy. We will keep an

eye on this. It is a fascinating development.

More lurid details about the personal life of the Co-op Bank s

disgraced former chairman, the Reverend Paul Flowers. The links

between Labour, the bank and the wider Co-op movement have caused big

problems for Ed Miliband this week, and the Conservatives have been

revelling in it. But do the Tory allegations - Ed Miliband calls them

"smears" - stack up? Party Chairman Grant Shapps joins us from Hatfield.

Welcome to the programme. When it comes to the Co-op, what are you

accusing Labour of knowing and when? I think the simple thing to say here

is that the Co-op is an important bank. They have obviously got into

difficulty with Reverend flowers, and our primary concern is making

sure that that is properly investigated, and that we understand

what happened at the bank and how somebody like Paul Flowers could

have ended up thing appointed chairman. You wrote to edge Miliband

on Tuesday and asked him what he knew and when. -- you wrote to Ed

Miliband. But by Prime Minister s Questions on Wednesday, David

Cameron claims that you knew that Labour knew about his past all

along. What is the evidence for that? We found out by Wednesday that

he had been a Labour councillor Reverend Flowers, and had been made

to stand down. Certainly, Labour knew about that, but somehow didn't

seem to think that that made him less appropriate to be the chairman

of the Co-op bank. There was no evidence that Mr Miliband or Mr

Balls knew about that. I ask you again, what are you accusing the

Labour leadership of knowing? We know now that he stood down for very

inappropriate images on his computer, apparently. You are

telling me that they didn't know. I am not sure that is clear at all. I

have heard conflicting reports. There is a much bigger argument

about what they knew and when. There was a much bigger issue here. This

morning, Ed Miliband has said that they don't have to answer these

questions and that these smears This is ludicrous. These are

important questions about an important bank, how it ended up

getting into this position, and how a disastrous Britannia -- Italia

deal happen. -- Britannia deal happened. And we need to know how

the bank came off the rails. To be accused of smears for asking the

questions is ridiculous. I am just trying to find out what you are

accusing Labour of. You saying that the Labour leadership knew about the

drug-taking? Sorry, there was some noise here. I don't know what was

known and when. We do know that Labour, the party, certainly knew

about these very difficult circumstances in which he resigned

as a councillor. I think that the Labour Party knew about it. We knew

that Bradford did, but not London. Are you saying that Ed Miliband knew

about the inappropriate material on the Reverend's laptop? It is

certainly the case that Labour knew about it. But did Mr Miliband know

about it, and his predilection for rent boys? He will need to answer

those questions. It is quite proper to ask those questions. Surely,

asking a perfectly legitimate set of questions, not just about that but

about how we have ended up in a situation where this bank has made

loans to Labour for millions of pounds, that bank and the Unite

bank, who is connected to it. And how they made a ?50,000 donation to

Ed Balls' office. Ed Balls says that was nothing to do with Reverend

Flowers, and yet Reverend Flowers said that he personally signed that

off. Lots of questions to answer. David Cameron has already answered

them on Wednesday. He said that you now know that Labour knew about his

past all along. You have not been able to present evidence that

involve Mr Miliband or Mr Balls in that. So until you get that, surely

you should apologise? Hang on. He said that Labour knew about this,

and they did, because he stood down as a councillor. If Ed Miliband

didn't know about that, then why not? This was quite a serious thing

that happened. The wider point is about why it is that when you ask

perfectly legitimate questions about this bank, about the Britannia deal,

and about the background of Mr flowers, why is the response, it is

all smears? There are questions about how Labour failed to deal with

the deficit and how it hasn't done anything to support the welfare

changes, but there is nothing about that. Let us -- lets: To the wider

picture of the Co-operative Bank. Labour wanted the Co-op to take over

the Britannia Building Society, and it was a disaster. Do you accept

that? The government of the day has to be a part of these discussions

for regulatory reason. The government in 2009 - Ed Balls was

very pleased... But you supported that decision. There was a later

deal, potentially, for the Co-op to buy those Lloyds branches. There was

a proper process and it didn't go through just recently. If there had

been a proper process back in 2 09, would the Britannia deal have gone

through? First, you accept that the Tories were in favour of the

Britannia take over. Then your Chancellor Osborne went out of his

way to facilitate the purchase of the Lloyds branches, even though you

had no idea that the Co-op had the management expertise to become a

super medium. Correct? The difference is that that deal didn't

go through. There was a proper process that took place. Let's look

at the process. There was long indications as far back as January

2012 that the Co-op, as a direct result of the Britannia take over

which you will party supported, was unfit to acquire the Lloyds

branches. By January 2012, the Chancellor and the Treasury ignored

the warnings. Wide? In 2009, there was political pressure for the

Britannia to be brought together. Based on the information available,

this was supported, but that process ended up with a very, very

problematic takeover of the Britannia. Wind forward to this

year, and when the same types of issues were being looked at for the

purchase of the Lloyds deal, the proper process was followed, this

time with us in government, and that purchase didn't go through. It is

important that the proper process is followed, and when it was, it

transpired that the deal wasn't going to be done. But it was the

Treasury and the Chancellor who were the cheerleaders for the acquisition

of the Lloyds branches. But there was a warning that the Co-op did not

have enough capital on its balance sheet to make those acquisitions,

but instead of heeding those warnings, your people went to

Brussels to lobby for the requirements to be relaxed - why on

earth did you do that? Our Chancellor went to argue for all of

Rajesh banking, not specifically for the Co-op. He was arguing for the

mutuals to be given a special ruling. The idea was to make sure

that every bank in Britain could have a better deal, particularly the

mutuals, as you say. That is a proper thing for the Chancellor to

be doing. We could go round in circles here, but in the end, there

was not a takeover of the Lloyds branches, that is because we

followed a proper process. Had that same rigorous process been followed

in 2009, the legitimate question to ask is whether the Co-op would have

been -- would have taken over the Britannia. That is a proper question

to ask. It is no good to have the leader of the opposition say, as

soon as you ask any of these questions about anything where there

is a problem for them, they come back with, oh, this is all smears.

There are questions to ask about what the Labour government did, the

debt and the deficit they left the country with, the way they stopped

work from paying in this country. The big question your government has

two answer is, why, by July 201 , when it was clear there was a black

hole in the Co-op's balance sheet, your government re-confirmed the

Co-op as the preferred bidder for Lloyds - why would you do that?

Well, look, the good thing is, we can discuss this until the cows come

home, but there is going to be a proper, full investigation, so we

will find out what happened, all the way back. So, we will be able to get

to the bottom of all of this. Grant Shapps, the only reason the Lloyds

deal did not go ahead was, despite the Treasury cheerleading, when

Lloyds began its due diligence, it found that there was indeed a huge

black hole in the balance sheet and that the Co-op was not fit to take

over its branches. That wasn't you, it wasn't the Government, it was not

the Chancellor, it was Lloyds. You were still cheerleading for the deal

to go ahead... Well, as I say, a proper process was followed, which

did not result in the purchase of the Lloyds branches. At that proper

process been followed with the purchase of the Britannia, under the

previous government... Which you supported. Yes, but it may well be

that under that previous deal, there was a excess political pressure

perhaps put on in order to create that merger, which proved so

disastrous. The Tories facilitated it, Grant Shapps, they allowed it to

go ahead. I have said, we are going to have a proper, independent

review. What I cannot understand is, when you announce a robber,

independent review, the response you get to these serious questions. The

response is, oh, this is a smear. It is crazy. We are trying to answer

the big questions for this country. We have done all of that, and we are

out of time. The Reverend Flowers' chairmanship of the Co-op bank was

approved by the regulator at the time, which no longer exists. It was

swept away by the coalition government in a supposed revolution

in regulation. But will its replacement, the Financial Conduct

Authority, be different? Adam has been to find out. Come with me for a

spin around the Square mile to find out how we regulate our financial

sector, which is almost five times bigger than the country's entire

annual income. First, let's pick up our guide, journalist Iain Martin,

who has just written a book about what went so wrong during the

financial crisis. The FSA was an agency which was established to

supervise the banks on a day-to day basis. The Bank of England was

supposed to have overall responsible at for this to Bolivia the financial

system and the Treasury was supposed to take an interest in all of these

things. The disaster was that it was not anyone's call responsibility, or

main day job, to stay alert as to whether or not the banking system as

a whole was being run in a safe manner. And so this April, a new

system was set up to police the City. Most of the responsibly delays

here, with the Bank of England, and its new Prudential Regulation

Authority. And the Financial Services Authority has been replaced

with the new Financial Conduct Authority. Can we go to the

financial conduct authority, please? Canary Wharf, thank you. Here, it is

all about whether the people in financial services are playing by

the rules, in particular, how they treat their customers. This place

has got new powers, like the ability to ban products it does not like, a

new mandate to promote competition in the market, the concept being,

more competition means a better market, plus the idea that a new

organisation rings a whole new culture. Although these are the old

offices of the FSA, so maybe not quite so new after all. It has also

inherited the case of the Co-op bank and its disgraced former chairman

the Reverend Paul Flowers. The SCA will be part of the investigation

into what happened, which will probably involve looking at its own

conduct. One member of the Parliamentary commission into

banking wonders whether the new regulator, and its new boss, are up

to it. I have always said, it is not the architecture which is the issue,

it is the powers that the regulator has, and today, it does not seem to

me as if there is any increase in that. And with the unfolding scandal

at the Co-op, it feels like the new architecture for regulating the City

is now facing its first big test. And the chief executive of the

Financial Conduct Authority, the SCA, Martin Wheatley, joins me now.

Welcome to The Sunday Politics. The failure of bank regulation was one

of the clearest lessons of the crash in 2008, and yet two years later, in

2010, Paul Flowers is allowed to become chairman of the Co-op - why

have we still not got the regulation right? We have made a lot of changes

since then. We have created a new regulator, as you know. At the time,

we still had a process which allowed somebody to be appointed to a bank

and they would go through a challenge, but in the case of Paul

Flowers, there was no need for an additional challenge when he was

appointed to chairman, because he was already on the board. But going

from being on the board to becoming chairman, that is a big jump, and he

only had one interview? That is why today, it would be different. But

the truth is, that was the system at the time, the system which the FSA

operated. He was challenged, we did challenge him, and we said, you do

not have the right experience, but at the time, we would not have

opposed the appointment. What we needed was additional representation

of the board of people who did have banking experience. You can say that

that was then and this is now, but up until April of this year, it was

still the plan for the Co-op, under Mr Flowers, and despite being

seriously wounded by the Britannia takeover, to take on 632 Lloyds

branches. That was the Co-op's plan. They needed to pass our test

as to whether we thought they were fit to do that, and frankly, they

never passed that test. It was not the regulator that stopped them It

was. We were constantly pushing back, saying, you have not got the

capital, you have no got the systems, and ultimately, they

withdrew, when they could not answer our questions. You were asking the

right questions, I accept that, but all of the time, the politicians on

all sides, they were pushing for it to happen, and I cannot find

anywhere where the regulator said, look, this is just not going to

happen. I cannot comment on what the politicians were doing, but I

continue what we were doing, which was constantly asking the Co-op

have you got the systems in place, have you got the people, have you

got the capital? And they didn't. But it only came to a head when

Lloyds started its own due diligence on the bank, and they discovered

that it was impossible for them to take over the branches, it was not

the regulator... In fairness, what we do is ask the questions, can you

do this deal? And we kept pushing back, and we never frankly got

delivered a business plan which we were happy to approve. Is the SCA

going to launch its own inquiry into what happened? -- the FCA. The

Chancellor has announced what will be a very broad inquiry. There are a

number of specifics which we will be able to look at, relating to events

over the last five years. Could there be a police investigation I

think the police have already announced an investigation. I am

talking about into the handling of the bank. It depends. There might

be, if there is grim low activity, which we do not know yet. You worked

at the FS eight, didn't you? I did. Some of those people who were signed

off on the speedy promotion of Mr Flowers, are they now working

there? Yes, we have some. I came to join the Financial Services

Authority, to lead it into the creation of the new body, the SCA.

We had people who were challenging and they did the job. There was not

a requirement to approve the role as chairman. There was not even a

requirement to interview at that stage. What we did do was to require

that he was interviewed, and that the Co-op should get additional

experience. One of the people from the old organisation, who signed up

on the promotion of Mr Flowers to become chairman is now a

nonexecutive director of the Co op, so how does that work? Welcome he

was a senior adviser to our organisation, one of the people who

made the challenges, and who said, you need more experience on your

board. Subsequently he then went and joined the board. Surely that should

not be allowed, the regulator and the regulated should not be like

that. Well clearly, you need protection, but we have got to get

good people in, and frankly, we want the industry to have good people in

the industry, so there will be some movement between the regulator and

industry. We all wonder whether you have the power or even the

confidence to stand up if you look at all of the really bad bank

decisions recently, politicians were behind them. It was Gordon Brown who

pushed the disastrous merger of Lloyds and RBS. It was Alex Salmond

who egged on RBS to buy the world. All three main parties wanted the

Co-op to buy Britannia, even though they did not know the debt it would

inherit, and all three wanted the Co-op to buy the Lloyds branches -

how do you as a regulator stand up to that little concert party? Well,

that political pressure exists, our job at the end of the day is to do a

relatively technical job and say, does it stack up? And it didn't and

we made that point time and time again to the Co-op board. They did

not have a business case that we could approve. The bodies on left

and right -- the politicians on left and right gave the Co-op special

support. They may have done, but that was not you have made a warning

about these payday lenders, but I think what most people would like to

see is a limit put on the interest they can charge over a period of

time - will you do that? We have got a whole set of powers for payday

lenders. We will bring in some changes from April next year, and we

will bring in further changes as we see necessary. Will you put a limit

on the interest they can charge That is something we can study. You

do not sound too keen on it? Well, there are a lot of changes we need

to make. One change is limiting rollovers, limiting the use of

continuous payment authorities. Simply jumping to one trigger would

be a mistake. Finally, an issue which I think is becoming a growing

concern, because the Government is thinking of subsidising them, 9 %

mortgages are back - should we not be worried about that? I think we

should if the market has the same experiences that we had back in 2007

- oh wait. We are bringing a comprehensive package in under our

mortgage market review, which will change how people lend and will put

affordability back at the heart of lending decisions. -- 2007-08. You

have not had your first big challenge yet, have you? We have

many challenges. It was once called the battle of the

mods and the rockers - the fight between David Cameron-style

modernisers and old-style traditional Tories for the direction

and soul of the Conservative Party. But have the mods given up on

changing the brand? When David Cameron took over in 2005, he

promoted himself as a new Tory leader. He said that hoodies need

more love. He was talking about something called the big society. He

told his party conference that it was time to that sunshine win the

day. There was new emphasis on the environment, and an eye-catching

trip to a Norwegian glacier to see first-hand, supposedly, the effects

of global warming. This week, party modernise and Nick bone has said

that the party is still seen as an old-fashioned monolith and hasn t

done enough to improve its appeal. The Tories have put some reforms

into practice, such as gay marriage, but they have put more into welfare

reform band compassionate conservatism. David Cameron wants

talked about leading the greenest government ever. Downing Street says

that the quote in the Son is not recognised, get rid of the green

crap. At this point in the programme we were expecting to hear from the

Energy and Climate Change Minister, Greg Barker. Unfortunately, he has

pulled out, with Downing Street saying it's for ""family reasons"".

Make of that what you will. However, we won't be deterred. We're still

doing the story, and we're joined by our very own mod and rocker - David

Skelton of the think-tank Renewal, and Conservative MP Peter Bone.

Welcome to you both. I'm glad your family is allowed you to come? David

Skelton, getting rid of all the green crap, or words to that effect,

that David Cameron has been saying. It is just a sign that Tory

modernisation has been quietly buried. I do think that's right

Modernisation is about reaching out to the voters, and the work to do

that is now more relevant than ever. We got the biggest swing since 931,

and the thing is we need to do more to reach out to voters in the North.

We need to reach out to non-white voters, and show that the concerns

of modern Britain and the concerns of ordinary people is something that

we share. And what way will racking up electricity bills with green

levies get you more votes in the North of England? We have to look at

ways to reduce energy bills. The renewable energy directive doesn't

do anything to help cut our emissions, but does decrease energy

bills by ?45 a year. We should renegotiate that. That is a part of

modernisation and doing what ordinarily people want. And old

dinosaurs like you are just holding this modernisation process back I

am very appreciative of covering on this programme. The Tory party has

been reforming itself for more than 150 years. This idea of modern eyes

a is just some invention. We are changing all the time. I'm nice and

cuddly! So you are happy that the party made gay marriage almost a

kind of symbol of its modernisation? Fine Mac the gay marriage was a free

vote. David Cameron was recorded as a rebel there because more Tories

voted against his position than ever before. It was said that this was a

split between the old and young but it actually was a split between

those who were religious and nonreligious. It is a

misinterpretation of what happened. Is a modernisation in retreat? I

think modernisation is an invention. Seven years ago, in my

part of the world, we got three councillors elected, two were 8 and

one was 21. A few months ago, a 25-year-old was chosen to fight

Corby for the Conservative Party. He came from a comprehensive School. He

was one of the youngest. The Tory party is moving on. So you found

three young people? Hang on a three young people? Hang on a

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

modernisation exist? Modernisation is about watering our appeal and

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

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

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

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

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

party been against making poorer Tory party... When has the Tory

people better off? Or against better schools? Do you think Mrs Thatcher

those elections? The problem we have those elections? The problem we have

at the moment is that UKIP has grown-up. If we could get all of

those people who vote UKIP to vote for us, we would get 47% of the

vote. We don't need to worry about voters on the left. We need to worry

about the voters in the north, those people who haven't voted for us for

decades. Having an EU Referendum Bill is going to get people to

decades. Having an EU Referendum vote. We have to reach out to

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

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

concept is not going to work. We concept is not going to work. We

need something that generally appeals to low and middle-income

genuinely care about the life genuinely care about the life

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

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

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

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

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

euros, will be returned in Corby there. -- the 25-year-old. Whether

you are moderniser or traditionalist, people, particularly

in the North, see you as a bunch of rich men. And rich southerners. You

are bunch of rich southerners. We need to do more to show that we are

building on lifting the poorest out of the tax. We need to build more

houses. There is a perception that the leadership at the moment is

rich, and public school educated. What we have to do is get more

rich, and public school educated. people from state education into the

top. You are going the other way at top. You are going the other way at

the moment. That is a fair criticism. Modernisers also say

that. I went to a combo hedge of school as well. -- do a

comprehensive school. We need to show that we are standing up for low

income. Thank Q, both of you. You are watching the Sunday Politics.

Coming up in Hello and welcome to your local

Politics Show. As more council jobs are lost in Middlesbrough, we ask if

the region's private companies could create enough new jobs to fill the

gap. And the disabled travellers who have to be pushed across the tracks

in the gap between Intercity trains. A Cumbrian MP says it is frightening

and unacceptable. Labour MP for Newcastle Central and Sunderland

Conservative councillor, welcome to you both. Let's stop the economy.

Signs are there is a recovery under way and that is official, but how

true is it in our region? A survey was carried out of 100 firms. Six

out of ten said they are feeling more confident in their own business

and the wider economy, with half reporting growth in export revenues.

Is that optimism reflected in your community? Well, it is absolutely

great that the economy, despite this disastrous handling, is recovering

up to 2008 levels, because that is where we are getting too, but in my

constituency and everybody outside of the Cabinet macro, the cost of

living crisis continues and it is getting harder, and people are not

feeling that recovery, that sense of optimism in growth which the

Chancellor and David Cameron like to talk so much about. Robert Oliver,

what is the situation in Sunderland? It is certainly getting better and

it is very important that the North East improves and catches up. In

Sunderland, more than 12,000 private`sector jobs have been

created and that is excellent. Mainly around the investment and

success of Nissan. It will take time for the private sector to catch up

but those are the incentives that the Government is trying to give at

the moment. We are going to go into more detail about that now, because

we have had more positive jobs news for Nestle in York, Hitachi and a

few others. But can we create enough of those jobs to replace the tens of

thousands lost in the public sector? How have we been doing?

Protesters outside Middlesbrough town Hall this week. 20 of sound,

quite a lot of fury. Because the council has announced 600 job

losses, the latest in a whole raft of public sector cuts across the

region. `` plenty of sound. So where are the jobs to replace them? Partly

here. This firm in County Durham makes Craft supplies and also has

bases in California and Holland. The boss, Sara, started it from her

university bedroom and now employs many workers, some of which are from

the public sector. It is a totally different pace working in the

private sector from the public sector, which is what I think many

of those staff have found, but it is so rewarding where you are not a

tiny cog in a big wheel. Smaller companies need to not be frightened

of taking on staff and instead of looking at the expense that comes

with staff, look at the value staff can bring in. While this firm is

taking on workers, many others are being axed in the region's public

sector, so what do the numbers show? Since 2008, the region has lost

42,000 public sector jobs. During the same period, 34,000

private`sector jobs had been created, but that still leaves a

shortfall of 8000 jobs. This week, Sara spoke to 150 other

entrepreneurs at a conference in Darlington. These people have all

been successful but how quickly can they create new jobs? Entrepreneurs

are creating new businesses and employing more people but sometimes

there is a time delay between creating businesses and then jobs.

People coming from the public sector are extremely skilled and what they

have to do is look at the skills that they have as well and see if it

wasn't on the agenda immediately, whether they can become

entrepreneurs. Which is exactly what Marjorie did. She has set up her own

company providing similar services to her job working in

anti`bullying. But now that is under threat. Some of them say, we would

love to have your services in school but they don't have the money. It is

very disappointing because you have to put effort into setting up a

company and there are costs involved in that. I will be very sad if it

comes to the point where I'd do have to close down the service. Yeah.

Unions are concerned as well that the quality of some public sector

jobs. What we're seeing is an increase in zero hours contracts and

we know there is in excess of 1 million of those being used. And

four in five of those private`sector jobs being created are paying low

wages but what we want our good quality jobs with decent pay so

people can live and not just exist. More job losses mean more protests

but away from the placards and slogans, jobs are being created in

the region. It is a fluctuating picture of losses and gains,

sometimes hard to follow, but with the fate of our economy at stake.

Economic growth is only just getting going but the private sector has

already replaced many of the public sector jobs that have been lost. It

is not the doomsday situation Labour would have had us believe? It is not

a doomsday scenario but if you look at the detail, a lot of those

private`sector jobs are public sector jobs that have been

outsourced to the private sector. And many of those zero hours. It is

not more efficient. It undermines security and doesn't allow people to

plan for their families and their working lives and for their bill

payments. But, remember, the important thing for the North East

is that what this Chancellor promised was an export led,

rebalanced recovery, a manufacturing recovery plane to our strengths.

What we have instead is a recovery fuelled by a housing boom where the

service sector is leading and that is why the jobs that need to be

created are not being created in the North East and we still have the

highest level of unemployment in the country. Roger Oliver, it is a fake

boom and not creating the jobs we need? I would be more positive and

say that the private sector is creating a lot of valuable and

long`term jobs. We have the ports outside of Sunderland and time doing

very well. And the motor sector as well. Those are creating very

important jobs. They should rebalance the economy. But the

reality is that we have lost more jobs than we have gained and there

are hundreds, thousands more jobs to go and we are not out of the woods.

The loss in the public sector has come quite quickly because of the

reduction in finances to councils. That has happened and it will take

time for the private sector to catch up with that, but actually the

figures you have shown show that the private sector is catching up quite

well. But what about the quality of these jobs? Is the TUC says, low

paid, part`time, zero hours contracts? I think that is also to

do with the change in the workforce globally. That some people might

prefer part`time jobs or prefer to have that than no employment. And

with a zero hours contracts, they can be good or bad. They have been

around for some time and a lot of Labour councillors use the hours

contracts. But some people might want to have one of those. Yes,

think there is an issue where people would like more job security and

that will come with strength in the economy. `` I think. But there is

more to be done on that even though it will come. And as the economy

takes off, they will be better off, those people, than sitting on the

dole? I think it is very important not to failed to condemn the

negative aspects of zero hours contracts. But when the Government

stood back and waited to allow the private sector to create those jobs,

they didn't have any plans for the North East, and we have people

waiting for a signal in support in terms of the energy sector, the

automotive sector... They are getting support. They are getting

national insurer 's, cuts to their tax... You need to be making profits

before a cut taxes helps you! What makes a difference right at the

beginning is manufacturing allowances, which this Government

slashed, and also business support, which the Labour government would

bring in four small businesses. Things may be getting better, I

think we would all agree to that. But people might get left behind and

the North East will be left in the position further on where it is

lacking. Think the big thing we need to address to make sure that the gap

is narrowed its skills. You saw that in the Adonis report. That is one of

the reasons we don't do as well as the rest of the country. A lot of

jobs... I mean, I get employers say they have jobs for people but they

just don't have the skills, so we must address that through education.

And we will be discussing education in weeks to come. A Cumbrian MP has

called for urgent action to make railway station is fully accessible

for disabled people. Passengers in wheelchairs have to be pushed across

the West Coast Main Line in areas and councillors have said it is

unacceptable. Ministers say they are making ?100 million available for

improvements between now and 2019 but many say the improvements are

taking just too long. Penrith in North Cumbria. A busy

station on the West Coast Main Line but not one that many disabled

people can use. Elaine from Appleby has arthritis and cannot even walk

short distances. Penrith is her nearest major station but she cannot

use it. I am fairly sad, actually, because with it being my main

station to get to London, I would like to use it. But it's not the

going, it is the coming back. If you are heading south from Penrith

access is fine. There are no steps between the car park and platform

number one. But travelling from platform North, trains depart from

platform number two. Getting down their impulse going down a steep set

of stairs, along an underpass and then up more stairs on the other

side. If you cannot do the stairs, you have to get someone to help you

across the tracks over what is known as a barrow crossing. The station

Manager applets it is not a good situation. It can be quite

intimidating. `` the Station Manager ad mitts. But mobility scooters

aren't even allowed over the tracks so Elaine travels all the way to

Carlisle to catch trains, adding 20 miles to each journey. People

without disabilities don't realise how hard it is and it does make you

feel that really you should be able to cope and you can't cope. And they

are just leaving you behind. Across the region, eight other stations

still have barrow crossings, including Workington, Flynn beat,

Appleby and Dent. Bardon Mill and Hexham are not set free and not

being upgraded till next March. After a long campaign, Penrith has

been nominated for funding from the Department for Transport to get

lifts installed. But a decision will not be made until next April so the

lobbying continues. We are going to get the money from somewhere. If we

don't get it from the Government, we will get it from Virgin, and if not

there, the transport Department. But this is the only station that

doesn't have a disabled lift across this bit of the network. Penrith's

success was said by one minister not to be guaranteed but it is a strong

candidate, as they are due ?100 million for improvements. While this

carries on, disabled passengers will have to cross the tracks or use

other stations. We now have Baroness Tony Grey

Thompson with us. What does this seem like to you? How familiar is

it? It is incredibly familiar. Most people experience difficulty

somewhere along the way, whether it is ramps not being used on buses or

actually accessing trains. And one of the things that will happen with

the change welfare reform and potentially up to 100,000 people

losing mobility cars, it is not just about wheelchair users, it is about

parents with young families, elderly people and making the public

transport system open to everyone, and at the moment, it is not. The

Government acknowledges this problem and that is why it is putting this

money in. It is just a question of patience. They can't do everything

at once. I think disabled people have been patient enough! It is

important to recognise that these changes are expensive. 100 million

sounds like a huge amount of money but it still won't make the rail

network totally accessible. But it is about having a social life, a

work life, being able to spend money and be a full member of society. If

other people had to take a 20 mile the tour, I think that would do an

awful lot more to encourage these changes to be made. `` detoured.

Shouldn't it be companies like Virgin to put the money in rather

than always taxpayers? Because it would benefit them? I am sure as

part of their contracts, actually what you have to do at train

stations is not part of that. I'd think it is just about taking a bit

of a step back and thinking about who we want to be using public

transport and making it better for everyone. And Baroness Cramer has

offered to come on a train journey with me so I can show her some of

the things disabled people face every day because I think unless

they see it, they probably don't realise that you might be able to

get to the platform but you also still often need help to get on and

off the trains and there aren't accessible toilets. So it is a wider

issue than putting in some ramps and a lift. It is scandalous that

disabled people, people with mobility problems, older people or

those with children have to struggle with trains? You have this split

between railway lines and stations and trains and that has to be got

over so the money is put in to make sure every railway station is

accessible. Is it being done quickly enough? I don't think so. I would

say that if you look at what we are spending money on, this is a

priority over some of the other things we are doing. It is a result

of the fragmentation of the network through the network privatisation

and I have voice been proud that the metro system that was put in, the

product of an integrated transport system, was the first light Railway

accessible to disabled people. It is a disgrace that in this day and age

in the region disabled people cannot travel as they need to and it is

also an economic barrier for them. And we really do need to make sure

that in terms of European legislation, the accessibility to

public transport is right for disabled people and we need to make

sure the rail industry comes together as much as it can in order

to put this right. What is the one thing that could be done to make it

easier for disabled people to travel as freely as possible? Is it an

awareness when any improvements are made that disabled people's needs

have to be taken into account? I think so. It is in terms of if there

is any new build going on, that is easier to do rather than

retrospectively coming in to make changes. But huge amount could be

done to help staff coming in so disabled people can come and get on

a train and they don't have to book, and making sure they are

helped that the other end. Most of the complaints are received about

train companies are those that leave disabled people on board, so there

are lots of things we can do that don't have to cost a massive amount

of. Thank you very much. Calls to set up a new political

party for the North East and the local council is trying to did our

street lights. Just some of the local news making the headlines.

There's a need for a new political party in the North East along the

lines of the Scottish and Welsh nationalists, according to the

Labour MP Helston Dawson. We need real power in the hands of the North

East people and the only way to do that that eye can see is to have a

political party dedicated to that cause. `` I can. The leader of

Durham Council is to take over as chair of the North East leadership

board. It is a first step to getting all the councils to work together on

economic growth. The Sunderland MP has attacked the Prime Minister's

record on childcare. I have been disappointed that over 500 Sure

Start Centres have closed since 2010. And finally, the lumiere

festival lit up the skies and no street lights across parts of County

Durham are to be dimmed after tempi at night and 45,000 streetlights

will also be replaced. `` dimmed after 10pm.

Robert Oliver, let's talk more about childcare. Labour has been on the

offensive accusing David Cameron of breaking his promises. If you want

more people in work, women in particular, making childcare more

expensive and harder to find is hardly going to help, is it? This

has been a problem of a reduction in number of childminders and

increasing costs that has gone on for a number of years. I think one

of the biggest problems really is supplied. There is a lack of supply

and that is pushing up the cost. One of the things that can be done there

is to broaden the supply a little bit by trying to allow schools to

provide more childcare opportunities and to also make the training of

childminders much easier. The reality is that the government has

put more money into childcare since 2010. Labour quadruple but funding

for child care and since 2010, the number of childcare places has gone

down. `` labour quadrupled. The provision has gone down and there is

greater demand but fewer places, and over 500 Sure Start Centres, the

centres that David Cameron personally promised to support and

to save, they have closed and closing at the rate of three a week.

We will come back to that because there is a dispute on the figures.

Labour, as understand, want to fund extra childcare but you're going to

do it with this bank tax, which seems to pay for everything! That

has been the accusation! Whereas we have been incredibly careful in

terms of pricing every single proposal we have put forward, which

is more than this Government has done, for what it is saying it is

going to do after 2015, and we have called the office of the budget was

once ability to look at manifesto promises. `` the Office for Budget

Responsibility. So we want to have a wraparound childcare from 8am to 6pm

and then childcare going up as basic provision for those under three.

Those centres for those who need childcare the most and they are

closing. I think to be fair to those centres, it is best to say there is

some improvement in children's outcomes because they were extremely

expensive and the outcomes are relatively small. So it is located

close them? That is the choice councils. They are not being told to

close them. They are having a reduced budget and within that they

have to make the choices. But the problem with Sure Start Centres is

that they don't focus enough on the really poor people who need them the

most. They are often used by people who could afford childcare

privately. Very briefly? In Newcastle let me tell you that the

really poor people who need them the most really do appreciate that

provision through Sure Start Centres and that work is particularly

important in Newcastle. That is it from us. Next week we are turning

the spotlight on education, asking why the performance of our secondary

schools that's behind most other parts of the country. `` is behind.

schools that's behind most other those people who want to cycle. We

will be returning to this one. Thank you.

A little bit of history was made at Prime Minister's Questions this

week. A teensy tiny bit. It wasn't David Cameron accusing one MP of

taking "mind-altering substances" - they're always accusing each other

of doing that. No, it was the first time a Prime Minister used a live

tweet sent from someone watching the session as ammunition at the

dispatch box. Let's have a look We have had some interesting

interventions from front edges past and present. I hope I can break

records by explaining that a tweet has just come in from Tony McNulty,

the former Labour security minister, saying that the public are

desperate for a PM in waiting who speaks for them, not a Leader of the

Opposition in dodging in partisan Westminster Village knock about So

I would stay up with the tweets if you want to get on the right side of

this one! We are working on how the Prime Minister managed to get that

wheat in the first place. What did you think when you saw it being read

out? I was certainly watching the Daily Politics. I almost fell off my

chair! It was quite astonishing He didn't answer the question - he

didn't do that the whole time. But I stand by what the tweets said. I

have tweeted for a long time on PMQs. Normally I am praising Ed

Miliband to the hilt, but no one announces that in Parliament!

Because the Prime Minister picked up on what you said, it unleashed some

attacks on you from the Labour side. It did, minor attacks from some very

junior people. Most people were supportive of what I said. They took

issue with the notion of not doing it until 12:30pm, when it wasn't

available for the other side to use. Instant history, and instantly

forgettable, I would say. Do you think you have started a bit of a

trend? I hope not, because the dumbing down of PMQs is already on

its way. Most people tweet like mad through PMQs! Is a measure of how

post-modern we have become, we have journalists tweeting about someone

talking about a tweet. That is the level of British politics. I am

horrified by this development. The whole of modern life has become

about observing people -- people observing themselves doing things.

Do we know what happened? Somebody is monitoring the tweets on behalf

of the Prime Minister or the Tory party. They see Tony's tweet. They

then print it out and give it to him? There was a suggestion that

Michael Goves had spotted it, but Craig Oliver from the BBC had this

great sort of... Craig Oliver was holding up his iPad to take pictures

of the Prime Minister, which he then tweeted, from the Prime Minister.

People will now be tweeting in the hope that they will be quoted by the

Prime Minister, or the Leader of the Opposition. I wasn't doing that I'm

just talking about the monster you have unleashed! I hope it dies a

miserable death. I think Tony is a good analysis -- a good analyst of

PMQs on Twitter. Moving onto the Co-op. You were a Co-op-backed MP,

white you? I was a Co-op party member. There are two issues here

about the Co-op and the Labour Party. All the new music suggests

that the Co-op will now have to start pulling back from lending or

donating to the Labour Party, which, at a time when Mr Miliband is going

through changes that are going to cut of the union funds, it seems

quite dangerous. There are three things going on. There's the

relationship that the party has politically with the Co-op party,

there is the commercial relationship you referred to, and then there is

this enquiry into the comings and goings of Flowers and everybody

else. The Tories, at their peril, will mix the three up. There's a lot

of things going on with a bang. Labour has some issues around

funding generally, and they are potentially exacerbated by the Co-op

issue. The Labour Party gets soft loans from the Co-op bank, and it

gets donations. ?800,000 last year. Ed Balls got about ?50,000 for his

private office. You get the feeling, given the state of the Co-operative

Bank now, that that money could dry up. We will see. There's lots of

speculation in the papers today At the core, the relationship between

the Co-op party and the Labour Party is a proud one, and a legitimate

one. I don't think others always understand that. Here is an even

bigger issue. Is it not possible that the Co-op bank will cease to

exist in any meaningful way as a Co-op bank? Is the bane out means it

is 70% owned -- the bail out means that it is 70% owned, or 35% going

to a hedge fund, I think I read Yes, there is a move from the

mutualism of the Co-op. But don t confuse the Co-op bank with the

Co-op Group. Others have done that. I haven't. Here's the rub. The soft

loans that Labour gets. They got ?1.2 million from this. And 2.4

million. They are secured against future union membership fees of the

party. What is Mr Miliband doing? He is trying to end that? You have this

very difficult confluence of events, which is, could these wonderful soft

loans that Labour has had from the Co-op, could they be going? And

these union reforms, where Ed Miliband is trying to create a link

between individuals and donations to the Labour Party... Clearly, there

could be real financial difficulties here. The government needs to be

careful, because George Osborne launched one of his classic

blunderbuss operations this week, which is that the Labour Party is to

blame for Paul Flowers' private life. No, it's not. And that all the

problems, essentially... Look at what George Osborne was doing in

Europe. He was trying to change the capital requirement rules that would

make it easier for the Co-op to take over Lloyd's. If there is to be a

big investigation, George Osborne needs to be careful of what he

wishes for. This is another example of the Westminster consensus. All of

the Westminster parties were in favour of the Britannia takeover.

This is how the Co-op ended up with all this toxic rubbish on its

balance sheet. All the major parties were in favour of going to get the

Lloyds branches. The Tories tried to outdo Labour in being more

pro-Co-op. There was nobody in Westminster saying, hold on, this

doesn't work. It is like the financial bubble all over again

Everyone was in favour of that at the time. I think there is no

evidence so far that the storm is cutting through to the average

voter. If I were Ed Miliband, I would let it die a natural death. I

would not write to an editorial column for a national newspaper on a

Sunday. That keeps the issue alive, and it makes him look oversensitive

and much better at dishing it out than taking it. I agree about that.

The Labour press team tweeted this week saying that it was a new low

for the times. And this was re-tweeted by Ed Miliband. It isn't

a great press attitude. It is very Moni. Bill Clinton went out there

and fought and made the case. So did Tony Blair. If you just say, they

are being horrible to us, it looks pathetic. And it will cut through on

Osborne and the financial dimensional is, not political. I

shall tweet that later! While we have been talking, Mr Miliband has

been on Desert Island Discs. He might still be on it. Let's have a

listen to what he had to say. # Take on me, take me on.

# And threw it all, she offers me protection.

# A lot of love and affection. # Whether I'm right or wrong #.

# Je Ne Regrette Rien. #. Obviously, that was the music that

Ed Miliband chose. Who thought - you would have thought he would

choose Norman Lamont's theme tune! He chose Jerusalem... He has no

classical background at all. He had no Beethoven, no Elgar. David

Cameron had Mendelssohn. And Ernie, the fastest Notman in the West. --

fastest milkman. Tony Blair chose the theme tune to a movie. Tony

Blair's list was chosen by young staffers in his office. It

absolutely was. Tony Blair's list was chosen by staff. The Ed Miliband

this was clearly chosen by himself, because who would allow politician

to go out there and say that they like Aha. I am the same age as Ed

Miliband, and of course he likes Aha. That was the tumour was played

in the 80s. Sweet Caroline. It is Angels by Robbie Williams. I was

14-year-old girl when that came out. I thought Angels was the staple of

hen nights and chucking out time in pubs. The really good thing about

his list is that the Smiths to not appear. The Smiths were all over

David Cameron's list. The absolutely miserable music of Morris he was not

there. What was his luxury? And Indian takeaway! Again, chosen for

political reasons. I would agree with the panel about Aha, but I

would expect -- I would respect his right to choose. Have you been on

Desert Island Discs? I have. It took me three weeks to choose the music.

It was the most difficult decision in my life. What was the most

embarrassing thing you chose? I didn't choose anything embarrassing.

I chose Beethoven, Elgar, and some proper modern jazz. Anything from

the modern era? Pet Shop Boys. That's all for today. The Daily

Politics will be on BBC Two at lunchtime every day next week, and

we'll be back here on BBC One at 11am next week. My luxury, by the

way, was a wind-up radio! Remember, if it's Sunday, it's the Sunday

Politics.