24/11/2013 Sunday Politics North East and Cumbria


Andrew Neil and Richard Moss present the latest political stories, with Conservative chairman Grant Shapps and a look at Ed Miliband's choices for Desert Island Discs.

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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




Andrew Neil and Richard Moss present the latest political stories, with Conservative chairman Grant Shapps and a look at Ed Miliband's choices for Desert Island Discs on Radio 4.

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