16/03/2014 Sunday Politics North East and Cumbria


16/03/2014

Richard Moss with the latest political news, interviews and debate. Andrew Neil looks ahead to the budget and speaks to UKIP leader Nigel Farage.


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Transcript


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

:00:37.:00:44.

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

:00:45.:00:47.

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

:00:48.:00:49.

Ed Balls says millions of people top story.

:00:50.:00:52.

Ed Balls says millions of people aren't feeling any benefit from the

:00:53.:00:55.

recovery. We'll discuss the economy with big political beasts from

:00:56.:00:56.

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

:00:57.:01:04.

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

:01:05.:01:07.

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

:01:08.:01:08.

In the North East and Cumbrha. means no chance

:01:09.:01:15.

In the North East and Cumbrha. Labour and the unions changds are

:01:16.:01:19.

coming but are members convhnced? And tackling youth unemploylent `

:01:20.:01:21.

the County Durham scheme getting young people

:01:22.:01:23.

of cycling. The three areas of London getting a cash boost to try

:01:24.:01:24.

something different. And with me as always our top

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political panel - Nick Watt, Helen Lewis and Janan Ganesh. They'll be

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tweeting their thoughts using the hashtag #bbcsp throughout the

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programme. So, just three months after his last major financial

:01:44.:01:46.

statement, George Osborne will be at the despatch box again on Wednesday,

:01:47.:01:52.

delivering his 2014 Budget. The Chancellor has already previewed his

:01:53.:01:54.

own speech, pledging to build what he calls a "resilient economy". The

:01:55.:02:05.

message I will give in the Budget is the economic plan is working but the

:02:06.:02:09.

job is far from done. We need to build resilient economy which means

:02:10.:02:12.

addressing the long-term weaknesses in Britain that we don't export

:02:13.:02:16.

enough, invest enough, build enough, make enough. Those are the things I

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will address because we want Britain to earn its way in the world. George

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Osborne's opposite number, Ed Balls, has also been talking ahead of the

:02:25.:02:27.

Budget. He says not everyone is feeling the benefit of the economic

:02:28.:02:30.

recovery, and again attacked the Government's decision to reduce the

:02:31.:02:36.

top rate of tax from 50 to 45%. George Osborne is only ever tough

:02:37.:02:40.

when he's having a go at the week and the voiceless. Labour is willing

:02:41.:02:43.

to face up to people on the highest incomes and say, I'm sorry,

:02:44.:02:47.

justifying a big tax cut at this time is not fair. We will take away

:02:48.:02:53.

the winter allowance from the richer pensioners, and I think that's the

:02:54.:02:57.

right thing to do. George Osborne might agree, but he's not allowed to

:02:58.:03:03.

say so. That was the Chancellor and the shadow chancellor. Janan, it

:03:04.:03:06.

seems like we are in a race against time. No one argues that the

:03:07.:03:10.

recovery is not under way, in fact it looks quite strong after a long

:03:11.:03:14.

wait, but will it feed through to the living standards of ordinary

:03:15.:03:19.

people in time for the May election? They only have 14 months to do it.

:03:20.:03:24.

The big economic variable is business investment. Even during the

:03:25.:03:28.

downturn, businesses hoarded a lot of cash. The question is, are they

:03:29.:03:32.

confident enough to release that into investment and wages? Taking on

:03:33.:03:37.

new people, giving them higher pay settlements. That could make the

:03:38.:03:40.

difference and the country will feel more prosperous and this time next

:03:41.:03:46.

year. But come to think of it, it strikes me, that how anticipated it

:03:47.:03:50.

is, it's the least talked about Budget for many years. I think that

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is because the economy has settled down a bit, but also because people

:03:54.:03:58.

have got used to the idea that there is no such thing as a giveaway.

:03:59.:04:02.

Anything that is a tax cut will be taken away as a tax rise or spending

:04:03.:04:07.

cut. That's true during the good times but during fiscal

:04:08.:04:10.

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

:04:11.:04:17.

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

:04:18.:04:21.

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

:04:22.:04:23.

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

:04:24.:04:29.

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

:04:30.:04:35.

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

:04:36.:04:40.

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

:04:41.:04:45.

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

:04:46.:04:50.

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

:04:51.:04:55.

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

:04:56.:04:59.

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

:05:00.:05:06.

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

:05:07.:05:13.

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

:05:14.:05:16.

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

:05:17.:05:22.

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

:05:23.:05:28.

George Osborne announcing the rays in the personal allowance will go

:05:29.:05:32.

up, saying it might go up to 10 750 from next year, and Conservative MPs

:05:33.:05:40.

say that that's OK but we need to think about the middle voters.

:05:41.:05:44.

People are saying the economy is recovering but no one is feeling it

:05:45.:05:47.

in their pocket. These are people snagged in at a 40p tax rate. The

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Tories are saying these are our people and we have to get to them.

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He has given the Lib Dems more than they could have hoped for on raising

:05:57.:06:02.

the threshold. Why is he not saying we have done a bit for you, now we

:06:03.:06:06.

have to look after our people and get some of these people out of that

:06:07.:06:13.

40% bracket? Partly because the Lib Dems have asked for it so

:06:14.:06:15.

insistently behind-the-scenes. Somebody from the Treasury this week

:06:16.:06:19.

told me that these debates behind the scenes between the Lib Dems and

:06:20.:06:22.

Tories are incredibly tenacious and get more so every year. The Lib Dems

:06:23.:06:27.

have been insistent about going further on the threshold. The second

:06:28.:06:32.

reason is that the Tories think the issue can work for them in the next

:06:33.:06:37.

election. They can take the credit. If they enthusiastically going to

:06:38.:06:41.

?12,000 and make it a manifesto pledge, they can claim ownership of

:06:42.:06:45.

the policy. The Liberal Democrats want to take it to 12,500, which

:06:46.:06:50.

means you are getting into minimum wage territory. It's incredibly

:06:51.:06:54.

expensive and the Tories are saying that maybe you would be looking at

:06:55.:07:00.

the 40p rate. The Tories have played as well. There have been authorised

:07:01.:07:04.

briefings about the 40p rate, and Cameron and Osborne have said that

:07:05.:07:07.

their priority was helping the lowest paid which is a useful

:07:08.:07:10.

statement to make and it appeals to the UKIP voters who are the

:07:11.:07:16.

blue-collar workers. And we are right, the economy will determine

:07:17.:07:20.

the next election? You assume so. It was ever that is. It didn't in 992

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

:07:25.:07:34.

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

:07:35.:07:37.

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

:07:38.:07:39.

certainly clarified matters. UKIP say it just shows the mainstream

:07:40.:07:44.

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

:07:45.:07:47.

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

:07:48.:07:50.

securing a referendum. Giles Dilnot reports.

:07:51.:07:54.

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

:07:55.:07:58.

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

:07:59.:08:02.

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

:08:03.:08:05.

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

:08:06.:08:09.

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

:08:10.:08:21.

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

:08:22.:08:24.

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

:08:25.:08:30.

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

:08:31.:08:33.

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

:08:34.:08:37.

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

:08:38.:08:47.

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

:08:48.:08:49.

membership: the largest rebellion against a Tory prime minister over

:08:50.:08:53.

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

:08:54.:09:03.

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

:09:04.:09:05.

coalition Government including selfie-conciously-pro European Lib

:09:06.:09:08.

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

:09:09.:09:11.

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

:09:12.:09:14.

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

:09:15.:09:17.

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

:09:18.:09:25.

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

:09:26.:09:31.

like UKIP, we want a referendum but only a Conservative government can

:09:32.:09:36.

deliver it because most suffer largest would say it is possible in

:09:37.:09:41.

the first past the post system to have a UKIP government --

:09:42.:09:50.

sophologists. And then it's easy for as to say that if a UKIP vote lets

:09:51.:09:57.

in a Conservative government, then they won't hold a referendum. UKIP

:09:58.:10:03.

seem undaunted by the clarifications of the other parties, campaigning

:10:04.:10:07.

like the rest but with a "tell it how it is, just saying what you re

:10:08.:10:10.

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

:10:11.:10:16.

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

:10:17.:10:21.

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

:10:22.:10:27.

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

:10:28.:10:31.

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

:10:32.:10:38.

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

:10:39.:10:43.

were quick to capitalise on the announcements, saying only the

:10:44.:10:48.

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

:10:49.:10:54.

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

:10:55.:10:58.

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

:10:59.:11:02.

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

:11:03.:11:06.

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

:11:07.:11:09.

how they voted before is complicated, and what dent they

:11:10.:11:12.

might make on Conservative and Labour votes in 2015 is trickier

:11:13.:11:14.

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

:11:15.:11:23.

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

:11:24.:11:26.

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

:11:27.:11:30.

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

:11:31.:11:35.

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

:11:36.:11:38.

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

:11:39.:11:43.

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

:11:44.:11:49.

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

:11:50.:11:52.

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

:11:53.:11:56.

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

:11:57.:11:59.

any support the other parties have previously enjoyed.

:12:00.:12:02.

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

:12:03.:12:05.

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

:12:06.:12:22.

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

:12:23.:12:25.

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

:12:26.:12:29.

way between now and the next election, and Conservative party

:12:30.:12:33.

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

:12:34.:12:36.

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

:12:37.:12:40.

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

:12:41.:12:44.

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

:12:45.:12:47.

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

:12:48.:12:51.

that Labour will match the Conservative pledge by the next

:12:52.:12:55.

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

:12:56.:13:00.

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

:13:01.:13:03.

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

:13:04.:13:10.

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

:13:11.:13:14.

Remember, two thirds of our voters would never vote Conservative

:13:15.:13:17.

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

:13:18.:13:22.

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

:13:23.:13:25.

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

:13:26.:13:31.

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

:13:32.:13:37.

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

:13:38.:13:40.

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

:13:41.:13:44.

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

:13:45.:13:47.

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

:13:48.:13:52.

situation in key marginals, especially where all three parties

:13:53.:13:56.

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

:13:57.:14:00.

the local elections and the European elections, there are target

:14:01.:14:07.

constituencies where UKIP has a reasonably good chance of winning a

:14:08.:14:10.

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

:14:11.:14:17.

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

:14:18.:14:20.

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

:14:21.:14:27.

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

:14:28.:14:31.

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

:14:32.:14:33.

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

:14:34.:14:37.

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

:14:38.:14:41.

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

:14:42.:14:46.

minority Ed Miliband government it means no referendum. Labour and the

:14:47.:14:49.

Liberal Democrats are now at one on the matter. The next election is in

:14:50.:14:54.

a few weeks time, the European elections. What happens in those

:14:55.:14:58.

elections will likely change the party stands and position on a

:14:59.:15:02.

referendum. The fact that Ed Miliband has said this means, for

:15:03.:15:06.

us, our big target on the 22nd of May will be the Labour voters in the

:15:07.:15:10.

Midlands and northern cities, and if we do hammer into that boat and we

:15:11.:15:14.

are able to beat Labour on the day, there's a good chance of their

:15:15.:15:23.

policy changing. One poll this morning suggests Labour is close to

:15:24.:15:31.

you at 28, the Conservatives down at 21, the Lib Dems down at eight. You

:15:32.:15:38.

are taking votes from the Conservatives and the Liberal

:15:39.:15:41.

Democrats. We are certainly taking votes from the Lib Dems but that is

:15:42.:15:49.

comparing the poll with one year ago when I don't think most people knew

:15:50.:15:54.

what the question really was. You seem to be in an impossible position

:15:55.:15:59.

because the better you do in a general election, the less chance

:16:00.:16:04.

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

:16:05.:16:10.

third of our voters are Conservatives. When we have polled

:16:11.:16:16.

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

:16:17.:16:20.

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

:16:21.:16:25.

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

:16:26.:16:30.

Conservative under any circumstances so the arithmetic does not suggest

:16:31.:16:35.

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

:16:36.:16:39.

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

:16:40.:16:44.

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

:16:45.:16:50.

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

:16:51.:16:59.

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

:17:00.:17:04.

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

:17:05.:17:10.

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

:17:11.:17:15.

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

:17:16.:17:19.

national television on the alternatives of the European Union

:17:20.:17:24.

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

:17:25.:17:37.

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

:17:38.:17:43.

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

:17:44.:17:48.

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

:17:49.:17:54.

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

:17:55.:17:58.

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

:17:59.:18:04.

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

:18:05.:18:10.

want to show why that is nonsense. Who do you think is playing you in

:18:11.:18:16.

their mock debates? They probably went to the pub and found someone!

:18:17.:18:23.

We will see. You have promised to do whatever it takes to fund your

:18:24.:18:27.

European election campaign, how much has been given so far? Just give it

:18:28.:18:34.

a few weeks and you will see what Paul is planning to do. He has made

:18:35.:18:40.

a substantial investment in the campaign already. How much? I'm not

:18:41.:18:49.

answering that for now. We are well on our way to a properly funded

:18:50.:18:53.

campaign and our big target will be the big cities and the working vote

:18:54.:19:00.

in those communities. Your deputy chairman Neil Hamilton is another

:19:01.:19:03.

former Tory, he says so far we haven't seen the colour of his

:19:04.:19:09.

money. Exactly two weeks ago, and things have changed since then. Mr

:19:10.:19:15.

Sykes has written a cheque since then? Yes. This morning's papers

:19:16.:19:25.

saying you will be asking MEPs to contribute ?50,000 each, is that

:19:26.:19:32.

true? Over the next five years, yes. Not for the European campaign. So

:19:33.:19:39.

lack of money will not be an excuse. We will have a properly funded

:19:40.:19:44.

campaign. How we raise the kind of money needed to fund the general

:19:45.:19:48.

election afterwards is another question. What is UKIP's policy on

:19:49.:19:59.

paying family members? We don't encourage it and I didn't employ any

:20:00.:20:04.

family member for years. My wife ended up doing the job and paid for

:20:05.:20:10.

the first seven years of my job She is paid now? Until May, then she

:20:11.:20:17.

comes off the payroll am which leaves me with a huge problem. In

:20:18.:20:25.

2004 you said, UKIP MEPs will not employ wives and there will be no

:20:26.:20:31.

exceptions. An exception was made because I became leader of the

:20:32.:20:35.

National party as well as a leader of the group in European

:20:36.:20:39.

Parliament. Things do change in life, and you can criticise me for

:20:40.:20:43.

whatever you like, but I cannot be criticised for not having a big

:20:44.:20:49.

enough workload. No, but you didn't employ your wife when you had told

:20:50.:20:58.

others not to do it your party. Nobody else in my party has a big

:20:59.:21:01.

job in Europe and the UK. We made the exception for this because of

:21:02.:21:06.

very unusual circumstances. It also looks like there was a monetary

:21:07.:21:11.

calculation. Listen to this clip from a BBC documentary in 2000. It

:21:12.:21:18.

is a good job. I worked it out because so much of what you get is

:21:19.:21:24.

after tax that if you used the secretarial allowances to pay your

:21:25.:21:27.

wife on top of the other games you can play, I reckon this job in

:21:28.:21:35.

Stirling term is over a quarter of ?1 million a year. That is what you

:21:36.:21:38.

would need to earn working for Goldman Sachs or someone like that.

:21:39.:21:45.

I agree with that. More importantly the way you really make money in the

:21:46.:21:48.

European Parliament is being their five days a week, because you sign

:21:49.:21:53.

in every day, you get 300 euros every day, and that is how people

:21:54.:21:59.

maxed out. The criticism of me is that I am not there enough so

:22:00.:22:04.

whatever good or bad I have done in the European Parliament, financial

:22:05.:22:08.

gain has not been one of the benefits. There have been

:22:09.:22:12.

allegations of you also employing a former mistress on the same European

:22:13.:22:18.

Parliamentary allowance, you deny that? I am very upset with the BBC

:22:19.:22:23.

coverage of this. The ten o'clock news run this as a story without

:22:24.:22:28.

explaining that that allegation was made using Parliamentary privilege

:22:29.:22:32.

by somebody on bail facing serious fraud charges. I thought that was

:22:33.:22:40.

pretty poor. You have a chance to do that and you deny you have employed

:22:41.:22:48.

a former mistress? Yes, but if you look at many of the things said over

:22:49.:22:52.

the last week, I think it is becoming pretty clear to voters that

:22:53.:22:56.

the establishment are becoming terrified of UKIP and they will use

:22:57.:23:03.

anything they can find to do us down in public. Is an MEP employs his

:23:04.:23:10.

wife and his former mistress, that would be resigning matter, wouldn't

:23:11.:23:16.

it? Yes, particularly if the assumption was that money was being

:23:17.:23:20.

taped for work but was not being done. Who do you think is behind

:23:21.:23:27.

these stories? It is all about negative, it is all about attacks,

:23:28.:23:33.

but I don't think it is actually going to work because so much of

:23:34.:23:37.

what has been said in the last week is nonsense. A reputable daily

:23:38.:23:42.

newspaper said I shouldn't be trusted because I had stored six

:23:43.:23:47.

times for the Conservative party, I have never even stored in a local

:23:48.:23:51.

council election. I think if you keep kicking an underdog, it will

:23:52.:23:56.

make the British people rally around us. Is it the Conservatives? Yes,

:23:57.:24:07.

and the idea that all of our voters are retired colonels is simply not

:24:08.:24:12.

true. We get some voters from the Labour side as well. Would you

:24:13.:24:22.

consider standing in a Labour seat if you are so sure you are getting

:24:23.:24:27.

Labour votes? Yes, but the key for UKIP is that it has to be marginal.

:24:28.:24:36.

Just for your own future, if you fail to win a single soul -- single

:24:37.:24:43.

seat in the general election, if Ed Miliband fails to win an outright

:24:44.:24:48.

majority, will you stand down as UKIP leader? I would think within

:24:49.:24:53.

about 12 hours, yes. I will have failed, I got into politics not

:24:54.:24:58.

because I wanted a career in politics, far from it. I did it

:24:59.:25:04.

because I don't think this European entanglement is right for our

:25:05.:25:07.

country. I think a lot of people have woken up to the idea we have

:25:08.:25:12.

lost control of our borders and now is the moment for UKIP to achieve

:25:13.:25:19.

what it set out to do. Will UKIP continue without you if you stand

:25:20.:25:24.

down? Of course it will. I know that everyone says it is a one-man band

:25:25.:25:34.

but it is far from that. We have had some painful moments, getting rid of

:25:35.:25:36.

old UKIP, new UKIP is more professional, less angry and it is

:25:37.:25:40.

going places. Nigel Farage, thank you for being with us.

:25:41.:25:46.

So, what else should we be looking out for in Wednesday's Budget

:25:47.:25:49.

statement? We've compiled a Sunday Politics guide to the Chancellor's

:25:50.:25:51.

likely announcements. Eyes down everyone, it's time for a

:25:52.:25:54.

bit of budget bingo. Let's see what we will get from the man who lives

:25:55.:25:58.

at legs 11. Despite some good news on the economy, George Osborne says

:25:59.:26:01.

that this will be a Budget of hard truths with more pain ahead in order

:26:02.:26:05.

to get the public finances back under control. But many in the

:26:06.:26:07.

Conservative party, including the former chancellor Norman Lamont

:26:08.:26:10.

want Mr Osborne to help the middle classes by doing something about the

:26:11.:26:13.

4.4 million people who fall into the 40% bracket. Around one million more

:26:14.:26:20.

people pay tax at that rate compared to 2010 because the higher tax

:26:21.:26:23.

threshold hasn't increased in line with inflation. Mr Osborne has

:26:24.:26:28.

indicated he might tackle the issue in the next Conservative manifesto,

:26:29.:26:32.

but for now he is focused on helping the low paid. It's likely we will

:26:33.:26:37.

see another increase in the amount you can earn before being taxed

:26:38.:26:43.

perhaps up another ?500 to ?10, 00. The Chancellor is going to flesh out

:26:44.:26:46.

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

:26:47.:26:49.

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

:26:50.:27:06.

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

:27:07.:27:10.

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

:27:11.:27:13.

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

:27:14.:27:15.

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

:27:16.:27:18.

by the former Conservative chancellor Norman Lamont, in Salford

:27:19.:27:20.

by the former Labour Cabinet minister Hazel Blears, and in

:27:21.:27:23.

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

:27:24.:27:26.

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

:27:27.:27:33.

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

:27:34.:27:43.

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

:27:44.:27:48.

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

:27:49.:27:53.

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

:27:54.:27:58.

forever and forever increasing the personal allowance and not

:27:59.:28:01.

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

:28:02.:28:07.

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

:28:08.:28:10.

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

:28:11.:28:16.

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

:28:17.:28:23.

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

:28:24.:28:30.

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

:28:31.:28:34.

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

:28:35.:28:40.

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

:28:41.:28:54.

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

:28:55.:29:00.

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

:29:01.:29:03.

raise the threshold for national insurance contributions, which is

:29:04.:29:10.

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

:29:11.:29:19.

threshold? We are concentrating on raising the lower threshold because

:29:20.:29:25.

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

:29:26.:29:31.

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

:29:32.:29:34.

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

:29:35.:29:39.

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

:29:40.:29:44.

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

:29:45.:29:48.

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

:29:49.:29:53.

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

:29:54.:29:59.

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

:30:00.:30:05.

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

:30:06.:30:13.

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

:30:14.:30:18.

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

:30:19.:30:23.

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

:30:24.:30:30.

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

:30:31.:30:36.

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

:30:37.:30:40.

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

:30:41.:30:45.

?10,000, we hope eventually 12, 00, and that means only people on very

:30:46.:30:50.

low wages. If you opt out of national insurance, you're saying to

:30:51.:30:53.

people that you make no contribution to the welfare system, so there is a

:30:54.:30:59.

general principle that people should participate and paying, and also

:31:00.:31:04.

claim when they need something out. We thought raising the threshold was

:31:05.:31:07.

simple and effective at a time of economic austerity and the right way

:31:08.:31:10.

to deliver a helpful support to welcoming people. -- working people.

:31:11.:31:17.

With the Labour Party continue to raise the threshold, or do they

:31:18.:31:21.

think there is a case that there are too many people being dragged into

:31:22.:31:27.

the 40p tax bracket? If Norman Lamont thinks this is the right time

:31:28.:31:30.

to benefit people who are reasonably well off rather than those who are

:31:31.:31:34.

struggling to make ends meet, then genuinely, I say it respectfully, I

:31:35.:31:38.

don't think he's living in the world the rest of us are. Most working

:31:39.:31:42.

people have seen their wages effectively reduced by about ?1 00

:31:43.:31:46.

because they have been frozen, so the right thing is to help people on

:31:47.:31:53.

modest incomes. I also understand that if the 40% threshold went up,

:31:54.:31:56.

the people who would benefit the most, as ever, are the people who

:31:57.:32:01.

are really well off, not the people in the middle. The Conservatives

:32:02.:32:05.

have already reduced the 50p tax on people over ?150,000 a year, and we

:32:06.:32:10.

have to concentrate on the people going out to work, doing their best

:32:11.:32:14.

to bring their children up and have a decent life and need a bit of

:32:15.:32:17.

help. I think raising the threshold is a good thing. We would bring back

:32:18.:32:21.

the 10p tax, which we should never have abolished, and do things with

:32:22.:32:28.

regard to childcare. At the moment, childcare costs the average family

:32:29.:32:31.

as much as their mortgage, for goodness sake. We would give 25

:32:32.:32:35.

hours free childcare for youngsters over three and four years old. That

:32:36.:32:38.

would be a massive boost the working families. We are talking about

:32:39.:32:46.

nurses, tube drivers, warrant officers in the army. There are many

:32:47.:32:50.

people who are not well off but have been squeezed in the way everybody

:32:51.:32:55.

has been squeezed and they are finding it continuing. I am stunned

:32:56.:32:59.

by Malcolm's argument where everybody should pay something so

:33:00.:33:02.

you should not take people out of national insurance, but the

:33:03.:33:05.

principle doesn't apply to income tax. You can stand that argument on

:33:06.:33:11.

its head and apply it to income tax. Most people don't see a difference

:33:12.:33:14.

between income tax and national insurance, it's the same thing to

:33:15.:33:19.

most people. It is true that it isn't really an insurance fund and

:33:20.:33:22.

there is an argument from merging both of them. But we have

:33:23.:33:28.

concentrated on a simple tax proposition. Norman is ignoring the

:33:29.:33:34.

fact the people on the 40% rate have benefited by the raising of the

:33:35.:33:38.

personal allowance. To say they have been squeezed is unfair. The

:33:39.:33:41.

calculation is that an ordinary taxpayer will be ?700 better off at

:33:42.:33:47.

the current threshold, and about ?500 better off at the higher rate.

:33:48.:33:51.

It is misleading to say the better off we'll be paying more. I agree

:33:52.:33:56.

with Hazel, if you go to the 40 rate, it's the higher earners who

:33:57.:33:59.

benefit the most, and we won't do that when the economy is not where

:34:00.:34:04.

it was before the crash. How much will the lower paid be better off if

:34:05.:34:07.

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

:34:08.:34:14.

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

:34:15.:34:20.

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

:34:21.:34:23.

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

:34:24.:34:27.

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

:34:28.:34:30.

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

:34:31.:34:35.

with childcare payments. It is a guaranteed to get young people back

:34:36.:34:39.

discussion about that, and we have discussion about that, and we have

:34:40.:34:41.

nearly 1 million people who have been out of work for six months or

:34:42.:34:45.

more, and as a country we need to do something to help that. 350,000

:34:46.:34:53.

full-time students, so it is a misleading figure. It is not a

:34:54.:34:55.

million including full-time students. All parties do this. It

:34:56.:35:02.

sounds to me, Malcolm Bruce, you have more in common with the Labour

:35:03.:35:05.

Party than you do with the Conservatives. You want an annual

:35:06.:35:09.

levy on houses over ?2 million, so does Labour. A lot of your members

:35:10.:35:13.

want to scrap the so-called bedroom tax and so does labour. You think

:35:14.:35:15.

want to scrap the so-called bedroom every teacher should have a teaching

:35:16.:35:20.

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

:35:21.:35:24.

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

:35:25.:35:30.

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

:35:31.:35:33.

in order and we have grave reservations about the Labour Party

:35:34.:35:34.

promises. But they followed your reservations about the Labour Party

:35:35.:35:44.

spending plans in the first year. The point we are making is we can

:35:45.:35:48.

make a fairer society and stronger economy if you keep the public

:35:49.:35:51.

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

:35:52.:35:55.

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

:35:56.:35:58.

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

:35:59.:36:04.

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

:36:05.:36:11.

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

:36:12.:36:16.

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

:36:17.:36:20.

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

:36:21.:36:23.

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

:36:24.:36:28.

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

:36:29.:36:33.

main thing is to get the deficit main thing is to get the deficit

:36:34.:36:37.

down. My argument is is that you have an adjustment in tax rates it

:36:38.:36:40.

should be shared between the allowances and the higher rate, but

:36:41.:36:45.

I don't think that the progress on the deficit is something we can give

:36:46.:36:51.

up on. This is still a very long way to go. We're only halfway through.

:36:52.:36:58.

Hazel, does it make sense to borrow for tax cuts? I am reluctant to do

:36:59.:37:01.

this, but I agree with both Norman and Malcolm. Malcolm Bruce wants to

:37:02.:37:08.

borrow for tax cuts. We absolutely need to get the deficit down and get

:37:09.:37:12.

finances on a strong footing. But we also have to think about having some

:37:13.:37:16.

spending in the system that in the longer run saves us money. We all

:37:17.:37:21.

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

:37:22.:37:25.

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

:37:26.:37:30.

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

:37:31.:37:34.

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

:37:35.:37:40.

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

:37:41.:37:43.

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

:37:44.:37:45.

goodbye to viewers in Scotland who watching the Sunday Politics. We say

:37:46.:37:49.

leave us now for Sunday Politics Scotland. Coming up here in 20

:37:50.:37:52.

minutes, Frances O'Grady, the General Secretary of the TUC, joins

:37:53.:38:02.

Hello and a very warm welcole to the bit of Sunday Politics lovingly made

:38:03.:38:08.

right here in Cumbria and the North East. This week the region still has

:38:09.:38:11.

some of the highest youth unemployment figures in Britain

:38:12.:38:15.

We're hearing from the County Durham factory now totally devoted to

:38:16.:38:18.

getting young people back to work and asking if it could offer the

:38:19.:38:23.

answer. And Labour had its regional conference this weekend as the party

:38:24.:38:27.

shakes up its union links. But are Labour's rank and file convhnced?

:38:28.:38:30.

With me to chew all that ovdr, the Labour MP for Sedgefield, Phil

:38:31.:38:33.

Wilson and the Conservative group leader in Northumberland, Pdter

:38:34.:38:37.

Jackson. Welcome to you both. But first tributes have been paid to

:38:38.:38:40.

the veteran left winger, former Cabinet minister, and polithcal

:38:41.:38:43.

legend, Tony Benn, who died at the end of last week, aged 88. The

:38:44.:38:48.

former MP was a regular Spe`ker at the Durham Miners' Gala and in 006

:38:49.:38:52.

he spoke of the changes he'd seen at the event.

:38:53.:38:57.

When I first came 44 years `go there were 126 pits in the Durham

:38:58.:39:02.

coalfield. Now, of course, they ve closed all the pits. But thd

:39:03.:39:07.

traditions go on. You see the whole of human life, you see kids playing,

:39:08.:39:13.

you see disabled miners. It an amazing event. For me, when I come,

:39:14.:39:20.

it recharges my batteries. H love it.

:39:21.:39:23.

Tony Benn speaking eight ye`rs ago. Phil Wilson, people have talked

:39:24.:39:26.

about their respect, even their love for Tony Benn. Let's face it when

:39:27.:39:30.

the Labour Party was not thd one you or your predecessor, his Labour

:39:31.:39:34.

Party, sorry was not one yot or your predecessor, Tony Blair,

:39:35.:39:36.

particularly wanted. In fact, both of you tried to move the party away

:39:37.:39:40.

from that. How should we thhnk of him? He was a man who had rdally

:39:41.:39:46.

deep convictions. He saw hilself as a traditional socialist. He saw

:39:47.:39:51.

himself as a man of principle and I don't think you can take th`t away

:39:52.:39:55.

from him. You don't necessarily have to agree with him to accept that.

:39:56.:39:59.

When you look back at his hhstory, I think he first got elected hn 1 50.

:40:00.:40:03.

He was involved in politics for over 50 years. I remember the first time

:40:04.:40:07.

I ever saw him at a Durham Liners Gala, back in the 1970s. Yot listen

:40:08.:40:13.

to what he had to say and hd always had something interesting to say. He

:40:14.:40:16.

always said it in a very interesting way as well. He was a towerhng

:40:17.:40:20.

figure in the Labour movement. That doesn't mean to say you havd to

:40:21.:40:23.

agree with everything he sahd but you can't take it away from him that

:40:24.:40:27.

he was a towering figure in the Labour movement.

:40:28.:40:29.

Peter Jackson, quite few Conservatives have talked about

:40:30.:40:32.

their respect for Tony Benn, even though they were political opponents

:40:33.:40:36.

of his. Why do you think th`t is? I think it's because he was a man of

:40:37.:40:40.

ideas and politics is all about ideas and whether they challenge the

:40:41.:40:43.

way that you think at the moment, or not. It all adds to it. Most

:40:44.:40:50.

politicians tend to follow the crowd too much these days, I feel. They

:40:51.:40:56.

don't bring in ideas from the outside. That's why we respdct him.

:40:57.:41:03.

He wasn't afraid to stand up for what he thought. Can Labour learn

:41:04.:41:07.

anything from that, then? In some ways you can see him as a political

:41:08.:41:11.

failure but could they learn anything from his connection with

:41:12.:41:14.

the public, I suppose? I thhnk what he reminds me of, as well, hs what

:41:15.:41:18.

John Prescott once said abott traditional principles in a modern

:41:19.:41:21.

setting. I think what Tony Benn offered was those tradition`l

:41:22.:41:24.

principles and what we had to do was provide him with a modern sdtting,

:41:25.:41:30.

which I don't think perhaps he did. But what Tony Blair did and Gordon

:41:31.:41:34.

Brown did and everybody elsd was create that environment that we did

:41:35.:41:36.

have a modern setting for traditional principles. OK, we'll

:41:37.:41:40.

have to leave it there. Now it's one of the region's biggest

:41:41.:41:43.

economic challenges ahead of this week's Budget. How do we get young

:41:44.:41:47.

people off the dole and into work? The North East has the highdst youth

:41:48.:41:50.

unemployment figures outsidd London with a quarter of 16 to 24`xear`olds

:41:51.:41:54.

in the region out of work. While the Coalition has its Work Programme and

:41:55.:41:57.

Labour its Jobs Guarantee, one County Durham charity reckons it's

:41:58.:42:01.

found a great way to get yotng people into work.

:42:02.:42:07.

Meet Bill Marley. For 30 ye`rs he has worked in manufacturing. This

:42:08.:42:13.

factory is a little different. He bought these premises in Peterlee to

:42:14.:42:16.

fulfil a mission. After spending time working with deprived xoung

:42:17.:42:19.

people, he realised he wantdd to spend the rest of his working life

:42:20.:42:23.

helping others get a job. I saw so many people on Jobcentre Plts that

:42:24.:42:28.

had thrown the towel in, basically. They were stuck in the benefits

:42:29.:42:33.

system. Unable to get out. They didn't have the confidence

:42:34.:42:37.

themselves. I wanted to show these youngsters, and their parents, that

:42:38.:42:42.

there is another life out there But the Employability Trust is not a

:42:43.:42:45.

fantasy workplace. The young people work on contracts for the lhkes of

:42:46.:42:49.

B and WH Smith for a minilum of eight weeks. Many do it voltntarily

:42:50.:42:53.

and no pay. Knowing they ard getting invaluable experience. I don't want

:42:54.:42:59.

to sit back and be on benefhts. I do actually want to get out thdre, get

:43:00.:43:04.

a job. I need something to do each day. Everyone needs experience but

:43:05.:43:09.

how do you get experience? There is no where to get it from. Th`t's what

:43:10.:43:17.

this place offers. They havd the experience to go to other places and

:43:18.:43:21.

get a job. I was applying for about 20 jobs each day and getting

:43:22.:43:25.

nowhere. When the Jobcentre sent us here, I was over the moon. H was

:43:26.:43:31.

going somewhere in my life. It is delivering. After 20 people sent

:43:32.:43:42.

from the Jobcentre so far, 07 have found full`time work. Melissa is one

:43:43.:43:47.

success stories. She has moved on from the factory to a placelent at

:43:48.:43:51.

this electronics firm, her life transformed.

:43:52.:44:02.

I don't want to ever go on the dole. I want to always be in work. To be

:44:03.:44:09.

able to have the money in mx pocket and not have to rely on othdr people

:44:10.:44:14.

to give us money, or rely on me mam to provide for us. I can brhng the

:44:15.:44:18.

money in myself and do what I want with my money and not have to ask

:44:19.:44:22.

other people for it. Obviously I'm getting through my driving lessons,

:44:23.:44:25.

my driving test and getting myself a car. I've got the freedom now. This

:44:26.:44:28.

is not a government funded project. It's not part of any scheme. In fact

:44:29.:44:32.

it's different from the initiative the Coalition and Labour have

:44:33.:44:34.

designed. Under the governmdnt existing youth contract, employees

:44:35.:44:38.

are offered up to ?2,275 to take on young person that has been on the

:44:39.:44:39.

dole more than six months. They have never been into a factory.

:44:40.:45:01.

Industry the giving these gtys for free. However, more than 50,000

:45:02.:45:15.

under 25 is still the polithcians should take a Well with me hs Bill

:45:16.:45:24.

Marley, the man who set up that charity in Peterlee.

:45:25.:45:27.

We hear a lot about people choosing to stay on benefits but you seem to

:45:28.:45:31.

have found a group of peopld who want to get off them. Why do think

:45:32.:45:34.

your approach is distinctivd, perhaps from what might be on offer

:45:35.:45:38.

elsewhere? My approach at the Employability Trust, people who are

:45:39.:45:41.

working with me, volunteered to come to work with me. No one has forced

:45:42.:45:45.

them. They want a job. They want to take every advantage of comhng to

:45:46.:45:48.

the Employability Trust. Will that give them the experience? It has. It

:45:49.:45:52.

has demonstrated that we can give them the opportunity, open the doors

:45:53.:45:55.

in industry because they have come through our doors over the last

:45:56.:46:01.

eight weeks. If I was taking a devil's advocate view, you `re

:46:02.:46:05.

working, as you say, with pdople who are keen. The challenge, I suppose,

:46:06.:46:10.

is those people who are not that keen. What can you do for them?

:46:11.:46:14.

You're right, the challenge is to understand, you would have two pots

:46:15.:46:19.

of individuals. One, the guxs who come to us who are motivated and

:46:20.:46:23.

want to change their lives, the others who are not motivated. We

:46:24.:46:30.

need to understand. They nedd to understand the world of work. One of

:46:31.:46:34.

the advantages if they come to work. This is why we buy into indtstry.

:46:35.:46:37.

The general managers, the supervisors, the apprentices, even

:46:38.:46:40.

the shop floor get those involved in selling the place of work and what

:46:41.:46:47.

the benefits are. The type of cars that they will be able to afford,

:46:48.:46:51.

the holidays they can go on to. They don't know because unfortun`tely in

:46:52.:46:56.

my area, a generation of parents who have never ever worked. Who is

:46:57.:47:02.

telling these youngsters? It is our job. You clearly don't belidve the

:47:03.:47:05.

answer is just to send people to work? No, certainly not. As I said

:47:06.:47:09.

on the clip, a recipe for dhsaster. If you imagine those individuals

:47:10.:47:13.

going in on the first day, ht very frightening to the individu`ls. One

:47:14.:47:20.

of the young guys at the Employability Trust, his synergy is,

:47:21.:47:24.

it's like going into a swimling pool and jumping in the deep end. The

:47:25.:47:31.

Employability Trust, we takd you into the shallow end then btild the

:47:32.:47:35.

confidence up, allow you a period of time to swim to the deep end. Thank

:47:36.:47:39.

you very much. Peter Jackson, one in four xoung

:47:40.:47:42.

people in the north`east on the dole. You need as many ideas as you

:47:43.:47:48.

can get. I gather that Bill Marley did go and see a minister. He didn't

:47:49.:47:52.

get that much buy`in from it? We will have to do something about

:47:53.:47:57.

that. At first I must say this is a shining light to all of us `nd a

:47:58.:48:01.

wake`up call about what can be done to help young people. I think we

:48:02.:48:05.

have to recognise there has been a fall in long`term youth unelployment

:48:06.:48:07.

in the north`east. Some 3,000 people in the last three years. Thdre has

:48:08.:48:13.

been some success countrywide. Not enough success? No, it is a very

:48:14.:48:18.

serious problem. We are doing three things in particular as a

:48:19.:48:20.

Conservative government at the moment. The first thing is the

:48:21.:48:24.

apprenticeship scheme is behng rolled out and we have twicd as many

:48:25.:48:28.

apprenticeships in this country as we had three years ago. In fact 1.5

:48:29.:48:35.

million people, young peopld... I will have to hurry you. We're

:48:36.:48:44.

talking about the youth contract already which is to subsidise.. It

:48:45.:48:47.

has missed its target? It is having some success. The third thing is the

:48:48.:48:52.

work programme. The young pdople who are unemployed for more than nine

:48:53.:48:56.

months into the work progralme and they get individual things from

:48:57.:48:58.

charities and private organisations, to get them hnto

:48:59.:49:04.

work. The concern here is your jobs guarantee will land employers with a

:49:05.:49:07.

whole bunch of people who don't really want to be there. Thdy are

:49:08.:49:11.

under threat of benefit sanction. That is not a solution to youth

:49:12.:49:14.

unemployment, is it? The nulber of young people that have been out of

:49:15.:49:18.

work 12 months has doubled from 2010, from 20,000 to 50,000 now I

:49:19.:49:21.

think what Bill's organisathon is doing is highly commendable but that

:49:22.:49:25.

is a lot of people we have to get back into work. I think there

:49:26.:49:30.

probably will have to be an element of compulsion. Bill has alrdady said

:49:31.:49:35.

the people who come to him `re the people who want work. Our elployees

:49:36.:49:43.

really going to want to takd on people who are only there under

:49:44.:49:46.

sufferance? Probably it's something that we have to work on. We realised

:49:47.:49:51.

this. You are making this jobs guarantee, you haven't got `n

:49:52.:49:55.

employer signed up? At the loment we haven't. What we're doing at the

:49:56.:49:58.

moment is setting up a commhssion of businesses to look at how wd will

:49:59.:50:02.

implement this in 12 months time. It will be over the lifetime, the

:50:03.:50:06.

lifetime of a Parliament. Wd have already got a scheme set up under

:50:07.:50:10.

the Welsh assembly which is a Labour run assembly which ensures 80% of

:50:11.:50:14.

the people who go on to the scheme end up with job. It has a lot going

:50:15.:50:20.

for it. It is something that is working in Wales. It's got private

:50:21.:50:24.

sector employers involved. H'm sure we can do it nationally arotnd the

:50:25.:50:30.

UK. What young people to sax, they're guaranteed eight six month

:50:31.:50:34.

job with an 80% chance of a job that is better than what yot are

:50:35.:50:41.

offering? It is not `` it is another promise, they're not saying whether

:50:42.:50:47.

is coming from. I Inc the rdcord of the last Labour government was

:50:48.:50:51.

continually rising youth employment and we are tackling that as a

:50:52.:50:54.

Conservative government with a small degree of success but we ard putting

:50:55.:51:00.

a lot of effort in. The mondy question is what people havd

:51:01.:51:05.

raised? The bankers bonus and tax relief on pensions for highdr tax

:51:06.:51:10.

payers. What we are seeing hs the money from those two sources will go

:51:11.:51:14.

on this scheme and nothing dlse As far as people saying about the last

:51:15.:51:20.

Labour government, in 1997 there were 60,000 apprenticeships, by the

:51:21.:51:26.

time we left there was 250,000. The ones you mention, the vast lajority

:51:27.:51:31.

of people over 25. I think xou have to go along way before you can much

:51:32.:51:36.

what the liver `` what the Labour government did. You cannot `rgue

:51:37.:51:40.

Jones boom long`term youth `nd employment increased. Bill Laley,

:51:41.:51:46.

are you convinced by what you have heard? Not a great deal of response

:51:47.:51:54.

from a minister? Unfortunatdly not. We plod up on. We will get there

:51:55.:51:59.

with or without support. It would make your job a lot easier? It

:52:00.:52:04.

certainly would. Thank you very much.

:52:05.:52:07.

Now delegates gathered for Labour's regional conference in Newton

:52:08.:52:10.

Aycliffe this weekend, with plenty to chat about over coffee, or even

:52:11.:52:13.

the beer and sandwiches if they re old school. This month partx members

:52:14.:52:16.

across the country voted for a shake`up in Labour's union links,

:52:17.:52:19.

something Ed Miliband calls the biggest change in his party for over

:52:20.:52:25.

100 years. Feature Labour ldaders will be chosen by one member, one

:52:26.:52:29.

vote. Scrapping a system whdre one third of the leadership votd.

:52:30.:52:33.

Rank`and`file trade unions hs will not automatically come Labotr

:52:34.:52:38.

members they will have to opt in to pay if you can feed and become an

:52:39.:52:41.

affiliated supporter. There will be new spending limit. Designed to spot

:52:42.:52:47.

some outspending others to win nominations. Those changes come at a

:52:48.:52:52.

time of falling Labour membdrship. The party has lost 5000 members over

:52:53.:52:59.

the last four years. They vhsited links go back to the part is very

:53:00.:53:02.

beginning. We bid to beat three members in the region with different

:53:03.:53:04.

views on those changes. My name is Martin Wright. I'm 4 ,

:53:05.:53:25.

been a member of the Labour Party for probably about ten years. I live

:53:26.:53:29.

in Gateshead. I'm a member of the Unite union. My feeling is kind of

:53:30.:53:34.

mixed emotions, to be honest. I worry that the timing is potentially

:53:35.:53:37.

dangerous and that's just lhke a personal view, I think. We `re just

:53:38.:53:42.

over a year out from the General Election. But I do feel that

:53:43.:53:48.

something has to change. I've described in the past the

:53:49.:53:50.

relationship between the unhon movement and the party as bding like

:53:51.:53:53.

parent and child relationshhp because the Labour Party was born

:53:54.:53:59.

out of the trade union movelent It's like the child has grown up and

:54:00.:54:03.

left home and is no longer listening to the parents. I don't think it'll

:54:04.:54:08.

ever break, as in sever. I don't think we'll ever get divorcdd in

:54:09.:54:09.

that respect. I'm Rachel Wright, I'm 32 and I live

:54:10.:54:18.

in Newcastle. I've been a mdmber of the party on and off for about 4

:54:19.:54:22.

years and I'm a member of the GMB union. I think any political party

:54:23.:54:27.

to survive needs to reform. It needs to move with the times and with the

:54:28.:54:32.

population. They are planning on capping the amount that can be spent

:54:33.:54:35.

on somebody's selection process and also the time it takes to do the

:54:36.:54:40.

selection. At the moment I think because there is no cap on ht,

:54:41.:54:44.

somebody with personal funds can outspend somebody else and H think

:54:45.:54:49.

that would probably put people off. It would certainly put myself off if

:54:50.:54:53.

I got to the point where I decided I maybe wanted to run. I just wouldn't

:54:54.:54:57.

have the money to compete whth somebody and putting a reasonable

:54:58.:55:00.

cap on it actually opens up the selection process to people who at

:55:01.:55:04.

the moment feel that they c`n't enter because of financial reasons.

:55:05.:55:09.

I'm Daniel Maguire. I'm 33. I live in Newcastle`upon`Tyne. I'vd been a

:55:10.:55:17.

member of the Labour for about 8 years. I'm also a member of Unite.

:55:18.:55:21.

The difficulty is these reforms have gone through. Although they've been

:55:22.:55:23.

watered down from what was originally proposed is they open the

:55:24.:55:27.

door to a move towards breaking the link, the collective link bdtween

:55:28.:55:30.

the trade unions and the Labour Party. That would really concern me

:55:31.:55:35.

because the Labour Party is the trade unions. The two are

:55:36.:55:41.

inseparable. I'm not one of these people that threatens to resign when

:55:42.:55:44.

policy doesn't go the way that I want it to. But if the fund`mental

:55:45.:55:50.

structure of the party, the fundamental nature of what we are

:55:51.:55:54.

changes. Ie the link with the trade unions goes, then we are no longer

:55:55.:55:58.

the Labour Party. It would be very difficult for me to continud as a

:55:59.:55:59.

member of that party. You help draw up these changes. Was

:56:00.:56:16.

there anything that needed fixing. At think what these proposals and

:56:17.:56:21.

these reforms have done is `ctually maintained the link with thd trade

:56:22.:56:25.

unions but also ensured that the link is no longer just with the

:56:26.:56:29.

trade union but the trade unionists. It allows us to track more

:56:30.:56:32.

individual trade unionists hnto the Labour party `` attract. We haven't

:56:33.:56:40.

just done that, we've also opened it up as far as the leadership contest

:56:41.:56:46.

is concerned, to registered supporters. It is a broad`b`sed

:56:47.:56:52.

party we will achieve over the next few years. It will not happdn

:56:53.:56:55.

overnight. David Phillips and Christopher Kelly who did the

:56:56.:57:00.

independent reports of the opting in scheme will take five years to

:57:01.:57:06.

implement. It is broadening the relationship we have. The fhrst time

:57:07.:57:11.

we have those things with trade unionists. I guess you will be

:57:12.:57:16.

cynical. Your membership is not booming? This is recognising the

:57:17.:57:23.

problem of over Dominus of the unions in the Labour Party. `` over

:57:24.:57:33.

dominance. Some unions response `` sponsor a lot of MPs. Critics would

:57:34.:57:40.

say we know with unions are coming from, we do not know where the big

:57:41.:57:46.

business dinners come from? The Conservative party has a widespread

:57:47.:57:51.

of donors. We do not go to one or two, there are thousands. The

:57:52.:58:00.

affiliation fees is made up of 3 levy made from millions of working

:58:01.:58:07.

the ball. 36 funding of the Tory party comes from a handful of large

:58:08.:58:12.

donors who are special access to the prime minister. The reason these

:58:13.:58:20.

have got through it was not that consensus. The biggest nations we

:58:21.:58:28.

get from the Labour Party is from its membership and not necessarily

:58:29.:58:31.

the trade unions. What thesd proposals have done, and thdse

:58:32.:58:36.

reforms, has opened up over party. It is now one member, one vote to

:58:37.:58:40.

elect the leader of the Labour Party. It has affected the way that

:58:41.:58:44.

the relationship with the trade unions will be going on. Thd link

:58:45.:58:50.

will still be there. Peter Jackson, just to show the

:58:51.:58:54.

Labour Party is more democr`tic than the Conservatives? It is ond member,

:58:55.:59:01.

one vote in the Conservativd party for the leadership. I think

:59:02.:59:07.

membership in all parties is a problem because people generally...

:59:08.:59:13.

Apart from the UK Independence party? We're finding more informal

:59:14.:59:19.

support. Now it's been quite a week, a gaggle

:59:20.:59:22.

of senior politicians visithng us and one of our most high profile

:59:23.:59:26.

politicians celebrating his 250th birthday, sort of. Here's M`rk

:59:27.:59:29.

Denten, forever 21, with a look back at the week in 60 seconds.

:59:30.:59:38.

MPs paid tribute to Bob Crow last year, died suddenly. Dave Anderson

:59:39.:59:51.

said it is a sad loss. He w`s blunt, he was forthright, he had vhews He

:59:52.:59:59.

was a caring guy. Nick Clegg was at Nissan aiming to attract 9000 new

:00:00.:00:06.

jobs. Ministers announced ?00.6 million for Northumberland's schools

:00:07.:00:12.

at no extra Cass for Middlesbrough. `` cash. To reason it waded into the

:00:13.:00:18.

Scottish independence debatd. We are definitely better together. People

:00:19.:00:25.

who live here will know how they find find easy to move across the

:00:26.:00:30.

board into Scotland. If Scotland became separate that would be an

:00:31.:00:36.

international border. And the milestone... Happy birthday. And

:00:37.:00:44.

that's all from me for now. Remember you can keep up`to`date with the

:00:45.:00:47.

helter skelter world of polhtics by following me on Twitter. And take a

:00:48.:00:51.

look at my blog for more on youth unemployment. For now though it s

:00:52.:00:52.

back to Andrew for the rest of the industrial action is a sign of

:00:53.:01:00.

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

:01:01.:01:10.

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

:01:11.:01:15.

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

:01:16.:01:16.

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

:01:17.:01:28.

discuss the budget is the general secretary of the Trades Union

:01:29.:01:30.

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

:01:31.:01:35.

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

:01:36.:01:39.

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

:01:40.:01:45.

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

:01:46.:01:49.

investment in the British economy. Certainly I would like the

:01:50.:01:57.

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

:01:58.:02:00.

take action on living standards but if they're going to do that it's got

:02:01.:02:09.

to be about unlocking investment. In the period where the economy has

:02:10.:02:14.

been flat-lining there has been little business investment, but

:02:15.:02:17.

there are signs towards the end of last year that it is beginning to

:02:18.:02:23.

pick up. But a long way to go. The problem is we have key industries

:02:24.:02:26.

like construction and manufacturing that are still smaller than they

:02:27.:02:32.

were before the recession. The government itself, of course, has

:02:33.:02:35.

slashed its own capital investment budget by half. There is plenty of

:02:36.:02:41.

good and important work that needs to be done from building houses to

:02:42.:02:45.

improving the transport system, to improving our schools. And the

:02:46.:02:50.

government really needs to pick up that shovel and start investing in

:02:51.:02:55.

our economy to get the decent jobs we need, the pay increases we need,

:02:56.:02:59.

and that in itself will help stimulate demand. It was Alistair

:03:00.:03:08.

Darling who cut in 2011, and it s interesting that Ed Balls in his

:03:09.:03:10.

plans for the next parliament would run a current budget surplus by the

:03:11.:03:15.

end of the parliament as opposed to George Osborne who would have an

:03:16.:03:18.

overall budget surplus. That gives Ed Balls or -- more wriggle room to

:03:19.:03:23.

do what you talk about, but he is reticent to talk about it. He does

:03:24.:03:27.

not want to say that he has an opportunity to spend on investment

:03:28.:03:30.

because he fears if he says it he will be attacked by the

:03:31.:03:32.

Conservatives for being irresponsible. Why is business doing

:03:33.:03:40.

this? The recession was deeper than any since the war and the recovery

:03:41.:03:43.

was slower than almost any since the war. The lag, the time it takes to

:03:44.:03:49.

get over that is longer than anyone expected. I read the same evidence

:03:50.:03:56.

as you towards the end of last year pointing to money being released,

:03:57.:03:58.

and it depends what it is released on, whether it is capital investment

:03:59.:04:03.

or bringing in people on higher wages. The one surprise in the

:04:04.:04:07.

downturn is how well the employment figures have done, but they have not

:04:08.:04:12.

invested in new capacity and they are sitting on a lot of dosh. I

:04:13.:04:15.

looked at one set of figures that said if you took the biggest company

:04:16.:04:22.

in Britain, they have about 715 billion pounds in corporate treasury

:04:23.:04:25.

-- the biggest companies. I think it's reduced a little but they are

:04:26.:04:32.

sitting on a mountain in dash of skills. Yes, but they're not

:04:33.:04:36.

investing in skills, wages, or sustainable jobs. The new jobs we

:04:37.:04:40.

have seen created since 2010, the vast majority of them have been in

:04:41.:04:47.

low paid industries, and they are often zero hours, or insecure, or

:04:48.:04:51.

part-time. So it's not delivering a recovery for ordinary working

:04:52.:04:56.

people. Government ministers, as you know when you lobby them, they are

:04:57.:04:59.

anxious to make out that they know the job is not done and the recovery

:05:00.:05:05.

has just begun, but the one bit they are privately proud of, although

:05:06.:05:10.

they can't explain it, is how many private-sector jobs have been

:05:11.:05:14.

created. A lot of unions have done sensible deals with employers to

:05:15.:05:17.

protect jobs through this period, but it's not sustainable. The

:05:18.:05:23.

average worker in Britain today is now ?2000 a year worse off in real

:05:24.:05:28.

terms than they were. On a pay against price comparison? It doesn't

:05:29.:05:36.

take into account tax cuts. The raising of the personal allowance is

:05:37.:05:45.

far outweighed by the raising VAT. Does the raising of the threshold

:05:46.:05:48.

which the Lib Dems are proud of and the Tories are trying to trade

:05:49.:05:51.

credit for, does it matter to your members? -- take credit for. It

:05:52.:05:57.

matters that it is eclipsed by the cuts in benefits and know what is

:05:58.:06:02.

conned any more. We're going to hear a lot about the raising of the

:06:03.:06:06.

allowance, but as long as the real value of work, tax credits, things

:06:07.:06:11.

like that, people won't feel it in their pocket, and they will find it

:06:12.:06:14.

harder and harder to look after their family. When you look at the

:06:15.:06:18.

other things that could take over from consumer spending which has

:06:19.:06:22.

driven the recovery, held by house price rising in the south, it is

:06:23.:06:25.

exports and business investment and you look at the state of the

:06:26.:06:28.

Eurozone and the emerging markets which are now in trouble, and the

:06:29.:06:34.

winter seems to have derailed the US recovery. It won't be exports.

:06:35.:06:38.

Indeed, the Obie Eich does not think that will contribute to growth until

:06:39.:06:46.

2015 -- OBI. So the figures we should be looking at our business

:06:47.:06:52.

investment. And also the deficit. The deficit is 111 billion, and that

:06:53.:06:56.

is a problem, because we are not at the end of the cutting process,

:06:57.:07:01.

there are huge cuts to be made. I understand we are only a third of

:07:02.:07:05.

the way through. That will definitely affect business

:07:06.:07:09.

confidence. It is clear that the strategy has failed. Borrowing has

:07:10.:07:13.

gone up and it's not delivered improved living standards and better

:07:14.:07:17.

quality jobs, so cutting out of the recession is not going to work. The

:07:18.:07:22.

structural budget deficit was going to be eliminated three weeks today

:07:23.:07:28.

under the original plan. They missed target after target. Every economist

:07:29.:07:34.

has their own definition of that. I think Mark Carney is right when he

:07:35.:07:37.

says that fundamentally the economy is unbalanced and it is not

:07:38.:07:41.

sustainable, growth is not sustainable. But if it clicked on,

:07:42.:07:49.

it would be more balanced. It is not just north and south and

:07:50.:07:52.

manufacturing a way out with services, but it is also between the

:07:53.:07:58.

rich and everybody else. What do you make of the fact that there will

:07:59.:08:01.

effectively be another freezing public sector pay, or at least no

:08:02.:08:07.

more than 1%? Not even that for nurses and health workers. But they

:08:08.:08:14.

will get 3% progression pay. 70 of nurses will not get any pay rise at

:08:15.:08:18.

all. They get no progression pay at all. I think this is smack in the

:08:19.:08:24.

mouth. Smack in the mouth to dedicated health care workers who

:08:25.:08:28.

will feel very, very discontented about the decision. Danny

:08:29.:08:34.

Alexander, I saw him appealing to health workers do not move to strike

:08:35.:08:38.

ballots and said they should talk to their department. But about what? Is

:08:39.:08:45.

that real pay cut has been imposed, what are workers left with? So do

:08:46.:08:50.

you expect as a result of yet more tough controls on public sector pay

:08:51.:08:57.

that unrest is inevitable? I know some unions will be consulting with

:08:58.:09:01.

their members, but ultimately it's always members who decide what to

:09:02.:09:06.

do. It does seem to me insulting not to at least be honest and say that

:09:07.:09:11.

we are cutting real pay of nurses, health care workers, on the back of

:09:12.:09:18.

a ?3 billion reorganisation of the NHS that nobody wanted and nobody

:09:19.:09:24.

voted for. Their long-term changes taking place here that almost talks

:09:25.:09:29.

about -- there are long-term changes. It is how lower percentage

:09:30.:09:38.

wages have become of GDP on how big the percentage of profits is. It

:09:39.:09:40.

seems to me there is a strong case for some kind of realignment there.

:09:41.:09:46.

The biggest event of my life, in this world, is the entry of a couple

:09:47.:09:50.

of billion more people into the labour supply. At the end of the

:09:51.:09:54.

Cold War, India and China plugged into the global economy. If there is

:09:55.:09:59.

a greater supply of that factor of production, logically you conclude

:10:00.:10:01.

that wages will fall or stagnate and that has been the story in this

:10:02.:10:06.

country and America and large parts of Western Europe in the last

:10:07.:10:09.

generation. What is not possible is for governments to do much about

:10:10.:10:14.

it. They can ameliorate it at the margins, but the idea that the

:10:15.:10:16.

government controls living standards, which has become popular

:10:17.:10:20.

over the last six months, and the Labour Party have in establishing

:10:21.:10:25.

that, and I don't think it's true. George Osborne's options are

:10:26.:10:30.

astonishingly limited compared to public expectations. If wages have

:10:31.:10:35.

reached a modern record low as percentage of GDP, who is going to

:10:36.:10:40.

champion the wage earner? We have lost Bob Crow, Tony Benn passed

:10:41.:10:47.

away, so who is the champion? The trade union movement is the champion

:10:48.:10:51.

of ordinary workers. We need those larger-than-life figures that we

:10:52.:10:57.

will mess. Have you got them yet? We have a generation of workers coming

:10:58.:11:01.

through. One thing about the loss of Bob Crow is that the whole union

:11:02.:11:05.

movement has responded strongly to that, and we want to say that we are

:11:06.:11:09.

strong and united and here to stand up for working people and we will

:11:10.:11:14.

fight as hard as Bob Crow did. Whoever replaces Bob Crow or Tony

:11:15.:11:18.

Benn, we can be sure they will not come from Eton because they all have

:11:19.:11:22.

jobs in the government. I want to put up on the screen what even

:11:23.:11:25.

Michael Gove was saying about this coterie of Old Etonian 's.

:11:26.:11:35.

He's right, is he not? He's absolutely right. We have the idea

:11:36.:11:44.

of the manifesto being written by five people from Eton and one from

:11:45.:11:50.

Saint Pauls. A remarkable example of social mobility that George Osborne,

:11:51.:11:54.

who had the disadvantage of going to Saint Pauls has made it into that

:11:55.:11:59.

inner circle. Here is the question, what is Michael Gove up to? If you

:12:00.:12:04.

saw the response from George Osborne, there was no slap down and

:12:05.:12:08.

they know this is an area they are weak on an David Cameron will not

:12:09.:12:11.

comment on it. If this had been a Labour shadow minister making a

:12:12.:12:16.

similarly disloyal statement, they might have been shot at dawn. But

:12:17.:12:20.

there is a real tolerance from Michael Gove to go freelance which

:12:21.:12:25.

comes from George Osborne. It's about highlighting educational

:12:26.:12:27.

reforms that he wants to turn every school in to eat and so it won't

:12:28.:12:31.

happen in the future. But it's also pointing out who did not go to Eton

:12:32.:12:35.

school and who would be the best candidate to replace David Cameron

:12:36.:12:39.

as leader, George Osborne, and who did go to Eton school, Boris

:12:40.:12:42.

Johnson. Michael Gove is on manoeuvres to destroy Boris

:12:43.:12:50.

Johnson's chances of being leader. It's a good job they don't have an

:12:51.:12:55.

election to worry about. Hold on. I think they are out of touch with

:12:56.:12:59.

businesses as well as working people. You ask about who is talking

:13:00.:13:04.

about wage earners. Businesses are. They are worried that unless living

:13:05.:13:06.

standards rise again there will be nobody there to buy anything. We are

:13:07.:13:12.

running out of time, but the TUC, are enthusiastic about HS2? We

:13:13.:13:18.

supported. We think it's the kind of infrastructure project that we need

:13:19.:13:22.

to invest in long-term. He could, if we get it right, rebalance north and

:13:23.:13:27.

south and create good jobs along the way -- it could. Thank you very much

:13:28.:13:34.

tool. I have to say that every week -- thank you very much to you all.

:13:35.:13:37.

That's all for today. I'll be back next Sunday at 11am, and Jo Coburn

:13:38.:13:41.

will be on BBC Two tomorrow at midday with the Daily Politics.

:13:42.:13:46.

Remember if it's Sunday, it's the Sunday Politics.

:13:47.:13:49.

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