23/03/2014 Sunday Politics North East and Cumbria


23/03/2014

Richard Moss with the latest political news, interviews and debate. Andrew Neil is joined by pensions minister Steve Webb, Labour's Chris Leslie and Happy Mondays star Bez.


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Morning, folks. Welcome to the Sunday Politics. The dust has barely

:00:35.:00:42.

settled on George Osborne's Budget and, amazingly, for once it hasn't

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all gone horribly wrong by the weekend. So, is this the election

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springboard the Tories needed, and where does it leave Labour? Turns

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out the big Budget surprise was a where does it leave Labour? Turns

:00:51.:00:54.

revolution in how we pay for old age. The Pensions Minister says he's

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relaxed if you want to spend it all on a Lamborghini. He'll join us

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later. And could the man with the maracas be on his way to

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later. And could the man with the Westminster? Bez from the Happy

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Here: Will the budget kick`start the plan

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Here: Will the budget kick`start the region's recovery or leave ts

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lagging further behind? A c`mpaign to

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stay in Axbridge. Are there ways of making the European arrest warrant

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work better? -- Uxbridge. And who better to help guide you through all

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of that than three journalists, who dispense wisdom faster than Grant

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Shapps calls out the numbers in his local bingo hall over a pint of

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beer. Yes, they're hard-working and they're doing the things they enjoy.

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Cup of tea, number three. It's Nick Watt, Polly Toynbee and Janan

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Ganesh. So, George Osborne delivered his

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fifth Budget on Wednesday and had so many glowing front pages the day

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afterwards he must be running out of room to pin them up in on his

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bedroom wall. Although it's probably a pretty big wall. For those of you

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who didn't have time to watch 3 5 hours of Budget coverage on the BBC,

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here's Giles with the whole thing in three minutes.

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Budget days have a rhythm of their own, driven partly by tradition

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like that photocall at 11 Downing Street and part logistics, how to

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get this important statement out and explain to those whom it affects -

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us? Behind-the-scenes of a Budget Day is much the same. This ritual

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red boxery may be the beginning of the end of weeks of work behind the

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scenes in the Treasury and sets the clock ticking on the process of

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finding out the answer to one question. You got any rabbits in the

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box, Chancellor? Yes, there will be something in the Budget we don't

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know about. Time marches steadily towards the statement and already

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commentators are hovering over what those potential surprises are. As

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Big Ben chimes, all focus returns to the Commons, where there is Prime

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Minister's questions and the Chancellor gets up and does his

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thing. Once he's on his feet and remembering there is still no copy

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of the details, the major measures are rapidly highlighted as they come

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and then put up on screen. A cap on Government welfare spending set for

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2015/16 at 119 billion. Income tax personal allowance raised to

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?10,500. Bingo duty halved, which ticked boxes for some but was

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unlikely to make anyone a poster boy. And the beer tax cut of 1p or

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the froth on the top. And changes to pensions allowing people to take

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their money out in one lump sum rather than being forced to accept a

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fixed annual pay-out, or annuity. This is a Budget for the makers the

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doers and the savers and I commend it to the House. Not everyone can

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focus on the Budget by listening to what the Chancellor says. We need to

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get a copy of the script. We do not get that till he sits down. I'm

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going to go into the House of Commons to get that right now. There

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will be a response on that and all the other things from Mr Miliband.

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The Chancellor spoke for nearly an hour but he did not mention one

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essential fact, the working people of Britain are worse off under the

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Tories. It is a tricky job answering the Budget at the best of times

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though some, including Labour MPs, think it is better to mention the

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Budget when you do. Here we are. I am going to go. I am

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not the only journalist missing Ed Miliband's speech. Many others leave

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the Chamber as the Chancellor sits down to attend a special briefing

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from the Chancellor's advisory team. I am hotfoot to the studio. There is

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a little more detail to the Budget than the Budget Speech. That detail

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can be whether words unravel and other interpretations emerge. By now

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the gaggle of supporters and detractors are taking the debate

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onto the airwaves. Are you the BBC? Have the Daily Politics packed up?

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No, we're still standing and, days later, still trying to assess

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whether the measures announced still seem fresh and appetising or have

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already gone stale in the minds of voters?

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How significant are these two poles this morning putting Labour and Tory

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nip and tuck? Osborne gave his party a good bounce. It was an

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astonishingly theatrical coup. At first glance, it seems like a huge

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gift to all people. That is where all of the money has been channelled

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by this government. They have been ultra-protected, triple locked.

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Pensioners have done very well and others less well. It is not

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surprising. Normally a budget which is well received on the day and the

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day after has unravelled by the weekend. This time, it has not, so

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far. The dangerous thing for the Labour Party now, George Osborne is

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the assessment this thing called the baseline. He says, in government,

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you must control the baseline. The Labour party controlled in 2001 and

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2005 and he needs to control it next time. He is controlling it on fiscal

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policy because labour is matching them on everything. The danger for

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Labour on the big, headline grabbing issue, which was freeing up

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annuities on pensions, that again Labour was pretty much saying it was

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going to support it though it were saying it has to be fair and

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cost-effective. On a big, policy issue, they are following on behind

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George Osborne. George Osborne is controlling the crucial baseline.

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Are we in danger of reading too much into the political implications of

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the budget? The good thing about the pensions policy is, if it does

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unravel, it will not happen for ten years and, by that time, George

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Osborne will have left office. Towards the end of his speech, I

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thought, that is not enough. There is not an idea in your budget which

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is politically very vivid a year before an election. What I

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underestimated was, how many frustrated savers that are in the

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country. There are a lot of people who are frustrated by low interest

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rates and tax rates on pension pots. This was an explicit gesture for

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them. That is what has paid off in the polls in the past few days. You

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spend all of your money on your wardrobe, is that right? The bingo

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poster was a kind of get out of jail card for Labour. It gave them

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something to zoom in on. Everyone beat up on Grant Shapps, the Tory

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chairman. We read in the daily Telegraph that the fingerprints of

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the Chancellor were all over this poster. The Chancellor signed off it

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-- off on it and so did Lynton Crosby. They referred to working

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class people as, they are. How did it get into the Telegraph? We can

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only presume but grant Shapps made it clear that it was not him. We had

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a time when Labour politicians, we saw from the response of Ed Miliband

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onwards, they were not quite sure how to react to this budget. A lot

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of detail had to be absorbed. Suddenly, here is something we can

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talk about. You can see the thinking behind the poster was very sensible.

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We are not Tory toffs, we are interested in helping people who do

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not come from our backgrounds. The wording was awful and played into

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every cliche. It was all his fault. It shows how unsophisticated he

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was. There were people from Tory HQ who agreed the budget. A month down

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the line will the budget look as good? Probably. Once people look at

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it, pensions are fiendishly conjugated. Once they look and see

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what it will do with people having to pay for their own care because

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they can now take capital at their pension, that will come as a shock

:10:07.:10:09.

to a lot of people with small savings. It all be gone on their

:10:10.:10:18.

care. The polling will be neck and neck all the way. In the past,

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George Osborne has been accused of using his Budgets to tinker at the

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margins or pull cheap tricks on his political opponents. Perish the

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thought. But the big surprise in this year's statement was a

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genuinely radical shake-up of the pensions system that will affect

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most people who've yet to retire. At the moment, everyone is saving money

:10:42.:10:45.

into a defined contribution pension, that is the type most common in the

:10:46.:10:51.

private sector. They can take 2 % of the pot is a tax-free lump sum when

:10:52.:10:55.

they retire. The rest of the money, for most people, they are forced to

:10:56.:11:00.

buy an annuity, a form of insurance which provide a guaranteed monthly

:11:01.:11:03.

income until they die. Annuities have hardly been a bargain since

:11:04.:11:09.

interest rates were flat slashed following the financial crash. Even

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with a ?100,000 pension pot would only get an income of ?5,800 a year

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at current rates. From 2018, pensioners will not be forced to buy

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an annuity. They can do what they like with their money, even taking

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the entire pot as a lump some but paying tax on 75% of it.

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With an average pension pot closer to around ?30,000, pensioners would

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be more likely to buy a Skoda instead of a Lamborghini. Most newly

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retired people who take the cash are more likely to spend the money

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paying off their mortgage, helping a family member to buy a property or

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investing the money elsewhere. Well, earlier I spoke to the Pensions

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Minister. He's a Lib Dem called Steve Webb. I began by asking him if

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he still thought the reforms might lead to pensioners splurging all

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their savings on supercars. What this reform is about is treating

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people as adults. For far too long, we have said, we will make sure you

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save for your old age and then we will control each year how much is

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spent on what you spend it on. What we are saying is because we have

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formed -- reformed the state pension, we will be much more

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relaxed about what people do with their own money. The evidence is

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that people who have been frugal and saved hard for retirement do not

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generally blows a lot. They will spin it out. It is treating people

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as adults and giving them choices they should have had all along. It

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is a red herring, isn't it? The average pension pot is between 5000

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and 30,000. Lamborghinis aren't an option, correct? I gather only about

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5000 people a year retiring can buy a flashy Italian sports car. It

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might be about paying off a mortgage, paying off outstanding

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debts. Maybe spending more money earlier in retirement when they are

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fit and able and can enjoy it more. We will give people guidance. We

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will make sure when they retire there is someone to have a

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conversation with talking through the implications of spending the

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money early and options of investing it. This will be a real step

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forward. Even if you have a much bigger pension pot, say half ?1

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million, which is way bigger than the average, even then the marginal

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rates of tax will be a disincentive to take it all out at once. You will

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lose huge chunks of it at the 4 % band and then the 45% band. The tax

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system gives you the incentive to spread it out if the tax threshold

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is a bit over 10000 and the state pension is a bit over 7000, the

:14:04.:14:08.

first 3000 you draw out in a given year is tax-free. The next band is

:14:09.:14:17.

at 20%. Spreading your money will mean you pay less tax. That is why,

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in general, people will not blow the lot up front. They will spread it

:14:21.:14:25.

out over their retirement. You have kept this policy quiet. Not even a

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hint. How did you test it? How did you make sure it would be robust?

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You did not do a consultation. I have been talking about freeing up

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the annuity market for a decade The idea of giving people more choice.

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The government has relaxed rules over this Parliament. It was not a

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completely new idea. We know in places like Australia and America,

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people have these freedoms. We already have something to judge it

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by. We will spend the next year talking to people, working it

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through. There will be a three-month consultation. I want people to have

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choices about their own money. There is detail still to be worked out and

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we are in listening mode about how we implement it. When you announce

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something you cannot do widespread consultation, for the reasons I have

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given, you do run the risk of unforeseen consequences? Pension

:15:21.:15:23.

companies this morning are indicating, you, the government can

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write you are looking for ?25 billion of infrastructure investment

:15:27.:15:34.

from us. You hold our shell below the water line. That may not happen.

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We spoke internally about the implications for instruction --

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infrastructure. It seems to me there will still be long-term investments.

:15:58.:16:05.

Many people want to turn their whole pot into an income. I understand the

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insurance companies are lobbying, but I'm convinced there will still

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be plenty of money for investment and infrastructure. If the

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Chancellor's pro-savings measures work, that will generate more

:16:19.:16:26.

savings. With no requirement now to buy an annuity, surely it is the

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case that pension pots are another ordinary savings fund, so why should

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they continue to get favourable tax treatment? Bear in mind that a lot

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of the tax treatment of pensioners is tax deferred so most people pay

:16:45.:16:48.

tax at the standard rate. If they put money into a pension, they don't

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pay tax when they earn it, but they do at retirement. We do want, we

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will still have automatic enrolment into workplace pensions, we do want

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people to build up, because at age 20 and 30 nobody thinks about

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retirement. It is still vital that people do reach retirement to have

:17:15.:17:18.

these new choices with a decent sized pension pot. Pensions. Tax

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breaks because they were supposed to provide an income in retirement

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that is how it was structured, but that is no longer a requirement

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surely that undermines the case that if they get tax breaks, other forms

:17:36.:17:42.

of savings should get tax breaks. Other forms do get tax breaks, of

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course. The return with ISAs is tax free. The point with pensions is

:17:54.:17:59.

that you are simply deferring your earnings. There is a bit when high

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tax rate payers get a kick when they are working and then retire on

:18:09.:18:13.

standard rate, so there is the issue of the top getting too many tax

:18:14.:18:18.

breaks, but the basic principle that you pay tax when you get the income

:18:19.:18:24.

seems right to me and isn't affected by these changes. You have announced

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save friendly measures, are we right to look at them as a consolation

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prize because savers have suffered from the Government's policy of

:18:35.:18:38.

keeping interest rates abnormally low? It is certainly the case that

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very low interest rates have been a huge boon to people of working age

:18:44.:18:50.

with mortgages, and people who have retired said they thought they could

:18:51.:18:53.

have got a better deal on their savings. I think there is a

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recognition that whilst we have done the right thing with pensioners on

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the state pension, we have brought in the triple lock, and many will

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bent on -- benefit from these changes. Why don't savers who are

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not pensioners get the same help? They have been hit by low interest

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rates as well. Those of working age, many of them say they have

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benefited from low interest rates was predominantly people in

:19:32.:19:38.

retirement have not had the benefit. Obviously people of working age will

:19:39.:19:45.

have benefited from the tax allowance so it is a myth to say the

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Budget was all about pensioners And yet even when the Office for Budget

:19:55.:19:58.

Responsibility takes into account your new measures, it still shows

:19:59.:20:01.

that over the next five years households will save less and less,

:20:02.:20:08.

indeed the savings ratio falls by 50%. You haven't done enough. One of

:20:09.:20:14.

the things we know is that the economy is picking up strongly, and

:20:15.:20:19.

as we have more confidence about the future they will be more willing to

:20:20.:20:22.

consume now, so without these measures it may be that the saving

:20:23.:20:27.

rate would have fallen further. We want people to save and spend, it is

:20:28.:20:35.

about getting the right balance As the economy picks up, people will

:20:36.:20:38.

want to spend more of their money and it is about getting the balance

:20:39.:20:44.

right. You make the point that if people are little profligate with

:20:45.:20:48.

their private pensions, they will have the state pension to fall back

:20:49.:20:52.

on and it will be higher than it has been, but it is also the case that

:20:53.:20:57.

in these circumstances they will still be entitled to housing benefit

:20:58.:21:03.

and even to perhaps some council tax benefit as well. Do you know by how

:21:04.:21:09.

much this could put the welfare bill up? We think the impact will be

:21:10.:21:14.

relatively modest because the sort of people who save for a pension and

:21:15.:21:18.

make sacrifices while they are at work are not the sort of people who

:21:19.:21:25.

get to 65 and decide to blow the lot for the great privilege of receiving

:21:26.:21:29.

council tax benefit or housing benefit. There will be people on the

:21:30.:21:31.

margins and benefit. There will be people on the

:21:32.:21:43.

who retire with some capital want to put some money away for their

:21:44.:21:46.

funeral. People like to save even into retirement so the myth of the

:21:47.:21:51.

spendthrift pensioner I don't believe. I think this has been

:21:52.:22:00.

rightly welcomed. Ever fancied a Lamborghini yourself? If you turned

:22:01.:22:06.

the camera around you would see my 2-door Corsa!

:22:07.:22:19.

What's your favourite thing about an election? Could it be the candidates

:22:20.:22:22.

ringing on your door while you're having dinner? The leaflets piling

:22:23.:22:25.

up on your doormat? Or the endless adverts aimed at hardworking

:22:26.:22:27.

families? Well, if you thought that was bad enough, then you might want

:22:28.:22:31.

to consider going overseas for the 2015 election because the parties

:22:32.:22:34.

are going to be aiming their message at you like never before. Adam's

:22:35.:22:39.

been to Worcester to find out more. One of the most famous political

:22:40.:22:44.

figures in history lived here, she is called Worcester woman. She was

:22:45.:22:48.

in her 30s, working class with a couple of kids, aspirational yet

:22:49.:22:53.

worried about quality of life. But she wasn't a real person, she was a

:22:54.:22:58.

label for the kind of voter new Labour were trying to reach and she

:22:59.:23:02.

was later joined by Mondeo man and several others. Doesn't that all

:23:03.:23:09.

seem a bit 90s? The technique, called segmentation, was used by

:23:10.:23:16.

George Bush in 2004. Then refined by Barack Obama. Rather than focusing

:23:17.:23:20.

on crude measures like cars and hometowns, they delved into the

:23:21.:23:26.

minds of voters. It is not just women, not just people who live in

:23:27.:23:30.

cities, but if you start to put together these groups of people you

:23:31.:23:36.

can even in an anecdote or way imagine who they are, what types of

:23:37.:23:45.

language and imagery might relate to them. We have been given access to a

:23:46.:23:50.

new polling model being used here by this firm, which is pretty close to

:23:51.:23:56.

the one we are told is being used by the Tories. It carves the country

:23:57.:24:00.

into six personality types, and we are trying it out on Worcester woman

:24:01.:24:05.

and wast of man. We are using an online quiz to work out who is in

:24:06.:24:12.

which segment. Meet new monk, Susie. She feels well represented. I

:24:13.:24:21.

know the Budget and the increases to childcare, I think at the moment I

:24:22.:24:27.

am fairly represented. This puts her in the category of optimistic

:24:28.:24:31.

contentment, people who feel they are doing OK. Terry, on the other

:24:32.:24:37.

hand, isn't happy about Britain today. Health and safety and all

:24:38.:24:45.

that! I hardly recognise the country a living in any more? Yes. Are you

:24:46.:24:55.

ready for the result? He is Mr comfortable nostalgia, they tend to

:24:56.:25:00.

favour the Tories and UKIP. They dislike the cultural changes they

:25:01.:25:05.

see as altering Britain for the worst. That sums me up. Tony is

:25:06.:25:10.

worried as well but feels much less secure. I look forward to the future

:25:11.:25:22.

with optimism or anxiety? Anxiety. Optimist or pessimist? Pessimist.

:25:23.:25:32.

His category is... You feel a bit insecure, you think the Government

:25:33.:25:38.

could probably help you more? Yes. Labour picks up a lot of these

:25:39.:25:43.

voters. This man is being asked to do more and more at work, but he is

:25:44.:25:52.

getting less and less. I am getting more towards the despair side.

:25:53.:25:57.

Things are getting tougher, generally? It puts him into the

:25:58.:26:02.

segment called long-term despair, people who feel left out. Finally,

:26:03.:26:11.

this is ever thoughtful Carol. I am a bit of an idealist. Her idealism

:26:12.:26:20.

makes her a cosmopolitan critic I am a liberal person. Apparently a

:26:21.:26:25.

lot of the media fit into this category as well. There is one group

:26:26.:26:31.

of voters we have not come across, people who show calm persistence.

:26:32.:26:34.

They hope things will get better but don't expect them to. They are

:26:35.:26:39.

coping, rather than comfortable Presumably they are all out of work.

:26:40.:26:44.

Which group are you win? You can take the poll on the BBC website,

:26:45.:26:49.

and in the coming weeks we will be doing our own polling using the six

:26:50.:26:54.

segments to see of the politicians really have worked out how we think.

:26:55.:27:01.

And as Adam said, if you want to try the survey for yourself, you can go

:27:02.:27:05.

to the BBC website and click on the link.

:27:06.:27:07.

And we're joined now by the pollster, Rick Nye. Welcome to

:27:08.:27:17.

Sunday Politics. We have had Worcester woman, Worcester man, is

:27:18.:27:23.

this any different? It is a recognition that or politician -

:27:24.:27:39.

all politics these days is like this. It enables them to cut them

:27:40.:27:47.

more finally. You think all politics is coalition politics, you think

:27:48.:27:51.

they have to put together these groups of people, not that the Lib

:27:52.:27:58.

Dems will always be in power? No, and if you listen to the coverage

:27:59.:28:03.

these days you might think it is about grumpy old men on the one hand

:28:04.:28:09.

with Guardian readers on the other. It is far more complicated than

:28:10.:28:13.

that, there is a lot of churning going on underneath which is driven

:28:14.:28:20.

by people's value systems. A lot of this has been pioneered in the

:28:21.:28:24.

United States, very sophisticated on their election techniques, and in

:28:25.:28:28.

Britain we are always the first to grab whatever the New Year will is

:28:29.:28:34.

from America. How do you think this will translate to this country? I

:28:35.:28:39.

think it means that if you are target photo you will still get the

:28:40.:28:44.

same of leaflets and people calling, but you will probably have different

:28:45.:28:47.

kinds of conversations because people on the other side, the party

:28:48.:28:54.

campaigners, will think they know more about you. Will I know who you

:28:55.:29:00.

are? If I am a party campaigner will I know, looking down the

:29:01.:29:05.

street, who fits into which category? You will be able to

:29:06.:29:09.

approximate that with all of the other data that you have gathered

:29:10.:29:14.

through polling, or doing local campaigning, that is the idea to

:29:15.:29:18.

make sense of this vast quantity of data people have about voters. We

:29:19.:29:25.

asked our panel to fill in your survey. Nick is optimistic

:29:26.:29:31.

contentment, 99%. He was 1% cosmopolitan critic, which is how he

:29:32.:29:36.

keeps his job at the Guardian. Polly's job could not be more

:29:37.:29:41.

secure, 100% cosmopolitan critics, and Janan Ganesh, optimistic

:29:42.:29:45.

contentment, which is what you would contentment, which is what you would

:29:46.:29:48.

expect from a financial Times columnist. What do you make of this

:29:49.:30:05.

technique? Why are you only 99? It sounds really clever. 95% of the

:30:06.:30:15.

population five years ago voted Labour or the Conservatives. We have

:30:16.:30:19.

got away from that. It is coalition politics. You need sophisticated

:30:20.:30:25.

methods. Presumably you must not lose touch with basic points. You

:30:26.:30:32.

said it was used in the US presidential elections. Wasn't there

:30:33.:30:37.

them moment emit Romney 's sweet when the initial response was, we

:30:38.:30:42.

did not know the sort of people voted. His next response was, we did

:30:43.:30:45.

did not know the sort of people not know these people existed.

:30:46.:30:50.

Unless you know about certain key demographics, you are wasting your

:30:51.:30:56.

time. Is it important in modern campaigning? I think it is useful

:30:57.:31:03.

because it is about attitude. We have got Mosaic. We have got Acorn.

:31:04.:31:13.

It does not tell us very much. What people think and feel may be

:31:14.:31:17.

different to their income. You can be quite a high earner and anxious.

:31:18.:31:22.

You can be quite a low earner and feeling aspirational and optimistic

:31:23.:31:25.

about the future. I think this does get something else. In days gone by,

:31:26.:31:33.

particularly in America, overwhelmingly, if you are in the

:31:34.:31:38.

better of segment, you would be Republican and the blue-collar

:31:39.:31:41.

workers and some academics and Liberals voted Democrat. In the last

:31:42.:31:46.

election, the richest 200 counties in America voted Democrat. That is

:31:47.:31:50.

an attitude thing. Income does not tell you how people will vote. There

:31:51.:31:56.

support for the Republicans. It is support for the Republicans. It is

:31:57.:32:01.

unavoidable. Add a time when people no longer identify with ideologies

:32:02.:32:05.

or class blocks, you have to go the temperament and lifestyle and

:32:06.:32:19.

manageable. In America there were 128 segments according to lifestyle

:32:20.:32:21.

manageable. In America there were and Outlook. Once you get to that

:32:22.:32:26.

stage, it becomes close to useless. We were talking about the budget

:32:27.:32:31.

earlier. What other polls saying about the budget? The lead of labour

:32:32.:32:39.

has been narrowed over the Conservatives. -- Labour. Osborne

:32:40.:32:47.

and Cameron as an academic team have always had a lead over Miller band

:32:48.:32:53.

and Balls. This week it is about economic management. -- over Mr

:32:54.:32:55.

Miller band. Thank you for being with us

:32:56.:33:11.

It's just gone 11:30am. You're watching the Sunday Politics. We say

:33:12.:33:15.

goodbye to viewers in Scotland, who leave us now for Sunday Politics

:33:16.:33:16.

The economic recovery is helping all Scotland. Coming up here in

:33:17.:34:09.

The economic recovery is helping all regions of the UK. Not just the

:34:10.:34:14.

south`east. That is according to the Conservative party chairman, Grant

:34:15.:34:18.

Shapps. He's a man who causdd storm this week by Tweeting this `dvert

:34:19.:34:31.

about bingo and the attacks, That was criticised as "condescending" `

:34:32.:34:34.

even by his own coalition p`rtners ` among them Redcar MP Ian Sw`les As

:34:35.:34:38.

for Mr Shapps, he was on a visit to Carlisle on Friday, and was

:34:39.:34:41.

unrepentant about his comments. We can all argue about whether the

:34:42.:34:44.

words are "they", "us", or whatever. Personally, I drink beer and I love

:34:45.:34:48.

a game of bingo. I just don't see why they think this is more

:34:49.:34:51.

important than talking about the long`term economic future of our

:34:52.:34:54.

country. Supporting sectors like bingo, by halving the tax, local

:34:55.:34:57.

pubs, where we are helping them to stay open. That is more important

:34:58.:35:01.

and we have had heard nothing about it from Labour at all. All they want

:35:02.:35:05.

to do is talk about the trivia, rather than the real issues. There

:35:06.:35:14.

has been criticism of this because the perception is that the lask

:35:15.:35:18.

slipped. It is what they, the proles, as in the north`east,

:35:19.:35:25.

perhaps, won. This is a storm in a teacup generated by the Labour

:35:26.:35:29.

Party. As we saw on Wednesd`y we had Ed Miliband who had nothing to say

:35:30.:35:32.

about the substance of the budget, and this is a distraction t`ctic to

:35:33.:35:40.

try and get away from the f`ct that they do not have a response to the

:35:41.:35:43.

budget. On the other hand, we saw George Osborne, the Conserv`tive

:35:44.:35:49.

Chancellor, give a good budget for savers, doers and makers. And they

:35:50.:35:57.

can see what he has done about the long`term economic prospects. You

:35:58.:36:02.

are completely relaxed about the bingo and beer? If you look at the

:36:03.:36:07.

substance, there was nothing wrong with halving the tax on bingo halls

:36:08.:36:10.

full stop they are under vast pressure. Some have come out and

:36:11.:36:13.

said that they will be able to remain open and with regard to the

:36:14.:36:18.

beer industry, it is not just 1p off pint, the loss of jobs dependent on

:36:19.:36:26.

it. The headlines have been pretty good on this, apart from th`t, on

:36:27.:36:31.

the budget, but not for Ed Liliband, for instance. It is churlish not to

:36:32.:36:39.

welcome some help for bingo and for the beer industry, but the Labour

:36:40.:36:44.

criticism has been more fundamental. This is a budget delivering for a

:36:45.:36:47.

certain section of the population, not benefit of the country, and in

:36:48.:36:53.

particular, it did not give us the investment that we need to see in

:36:54.:36:56.

the North East, if the economy is to grow. Well, let's look at the

:36:57.:37:04.

economic impact of the Budgdt in a bit more detail. The steel `nd

:37:05.:37:07.

chemical industries on Teesside will benefit, thanks to tax relidf on

:37:08.:37:10.

heavy energy users. But what about smaller manufacturers? Mich`el

:37:11.:37:13.

Tuddenham runs a business m`king kitchen and bathroom units hn

:37:14.:37:15.

Longtown near Carlisle. He believes the Budget will help create more

:37:16.:37:18.

opportunities for young people. We took a 16`year`old on just `fter the

:37:19.:37:26.

summer holidays last year. From a local high school. And with the

:37:27.:37:36.

national insurance being taken out forunder 21s, that is very positive

:37:37.:37:39.

for the younger generation, basically. And I think employers

:37:40.:37:42.

will react to that and bringing down the unemployment among the xounger

:37:43.:37:45.

generation will be a positive step. Energy costs, there has been a cut

:37:46.:37:49.

on the carbon tax. This feeds into the electricity costs, etc.

:37:50.:37:59.

Obviously, energy use, lighting edge banding, power units, ht is

:38:00.:38:02.

something that we look at closely. So, all in all, I was very positive

:38:03.:38:06.

towards the budget. So at ldast one business in Cumbria thinks the

:38:07.:38:09.

Chancellor's on the right lhnes But let's talk now to the regional

:38:10.:38:13.

secretary of the TUC, Beth Farhat. Many business organisations have

:38:14.:38:17.

welcomed this. Is this delivering for businesses and for young people

:38:18.:38:22.

looking for jobs? That is good, the work that they are doing to support

:38:23.:38:27.

small businesses are taking on more apprenticeships, but the budget put

:38:28.:38:31.

forward a couple of measures that we would support, more investmdnt and

:38:32.:38:37.

support for manufacturing. That comes at a time when we havd got

:38:38.:38:43.

3000 fewer managed `` manuf`cturing jobs in the north`east and the dead,

:38:44.:38:48.

in 2010. We have a little bht of time to wait for that because it is

:38:49.:38:55.

in the next Parliament. Raising of the personal allowance, this was

:38:56.:38:57.

tabled as a policy that is going to help low`paid workers, but the

:38:58.:39:01.

reality is that it will be liddle income and high income earndrs that

:39:02.:39:05.

will benefit from it most. The fundamental thing that the budget

:39:06.:39:10.

did not tackle was the living standards crisis. When I talk to

:39:11.:39:13.

workers, that is the real issue for them. It did not talk about the

:39:14.:39:18.

living wage and Fairplay. It talked about bingo and beer. `` fahrer pay.

:39:19.:39:30.

The lifting of the tax threshold has been significant and will lhft a lot

:39:31.:39:37.

of people out of tax. You c`nnot be churlish about that, even if it

:39:38.:39:40.

helps people further up the chain as well. It will give low incole

:39:41.:39:46.

earners to hundred pounds annually. And it will increase the VAT

:39:47.:39:53.

anthrax, so the devil is in the detail. Can I tell you something

:39:54.:39:57.

about north`east workers? They are ?1300 a year worse off in rdal

:39:58.:40:04.

terms. That is the equivalent to 23 average weekly shops, one ydar's

:40:05.:40:09.

worth of energy bills for the average household. But they are

:40:10.:40:13.

getting back to work, the fhgures suggest this week. No. Unemployment

:40:14.:40:21.

fell? Yes, but the quality of the jobs, zero hours contracts, eight

:40:22.:40:26.

out of ten private sector jobs are created in the cell. The jobs that

:40:27.:40:30.

we see created are predomin`ntly in low`paid sectors. We have got

:40:31.:40:35.

families on low`paid incomes with more money going out than they can

:40:36.:40:39.

coming in, relying on zero hours contracts and payday loans

:40:40.:40:52.

companies, so that is a problem There was a difference in the

:40:53.:40:55.

recovery. It is more accents rated in the South than in the North. Is

:40:56.:41:01.

anything being done to addrdss that? You referred to the unemploxment

:41:02.:41:06.

statistics. It fell in the north`east at the highest r`te

:41:07.:41:08.

compared to anywhere else in the country. It is important th`t we are

:41:09.:41:12.

seeing things moving in the right direction. We have got plenty more

:41:13.:41:20.

to do. What was in the budgdt specifically to help the north`east?

:41:21.:41:25.

The increase in the personal allowance takes 14,000 people in the

:41:26.:41:27.

north`east out of paying income tax altogether. It has delivered 1

:41:28.:41:32.

million people a tax cut. This will help relieve the pressure is on

:41:33.:41:37.

budgets. And freezing the ftel duty escalator, if Labour had bedn in

:41:38.:41:42.

government, the fuel duty would be 20p higher per litre. If we look at

:41:43.:41:48.

jobs as well, this is where the Labour Party does not appreciate,

:41:49.:41:51.

but people are better in work than out of work. We have seen 1.4

:41:52.:42:00.

million more jobs created. The point is, the cost of living and frozen

:42:01.:42:06.

fuel duty, you make beer and fuel duty, you bring people out of tax,

:42:07.:42:10.

surely that is the way to t`ckle it. Labour is proposing to freeze energy

:42:11.:42:16.

bills until 2017 and reduce business rates for small businesses, and give

:42:17.:42:20.

all young people are job through the jobs guarantee. We would be doing

:42:21.:42:24.

much more to support the economy. There were no measures in this

:42:25.:42:29.

budget to help the North East. No specific understanding... W`s of

:42:30.:42:36.

chemical industries and stedl industries on these side will

:42:37.:42:44.

benefit massively. `` lots of industries on Teesside. We still

:42:45.:42:49.

need specific measures to rdbalance the economy and support trahning. We

:42:50.:42:55.

are seeing support pouring `cross the piece. We are saying th`t some

:42:56.:42:59.

areas need more assistance to get the economy fully buoyant, than

:43:00.:43:03.

others, and we need to see lore investment in the North East. At the

:43:04.:43:08.

moment 3% of investment frol this government is coming into the

:43:09.:43:14.

north`east. Some businesses wanted investment in infrastructurd in the

:43:15.:43:20.

north`east. There was none. The manufacturing organisations have

:43:21.:43:24.

welcomed the ?7 million worth of investment. They have already said

:43:25.:43:29.

that that is when to generate both and potentially lots more jobs. So

:43:30.:43:35.

it doesn't matter about the infrastructure investment? What we

:43:36.:43:39.

saw the day after the budget, we have seen a touchy moving their

:43:40.:43:44.

headquarters to London, gendrating 750 jobs in the north`east. That

:43:45.:43:48.

could see the North East become a world centre for building Hhgh Speed

:43:49.:43:51.

Richard Moss with the latest political news, interviews and debate. Andrew Neil is joined by pensions minister Steve Webb to discuss the government's pension reforms, while Labour's Chris Leslie will talk about his party's response to the Budget. Finally, Happy Mondays star Bez will explain why he wants to become an MP.


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