24/11/2013 Sunday Politics Northern Ireland

Morning, folks. Welcome to the Sunday Politics.

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

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

Shapps. Five years on from the financial

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

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

City's new financial watchdog. And he used to have a windmill on

his roof and talked about giving hugs to hoodies and huskies. These

days, not so much. Has the plan to make

Coming up here - the DUP leader, make the

Coming up here - the DUP leader, Peter Robinson, on the challenge of

making unionism more open and inviting, union flag protests and

the debate over running a second Euro candidate. Join us

homelessness and population ships. What is the evidence?

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

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

be tweeting faster than England loses wickets to Australia. Yes,

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

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

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

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

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

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

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

diplomacy, bilaterally with the Iranians, and together with our

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

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

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

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

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

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

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

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

Iranian currency strengthened overnight, which is exactly what the

Iranians wanted. Inflation in Iraq overnight, which is exactly what the

is 40%, so they need a stronger currency. -- information in Iran.

France has played a blinder. It was there intransigence that led to

this. Otherwise, I think the West would have led to a much softer

deal. The question now becomes implementation. Here, everything

hinges on two questions. First, who is Hassan Rouhani? Is he the

Iranians Gorbachev, a serious reformer, or he's here much more

tactical and cynical figure? Or, within Iran, how powerful is he?

There are military men and intelligence officials within Iran

who may stymie the process. The Western media concentrate on the

fact that Mr Netanyahu and the Israelis are not happy about this.

They don't often mention that the Arab Gulf states are also very

apprehensive about this deal. I read this morning that the enemies of

Qatar and Kuwait went to Saudi king. -- the MAs row. That is the key

thing to watch in the next couple of weeks. There was a response from

Saudi Arabia, but it came from the Prime Minister of Israel, who said

this was a historic mistake. The United States said there would be no

enrichment of uranium to weapons grade. In the last few minutes, the

Iranian Foreign Minister has tweeted to say that there is an inalienable

right -- right to enrich. The key thing is the most important thing

that President Obama said in his inaugural speech. He reached out to

Iran. It failed under President McKenna jab. Under President

Rouhani, there seems to be progress. There is potentially now what he

talked about in that first inaugural address potentially coming through.

In the end, the key issue - and we don't know the answer - is the

supreme leader, not the president. Will the supreme leader agreed to

Iran giving up its ability to create nuclear weapons? This is the huge

ambiguity. Ayatollah Khamenei authorise the position that

President Rouhani took to Geneva. That doesn't mean he will sign off

on every bit of implementation over the next six months. Even when

President Ahmadinejad was president, he wasn't really President. We in

the West have to resort to a kind of Iranians version of the study of the

Kremlin, to work out what is going on. And the problem the president

faces is that if there is any sign... He can unlock these funds by

executive order at the moment, but if he needs any more, he has to go

to Congress. Both the Democrat and the Republican side have huge

scepticism about this. And he has very low credibility now. There's

already been angry noises coming from quite a lot of senators. It was

quite strange to see that photo of John Kerry hugging Cathy Ashton as

if they had survived a ship great together. John Kerry is clearly

feeling very happy. We will keep an eye on this. It is a fascinating

development. More lurid details about the

personal life of the Co-op Bank's disgraced former chairman, the

Reverend Paul Flowers. The links between Labour, the bank and the

wider Co-op movement have caused big problems for Ed Miliband this week,

and the Conservatives have been revelling in it. But do the Tory

allegations - Ed Miliband calls them "smears" - stack up? Party Chairman

Grant Shapps joins us from Hatfield. Welcome to the programme. When it

comes to the Co-op, what are you accusing Labour of knowing and when?

I think the simple thing to say here is that the Co-op is an important

bank. They have obviously got into difficulty with Reverend flowers,

and our primary concern is making sure that that is properly

investigated, and that we understand what happened at the bank and how

somebody like Paul Flowers could have ended up thing appointed

chairman. You wrote to edge Miliband on Tuesday and asked him what he

knew and when. -- you wrote to Ed Miliband. But by Prime Minister's

Questions on Wednesday, David Cameron claims that you knew that

Labour knew about his past all along. What is the evidence for

that? We found out by Wednesday that he had been a Labour councillor,

Reverend Flowers, and had been made to stand down. Certainly, Labour

knew about that, but somehow didn't seem to think that that made him

less appropriate to be the chairman of the Co-op bank. There was no

evidence that Mr Miliband or Mr Balls knew about that. I ask you

again, what are you accusing the Labour leadership of knowing? We

know now that he stood down for very inappropriate images on his

computer, apparently. You are telling me that they didn't know. I

am not sure that is clear at all. I have heard conflicting reports.

There is a much bigger argument about what they knew and when. There

was a much bigger issue here. This morning, Ed Miliband has

was a much bigger issue here. This they don't have to answer these

questions and that these smears. This is ludicrous. These are

important questions about an important bank, how it ended up

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

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

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

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

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

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

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

about these very difficult Labour, the party, certainly knew

circumstances in which he resigned as a councillor. I think that the

Labour Party knew about it. We knew that Bradford did, but not London.

Are you saying that Ed Miliband knew about the inappropriate material on

the Reverend's laptop? It is certainly the case that Labour knew

about it. But did Mr Miliband know about it, and his predilection for

rent boys? He will need to answer those questions. It is quite proper

to ask those questions. Surely, asking a perfectly legitimate set of

questions, not just about that but about how we have ended up in a

situation where this bank has made loans to Labour for millions of

pounds, that bank and the Unite bank, who is connected to it. And

how they made a ?50,000 donation to Ed Balls' office. Ed Balls says that

was nothing to do with Reverend Flowers, and yet Reverend Flowers

said that he personally signed that off. Lots of questions to answer.

David Cameron has already answered them on Wednesday. He said that you

now know that Labour knew about his past all along. You have not been

able to present evidence that involve Mr Miliband or Mr Balls in

that. So until you get that, surely you should apologise? Hang on. He

said that Labour knew about this, and they did, because he stood down

as a councillor. If Ed Miliband didn't know about that, then why

not? This was quite a serious thing that happened. The wider point is

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

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

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

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

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

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

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

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

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

for regulatory reason. The government in 2009 - Ed Balls

for regulatory reason. The very pleased... But you supported

that decision. There was a later deal, potentially, for the Co-op to

buy those Lloyds branches. There was a proper process and it didn't go

through just recently. If there had been a proper process back in 2009,

would the Britannia deal have gone through? First, you accept that the

Tories were in favour of the Britannia take over. Then your

Chancellor Osborne went out of his way to facilitate the purchase of

the Lloyds branches, even though you had no idea that the Co-op had the

management expertise to become a super medium. Correct? The

difference is that that deal didn't go through. There was a proper

process that took place. Let's look at the process. There was long

indications as far back as January 2012 that the Co-op, as a direct

result of the Britannia take over which you will party supported, was

unfit to acquire the Lloyds branches. By January 2012, the

Chancellor and the Treasury ignored the warnings. Wide? In 2009, there

was political pressure for the Britannia to be brought together.

Based on the information available, this was supported, but that process

ended up with a very, very problematic takeover of the

Britannia. Wind forward to this year, and when the same types of

issues were being looked at for the purchase of the Lloyds deal, the

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

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

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

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

Treasury and the Chancellor who were the cheerleaders for the acquisition

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

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

but instead of heeding those warnings, your people went to

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

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

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

mutuals to the Co-op. He was arguing for the

ruling. The idea was to make sure that every bank in Britain could

have a better deal, particularly the mutuals, as you say. That is a

proper thing for the Chancellor to be doing. We could go round in

circles here, but in the end, there was not a takeover of the Lloyds

branches, that is because we followed a proper process. Had that

same rigorous process been followed in 2009, the legitimate question to

ask is whether the Co-op would have been -- would have taken over the

Britannia. That is a proper question to ask. It is no good to have the

leader of the opposition say, as soon as you ask any of these

questions about anything where there is a problem for them, they come

back with, oh, this is all smears. There are questions to ask about

what the Labour government did, the debt and the deficit they left the

country with, the way they stopped work from paying in this country.

The big question your government has two answer is, why, by July 2012,

when it was clear there was a black hole in the Co-op's balance sheet,

your government re-confirmed the Co-op as the preferred bidder for

Lloyds - why would you do that? Well, look, the good thing is, we

can discuss this until the cows come home, but there is going to be a

proper, full investigation, so we will find out what happened, all the

way back. So, we will be able to get to the bottom of all of this. Grant

Shapps, the only reason the Lloyds deal did not go ahead was, despite

the Treasury cheerleading, when Lloyds began its due diligence, it

found that there was indeed a huge black hole in the balance sheet and

that the Co-op was not fit to take over its branches. That wasn't

that the Co-op was not fit to take it wasn't the Government, it was not

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

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

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

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

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

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

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

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

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

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

review. What I cannot understand is, independent review, the response you

get to these serious questions. The response is, oh, this is a smear. It

is crazy. We are trying to answer the big questions for this country.

We have done all of that, and we are out of time. The Reverend Flowers'

chairmanship of the Co-op bank was approved by the regulator at the

time, which no longer exists. It was swept away by the coalition

government in a supposed revolution in regulation. But will its

replacement, the Financial Conduct Authority, be different? Adam has

been to find out. Come with me for a spin around the Square mile to find

out how we regulate our financial sector, which is almost five times

bigger sector, which is almost five times

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

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

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

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

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

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

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

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

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

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

here, with the Bank of England, and City. Most of the responsibly delays

its new Prudential Regulation Authority. And the Financial

Services Authority has been replaced with the new Financial Conduct

Authority. Can we go to the financial conduct authority, please?

Canary Wharf, thank you. Here, it is all about whether the people in

financial services are playing by the rules, in particular, how they

treat their customers. This place has got new powers, like the ability

to ban products it does not like, a new mandate to promote competition

in the market, the concept being, more competition means a better

market, plus the idea that a new organisation rings a whole new

culture. Although these are the old offices of the FSA, so maybe not

quite so new after all. It has also inherited the case of the Co-op bank

and its disgraced former chairman the Reverend Paul Flowers. The SCA

will be part of the investigation into what happened, which will

probably involve looking at its own conduct. One member of the

Parliamentary commission into banking wonders whether the new

regulator, and its new boss, are up to it. I have always said, it is not

the architecture which is the issue, it is the powers that the regulator

has, and today, it does not seem to me as if there is any increase in

that. And with the unfolding scandal at the Co-op, it feels like the new

architecture for regulating the City is now facing its first big test.

And the chief executive of the Financial Conduct Authority, the

SCA, Martin Wheatley, joins me now. Welcome to The Sunday Politics. The

failure of bank regulation was one failure of bank regulation was one

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

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

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

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

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

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

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

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

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

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

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

operated. He was challenged, we did the time, the system which the FSA

challenge him, and we said, you do not have the right experience, but

at the time, we would not have opposed the appointment. What we

needed was additional representation of the board of people who did have

banking experience. You can say that that was then and this is now, but

up until April of this year, it was still the plan for the Co-op, under

Mr Flowers, and despite being seriously wounded by the Britannia

takeover, to take on 632 Lloyds branches. That was the Co-op's

plan. They needed to pass our test as to whether we thought they were

fit to do that, and frankly, they never passed that test. It was not

the regulator that stopped them? It was. We were constantly pushing

back, saying, you have not got the capital, you have no got the

systems, and ultimately, they withdrew, when they could not answer

our questions. You were asking the right questions, I accept that, but

all of the time, the politicians on all sides, they were pushing for it

to happen, and I cannot find anywhere where the regulator said,

look, this is just not going to happen. I cannot comment on what the

politicians were doing, but I continue what we were doing, which

was constantly asking the Co-op, have you got the systems in place,

have you got the people, have you got the capital? And they didn't.

But it only came to a head when Lloyds started its own due diligence

on the bank, and they discovered that it was impossible for them to

take over the branches, it was not the regulator... In fairness, what

we do is ask the questions, can you do this deal? And we kept pushing

back, and we never frankly got delivered a business plan which we

were happy to approve. Is the SCA going to launch its own inquiry into

what happened? -- the FCA. The Chancellor has announced what will

be a very broad inquiry. There are a number of specifics which we will be

able to look at, relating to events over the last five years. Could

there be a police investigation? I think the police have already

announced an investigation. I am talking about into the handling of

the bank. It depends. There might be, if there is grim low activity,

which we do not know yet. You worked at the FS eight, didn't you? I did.

Some of those people who were signed off on the speedy promotion of Mr

Flowers, are they now working there? Yes, we have some. I came to

join the Financial Services Authority, to lead it into the

creation of the new body, the SCA. We had people who were challenging

and they did the job. There was not a requirement to approve the role as

chairman. There was not even a requirement to interview at that

stage. What we did do was to require that he was interviewed, and that

the Co-op should get additional experience. One of the people from

the old organisation, who signed up on the promotion of Mr Flowers to

become chairman is now a nonexecutive director of the Co-op,

so how does that work? Welcome he was a senior adviser to our

organisation, one of the people who made the challenges, and who said,

you need more experience on your board. Subsequently he then went and

joined the board. Surely that should not be allowed, the regulator and

the regulated should not be like that. Well clearly, you need

protection, but we have got to get good people in, and frankly, we want

the industry to have good people in the industry, so there will be some

movement between the regulator and industry. We all wonder whether you

have the power or even the confidence to stand up if you look

at all of the really bad bank decisions recently, politicians were

behind them. It was Gordon Brown who pushed the disastrous merger of

Lloyds and RBS. It was Alex Salmond who egged on RBS to buy the world.

All three main parties wanted the Co-op to buy Britannia, even though

they did not know the debt it would inherit, and all three wanted the

Co-op to buy the Lloyds branches - how do you as a regulator stand up

to that little concert party? Well, that political pressure exists, our

job at the end of the day is to do a relatively technical job and say,

does it stack up? And it didn't, and we made that point time and time

again to the Co-op board. They did not have a business case that we

could approve. The bodies on left and right -- the politicians on left

and right gave the Co-op special support. They may have done, but

that was not you have made a warning about these payday lenders, but I

think what most people would like to see is a limit put on the interest

they can charge over a period of time - will you do that? We have got

a whole set of powers for payday lenders. We will bring in some

changes from April next year, and we will bring in further changes as we

see necessary. Will you put a limit on the interest they can charge?

That is something we can study. You do not sound too keen on it? Well,

there are a lot of changes we need to make. One change is limiting

rollovers, limiting the use of continuous payment authorities.

Simply jumping to one trigger would be a mistake. Finally, an issue

which I think is becoming a growing concern, because the Government is

thinking of subsidising them, 95% mortgages are back - should we not

be worried about that? I think we should if the market has the same

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

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

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

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

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

many challenges. It was once called the battle of the

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

modernisers and old-style traditional Tories for the direction

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

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

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

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

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

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

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

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

that the party is still seen as an old-fashioned monolith and hasn't

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

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

reform band compassionate conservatism. David Cameron wants

talked about leading the greenest government ever. Downing Street says

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

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

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

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

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

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

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

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

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

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

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

modernisation has been quietly Modernisation is about reaching out

to the voters, and the work to do that is now more relevant than ever.

We got the biggest swing since 1931, and the thing is we need to do more

to reach out to voters in the North. We need to reach out to non-white

voters, and show that the concerns of modern Britain and the concerns

of ordinary people is something that we share. And what way will racking

up electricity bills with green levies get you more votes in the

North of England? We have to look at ways to reduce energy bills. The

renewable energy directive doesn't do anything to help cut our

emissions, but does decrease energy bills by ?45 a year. We should

renegotiate that. That is a part of modernisation and doing what

ordinarily people want. And old dinosaurs like you are just holding

this modernisation process back? I am very appreciative of covering on

this programme. The Tory party has been reforming itself for more than

150 years. This idea of modern eyes a is just some invention. We are

changing all the time. I'm nice and cuddly! So you are happy that the

party made gay marriage almost a kind of symbol of its modernisation?

Fine Mac the gay marriage was a free vote. David Cameron was recorded as

a rebel there because more Tories voted against his position than ever

before. It was said that this was a split between the old and

before. It was said that this was a it actually was a split between

those who were religious and nonreligious. It is a

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

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

part of the world, we got three councillors elected, two were 80 and

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

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

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

three young people? Hang on a minute. You can't get away with

that. Three in one batch. Does modernisation exist?

that. Three in one batch. Does is about watering our appeal and

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

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

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

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

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

party been against making poorer people better off? Or against better

schools? Do you think Mrs Thatcher was a moderniser when she won all

those elections? The problem we have at the moment is that UKIP has

grown-up. If we could get all of those people who vote UKIP to vote

for us, we would get 47% of the vote. We don't need to worry about

voters on the left. We need to worry about the voters in the north, those

people who haven't voted for us for decades. Having an EU Referendum

Bill is going to get people to vote. We have to reach out to

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

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

appeal, but this back to the future concept is not going to work. We

need something that generally appeals to low and middle-income

voters, and something that shows we genuinely care about the life

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

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

support those aspirations? We are We don't have an EU Referendum Bill

stop we have to get the centre right to vote for us again. Do that, and

we have it. Tom Pursglove, the 25 euros, will be returned in Corby

because we cannot win an election there. -- the 25-year-old. Whether

you are moderniser or traditionalist, people, particularly

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

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

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

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

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

people from state education into the top. You are going the other way at

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

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

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

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

Coming up in just under 20 minutes, I

Hello, and welcome to Sunday Politics in Northern Ireland. Peter

Robinson's critics might speculate about his future as leader and who

will succeed him. We'll hear from the the DUP

will succeed him. We'll hear from Minister on his plans to carry on

doing what he calls his "duty". And they may be minnows in the Assembly

with just one MLA, but they've big plans to build on their numbers

here. We'll have a special report from the UKIP conference. Joining me

to discuss that and more are PR consultant Sheila Davidson and

journalist and commentator Steven Mc Caffery. The DUP has been the

largest political party here for ten years - a milestone it was keen to

celebrate at its weekend conference. The party faithful were told that to

build on that success, unionism is at its best when it's open and

inviting, not narrow and exclusive. With a senior Catholic priest

invited to take part in the conference, our Political

Correspondent, Martina Purdy, went along to find out more.

I think it is slim in the short term. One catholic told me he was

voting for the D U P and was doing it to move into teachers about

abortion. One catholic priest who made history by taking part in a

diversity debate had its own reservations. Does it present a more

confident sense of unionism and the better thing for society if you can

avoid any sense of sectarianism, then I think there will be Catholics

who will find in the DUP, the policies are social and moral

policies on abortion and same-sex marriage who might be inclined to

vote for them. Conference delegates were open to the idea. We have held

events were catholic people have come along to it. I think the

hardline nationalist areas, it's hard to break him, but for the more

moderate people are more open to discussion and moving on, then yes,

there can be more voters. Sammy Wilson joked that change might be in

the air. Look at that. Can't you have it in green, white and gold?

There is one thing the DUP that are very serious about.

Well Peter Robinson isn't able to join us live on Sunday Politics this

morning, but immediately after his speech Mr Robinson did talk to me. I

started off by asking him about the forthcoming European Election. As we

heard in Martina's report the party still has to decide if it will run a

second candidate alongside its current MEP, Diane Dodds. I put it

to Mr Robinson that running another DUP candidate is potentially a very

risky strategy. There are strong voices in the party, it has to be

said, who want to put in a second candidate. But for me it always has

to be about whether we can win the two seats for unionism, and will it

be a better opportunity to have two Democratic Unionist party

candidates, or whether other party should have a

candidates, or whether other party rather than have a mother

nationalist or Republican getting elected. Over the next few weeks and

months we will talk to the members of the party to see what the best

strategy will be. Do you accept it is risky? There is the potential

with a second candidate to further shred the Unionist vote and perhaps

restrict Unionist representation to just one seat and allow the SDLP and

Sinn Fein to take the others. That has to be a real risk. That is a

risk on one side, but the risk on the other is that the last opinion

poll showed that the UUP was down to 10%, and you need 25% to get a

European seat. Do we risk leaving it as they are capable of winning a

seat, or do we take a decision to run a second? There is a risk

whichever way we do it. We have to take whatever is the most likely

outcome to get the Unionists to return. You said today unionism was

its best when it was not narrow and exclusive. Are there some people in

the DUP who, frankly, either don't know what you mean by that might

even disagree? I think there are very few who will not know what I

mean. I think the issue is that we have come from a very difficult and

entrenched position, coming through decades of violence in Northern

Ireland. Therefore it is difficult for people to leave behind the

baggage of those difficult years and two move forward and be embracing

and encouraging, but I think that's the way forward for Northern Ireland

-- to move forward. The opinion polls had a third of the community

wanting to have a united Ireland. polls had a third of the community

Sinn Fein could barely get a majority on its own support base, so

people want to remain in the UK which allows us to look at a wider

rising. You were -- wider horizon. You were clear earlier in the week

that John Larkin was wrong to raise the debate and draw a line under the

pre-1998 troubles and their related crimes. Is it not the case though

the politicians are allowing victims to be the arbiters of public policy,

and what John Larkin was at least doing was allowing space for a

serious debate to take place. I think before anybody wants to

comment on those matters they should do the kind of thing I did a number

of days ago. I went down and spoke to the victims, and here we were,

of days ago. I went down and spoke ten, 20, 30, 40 years after some

have them had lost their loved ones and the tears were still flowing.

They were still hurting. They still felt that people were not giving

them the justice or truth that they needed. I believe we do need to have

a big Tim Centre approach to the future. -- victims centred. It means

that we bring victims along, allow them to be the centre of the

progress in Northern Ireland, but to recognise the very real hurt that

they have the entitlement they have had to keep open the hope that

ultimately justice will be done. How do you think you can realise your

vision for a more inclusive society when the relationships at the heart

of the executives and government between Sinn Fein and the DUP looks

so very toxic at the moment? There is a tendency on the part of the

press and the media to accentuate any difficulties we have in the

process. We have taken almost 1000 decisions as an executive. There is

only a handful of those that have ever caused division in the

executive. But that is a handful that you guys always concentrate on,

instead of showing the positive things that are done, all the

agreements made, all the achievements we have made. The

progress that is there. Let's get our priorities right and get some

perspective on what we're doing. The executive is a very successful. And

I hope that the BBC, amongst others, will be prepared to publish the kind

of list that the DUP has published today to let people see what has

been achieved in their name and see that not only the DUP, but the

executive as a whole is delivering. Some of that might be the case, but

with respect, the disagreements between you and Martin McGuinness

and others in the executives tend to be about fundamental issues, which

is why people are so interested in them and how you intend to resolve

them. You can't just wish that away. When we take 1000 decisions and you

find difficulty with one two, the first thing you need to have is some

focus on the successive -- successes. You never mention them,

you move on the areas with problems. Of course there are problems, we

come from different backgrounds and we have had decades of division and

conflict in Northern Ireland so of course there are difficulties to

overcome. But one thing we consistently do is that where there

are difficulties we keep working on them until we resolve them. Let's

look at the key issues like flags, parades, the past,

look at the key issues like flags, Richard Haass who was invited by the

media, it was you and Martin McGuinness. And why did we do it?

Because where there are real problems we keep that the matter. We

have agreed everything in the good relations strategy with the

exception of those three issues, and we did not say we could not get them

resolve, we said we could bring in outside facilitation to help unravel

the areas of difference again, so we continue to work at those matters

which are outstanding, which is the way forward in Northern Ireland.

Recognise the difficulties, but keep working to resolve them. Just a

final thought about next week's flag protest in the centre of Belfast.

What is your definitive position on what should happen, and what the

pitfalls potentially are for people taking part? I think we are past the

stage because the parades commission have indicated they are giving

permission. All I would ask the organisers to do, and as people who

want to see Northern Ireland succeeding, who don't want to damage

the Northern Irish economy, I asked them to carry out the protest, which

is a legitimate right, to show that one year on they are still opposed

to the flags decision of Belfast City Council, but I ask them have

their protest that does the least possible damage to the traders of

Belfast. You looks like you were enjoying yourself during the speech.

Commentators might say you have had a tough time over the last year or

two. Are you back on top of your game? The party has always been

supportive. There is a tendency on the part of the media to look at the

Democratic Unionist party as if it is just any other political party.

It is not. It is a very special creation. It is a family more than a

political party. You do not have the backstabbing and so forth in -- like

another political support -- parties. We have a lot of support,

we have a good relationship. The fact I am endorsed unanimously by

the executive shows a degree of support and the collective do --

connectivity and unity in the party as a whole. Peter Robinson talking

to me yesterday. Let's hear now from my guests public relations

consultant Sheila Davidson and journalist Steven McCaffery. Steven

and Sheila were both at the DUP Conference. Looking from the studio

here, it looked fairly slick affair. Was it like that on the ground? It

certainly was a slick affair, very well choreographed and there was a

very genuine support in the audience. But I was interested

very genuine support in the see Peter Robinson talking for

however long it was about all the negativity when you had given him

every opportunity to talk about all the positives they did produce

there. They brought out the two documents which will be interesting

to see if they appear as an insert in the Belfast Telegraph Tom paid

for by the party policy people, but they had an opportunity, an

opportunity to articulate the positives but he still kept talking

about the negatives and going back to the old ways. I would love to

have seen the kind of positivity that was in the speech reflected

back in the interview that happened, because no one is going to listen to

that speech for its entirety, but what they will look at is the media

output from it. And there needs to be some coordination between that

confidence in the speech and the confidence in terms of how they are

putting forward the confidence in terms of how they are

says they have achieved. Stephen, you were there, what did you make of

the idea that it was the fault of the media for not focusing on the

positives because the negative things are small in number? But they

are important, and that was the point I made. There may not be as

many of them, but flags and parades are what people need to see

resolved. Absolutely. It's no accident that the American

government in the last 12 months have re-engaged substantially in the

peace process, that speaks volumes where things are at. I thought the

speech was very impressive. Very professional. When you seek other

leaders shuffling bits of paper and staring down at their notes, this

was a political leader who addressed his audience, was using the

autocue. A very positive speech as well. I felt it was a single issue

speech though, all about confidence. It was essentially a pep talk of the

party after a difficult year. With the European election, how big a

debate is that, for them to run or not run a second candidate? It's

been kicking around a long time that they think they have the numbers in

the party to put up a second candidate, but it's hard to resist

this -- the conclusion that they are dangling the possibility of a deal.

Peter union -- Peter Robinson saying Unionism at its best when it's open

and inviting, not exclusive, that was presumably meant for the hall,

but also people outside. Do you think it will strike a chord with

the ball populace? I think it will -- broader populace. I think people

recognise that the DUP is the biggest Unionist party and they want

them to reflect the ones that they biggest Unionist party and they want

will engage with and if they vote, they can carry forward. We will talk

to you later in the programme, but for now, thank you very much. . The

DUP wasn't the only party to hold a conference this weekend. At the

Stormont Hotel, local members of the UK Independence Party came together.

Membership of the eurosceptic party has been growing here - and UKIP

believes it can achieve success in elections to the European

Parliament, councils, and Stormont. Chris Page reports.

Once an Ulster Unionist, David McNarry now leads a branch of the

party surging. There, UKIP has attracted thousands of former

Conservative voters. Given that the Tory vote is small though, how will

UKIP grow support in Northern Ireland? We are growing because of

the effect of the Unionist, and people who would vote Unionist

naturally are fed up with the lack of politics and the poverty of

politics there is. But it is across the board also. There are people

from a nationalist background at the conference today, belonging to the

party. They are just as fed up with what they are getting, which is

nothing. At the moment, David McNarry's is the only UKIP member of

the assembly and the party has just one councillor here, but the members

gathering for their conference over their belief that UKIP is only roll

across the UK, and they think the party is well placed to benefit in

Northern Ireland -- on a roll. This council is running in the European

Parliament next year -- councillor is running. He is upbeat about his

chances and thinks in 2016 UKIP could win several seats in

Stormont. I really think we can do it. In my constituency in Southdown,

and in North Down, those constituencies where we can return.

This MEP thinks the flagship policy of withdrawing from the European

Union is a crucial part of the electoral strategy. Because we are

not in the European Union and we don't have to follow the energy

policy and the agricultural policy. We don't have to have the fisheries

run by the European Union. All of these things mean you can be

different, genuinely different. Whether that chimes with the voters

here will become clear when the party is tested at the polls in the

spring. Sheila and Steven are still with me.

A much more modest affair than the DUP conference, but do you think

UKIP has a future in Northern Irish politics? If you look at the other

parties who have politics? If you look at the other

Sea and tried to plant a flag, mostly the Conservatives with a huge

resources, basically weren't able to, so for that reason I think it

will be difficult. I don't think the European issue has the same

traction. We have a different relationship with Europe than

perhaps the farming and wider community might have in England,

Scotland and Wales. I think they will struggle but they do have a

seasoned campaigner at the four with David McNarry, who is obviously a

strong -- strongly supported politician. Where could you could

potentially pick up any votes? I'm not sure that they are -- where

could UKIP? If we are in a situation with the protest was open to them,

maybe they might pick up some on that basis. I think a lot of the

parties are putting people forward. The SDLP, and Jim Nicholson as the

old warhorse for the UUP, I think the political parties are taking the

European elections very seriously in terms of positioning themselves for

the council elections, and then the elections for Stormont later. I

think the idea that they will just pick up votes is not necessarily

going to work out for them. Unless they bring in Nigel Farage and have

the big national personality vote that might come along with that. But

I don't think it's going to be enough to make a difference. If the

DUP are questioning if they can pick up two seats, I doubt that UKIP will

make any big inroads. It is certainly building up to being a

fascinating election battle as far as the European elections are

concerned. Let's pause now for a look at the week in 60 seconds with

Martina Purdy. The Attorney General John Larkin

provoked a week of political debate with this proposal. The time has

come to think about drawing a line, set at Good Friday, 1998, with

respect to prosecutions. As somebody who represents the law and the rule

of law, I think to suggest that kind of amnesty process has actually

undermined his credibility. And once again, the MLAs are told to mind

their language. I cannot allow members to make those contributions

and be so offensive that it is unbelievable. Alan Reid, who acted

as a conduit between Republicans and the government in the peace process,

has passed away. Reports say policing the past will cost ?190

million over the next five years. policing the past will cost ?190

And a laugh raised in the assembly. Physical powers, fiscal powers,

sorry. Let's have a final chat with Sheila

Davidson and Steven Mc Caffery. Stephen, we have the death announced

on Friday father Alex Reid who made a huge contribution to the peace

process. Absolutely, and when the pain of victims has been at the

front of political life here, his passing was a reminder of what we

have achieved in the past and what we can achieve in the future.

Individuals like Father read skate the troubles, and perhaps with the

right commitment we can escape the shadows of the trouble -- father

read escaped the troubles. Lamented by many people, including the First

Minister. Absolutely. We can never get away from the image of him

kneeling beside the soldiers, giving them the last rites of the kiss of

life, doing what he could, and if ever there was a personification of

how the church or any of the churches can do something positive

in terms of bringing people together, then I think it was with

him. Just a final sentence on Richard Haass. Notable that he was

not mentioned at all in the speed from Peter Robinson, but the issues

are there, so that is where the agenda goes. Sheila, positive? I

think we are being managed about the expectations that will come out of

Haas, and there needs to be that caution. That's it

those people who want to cycle. We will be returning to this one. Thank

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

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

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

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

tweet sent from someone watching the session as ammunition at the

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

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

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

the former Labour has just come in from Tony McNulty,

minister, saying that the public are desperate for a PM in waiting who

speaks for them, not a Leader of the Opposition in dodging in partisan

Westminster Village knock about. So I would stay up with the tweets if

you want to get on the right side of this one! We are working on how the

Prime Minister managed to get that wheat in the first place. What did

you think when you saw it being read out? I was certainly watching the

Daily Politics. I almost fell off my chair! It was quite astonishing. He

didn't answer the question - he didn't do that the whole time. But I

stand by what the tweets said. I have tweeted for a long time on

PMQs. Normally I am praising Ed Miliband to the hilt, but no one

announces that in Parliament! Because the

announces that in Parliament! on what you said, it unleashed some

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

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

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

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

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

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

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

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

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

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

about observing people -- people observing themselves doing things.

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

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

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

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

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

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

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

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

Prime Minister, or the Leader of the just talking about the monster you

have unleashed! I hope it dies a miserable death. I think Tony is a

good analysis -- a good analyst of PMQs on Twitter. Moving onto the

Co-op. You were a Co-op-backed MP, white you? I was a Co-op party

member. There are two issues here about the Co-op and the Labour

Party. All the new music suggests that the Co-op will now have to

start pulling back from lending or donating to the Labour Party, which,

at a time when Mr Miliband is going through changes that are going to

cut of the union funds, it seems quite dangerous. There are three

things going on. There's the relationship that the

things going on. There's the politically with the Co-op party,

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

this enquiry into the comings and goings of Flowers and everybody

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

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

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

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

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

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

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

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

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

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

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

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

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

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

mutualism of the Co-op. But don't confuse the Co-op bank with the

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

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

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

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

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

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

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

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

could be real financial difficulties here. The government

careful, because George Osborne launched one of his classic

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

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

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

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

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

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

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

the Westminster parties were in favour of the Britannia takeover.

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

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

Lloyds branches. The Tories tried to were in favour of going to get the

outdo Labour in being more pro-Co-op. There was nobody in

Westminster saying, hold on, this doesn't work. It is like the

financial bubble all over again. Everyone was in favour of that at

the time. I think there is no evidence so far that the storm is

cutting through to the average voter. If I were Ed Miliband, I

would let it die a natural death. I would not write to an editorial

column for a national newspaper on a Sunday. That keeps the issue alive,

and it makes him look oversensitive and much better at dishing it out

than taking it. I agree about that. The Labour press team tweeted this

week saying that it was a new low for the times. And this was

re-tweeted by Ed Miliband. It isn't a great press attitude. It is very

Moni. Bill Clinton went out there and fought and made the case. So did

Tony Blair. If you just say, they are being horrible to us, it looks

pathetic. And it will cut through on Osborne and the financial

dimensional is, not political. I shall tweet that later! While we

have been talking, Mr Miliband has been on Desert Island Discs. He

might still be on it. Let's have a listen to what he had to say.

# Take on me, take me on. # And threw it all, she offers me

protection. # A lot of love and affection.

# Whether I'm right or wrong #. # Je Ne Regrette Rien. #.

Obviously, that was the music that Ed Miliband chose. Who thought --

you would have thought he would choose Norman Lamont's theme tune!

He chose Jerusalem... He has no classical background at all. He had

no Beethoven, no Elgar. David Cameron had Mendelssohn. And Ernie,

the fastest Notman in the West. -- fastest milkman. Tony Blair chose

the theme tune to a movie. Tony Blair's list was chosen by young

staffers in his office. It absolutely was. Tony Blair's list

was chosen by staff. The Ed Miliband this was clearly chosen by himself,

because who would allow politician to go out there and say that they

like Aha. I am the same age as Ed Miliband, and of course he likes

Aha. That was the tumour was played in the 80s. Sweet Caroline. It is

Angels by Robbie Williams. I was 14-year-old girl when that came out.

I thought Angels was the staple of hen nights and chucking out time in

pubs. The really good thing about his list is that the Smiths to not

appear. The Smiths were all over David Cameron's list. The absolutely

miserable music of Morris he was not there. What was his luxury?

miserable music of Morris he was not Indian takeaway! Again, chosen for

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

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

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

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

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

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

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

Politics will be on BBC That's all for today. The Daily

lunchtime every day next week, and we'll be back here on BBC One at

11am next week. My luxury, by the way, was a wind-up radio! Remember,

if it's Sunday, it's the Sunday Politics.