:00:36. > :00:40.Morning, folks. Welcome to the Sunday Politics.
:00:41. > :00:43.Labour's been hit hard by scandals at the Co-op. Ed Miliband says the
:00:44. > :00:46.Tories are mudslinging. We'll speak to Conservative Chairman Grant
:00:47. > :00:49.Shapps. Five years on from the financial
:00:50. > :00:52.crisis, and we're still talking about banks in trouble. Why haven't
:00:53. > :00:58.the regulators got the message? We'll ask the man who runs the
:00:59. > :01:01.City's new financial watchdog. And he used to have a windmill on
:01:02. > :01:06.his roof and talked about giving hugs to hoodies and huskies. These
:01:07. > :01:10.days, not so much. Has the plan to make
:01:11. > :01:15.In the South West: The warning from the wind and solar industry that
:01:16. > :01:19.story talk of cutting green warned that benefit falls will be to
:01:20. > :01:26.homelessness and population ships. What is the evidence?
:01:27. > :01:31.And as always, the political panel that reaches the parts other shows
:01:32. > :01:35.can only dream of. Janan Ganesh Helen Lewis and Nick Watt. They ll
:01:36. > :01:39.be tweeting faster than England loses wickets to Australia. Yes
:01:40. > :01:42.they're really that fast. First, some big news overnight from
:01:43. > :01:45.Geneva, where Iran has agreed to curb some of its nuclear activities
:01:46. > :01:50.in return for the partial easing of sanctions. Iran will pause the
:01:51. > :02:00.enrichment of uranium to weapons grade and America will free up some
:02:01. > :02:03.funds for Iran to spend. May be up to $10 billion. A more comprehensive
:02:04. > :02:06.deal is supposed to be done in six months. Here's what President Obama
:02:07. > :02:15.had to say about this interim agreement. We have pursued intensive
:02:16. > :02:19.diplomacy, bilaterally with the Iranians, and together with our
:02:20. > :02:23.partners, the United Kingdom, France, Germany, Russia and China,
:02:24. > :02:29.as well as the European Union. Today, that diplomacy opened up a
:02:30. > :02:35.new path towards a world that is more secure, a future in which we
:02:36. > :02:42.can verify that Iraq and's nuclear programme is peaceful, and that it
:02:43. > :02:45.cannot build a nuclear weapon. President Obama spoke from the White
:02:46. > :02:51.House last night. Now the difficulty begins. This is meant to lead to a
:02:52. > :02:57.full-scale agreement which will effectively end all sanctions, and
:02:58. > :03:01.end Iran's ability to have a bomb. The early signs are pretty good The
:03:02. > :03:07.Iranian currency strengthened overnight, which is exactly what the
:03:08. > :03:14.Iranians wanted. Inflation in Iraq is 40%, so they need a stronger
:03:15. > :03:18.currency. -- information in Iran. France has played a blinder. It was
:03:19. > :03:22.there intransigence that led to this. Otherwise, I think the West
:03:23. > :03:27.would have led to a much softer deal. The question now becomes
:03:28. > :03:33.implementation. Here, everything hinges on two questions. First, who
:03:34. > :03:38.is Hassan Rouhani? Is he the Iranians Gorbachev, a serious
:03:39. > :03:45.reformer, or he's here much more tactical and cynical figure? Or
:03:46. > :03:47.within Iran, how powerful is he There are military men and
:03:48. > :03:55.intelligence officials within Iran who may stymie the process. The
:03:56. > :03:59.Western media concentrate on the fact that Mr Netanyahu and the
:04:00. > :04:04.Israelis are not happy about this. They don't often mention that the
:04:05. > :04:09.Arab Gulf states are also very apprehensive about this deal. I read
:04:10. > :04:20.this morning that the enemies of Qatar and Kuwait went to Saudi king.
:04:21. > :04:25.-- the MAs row. That is the key thing to watch in the next couple of
:04:26. > :04:30.weeks. There was a response from Saudi Arabia, but it came from the
:04:31. > :04:34.Prime Minister of Israel, who said this was a historic mistake. The
:04:35. > :04:38.United States said there would be no enrichment of uranium to weapons
:04:39. > :04:42.grade. In the last few minutes, the Iranian Foreign Minister has tweeted
:04:43. > :04:52.to say that there is an inalienable right -- right to enrich. The key
:04:53. > :04:57.thing is the most important thing that President Obama said in his
:04:58. > :05:01.inaugural speech. He reached out to Iran. It failed under President
:05:02. > :05:07.McKenna jab. Under President Rouhani, there seems to be progress.
:05:08. > :05:12.There is potentially now what he talked about in that first inaugural
:05:13. > :05:18.address potentially coming through. In the end, the key issue - and we
:05:19. > :05:22.don't know the answer - is the supreme leader, not the president.
:05:23. > :05:27.Will the supreme leader agreed to Iran giving up its ability to create
:05:28. > :05:33.nuclear weapons? This is the huge ambiguity. Ayatollah Khamenei
:05:34. > :05:39.authorise the position that President Rouhani took to Geneva.
:05:40. > :05:44.That doesn't mean he will sign off on every bit of implementation over
:05:45. > :05:50.the next six months. Even when President Ahmadinejad was president,
:05:51. > :05:55.he wasn't really President. We in the West have to resort to a kind of
:05:56. > :06:06.Iranians version of the study of the Kremlin, to work out what is going
:06:07. > :06:12.on. And the problem the president faces is that if there is any
:06:13. > :06:16.sign... He can unlock these funds by executive order at the moment, but
:06:17. > :06:21.if he needs any more, he has to go to Congress. Both the Democrat and
:06:22. > :06:28.the Republican side have huge scepticism about this. And he has
:06:29. > :06:33.very low credibility now. There s already been angry noises coming
:06:34. > :06:37.from quite a lot of senators. It was quite strange to see that photo of
:06:38. > :06:41.John Kerry hugging Cathy Ashton as if they had survived a ship great
:06:42. > :06:51.together. John Kerry is clearly feeling very happy. We will keep an
:06:52. > :06:53.eye on this. It is a fascinating development.
:06:54. > :06:56.More lurid details about the personal life of the Co-op Bank s
:06:57. > :07:01.disgraced former chairman, the Reverend Paul Flowers. The links
:07:02. > :07:04.between Labour, the bank and the wider Co-op movement have caused big
:07:05. > :07:09.problems for Ed Miliband this week, and the Conservatives have been
:07:10. > :07:13.revelling in it. But do the Tory allegations - Ed Miliband calls them
:07:14. > :07:23."smears" - stack up? Party Chairman Grant Shapps joins us from Hatfield.
:07:24. > :07:32.Welcome to the programme. When it comes to the Co-op, what are you
:07:33. > :07:35.accusing Labour of knowing and when? I think the simple thing to say here
:07:36. > :07:41.is that the Co-op is an important bank. They have obviously got into
:07:42. > :07:45.difficulty with Reverend flowers, and our primary concern is making
:07:46. > :07:48.sure that that is properly investigated, and that we understand
:07:49. > :07:51.what happened at the bank and how somebody like Paul Flowers could
:07:52. > :07:57.have ended up thing appointed chairman. You wrote to edge Miliband
:07:58. > :08:04.on Tuesday and asked him what he knew and when. -- you wrote to Ed
:08:05. > :08:08.Miliband. But by Prime Minister s Questions on Wednesday, David
:08:09. > :08:15.Cameron claims that you knew that Labour knew about his past all
:08:16. > :08:21.along. What is the evidence for that? We found out by Wednesday that
:08:22. > :08:27.he had been a Labour councillor Reverend Flowers, and had been made
:08:28. > :08:30.to stand down. Certainly, Labour knew about that, but somehow didn't
:08:31. > :08:37.seem to think that that made him less appropriate to be the chairman
:08:38. > :08:43.of the Co-op bank. There was no evidence that Mr Miliband or Mr
:08:44. > :08:48.Balls knew about that. I ask you again, what are you accusing the
:08:49. > :08:58.Labour leadership of knowing? We know now that he stood down for very
:08:59. > :09:01.inappropriate images on his computer, apparently. You are
:09:02. > :09:06.telling me that they didn't know. I am not sure that is clear at all. I
:09:07. > :09:10.have heard conflicting reports. There is a much bigger argument
:09:11. > :09:15.about what they knew and when. There was a much bigger issue here. This
:09:16. > :09:19.morning, Ed Miliband has said that they don't have to answer these
:09:20. > :09:22.questions and that these smears This is ludicrous. These are
:09:23. > :09:26.important questions about an important bank, how it ended up
:09:27. > :09:33.getting into this position, and how a disastrous Britannia -- Italia
:09:34. > :09:40.deal happen. -- Britannia deal happened. And we need to know how
:09:41. > :09:44.the bank came off the rails. To be accused of smears for asking the
:09:45. > :09:48.questions is ridiculous. I am just trying to find out what you are
:09:49. > :09:54.accusing Labour of. You saying that the Labour leadership knew about the
:09:55. > :10:03.drug-taking? Sorry, there was some noise here. I don't know what was
:10:04. > :10:07.known and when. We do know that Labour, the party, certainly knew
:10:08. > :10:12.about these very difficult circumstances in which he resigned
:10:13. > :10:18.as a councillor. I think that the Labour Party knew about it. We knew
:10:19. > :10:21.that Bradford did, but not London. Are you saying that Ed Miliband knew
:10:22. > :10:26.about the inappropriate material on the Reverend's laptop? It is
:10:27. > :10:33.certainly the case that Labour knew about it. But did Mr Miliband know
:10:34. > :10:40.about it, and his predilection for rent boys? He will need to answer
:10:41. > :10:45.those questions. It is quite proper to ask those questions. Surely,
:10:46. > :10:49.asking a perfectly legitimate set of questions, not just about that but
:10:50. > :10:53.about how we have ended up in a situation where this bank has made
:10:54. > :10:59.loans to Labour for millions of pounds, that bank and the Unite
:11:00. > :11:06.bank, who is connected to it. And how they made a ?50,000 donation to
:11:07. > :11:11.Ed Balls' office. Ed Balls says that was nothing to do with Reverend
:11:12. > :11:16.Flowers, and yet Reverend Flowers said that he personally signed that
:11:17. > :11:20.off. Lots of questions to answer. David Cameron has already answered
:11:21. > :11:26.them on Wednesday. He said that you now know that Labour knew about his
:11:27. > :11:30.past all along. You have not been able to present evidence that
:11:31. > :11:35.involve Mr Miliband or Mr Balls in that. So until you get that, surely
:11:36. > :11:39.you should apologise? Hang on. He said that Labour knew about this,
:11:40. > :11:45.and they did, because he stood down as a councillor. If Ed Miliband
:11:46. > :11:50.didn't know about that, then why not? This was quite a serious thing
:11:51. > :11:54.that happened. The wider point is about why it is that when you ask
:11:55. > :11:58.perfectly legitimate questions about this bank, about the Britannia deal,
:11:59. > :12:08.and about the background of Mr flowers, why is the response, it is
:12:09. > :12:11.all smears? There are questions about how Labour failed to deal with
:12:12. > :12:15.the deficit and how it hasn't done anything to support the welfare
:12:16. > :12:24.changes, but there is nothing about that. Let us -- lets: To the wider
:12:25. > :12:32.picture of the Co-operative Bank. Labour wanted the Co-op to take over
:12:33. > :12:37.the Britannia Building Society, and it was a disaster. Do you accept
:12:38. > :12:44.that? The government of the day has to be a part of these discussions
:12:45. > :12:49.for regulatory reason. The government in 2009 - Ed Balls was
:12:50. > :12:56.very pleased... But you supported that decision. There was a later
:12:57. > :13:00.deal, potentially, for the Co-op to buy those Lloyds branches. There was
:13:01. > :13:08.a proper process and it didn't go through just recently. If there had
:13:09. > :13:14.been a proper process back in 2 09, would the Britannia deal have gone
:13:15. > :13:19.through? First, you accept that the Tories were in favour of the
:13:20. > :13:23.Britannia take over. Then your Chancellor Osborne went out of his
:13:24. > :13:27.way to facilitate the purchase of the Lloyds branches, even though you
:13:28. > :13:35.had no idea that the Co-op had the management expertise to become a
:13:36. > :13:40.super medium. Correct? The difference is that that deal didn't
:13:41. > :13:47.go through. There was a proper process that took place. Let's look
:13:48. > :13:53.at the process. There was long indications as far back as January
:13:54. > :13:58.2012 that the Co-op, as a direct result of the Britannia take over
:13:59. > :14:02.which you will party supported, was unfit to acquire the Lloyds
:14:03. > :14:09.branches. By January 2012, the Chancellor and the Treasury ignored
:14:10. > :14:12.the warnings. Wide? In 2009, there was political pressure for the
:14:13. > :14:17.Britannia to be brought together. Based on the information available,
:14:18. > :14:20.this was supported, but that process ended up with a very, very
:14:21. > :14:26.problematic takeover of the Britannia. Wind forward to this
:14:27. > :14:29.year, and when the same types of issues were being looked at for the
:14:30. > :14:34.purchase of the Lloyds deal, the proper process was followed, this
:14:35. > :14:38.time with us in government, and that purchase didn't go through. It is
:14:39. > :14:42.important that the proper process is followed, and when it was, it
:14:43. > :14:52.transpired that the deal wasn't going to be done. But it was the
:14:53. > :14:56.Treasury and the Chancellor who were the cheerleaders for the acquisition
:14:57. > :15:00.of the Lloyds branches. But there was a warning that the Co-op did not
:15:01. > :15:04.have enough capital on its balance sheet to make those acquisitions,
:15:05. > :15:09.but instead of heeding those warnings, your people went to
:15:10. > :15:14.Brussels to lobby for the requirements to be relaxed - why on
:15:15. > :15:18.earth did you do that? Our Chancellor went to argue for all of
:15:19. > :15:23.Rajesh banking, not specifically for the Co-op. He was arguing for the
:15:24. > :15:29.mutuals to be given a special ruling. The idea was to make sure
:15:30. > :15:34.that every bank in Britain could have a better deal, particularly the
:15:35. > :15:37.mutuals, as you say. That is a proper thing for the Chancellor to
:15:38. > :15:41.be doing. We could go round in circles here, but in the end, there
:15:42. > :15:46.was not a takeover of the Lloyds branches, that is because we
:15:47. > :15:50.followed a proper process. Had that same rigorous process been followed
:15:51. > :15:55.in 2009, the legitimate question to ask is whether the Co-op would have
:15:56. > :15:58.been -- would have taken over the Britannia. That is a proper question
:15:59. > :16:03.to ask. It is no good to have the leader of the opposition say, as
:16:04. > :16:05.soon as you ask any of these questions about anything where there
:16:06. > :16:10.is a problem for them, they come back with, oh, this is all smears.
:16:11. > :16:14.There are questions to ask about what the Labour government did, the
:16:15. > :16:19.debt and the deficit they left the country with, the way they stopped
:16:20. > :16:24.work from paying in this country. The big question your government has
:16:25. > :16:27.two answer is, why, by July 201 , when it was clear there was a black
:16:28. > :16:33.hole in the Co-op's balance sheet, your government re-confirmed the
:16:34. > :16:38.Co-op as the preferred bidder for Lloyds - why would you do that?
:16:39. > :16:41.Well, look, the good thing is, we can discuss this until the cows come
:16:42. > :16:45.home, but there is going to be a proper, full investigation, so we
:16:46. > :16:50.will find out what happened, all the way back. So, we will be able to get
:16:51. > :16:55.to the bottom of all of this. Grant Shapps, the only reason the Lloyds
:16:56. > :17:00.deal did not go ahead was, despite the Treasury cheerleading, when
:17:01. > :17:03.Lloyds began its due diligence, it found that there was indeed a huge
:17:04. > :17:08.black hole in the balance sheet and that the Co-op was not fit to take
:17:09. > :17:13.over its branches. That wasn't you, it wasn't the Government, it was not
:17:14. > :17:19.the Chancellor, it was Lloyds. You were still cheerleading for the deal
:17:20. > :17:23.to go ahead... Well, as I say, a proper process was followed, which
:17:24. > :17:27.did not result in the purchase of the Lloyds branches. At that proper
:17:28. > :17:33.process been followed with the purchase of the Britannia, under the
:17:34. > :17:37.previous government... Which you supported. Yes, but it may well be
:17:38. > :17:41.that under that previous deal, there was a excess political pressure
:17:42. > :17:49.perhaps put on in order to create that merger, which proved so
:17:50. > :17:54.disastrous. The Tories facilitated it, Grant Shapps, they allowed it to
:17:55. > :17:58.go ahead. I have said, we are going to have a proper, independent
:17:59. > :18:03.review. What I cannot understand is, when you announce a robber,
:18:04. > :18:09.independent review, the response you get to these serious questions. The
:18:10. > :18:14.response is, oh, this is a smear. It is crazy. We are trying to answer
:18:15. > :18:24.the big questions for this country. We have done all of that, and we are
:18:25. > :18:27.out of time. The Reverend Flowers' chairmanship of the Co-op bank was
:18:28. > :18:32.approved by the regulator at the time, which no longer exists. It was
:18:33. > :18:36.swept away by the coalition government in a supposed revolution
:18:37. > :18:39.in regulation. But will its replacement, the Financial Conduct
:18:40. > :18:49.Authority, be different? Adam has been to find out. Come with me for a
:18:50. > :18:53.spin around the Square mile to find out how we regulate our financial
:18:54. > :18:58.sector, which is almost five times bigger than the country's entire
:18:59. > :19:03.annual income. First, let's pick up our guide, journalist Iain Martin,
:19:04. > :19:09.who has just written a book about what went so wrong during the
:19:10. > :19:11.financial crisis. The FSA was an agency which was established to
:19:12. > :19:16.supervise the banks on a day-to day basis. The Bank of England was
:19:17. > :19:20.supposed to have overall responsible at for this to Bolivia the financial
:19:21. > :19:24.system and the Treasury was supposed to take an interest in all of these
:19:25. > :19:30.things. The disaster was that it was not anyone's call responsibility, or
:19:31. > :19:34.main day job, to stay alert as to whether or not the banking system as
:19:35. > :19:38.a whole was being run in a safe manner. And so this April, a new
:19:39. > :19:47.system was set up to police the City. Most of the responsibly delays
:19:48. > :19:50.here, with the Bank of England, and its new Prudential Regulation
:19:51. > :19:54.Authority. And the Financial Services Authority has been replaced
:19:55. > :20:00.with the new Financial Conduct Authority. Can we go to the
:20:01. > :20:06.financial conduct authority, please? Canary Wharf, thank you. Here, it is
:20:07. > :20:09.all about whether the people in financial services are playing by
:20:10. > :20:14.the rules, in particular, how they treat their customers. This place
:20:15. > :20:18.has got new powers, like the ability to ban products it does not like, a
:20:19. > :20:22.new mandate to promote competition in the market, the concept being,
:20:23. > :20:26.more competition means a better market, plus the idea that a new
:20:27. > :20:33.organisation rings a whole new culture. Although these are the old
:20:34. > :20:38.offices of the FSA, so maybe not quite so new after all. It has also
:20:39. > :20:42.inherited the case of the Co-op bank and its disgraced former chairman
:20:43. > :20:46.the Reverend Paul Flowers. The SCA will be part of the investigation
:20:47. > :20:51.into what happened, which will probably involve looking at its own
:20:52. > :20:54.conduct. One member of the Parliamentary commission into
:20:55. > :21:00.banking wonders whether the new regulator, and its new boss, are up
:21:01. > :21:04.to it. I have always said, it is not the architecture which is the issue,
:21:05. > :21:08.it is the powers that the regulator has, and today, it does not seem to
:21:09. > :21:14.me as if there is any increase in that. And with the unfolding scandal
:21:15. > :21:22.at the Co-op, it feels like the new architecture for regulating the City
:21:23. > :21:24.is now facing its first big test. And the chief executive of the
:21:25. > :21:30.Financial Conduct Authority, the SCA, Martin Wheatley, joins me now.
:21:31. > :21:33.Welcome to The Sunday Politics. The failure of bank regulation was one
:21:34. > :21:39.of the clearest lessons of the crash in 2008, and yet two years later, in
:21:40. > :21:45.2010, Paul Flowers is allowed to become chairman of the Co-op - why
:21:46. > :21:49.have we still not got the regulation right? We have made a lot of changes
:21:50. > :21:54.since then. We have created a new regulator, as you know. At the time,
:21:55. > :21:57.we still had a process which allowed somebody to be appointed to a bank
:21:58. > :22:01.and they would go through a challenge, but in the case of Paul
:22:02. > :22:03.Flowers, there was no need for an additional challenge when he was
:22:04. > :22:10.appointed to chairman, because he was already on the board. But going
:22:11. > :22:15.from being on the board to becoming chairman, that is a big jump, and he
:22:16. > :22:19.only had one interview? That is why today, it would be different. But
:22:20. > :22:25.the truth is, that was the system at the time, the system which the FSA
:22:26. > :22:28.operated. He was challenged, we did challenge him, and we said, you do
:22:29. > :22:33.not have the right experience, but at the time, we would not have
:22:34. > :22:35.opposed the appointment. What we needed was additional representation
:22:36. > :22:40.of the board of people who did have banking experience. You can say that
:22:41. > :22:45.that was then and this is now, but up until April of this year, it was
:22:46. > :22:48.still the plan for the Co-op, under Mr Flowers, and despite being
:22:49. > :22:54.seriously wounded by the Britannia takeover, to take on 632 Lloyds
:22:55. > :22:58.branches. That was the Co-op's plan. They needed to pass our test
:22:59. > :23:02.as to whether we thought they were fit to do that, and frankly, they
:23:03. > :23:07.never passed that test. It was not the regulator that stopped them It
:23:08. > :23:11.was. We were constantly pushing back, saying, you have not got the
:23:12. > :23:14.capital, you have no got the systems, and ultimately, they
:23:15. > :23:19.withdrew, when they could not answer our questions. You were asking the
:23:20. > :23:25.right questions, I accept that, but all of the time, the politicians on
:23:26. > :23:28.all sides, they were pushing for it to happen, and I cannot find
:23:29. > :23:34.anywhere where the regulator said, look, this is just not going to
:23:35. > :23:38.happen. I cannot comment on what the politicians were doing, but I
:23:39. > :23:41.continue what we were doing, which was constantly asking the Co-op
:23:42. > :23:45.have you got the systems in place, have you got the people, have you
:23:46. > :23:49.got the capital? And they didn't. But it only came to a head when
:23:50. > :23:52.Lloyds started its own due diligence on the bank, and they discovered
:23:53. > :23:57.that it was impossible for them to take over the branches, it was not
:23:58. > :24:02.the regulator... In fairness, what we do is ask the questions, can you
:24:03. > :24:06.do this deal? And we kept pushing back, and we never frankly got
:24:07. > :24:13.delivered a business plan which we were happy to approve. Is the SCA
:24:14. > :24:24.going to launch its own inquiry into what happened? -- the FCA. The
:24:25. > :24:29.Chancellor has announced what will be a very broad inquiry. There are a
:24:30. > :24:34.number of specifics which we will be able to look at, relating to events
:24:35. > :24:38.over the last five years. Could there be a police investigation I
:24:39. > :24:42.think the police have already announced an investigation. I am
:24:43. > :24:46.talking about into the handling of the bank. It depends. There might
:24:47. > :24:55.be, if there is grim low activity, which we do not know yet. You worked
:24:56. > :25:02.at the FS eight, didn't you? I did. Some of those people who were signed
:25:03. > :25:08.off on the speedy promotion of Mr Flowers, are they now working
:25:09. > :25:11.there? Yes, we have some. I came to join the Financial Services
:25:12. > :25:17.Authority, to lead it into the creation of the new body, the SCA.
:25:18. > :25:28.We had people who were challenging and they did the job. There was not
:25:29. > :25:31.a requirement to approve the role as chairman. There was not even a
:25:32. > :25:37.requirement to interview at that stage. What we did do was to require
:25:38. > :25:48.that he was interviewed, and that the Co-op should get additional
:25:49. > :25:53.experience. One of the people from the old organisation, who signed up
:25:54. > :25:56.on the promotion of Mr Flowers to become chairman is now a
:25:57. > :26:03.nonexecutive director of the Co op, so how does that work? Welcome he
:26:04. > :26:07.was a senior adviser to our organisation, one of the people who
:26:08. > :26:11.made the challenges, and who said, you need more experience on your
:26:12. > :26:15.board. Subsequently he then went and joined the board. Surely that should
:26:16. > :26:20.not be allowed, the regulator and the regulated should not be like
:26:21. > :26:25.that. Well clearly, you need protection, but we have got to get
:26:26. > :26:29.good people in, and frankly, we want the industry to have good people in
:26:30. > :26:33.the industry, so there will be some movement between the regulator and
:26:34. > :26:36.industry. We all wonder whether you have the power or even the
:26:37. > :26:40.confidence to stand up if you look at all of the really bad bank
:26:41. > :26:45.decisions recently, politicians were behind them. It was Gordon Brown who
:26:46. > :26:49.pushed the disastrous merger of Lloyds and RBS. It was Alex Salmond
:26:50. > :26:54.who egged on RBS to buy the world. All three main parties wanted the
:26:55. > :26:58.Co-op to buy Britannia, even though they did not know the debt it would
:26:59. > :27:02.inherit, and all three wanted the Co-op to buy the Lloyds branches -
:27:03. > :27:07.how do you as a regulator stand up to that little concert party? Well,
:27:08. > :27:11.that political pressure exists, our job at the end of the day is to do a
:27:12. > :27:16.relatively technical job and say, does it stack up? And it didn't and
:27:17. > :27:19.we made that point time and time again to the Co-op board. They did
:27:20. > :27:24.not have a business case that we could approve. The bodies on left
:27:25. > :27:31.and right -- the politicians on left and right gave the Co-op special
:27:32. > :27:37.support. They may have done, but that was not you have made a warning
:27:38. > :27:41.about these payday lenders, but I think what most people would like to
:27:42. > :27:46.see is a limit put on the interest they can charge over a period of
:27:47. > :27:50.time - will you do that? We have got a whole set of powers for payday
:27:51. > :27:55.lenders. We will bring in some changes from April next year, and we
:27:56. > :27:57.will bring in further changes as we see necessary. Will you put a limit
:27:58. > :28:03.on the interest they can charge That is something we can study. You
:28:04. > :28:08.do not sound too keen on it? Well, there are a lot of changes we need
:28:09. > :28:11.to make. One change is limiting rollovers, limiting the use of
:28:12. > :28:16.continuous payment authorities. Simply jumping to one trigger would
:28:17. > :28:21.be a mistake. Finally, an issue which I think is becoming a growing
:28:22. > :28:25.concern, because the Government is thinking of subsidising them, 9 %
:28:26. > :28:30.mortgages are back - should we not be worried about that? I think we
:28:31. > :28:34.should if the market has the same experiences that we had back in 2007
:28:35. > :28:40.- oh wait. We are bringing a comprehensive package in under our
:28:41. > :28:43.mortgage market review, which will change how people lend and will put
:28:44. > :28:54.affordability back at the heart of lending decisions. -- 2007-08. You
:28:55. > :28:56.have not had your first big challenge yet, have you? We have
:28:57. > :29:05.many challenges. It was once called the battle of the
:29:06. > :29:07.mods and the rockers - the fight between David Cameron-style
:29:08. > :29:10.modernisers and old-style traditional Tories for the direction
:29:11. > :29:17.and soul of the Conservative Party. But have the mods given up on
:29:18. > :29:22.changing the brand? When David Cameron took over in 2005, he
:29:23. > :29:26.promoted himself as a new Tory leader. He said that hoodies need
:29:27. > :29:33.more love. He was talking about something called the big society. He
:29:34. > :29:37.told his party conference that it was time to that sunshine win the
:29:38. > :29:42.day. There was new emphasis on the environment, and an eye-catching
:29:43. > :29:47.trip to a Norwegian glacier to see first-hand, supposedly, the effects
:29:48. > :29:51.of global warming. This week, party modernise and Nick bone has said
:29:52. > :29:56.that the party is still seen as an old-fashioned monolith and hasn t
:29:57. > :30:05.done enough to improve its appeal. The Tories have put some reforms
:30:06. > :30:09.into practice, such as gay marriage, but they have put more into welfare
:30:10. > :30:13.reform band compassionate conservatism. David Cameron wants
:30:14. > :30:21.talked about leading the greenest government ever. Downing Street says
:30:22. > :30:28.that the quote in the Son is not recognised, get rid of the green
:30:29. > :30:31.crap. At this point in the programme we were expecting to hear from the
:30:32. > :30:34.Energy and Climate Change Minister, Greg Barker. Unfortunately, he has
:30:35. > :30:40.pulled out, with Downing Street saying it's for ""family reasons"".
:30:41. > :30:45.Make of that what you will. However, we won't be deterred. We're still
:30:46. > :30:48.doing the story, and we're joined by our very own mod and rocker - David
:30:49. > :30:54.Skelton of the think-tank Renewal, and Conservative MP Peter Bone.
:30:55. > :30:59.Welcome to you both. I'm glad your family is allowed you to come? David
:31:00. > :31:04.Skelton, getting rid of all the green crap, or words to that effect,
:31:05. > :31:07.that David Cameron has been saying. It is just a sign that Tory
:31:08. > :31:13.modernisation has been quietly buried. I do think that's right
:31:14. > :31:19.Modernisation is about reaching out to the voters, and the work to do
:31:20. > :31:24.that is now more relevant than ever. We got the biggest swing since 931,
:31:25. > :31:29.and the thing is we need to do more to reach out to voters in the North.
:31:30. > :31:38.We need to reach out to non-white voters, and show that the concerns
:31:39. > :31:42.of modern Britain and the concerns of ordinary people is something that
:31:43. > :31:45.we share. And what way will racking up electricity bills with green
:31:46. > :31:52.levies get you more votes in the North of England? We have to look at
:31:53. > :31:54.ways to reduce energy bills. The renewable energy directive doesn't
:31:55. > :32:01.do anything to help cut our emissions, but does decrease energy
:32:02. > :32:05.bills by ?45 a year. We should renegotiate that. That is a part of
:32:06. > :32:11.modernisation and doing what ordinarily people want. And old
:32:12. > :32:16.dinosaurs like you are just holding this modernisation process back I
:32:17. > :32:21.am very appreciative of covering on this programme. The Tory party has
:32:22. > :32:26.been reforming itself for more than 150 years. This idea of modern eyes
:32:27. > :32:33.a is just some invention. We are changing all the time. I'm nice and
:32:34. > :32:38.cuddly! So you are happy that the party made gay marriage almost a
:32:39. > :32:46.kind of symbol of its modernisation? Fine Mac the gay marriage was a free
:32:47. > :32:51.vote. David Cameron was recorded as a rebel there because more Tories
:32:52. > :32:54.voted against his position than ever before. It was said that this was a
:32:55. > :32:59.split between the old and young but it actually was a split between
:33:00. > :33:02.those who were religious and nonreligious. It is a
:33:03. > :33:10.misinterpretation of what happened. Is a modernisation in retreat? I
:33:11. > :33:15.think modernisation is an invention. Seven years ago, in my
:33:16. > :33:22.part of the world, we got three councillors elected, two were 8 and
:33:23. > :33:25.one was 21. A few months ago, a 25-year-old was chosen to fight
:33:26. > :33:31.Corby for the Conservative Party. He came from a comprehensive School. He
:33:32. > :33:37.was one of the youngest. The Tory party is moving on. So you found
:33:38. > :33:46.three young people? Hang on a minute. You can't get away with
:33:47. > :33:51.that. Three in one batch. Does modernisation exist? Modernisation
:33:52. > :33:54.is about watering our appeal and sharing our values are relevant to
:33:55. > :33:59.voters who haven't really thought about voting for us for decades now.
:34:00. > :34:03.Modernisation is about more than windmills and stuff, it is about
:34:04. > :34:11.boosting the life chances of the poorest, it is about putting better
:34:12. > :34:16.schools in poorer areas. It is also saying that modernisation and the
:34:17. > :34:20.Tory party... When has the Tory party been against making poorer
:34:21. > :34:24.people better off? Or against better schools? Do you think Mrs Thatcher
:34:25. > :34:28.was a moderniser when she won all those elections? The problem we have
:34:29. > :34:33.at the moment is that UKIP has grown-up. If we could get all of
:34:34. > :34:38.those people who vote UKIP to vote for us, we would get 47% of the
:34:39. > :34:43.vote. We don't need to worry about voters on the left. We need to worry
:34:44. > :34:51.about the voters in the north, those people who haven't voted for us for
:34:52. > :34:57.decades. Having an EU Referendum Bill is going to get people to
:34:58. > :35:02.vote. We have to reach out to voters, but not by some sort of
:35:03. > :35:07.London based in need. You have to broaden your base. I agree with you
:35:08. > :35:10.on that. We have to broaden our appeal, but this back to the future
:35:11. > :35:15.concept is not going to work. We need something that generally
:35:16. > :35:19.appeals to low and middle-income voters, and something that shows we
:35:20. > :35:26.genuinely care about the life chances of the poorest. Do you think
:35:27. > :35:33.that the people who vote UKIP don't support those aspirations? We are
:35:34. > :35:36.not doing enough to cut immigration. We don't have an EU Referendum Bill
:35:37. > :35:44.stop we have to get the centre right to vote for us again. Do that, and
:35:45. > :35:47.we have it. Tom Pursglove, the 25 euros, will be returned in Corby
:35:48. > :36:00.because we cannot win an election there. -- the 25-year-old. Whether
:36:01. > :36:06.you are moderniser or traditionalist, people, particularly
:36:07. > :36:15.in the North, see you as a bunch of rich men. And rich southerners. You
:36:16. > :36:19.are bunch of rich southerners. We need to do more to show that we are
:36:20. > :36:26.building on lifting the poorest out of the tax. We need to build more
:36:27. > :36:31.houses. There is a perception that the leadership at the moment is
:36:32. > :36:35.rich, and public school educated. What we have to do is get more
:36:36. > :36:42.people from state education into the top. You are going the other way at
:36:43. > :36:50.the moment. That is a fair criticism. Modernisers also say
:36:51. > :36:56.that. I went to a combo hedge of school as well. -- do a
:36:57. > :37:05.comprehensive school. We need to show that we are standing up for low
:37:06. > :37:07.income. Thank Q, both of you. You are watching the Sunday Politics.
:37:08. > :37:23.Coming up in just under 20 Hello.
:37:24. > :37:36.Coming up on the Sunday Politics in the South West: The wind and solar
:37:37. > :37:38.industry is warning that Tory talk of cutting green taxes is scaring
:37:39. > :37:42.investors and threatening jobs. And for the next 20 minutes, I'm joined
:37:43. > :37:45.by The Lib Dem Peer Robin Teverson and Labour Councillor in Plymouth
:37:46. > :37:54.Nicky Williams. Welcome both of you.
:37:55. > :37:57.Let's start with council cuts. This week, the Conservative mayor of
:37:58. > :38:00.Torbay blamed the government for his council's plans to remove funding
:38:01. > :38:02.from charities which work with drug users and homeless people. Meanwhile
:38:03. > :38:06.in Somerset the Conservative County Council put plans to cut children's
:38:07. > :38:10.centres on hold. When you are talking about children's services,
:38:11. > :38:14.of course it will be an emotive subject. We are going to go out and
:38:15. > :38:19.continue to listen so we make sure we come up with the right result. 18
:38:20. > :38:28.children's centres are under threat in Somerset. Is this now the cuts be
:38:29. > :38:35.inviting? I think it is. `` really biting. There are challenges to all
:38:36. > :38:45.of the services. Implement, have you seen any children's centres become
:38:46. > :38:51.vulnerable? `` implement. We are making sure that families in need
:38:52. > :39:00.are being helped. We have done a lot of work to secure our future. There
:39:01. > :39:04.has been support of children's centres, but the councils are saying
:39:05. > :39:09.it is their fault for the budget cuts in the first place. Can there
:39:10. > :39:17.be such aggressive cuts in spend be upset with the cuts are biting? Cuts
:39:18. > :39:21.have been biting. Local authorities clearly can now spend the money that
:39:22. > :39:26.they have left on the services that they want to. There is a lot more
:39:27. > :39:35.flexibility there. Which services oh or stay is another issue. `` go or
:39:36. > :39:42.stay. Eg the villages passing the buck? `` you do not feel it is
:39:43. > :39:46.passing the buck? I am sure that is not the case. There is only so far
:39:47. > :39:50.it can go, and I think central government will have to be very
:39:51. > :39:56.careful in the future. Plenty more to discuss today.
:39:57. > :40:01.This week the Prime Minister denied reports he'd told his team to get
:40:02. > :40:04.rid of all the green rubbish. His earlier talk of rolling back green
:40:05. > :40:07.levies is causing concern in the South West. With one renewable
:40:08. > :40:09.energy expert this week warning David Cameron's comments are already
:40:10. > :40:12.frightening investors and threatening jobs in the region.
:40:13. > :40:22.Just how green do the Conservatives want to be? The issue hit the
:40:23. > :40:25.headlines this week after one newspaper printed claims from what
:40:26. > :40:32.it called a unnamed senior party member that the PM was making a U
:40:33. > :40:36.turn on environmental issues. It comes only weeks after this
:40:37. > :40:45.statement in the Commons. We need to roll back some of the cream
:40:46. > :40:48.chargers. `` green charges. Last month, David Cameron revealed he was
:40:49. > :40:51.considering rolling back green levies on energy companies to make
:40:52. > :40:54.bills more affordable. Such talk inevitably sets alarm bells ringing
:40:55. > :40:59.in the green energy sector. We need clarity and a long`term framework.
:41:00. > :41:05.The message we are reviewing is very unhelpful. Many of the 10,000 jobs
:41:06. > :41:13.in renewables are at some parts `` are at some degree of risk. South
:41:14. > :41:16.West Conservatives have been pressuring David Cameron to cut the
:41:17. > :41:21.subsidies given to some forms of renewable energy. Among them, the
:41:22. > :41:25.Torridge and West Devon MP Geoffrey Cox, who pledged to oppose all new
:41:26. > :41:27.commercial wind farms in his constituency, and Richard Drax,
:41:28. > :41:29.whose Dorset South constituency lies near to the proposed Navitus Bay
:41:30. > :41:32.offshore wind farm. A development he spoke out against
:41:33. > :41:39.in Westminster this week. Eight other states `` sites have been
:41:40. > :41:43.identified. There is no World Heritage Site or coastline site. Why
:41:44. > :41:46.can't we do that? But despite this, Mr Drax is also a supporter of
:41:47. > :41:51.renewable. He's just had planning approved for a 175 acre solar farm
:41:52. > :41:56.on his estate in Dorset. Something campaigners were dismayed and
:41:57. > :42:01.slightly bemused by. He is credited as being opposed to the subsidy that
:42:02. > :42:08.government is giving to green energy. Apparently he has been very
:42:09. > :42:14.vocal about that and also about offshore wind farms. Then he
:42:15. > :42:18.proposes a development of this sort. So are the party that once urged
:42:19. > :42:24.people to vote blue and go green sending out mixed messages? The
:42:25. > :42:27.Prime Minister has strongly denied the comments reported in the press.
:42:28. > :42:30.But those in the renewable energy sector might need a bit more
:42:31. > :42:34.convincing. Earlier, I asked the Conservative MP
:42:35. > :42:40.Geoffrey Cox if he thought he'd won his campaign to get the Government
:42:41. > :42:47.to cut green energy subsidies. I think what we have one is a review,
:42:48. > :42:51.and it is a perfectly sensible and I think proper thing to do at the time
:42:52. > :42:54.of extreme financial hardship for many people that we review all of
:42:55. > :43:00.these kinds of charges that fall heavily on the ordinary consumer and
:43:01. > :43:05.see whether we can do better for last. What does that mean for jobs
:43:06. > :43:10.in the region? It doesn't necessarily mean anything for jobs.
:43:11. > :43:18.But we have heard that there are worries about the threat to jobs in
:43:19. > :43:22.the green industry. That is a response to mood music, not any
:43:23. > :43:26.particular detail. The Prime Minister is committed to green
:43:27. > :43:33.policies. We have the first green investment bank. We have a whole
:43:34. > :43:36.range of policies on green issues. He did `` do you think he used the
:43:37. > :43:45.words that were quoted in the newspaper? I do not know, but I know
:43:46. > :43:51.he is committed to seeing whether we can make this file less heavily on
:43:52. > :43:57.the householder. There may be people that feel cheated by this, that you
:43:58. > :44:01.are relaxing the green agenda. I do not buy that. We are not rolling it
:44:02. > :44:06.back. What we are doing is reviewing its to make it cleaner. But David
:44:07. > :44:10.Cameron said he was rolling it back. We are rolling it back in the sense
:44:11. > :44:17.that we want to reduce the charge on the consumer, but there are other
:44:18. > :44:23.ways of getting this particular cat `` skimming this particular we can
:44:24. > :44:29.make it default less on the individual householder. But you are
:44:30. > :44:34.doing it as a knee jerk reaction to Labour talking about freezing
:44:35. > :44:40.prices. Freezing prices is going to cause massive upset in the
:44:41. > :44:46.marketplace. Except profits have soared under this government by 70%,
:44:47. > :44:51.and the average bill has gone up by about ?300 under this Parliament.
:44:52. > :44:56.That is true, because the wholesale price of electricity and energy has
:44:57. > :45:01.gone up. Let me just finish one answers so that the message is very
:45:02. > :45:05.clear. The review is going to look at how we make it lighter on the
:45:06. > :45:09.householder. There are plenty of other ways of raising this money and
:45:10. > :45:13.not allowing it to fall so heavily as it does on the householder. At a
:45:14. > :45:19.time of financial hardship, that has got to be the right thing to do. You
:45:20. > :45:28.surprised by the negotiations on the deal to get a vast solar farm that
:45:29. > :45:33.covers around ten football pitches? I do not think it is for me to
:45:34. > :45:37.comment. I do not know enough about the detail about what Richard is
:45:38. > :45:42.planning. I simply do not know enough about the detail. It is but
:45:43. > :45:46.it would get around ?2 million of subsidies, and he has actually been
:45:47. > :45:51.opposed to these subsidies himself. I am not going to comment on any
:45:52. > :45:54.personal or individual case, certainly not about a colleague, the
:45:55. > :46:01.detail of which I certainly do not know. I do want to say that it must
:46:02. > :46:04.be right to reduce the charge on the householder of these levies. I have
:46:05. > :46:16.to stop you there. Thank you for joining us. You speak on energy.
:46:17. > :46:20.What is Jeffrey talking about here? He says that there are other ways to
:46:21. > :46:26.raise money and not allow it to fall happily on the householder. You have
:46:27. > :46:30.to put it through direct taxation. I suspect that is what the Chancellor
:46:31. > :46:37.is trying to do. In some ways, that is quite good. What it does do is
:46:38. > :46:43.create a whole uncertainty in the industry, particularly in the South
:46:44. > :46:49.West, and in terms of investment, and this whole argument about cost
:46:50. > :46:53.to the consumer of electricity, the trouble is, because of the lack of
:46:54. > :46:59.investment we have had from the big energy companies in the past, if we
:47:00. > :47:02.stayed stuck to gas and coal, we have seen how price rises go up and
:47:03. > :47:09.up, and we need to get off of that fossil fuel junkie that we have
:47:10. > :47:14.become and get renewables in. Are you worried that David Cameron's
:47:15. > :47:19.comments about rolling back green levies infesting green investment
:47:20. > :47:24.and jobs are threatened? Absolutely. This is real. This is politics. The
:47:25. > :47:29.whole reason we have been going through this over a two`year period
:47:30. > :47:36.is to get investing competence in the industry `` confidence in the
:47:37. > :47:40.industry, and this is seriously undermining it. I do not think
:47:41. > :47:43.George Osborne believes in this agenda at all and he is driving
:47:44. > :47:49.David Cameron to this degree. It is a real split within the Tories will
:47:50. > :47:55.stop it is bad for investment. `` Tories. Can you make these cuts
:47:56. > :48:01.without affecting the green industry? I believe that we can. We
:48:02. > :48:05.need to reset the energy market, which is why we want to do a
:48:06. > :48:08.two`year freeze, and then we can reset the market by making it much
:48:09. > :48:14.more fair and transparent and break down the power that the big five
:48:15. > :48:18.have. Robin was saying that you could freeze the price is now on a
:48:19. > :48:27.budget should have been doing this a long time ago. Is that what you were
:48:28. > :48:31.thinking? Yes all stop `` yes. The companies have too much power at the
:48:32. > :48:37.moment. Under the Labour government, I think it was down to six
:48:38. > :48:40.companies. We do not have a good enough market and the government
:48:41. > :48:47.hasn't done enough about it so far. We need a radical change but a price
:48:48. > :48:52.freeze is a sticking plaster. The price freeze will give us the time,
:48:53. > :48:59.whilst discontinuing the ?300 extra people have been facing in their
:49:00. > :49:02.pockets on energy, to actually put the legislation through, to break
:49:03. > :49:07.the monopoly that these big five companies have. What about the idea
:49:08. > :49:13.that we need to support green energy in other ways? We need a balanced
:49:14. > :49:17.market. Yes, we need to support green energy. The problem is, we
:49:18. > :49:23.have seen that there has been a fall in investment in green energy since
:49:24. > :49:27.2009, where it was at an all`time high. It has dramatically dropped to
:49:28. > :49:36.what it is today. There is more renewable generation, it is up about
:49:37. > :49:44.15% in the second half of the last year. That is quite wrong. It is the
:49:45. > :49:48.highest it has ever been. It was a 7.2 billion. Before we argue too
:49:49. > :49:53.much about this, what do you make of the solar farm idea? Do you think
:49:54. > :50:01.there is any hypocrisy going on there? I think he is a very astute
:50:02. > :50:04.businessman and it is up to him to put the pathway between his business
:50:05. > :50:12.and his parliamentary career. We will move on.
:50:13. > :50:15.Figures out this week revealed nearly 3,000 families in Cornwall
:50:16. > :50:18.have been hit by what Labour calls the bedroom tax. April's benefit
:50:19. > :50:21.changes mean people in social housing with spare bedrooms get less
:50:22. > :50:25.money. They can apply for an emergency bailout to help them
:50:26. > :50:36.adjust to the cuts but that cash is normally time limited and for some
:50:37. > :50:40.tenants it's about to run out. When his marriage broke down and his
:50:41. > :50:44.wife and twins moved out, Matt Pope was left with two spare bedrooms.
:50:45. > :50:47.He's had to find an extra ?80 a month to pay his rent because of new
:50:48. > :50:53.rules on under occupancy which have seen his housing benefit cut. It's
:50:54. > :50:58.been a tough year for him. My wife left and took my children. I had
:50:59. > :51:03.previously lost my job, and that all of the sudden, I had letters from
:51:04. > :51:09.the council saying that they were going to charge me for the now
:51:10. > :51:19.vacant rooms that I had. It felt like the straw that broke the camels
:51:20. > :51:22.back `` camel's back. I attempted suicide in April. It was a
:51:23. > :51:30.culmination of all of those issues at that point. Matt fell behind with
:51:31. > :51:33.the rent and recently got a letter from his council warning him that he
:51:34. > :51:36.could be evicted if he didn't pay the ?78 he owed. The Council has
:51:37. > :51:44.spent thousands of pounds and keeping me in this property, for
:51:45. > :51:48.adapting the place to suit my requirements, to meet my
:51:49. > :51:56.disability. It would have been easy for me to move into a glow that was
:51:57. > :52:06.disabled adapted `` a small home that was disabled adapted. Matt has
:52:07. > :52:09.been claiming discretionary housing payment to help him cover the
:52:10. > :52:13.shortfall in his housing benefit but the amount has reduced over the past
:52:14. > :52:16.three months and it is due to end in December. Figures obtained by BBC
:52:17. > :52:20.Sunday Politics South West show there has been a big rise in the
:52:21. > :52:23.number of people on benefits asking for emergency cash or what's known
:52:24. > :52:26.as discretionary housing payment to help them pay their rent. Last year,
:52:27. > :52:29.between April and September 2012, 1,600 people applied for the help.
:52:30. > :52:39.This year over the same period, applications have more than doubled,
:52:40. > :52:41.with 4,100 applying. The government has given councils more funds for
:52:42. > :52:48.discretionary housing payment this year in anticipation of the impact
:52:49. > :52:51.of its welfare reforms. But some housing providers say there isn't
:52:52. > :52:55.enough money to help everyone who needs it. There is variation in the
:52:56. > :53:01.ways that the local authorities work, and in some of our areas, we
:53:02. > :53:04.are not being successful. We have one area where we made seven
:53:05. > :53:19.applications and they were all refused. In Plymouth, the number of
:53:20. > :53:23.people on benefits applying for emergency cash for their rent has
:53:24. > :53:26.more than tripled. From 200 last year to more than 700 this year.
:53:27. > :53:29.Oliver Colvile, the Conservative MP for Plymouth Sutton and Devonport
:53:30. > :53:32.says the benefit changes are needed. There are some people who do not
:53:33. > :53:36.need family houses. The big issue, though, is that there are an awful
:53:37. > :53:39.lot of people who are living in cramped conditions. And my
:53:40. > :53:43.constituency, it is about 5,000 families who come and talk to me
:53:44. > :53:47.about how it is that they have been stuck in cramped accommodation, and
:53:48. > :53:55.we have to make sure that those people have the right accommodation.
:53:56. > :53:58.Back in Mid Devon, Matt Pope is now up to date with his rent because the
:53:59. > :54:02.parish council stepped in and used a community crisis fund to pay off his
:54:03. > :54:08.arrears. But he's worried about the future because he knows this is just
:54:09. > :54:13.a temporary fix. A temporary fix for him. It seems there are a lot of
:54:14. > :54:17.temporary fixes going on. This emergency cash that is being
:54:18. > :54:23.supplied is only temporary. It is not all temporary. In terms of
:54:24. > :54:28.forces families and retired people, in terms of foster parents, all of
:54:29. > :54:31.those have been permanently fixed. Certainly Liberal Democrats would
:54:32. > :54:37.include disabled people, but we have not been able to persuade our
:54:38. > :54:42.colleagues in the coalition. A number of local authorities do
:54:43. > :54:47.manage to fulfil those requirements from money that has been sent out to
:54:48. > :54:51.local government. There was one specifically that had not responded.
:54:52. > :54:55.I think that is down to attitude of particular local authorities at that
:54:56. > :55:00.time how that works. Surely the point of this is to free up some of
:55:01. > :55:04.these houses, and if you are going to hand out emergency and out of
:55:05. > :55:08.emergency cash to different people, then you are not actually freeing up
:55:09. > :55:15.the houses. Maybe you do need to evict a few more people. What we are
:55:16. > :55:20.doing is putting out enough money for people in need. Yes, the
:55:21. > :55:24.reconfiguration within the housing market is needed, because what we
:55:25. > :55:29.had under the previous government was 420,000 fall in the number of
:55:30. > :55:32.social and council homes in the country. The Labour government
:55:33. > :55:37.actually introduced spare room tax in terms of people having to live in
:55:38. > :55:41.the private rented sector. Yes, it has had to spread into the public
:55:42. > :55:47.sector. It is not good but things have to change. It is fundamentally
:55:48. > :55:55.unfair, which is why Labour have said they would get rid of it. You
:55:56. > :56:02.invented it in 2008. But it is inherently unfair. Implement, we
:56:03. > :56:08.have 600 families who wants to downsize. There is nowhere for them
:56:09. > :56:12.to go will stop we not `` them to go. It is causing more money because
:56:13. > :56:16.more people are having to go to private landlords, where it costs
:56:17. > :56:20.more, so they are claiming more in benefits, so this is a complete
:56:21. > :56:23.false economy. It is very well to say we need to build more houses,
:56:24. > :56:30.but if you desperately need those houses now, maybe this is the
:56:31. > :56:35.solution. We don't have the houses available for people to downsize. We
:56:36. > :56:39.have an enormous problem in that there are too many people on the
:56:40. > :56:44.waiting list. We are not building enough houses across the country. We
:56:45. > :56:47.are trying to put that right under lease of land onto the market and
:56:48. > :56:53.work with housing associations to bring forward more affordable
:56:54. > :56:56.accommodation. The stock of social housing and council housing during
:56:57. > :57:03.the Labour government went down 420,000 nationwide. You have waiting
:57:04. > :57:07.lists of up to 12,000 people that are not able to get decent housing
:57:08. > :57:14.because, during the Labour government, you did not build the
:57:15. > :57:19.houses. The number of housing stock has been reduced because of the
:57:20. > :57:23.right to buy policy. So why did you not do anything when you were in
:57:24. > :57:28.government? You didn't. You stop local authorities from replacing the
:57:29. > :57:31.houses that were sold. Your government stop you from replacing
:57:32. > :57:36.council houses that you sold under right to buy. We are working with
:57:37. > :57:42.housing associations to release more land so that we can actually build
:57:43. > :57:47.more houses. Labour has pledged to work out solutions to actually solve
:57:48. > :57:53.this problem. The bedroom tax is not a solution. It is just pledging more
:57:54. > :57:57.and more people into poverty. `` plunging. It is trying to get to a
:57:58. > :58:02.problem that we inherited as a government. It is not perfect. It is
:58:03. > :58:05.always fun to debate this but we have to move on because it is time
:58:06. > :58:12.for our round up of the political week in 60 seconds.
:58:13. > :58:21.Concern about rising water bills was raised in Parliament. If my right
:58:22. > :58:26.honourable friend convinced that the regular age or is robust enough and
:58:27. > :58:32.ensuring that future rises will be kept to a minimum? The problem of
:58:33. > :58:35.pay day lending was put to the Prime Minister by the MP for Torbay.
:58:36. > :58:38.Devon and Cornwall's Police Commissioner revealed he's spending
:58:39. > :58:40.more than half a million on consultants. I think it is
:58:41. > :58:44.ridiculous. I think he needs to go to the public and say, what do you
:58:45. > :58:48.think? The majority of them would say to put police back on the
:58:49. > :58:53.streets. It emerged that some Devon councillors have been failing to pay
:58:54. > :58:56.their council tax. They bowed these things in and they should be
:58:57. > :58:59.prepared to pay for them themselves. `` bowed to pay for them
:59:00. > :59:04.themselves. `` voted these things in. Councillors in Weymouth said
:59:05. > :59:10.Dorset was missing out on its olympic legacy. These things should
:59:11. > :59:17.be used now. And the campaign to get a Cornish tick`box on the census was
:59:18. > :59:27.revived. We haven't much time. Would you like
:59:28. > :59:32.a Cornish text box on the census? Yes, absolutely. Take away. Do you
:59:33. > :59:44.think that is ridiculous? Would you like a dev in the box? `` Devon. I
:59:45. > :59:48.do not see a reason why that data cannot be collected. You never
:59:49. > :59:54.know, there is still time. That is Sunday Politics in the South West.
:59:55. > :59:59.Thank you to my guests. Before we go back to Andrew in London, just time
:00:00. > :00:02.to tell you that, as always, the programme is available to watch on
:00:03. > :00:08.the eye player, and you can always check out Martin's blog, which you
:00:09. > :00:10.can go to buy the BBC website. `` through the BBC website.
:00:11. > :00:14.those people who want to cycle. We will be returning to this one. Thank
:00:15. > :00:25.you. A little bit of history was made at
:00:26. > :00:30.Prime Minister's Questions this week. A teensy tiny bit. It wasn't
:00:31. > :00:32.David Cameron accusing one MP of taking "mind-altering substances" -
:00:33. > :00:36.they're always accusing each other of doing that. No, it was the first
:00:37. > :00:39.time a Prime Minister used a live tweet sent from someone watching the
:00:40. > :00:48.session as ammunition at the dispatch box. Let's have a look We
:00:49. > :00:54.have had some interesting interventions from front edges past
:00:55. > :00:58.and present. I hope I can break records by explaining that a tweet
:00:59. > :01:02.has just come in from Tony McNulty, the former Labour security
:01:03. > :01:07.minister, saying that the public are desperate for a PM in waiting who
:01:08. > :01:12.speaks for them, not a Leader of the Opposition in dodging in partisan
:01:13. > :01:16.Westminster Village knock about So I would stay up with the tweets if
:01:17. > :01:21.you want to get on the right side of this one! We are working on how the
:01:22. > :01:25.Prime Minister managed to get that wheat in the first place. What did
:01:26. > :01:32.you think when you saw it being read out? I was certainly watching the
:01:33. > :01:36.Daily Politics. I almost fell off my chair! It was quite astonishing He
:01:37. > :01:41.didn't answer the question - he didn't do that the whole time. But I
:01:42. > :01:46.stand by what the tweets said. I have tweeted for a long time on
:01:47. > :01:52.PMQs. Normally I am praising Ed Miliband to the hilt, but no one
:01:53. > :01:56.announces that in Parliament! Because the Prime Minister picked up
:01:57. > :02:01.on what you said, it unleashed some attacks on you from the Labour side.
:02:02. > :02:05.It did, minor attacks from some very junior people. Most people were
:02:06. > :02:11.supportive of what I said. They took issue with the notion of not doing
:02:12. > :02:16.it until 12:30pm, when it wasn't available for the other side to use.
:02:17. > :02:21.Instant history, and instantly forgettable, I would say. Do you
:02:22. > :02:25.think you have started a bit of a trend? I hope not, because the
:02:26. > :02:35.dumbing down of PMQs is already on its way. Most people tweet like mad
:02:36. > :02:38.through PMQs! Is a measure of how post-modern we have become, we have
:02:39. > :02:45.journalists tweeting about someone talking about a tweet. That is the
:02:46. > :02:48.level of British politics. I am horrified by this development. The
:02:49. > :02:55.whole of modern life has become about observing people -- people
:02:56. > :03:00.observing themselves doing things. Do we know what happened? Somebody
:03:01. > :03:05.is monitoring the tweets on behalf of the Prime Minister or the Tory
:03:06. > :03:09.party. They see Tony's tweet. They then print it out and give it to
:03:10. > :03:13.him? There was a suggestion that Michael Goves had spotted it, but
:03:14. > :03:23.Craig Oliver from the BBC had this great sort of... Craig Oliver was
:03:24. > :03:28.holding up his iPad to take pictures of the Prime Minister, which he then
:03:29. > :03:32.tweeted, from the Prime Minister. People will now be tweeting in the
:03:33. > :03:38.hope that they will be quoted by the Prime Minister, or the Leader of the
:03:39. > :03:44.Opposition. I wasn't doing that I'm just talking about the monster you
:03:45. > :03:49.have unleashed! I hope it dies a miserable death. I think Tony is a
:03:50. > :03:58.good analysis -- a good analyst of PMQs on Twitter. Moving onto the
:03:59. > :04:07.Co-op. You were a Co-op-backed MP, white you? I was a Co-op party
:04:08. > :04:11.member. There are two issues here about the Co-op and the Labour
:04:12. > :04:16.Party. All the new music suggests that the Co-op will now have to
:04:17. > :04:21.start pulling back from lending or donating to the Labour Party, which,
:04:22. > :04:24.at a time when Mr Miliband is going through changes that are going to
:04:25. > :04:30.cut of the union funds, it seems quite dangerous. There are three
:04:31. > :04:33.things going on. There's the relationship that the party has
:04:34. > :04:39.politically with the Co-op party, there is the commercial relationship
:04:40. > :04:43.you referred to, and then there is this enquiry into the comings and
:04:44. > :04:50.goings of Flowers and everybody else. The Tories, at their peril,
:04:51. > :04:54.will mix the three up. There's a lot of things going on with a bang.
:04:55. > :04:59.Labour has some issues around funding generally, and they are
:05:00. > :05:07.potentially exacerbated by the Co-op issue. The Labour Party gets soft
:05:08. > :05:14.loans from the Co-op bank, and it gets donations. ?800,000 last year.
:05:15. > :05:18.Ed Balls got about ?50,000 for his private office. You get the feeling,
:05:19. > :05:24.given the state of the Co-operative Bank now, that that money could dry
:05:25. > :05:28.up. We will see. There's lots of speculation in the papers today At
:05:29. > :05:33.the core, the relationship between the Co-op party and the Labour Party
:05:34. > :05:38.is a proud one, and a legitimate one. I don't think others always
:05:39. > :05:43.understand that. Here is an even bigger issue. Is it not possible
:05:44. > :05:50.that the Co-op bank will cease to exist in any meaningful way as a
:05:51. > :06:01.Co-op bank? Is the bane out means it is 70% owned -- the bail out means
:06:02. > :06:06.that it is 70% owned, or 35% going to a hedge fund, I think I read
:06:07. > :06:10.Yes, there is a move from the mutualism of the Co-op. But don t
:06:11. > :06:21.confuse the Co-op bank with the Co-op Group. Others have done that.
:06:22. > :06:29.I haven't. Here's the rub. The soft loans that Labour gets. They got
:06:30. > :06:38.?1.2 million from this. And 2.4 million. They are secured against
:06:39. > :06:44.future union membership fees of the party. What is Mr Miliband doing? He
:06:45. > :06:49.is trying to end that? You have this very difficult confluence of events,
:06:50. > :06:53.which is, could these wonderful soft loans that Labour has had from the
:06:54. > :06:59.Co-op, could they be going? And these union reforms, where Ed
:07:00. > :07:04.Miliband is trying to create a link between individuals and donations to
:07:05. > :07:08.the Labour Party... Clearly, there could be real financial difficulties
:07:09. > :07:11.here. The government needs to be careful, because George Osborne
:07:12. > :07:14.launched one of his classic blunderbuss operations this week,
:07:15. > :07:22.which is that the Labour Party is to blame for Paul Flowers' private
:07:23. > :07:28.life. No, it's not. And that all the problems, essentially... Look at
:07:29. > :07:32.what George Osborne was doing in Europe. He was trying to change the
:07:33. > :07:37.capital requirement rules that would make it easier for the Co-op to take
:07:38. > :07:40.over Lloyd's. If there is to be a big investigation, George Osborne
:07:41. > :07:45.needs to be careful of what he wishes for. This is another example
:07:46. > :07:49.of the Westminster consensus. All of the Westminster parties were in
:07:50. > :07:54.favour of the Britannia takeover. This is how the Co-op ended up with
:07:55. > :07:58.all this toxic rubbish on its balance sheet. All the major parties
:07:59. > :08:02.were in favour of going to get the Lloyds branches. The Tories tried to
:08:03. > :08:09.outdo Labour in being more pro-Co-op. There was nobody in
:08:10. > :08:15.Westminster saying, hold on, this doesn't work. It is like the
:08:16. > :08:20.financial bubble all over again Everyone was in favour of that at
:08:21. > :08:24.the time. I think there is no evidence so far that the storm is
:08:25. > :08:29.cutting through to the average voter. If I were Ed Miliband, I
:08:30. > :08:33.would let it die a natural death. I would not write to an editorial
:08:34. > :08:39.column for a national newspaper on a Sunday. That keeps the issue alive,
:08:40. > :08:47.and it makes him look oversensitive and much better at dishing it out
:08:48. > :08:50.than taking it. I agree about that. The Labour press team tweeted this
:08:51. > :09:00.week saying that it was a new low for the times. And this was
:09:01. > :09:06.re-tweeted by Ed Miliband. It isn't a great press attitude. It is very
:09:07. > :09:11.Moni. Bill Clinton went out there and fought and made the case. So did
:09:12. > :09:17.Tony Blair. If you just say, they are being horrible to us, it looks
:09:18. > :09:23.pathetic. And it will cut through on Osborne and the financial
:09:24. > :09:32.dimensional is, not political. I shall tweet that later! While we
:09:33. > :09:38.have been talking, Mr Miliband has been on Desert Island Discs. He
:09:39. > :09:46.might still be on it. Let's have a listen to what he had to say.
:09:47. > :09:58.# Take on me, take me on. # And threw it all, she offers me
:09:59. > :10:09.protection. # A lot of love and affection.
:10:10. > :10:25.# Whether I'm right or wrong #. # Je Ne Regrette Rien. #.
:10:26. > :10:31.Obviously, that was the music that Ed Miliband chose. Who thought -
:10:32. > :10:40.you would have thought he would choose Norman Lamont's theme tune!
:10:41. > :10:51.He chose Jerusalem... He has no classical background at all. He had
:10:52. > :11:00.no Beethoven, no Elgar. David Cameron had Mendelssohn. And Ernie,
:11:01. > :11:10.the fastest Notman in the West. -- fastest milkman. Tony Blair chose
:11:11. > :11:13.the theme tune to a movie. Tony Blair's list was chosen by young
:11:14. > :11:24.staffers in his office. It absolutely was. Tony Blair's list
:11:25. > :11:28.was chosen by staff. The Ed Miliband this was clearly chosen by himself,
:11:29. > :11:38.because who would allow politician to go out there and say that they
:11:39. > :11:42.like Aha. I am the same age as Ed Miliband, and of course he likes
:11:43. > :11:53.Aha. That was the tumour was played in the 80s. Sweet Caroline. It is
:11:54. > :12:02.Angels by Robbie Williams. I was 14-year-old girl when that came out.
:12:03. > :12:09.I thought Angels was the staple of hen nights and chucking out time in
:12:10. > :12:12.pubs. The really good thing about his list is that the Smiths to not
:12:13. > :12:17.appear. The Smiths were all over David Cameron's list. The absolutely
:12:18. > :12:27.miserable music of Morris he was not there. What was his luxury? And
:12:28. > :12:33.Indian takeaway! Again, chosen for political reasons. I would agree
:12:34. > :12:41.with the panel about Aha, but I would expect -- I would respect his
:12:42. > :12:46.right to choose. Have you been on Desert Island Discs? I have. It took
:12:47. > :12:50.me three weeks to choose the music. It was the most difficult decision
:12:51. > :12:56.in my life. What was the most embarrassing thing you chose? I
:12:57. > :13:01.didn't choose anything embarrassing. I chose Beethoven, Elgar, and some
:13:02. > :13:13.proper modern jazz. Anything from the modern era? Pet Shop Boys.
:13:14. > :13:16.That's all for today. The Daily Politics will be on BBC Two at
:13:17. > :13:20.lunchtime every day next week, and we'll be back here on BBC One at
:13:21. > :13:23.11am next week. My luxury, by the way, was a wind-up radio! Remember,
:13:24. > :13:30.if it's Sunday, it's the Sunday Politics.