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Morning, folks. Welcome to the Sunday Politics. | :00:36. | :00:40. | |
Labour's been hit hard by scandals at the Co-op. Ed Miliband says the | :00:41. | :00:43. | |
Tories are mudslinging. We'll speak to Conservative Chairman Grant | :00:44. | :00:46. | |
Shapps. Five years on from the financial | :00:47. | :00:49. | |
crisis, and we're still talking about banks in trouble. Why haven't | :00:50. | :00:52. | |
the regulators got the message? We'll ask the man who runs the | :00:53. | :00:58. | |
City's new financial watchdog. And he used to have a windmill on | :00:59. | :01:01. | |
his roof and talked about giving hugs to hoodies and huskies. These | :01:02. | :01:06. | |
days, not so much. Has the plan to make | :01:07. | :01:10. | |
In the South West: The warning from the wind and solar industry that | :01:11. | :01:15. | |
story talk of cutting green warned that benefit falls will be to | :01:16. | :01:19. | |
homelessness and population ships. What is the evidence? | :01:20. | :01:26. | |
And as always, the political panel that reaches the parts other shows | :01:27. | :01:31. | |
can only dream of. Janan Ganesh Helen Lewis and Nick Watt. They ll | :01:32. | :01:35. | |
be tweeting faster than England loses wickets to Australia. Yes | :01:36. | :01:39. | |
they're really that fast. First, some big news overnight from | :01:40. | :01:42. | |
Geneva, where Iran has agreed to curb some of its nuclear activities | :01:43. | :01:45. | |
in return for the partial easing of sanctions. Iran will pause the | :01:46. | :01:50. | |
enrichment of uranium to weapons grade and America will free up some | :01:51. | :02:00. | |
funds for Iran to spend. May be up to $10 billion. A more comprehensive | :02:01. | :02:03. | |
deal is supposed to be done in six months. Here's what President Obama | :02:04. | :02:06. | |
had to say about this interim agreement. We have pursued intensive | :02:07. | :02:15. | |
diplomacy, bilaterally with the Iranians, and together with our | :02:16. | :02:19. | |
partners, the United Kingdom, France, Germany, Russia and China, | :02:20. | :02:23. | |
as well as the European Union. Today, that diplomacy opened up a | :02:24. | :02:29. | |
new path towards a world that is more secure, a future in which we | :02:30. | :02:35. | |
can verify that Iraq and's nuclear programme is peaceful, and that it | :02:36. | :02:42. | |
cannot build a nuclear weapon. President Obama spoke from the White | :02:43. | :02:45. | |
House last night. Now the difficulty begins. This is meant to lead to a | :02:46. | :02:51. | |
full-scale agreement which will effectively end all sanctions, and | :02:52. | :02:57. | |
end Iran's ability to have a bomb. The early signs are pretty good The | :02:58. | :03:01. | |
Iranian currency strengthened overnight, which is exactly what the | :03:02. | :03:07. | |
Iranians wanted. Inflation in Iraq is 40%, so they need a stronger | :03:08. | :03:14. | |
currency. -- information in Iran. France has played a blinder. It was | :03:15. | :03:18. | |
there intransigence that led to this. Otherwise, I think the West | :03:19. | :03:22. | |
would have led to a much softer deal. The question now becomes | :03:23. | :03:27. | |
implementation. Here, everything hinges on two questions. First, who | :03:28. | :03:33. | |
is Hassan Rouhani? Is he the Iranians Gorbachev, a serious | :03:34. | :03:38. | |
reformer, or he's here much more tactical and cynical figure? Or | :03:39. | :03:45. | |
within Iran, how powerful is he There are military men and | :03:46. | :03:47. | |
intelligence officials within Iran who may stymie the process. The | :03:48. | :03:55. | |
Western media concentrate on the fact that Mr Netanyahu and the | :03:56. | :03:59. | |
Israelis are not happy about this. They don't often mention that the | :04:00. | :04:04. | |
Arab Gulf states are also very apprehensive about this deal. I read | :04:05. | :04:09. | |
this morning that the enemies of Qatar and Kuwait went to Saudi king. | :04:10. | :04:20. | |
-- the MAs row. That is the key thing to watch in the next couple of | :04:21. | :04:25. | |
weeks. There was a response from Saudi Arabia, but it came from the | :04:26. | :04:30. | |
Prime Minister of Israel, who said this was a historic mistake. The | :04:31. | :04:34. | |
United States said there would be no enrichment of uranium to weapons | :04:35. | :04:38. | |
grade. In the last few minutes, the Iranian Foreign Minister has tweeted | :04:39. | :04:42. | |
to say that there is an inalienable right -- right to enrich. The key | :04:43. | :04:52. | |
thing is the most important thing that President Obama said in his | :04:53. | :04:57. | |
inaugural speech. He reached out to Iran. It failed under President | :04:58. | :05:01. | |
McKenna jab. Under President Rouhani, there seems to be progress. | :05:02. | :05:07. | |
There is potentially now what he talked about in that first inaugural | :05:08. | :05:12. | |
address potentially coming through. In the end, the key issue - and we | :05:13. | :05:18. | |
don't know the answer - is the supreme leader, not the president. | :05:19. | :05:22. | |
Will the supreme leader agreed to Iran giving up its ability to create | :05:23. | :05:27. | |
nuclear weapons? This is the huge ambiguity. Ayatollah Khamenei | :05:28. | :05:33. | |
authorise the position that President Rouhani took to Geneva. | :05:34. | :05:39. | |
That doesn't mean he will sign off on every bit of implementation over | :05:40. | :05:44. | |
the next six months. Even when President Ahmadinejad was president, | :05:45. | :05:50. | |
he wasn't really President. We in the West have to resort to a kind of | :05:51. | :05:55. | |
Iranians version of the study of the Kremlin, to work out what is going | :05:56. | :06:06. | |
on. And the problem the president faces is that if there is any | :06:07. | :06:12. | |
sign... He can unlock these funds by executive order at the moment, but | :06:13. | :06:16. | |
if he needs any more, he has to go to Congress. Both the Democrat and | :06:17. | :06:21. | |
the Republican side have huge scepticism about this. And he has | :06:22. | :06:28. | |
very low credibility now. There s already been angry noises coming | :06:29. | :06:33. | |
from quite a lot of senators. It was quite strange to see that photo of | :06:34. | :06:37. | |
John Kerry hugging Cathy Ashton as if they had survived a ship great | :06:38. | :06:41. | |
together. John Kerry is clearly feeling very happy. We will keep an | :06:42. | :06:51. | |
eye on this. It is a fascinating development. | :06:52. | :06:53. | |
More lurid details about the personal life of the Co-op Bank s | :06:54. | :06:56. | |
disgraced former chairman, the Reverend Paul Flowers. The links | :06:57. | :07:01. | |
between Labour, the bank and the wider Co-op movement have caused big | :07:02. | :07:04. | |
problems for Ed Miliband this week, and the Conservatives have been | :07:05. | :07:09. | |
revelling in it. But do the Tory allegations - Ed Miliband calls them | :07:10. | :07:13. | |
"smears" - stack up? Party Chairman Grant Shapps joins us from Hatfield. | :07:14. | :07:23. | |
Welcome to the programme. When it comes to the Co-op, what are you | :07:24. | :07:32. | |
accusing Labour of knowing and when? I think the simple thing to say here | :07:33. | :07:35. | |
is that the Co-op is an important bank. They have obviously got into | :07:36. | :07:41. | |
difficulty with Reverend flowers, and our primary concern is making | :07:42. | :07:45. | |
sure that that is properly investigated, and that we understand | :07:46. | :07:48. | |
what happened at the bank and how somebody like Paul Flowers could | :07:49. | :07:51. | |
have ended up thing appointed chairman. You wrote to edge Miliband | :07:52. | :07:57. | |
on Tuesday and asked him what he knew and when. -- you wrote to Ed | :07:58. | :08:04. | |
Miliband. But by Prime Minister s Questions on Wednesday, David | :08:05. | :08:08. | |
Cameron claims that you knew that Labour knew about his past all | :08:09. | :08:15. | |
along. What is the evidence for that? We found out by Wednesday that | :08:16. | :08:21. | |
he had been a Labour councillor Reverend Flowers, and had been made | :08:22. | :08:27. | |
to stand down. Certainly, Labour knew about that, but somehow didn't | :08:28. | :08:30. | |
seem to think that that made him less appropriate to be the chairman | :08:31. | :08:37. | |
of the Co-op bank. There was no evidence that Mr Miliband or Mr | :08:38. | :08:43. | |
Balls knew about that. I ask you again, what are you accusing the | :08:44. | :08:48. | |
Labour leadership of knowing? We know now that he stood down for very | :08:49. | :08:58. | |
inappropriate images on his computer, apparently. You are | :08:59. | :09:01. | |
telling me that they didn't know. I am not sure that is clear at all. I | :09:02. | :09:06. | |
have heard conflicting reports. There is a much bigger argument | :09:07. | :09:10. | |
about what they knew and when. There was a much bigger issue here. This | :09:11. | :09:15. | |
morning, Ed Miliband has said that they don't have to answer these | :09:16. | :09:19. | |
questions and that these smears This is ludicrous. These are | :09:20. | :09:22. | |
important questions about an important bank, how it ended up | :09:23. | :09:26. | |
getting into this position, and how a disastrous Britannia -- Italia | :09:27. | :09:33. | |
deal happen. -- Britannia deal happened. And we need to know how | :09:34. | :09:40. | |
the bank came off the rails. To be accused of smears for asking the | :09:41. | :09:44. | |
questions is ridiculous. I am just trying to find out what you are | :09:45. | :09:48. | |
accusing Labour of. You saying that the Labour leadership knew about the | :09:49. | :09:54. | |
drug-taking? Sorry, there was some noise here. I don't know what was | :09:55. | :10:03. | |
known and when. We do know that Labour, the party, certainly knew | :10:04. | :10:07. | |
about these very difficult circumstances in which he resigned | :10:08. | :10:12. | |
as a councillor. I think that the Labour Party knew about it. We knew | :10:13. | :10:18. | |
that Bradford did, but not London. Are you saying that Ed Miliband knew | :10:19. | :10:21. | |
about the inappropriate material on the Reverend's laptop? It is | :10:22. | :10:26. | |
certainly the case that Labour knew about it. But did Mr Miliband know | :10:27. | :10:33. | |
about it, and his predilection for rent boys? He will need to answer | :10:34. | :10:40. | |
those questions. It is quite proper to ask those questions. Surely, | :10:41. | :10:45. | |
asking a perfectly legitimate set of questions, not just about that but | :10:46. | :10:49. | |
about how we have ended up in a situation where this bank has made | :10:50. | :10:53. | |
loans to Labour for millions of pounds, that bank and the Unite | :10:54. | :10:59. | |
bank, who is connected to it. And how they made a ?50,000 donation to | :11:00. | :11:06. | |
Ed Balls' office. Ed Balls says that was nothing to do with Reverend | :11:07. | :11:11. | |
Flowers, and yet Reverend Flowers said that he personally signed that | :11:12. | :11:16. | |
off. Lots of questions to answer. David Cameron has already answered | :11:17. | :11:20. | |
them on Wednesday. He said that you now know that Labour knew about his | :11:21. | :11:26. | |
past all along. You have not been able to present evidence that | :11:27. | :11:30. | |
involve Mr Miliband or Mr Balls in that. So until you get that, surely | :11:31. | :11:35. | |
you should apologise? Hang on. He said that Labour knew about this, | :11:36. | :11:39. | |
and they did, because he stood down as a councillor. If Ed Miliband | :11:40. | :11:45. | |
didn't know about that, then why not? This was quite a serious thing | :11:46. | :11:50. | |
that happened. The wider point is about why it is that when you ask | :11:51. | :11:54. | |
perfectly legitimate questions about this bank, about the Britannia deal, | :11:55. | :11:58. | |
and about the background of Mr flowers, why is the response, it is | :11:59. | :12:08. | |
all smears? There are questions about how Labour failed to deal with | :12:09. | :12:11. | |
the deficit and how it hasn't done anything to support the welfare | :12:12. | :12:15. | |
changes, but there is nothing about that. Let us -- lets: To the wider | :12:16. | :12:24. | |
picture of the Co-operative Bank. Labour wanted the Co-op to take over | :12:25. | :12:32. | |
the Britannia Building Society, and it was a disaster. Do you accept | :12:33. | :12:37. | |
that? The government of the day has to be a part of these discussions | :12:38. | :12:44. | |
for regulatory reason. The government in 2009 - Ed Balls was | :12:45. | :12:49. | |
very pleased... But you supported that decision. There was a later | :12:50. | :12:56. | |
deal, potentially, for the Co-op to buy those Lloyds branches. There was | :12:57. | :13:00. | |
a proper process and it didn't go through just recently. If there had | :13:01. | :13:08. | |
been a proper process back in 2 09, would the Britannia deal have gone | :13:09. | :13:14. | |
through? First, you accept that the Tories were in favour of the | :13:15. | :13:19. | |
Britannia take over. Then your Chancellor Osborne went out of his | :13:20. | :13:23. | |
way to facilitate the purchase of the Lloyds branches, even though you | :13:24. | :13:27. | |
had no idea that the Co-op had the management expertise to become a | :13:28. | :13:35. | |
super medium. Correct? The difference is that that deal didn't | :13:36. | :13:40. | |
go through. There was a proper process that took place. Let's look | :13:41. | :13:47. | |
at the process. There was long indications as far back as January | :13:48. | :13:53. | |
2012 that the Co-op, as a direct result of the Britannia take over | :13:54. | :13:58. | |
which you will party supported, was unfit to acquire the Lloyds | :13:59. | :14:02. | |
branches. By January 2012, the Chancellor and the Treasury ignored | :14:03. | :14:09. | |
the warnings. Wide? In 2009, there was political pressure for the | :14:10. | :14:12. | |
Britannia to be brought together. Based on the information available, | :14:13. | :14:17. | |
this was supported, but that process ended up with a very, very | :14:18. | :14:20. | |
problematic takeover of the Britannia. Wind forward to this | :14:21. | :14:26. | |
year, and when the same types of issues were being looked at for the | :14:27. | :14:29. | |
purchase of the Lloyds deal, the proper process was followed, this | :14:30. | :14:34. | |
time with us in government, and that purchase didn't go through. It is | :14:35. | :14:38. | |
important that the proper process is followed, and when it was, it | :14:39. | :14:42. | |
transpired that the deal wasn't going to be done. But it was the | :14:43. | :14:52. | |
Treasury and the Chancellor who were the cheerleaders for the acquisition | :14:53. | :14:56. | |
of the Lloyds branches. But there was a warning that the Co-op did not | :14:57. | :15:00. | |
have enough capital on its balance sheet to make those acquisitions, | :15:01. | :15:04. | |
but instead of heeding those warnings, your people went to | :15:05. | :15:09. | |
Brussels to lobby for the requirements to be relaxed - why on | :15:10. | :15:14. | |
earth did you do that? Our Chancellor went to argue for all of | :15:15. | :15:18. | |
Rajesh banking, not specifically for the Co-op. He was arguing for the | :15:19. | :15:23. | |
mutuals to be given a special ruling. The idea was to make sure | :15:24. | :15:29. | |
that every bank in Britain could have a better deal, particularly the | :15:30. | :15:34. | |
mutuals, as you say. That is a proper thing for the Chancellor to | :15:35. | :15:37. | |
be doing. We could go round in circles here, but in the end, there | :15:38. | :15:41. | |
was not a takeover of the Lloyds branches, that is because we | :15:42. | :15:46. | |
followed a proper process. Had that same rigorous process been followed | :15:47. | :15:50. | |
in 2009, the legitimate question to ask is whether the Co-op would have | :15:51. | :15:55. | |
been -- would have taken over the Britannia. That is a proper question | :15:56. | :15:58. | |
to ask. It is no good to have the leader of the opposition say, as | :15:59. | :16:03. | |
soon as you ask any of these questions about anything where there | :16:04. | :16:05. | |
is a problem for them, they come back with, oh, this is all smears. | :16:06. | :16:10. | |
There are questions to ask about what the Labour government did, the | :16:11. | :16:14. | |
debt and the deficit they left the country with, the way they stopped | :16:15. | :16:19. | |
work from paying in this country. The big question your government has | :16:20. | :16:24. | |
two answer is, why, by July 201 , when it was clear there was a black | :16:25. | :16:27. | |
hole in the Co-op's balance sheet, your government re-confirmed the | :16:28. | :16:33. | |
Co-op as the preferred bidder for Lloyds - why would you do that? | :16:34. | :16:38. | |
Well, look, the good thing is, we can discuss this until the cows come | :16:39. | :16:41. | |
home, but there is going to be a proper, full investigation, so we | :16:42. | :16:45. | |
will find out what happened, all the way back. So, we will be able to get | :16:46. | :16:50. | |
to the bottom of all of this. Grant Shapps, the only reason the Lloyds | :16:51. | :16:55. | |
deal did not go ahead was, despite the Treasury cheerleading, when | :16:56. | :17:00. | |
Lloyds began its due diligence, it found that there was indeed a huge | :17:01. | :17:03. | |
black hole in the balance sheet and that the Co-op was not fit to take | :17:04. | :17:08. | |
over its branches. That wasn't you, it wasn't the Government, it was not | :17:09. | :17:13. | |
the Chancellor, it was Lloyds. You were still cheerleading for the deal | :17:14. | :17:19. | |
to go ahead... Well, as I say, a proper process was followed, which | :17:20. | :17:23. | |
did not result in the purchase of the Lloyds branches. At that proper | :17:24. | :17:27. | |
process been followed with the purchase of the Britannia, under the | :17:28. | :17:33. | |
previous government... Which you supported. Yes, but it may well be | :17:34. | :17:37. | |
that under that previous deal, there was a excess political pressure | :17:38. | :17:41. | |
perhaps put on in order to create that merger, which proved so | :17:42. | :17:49. | |
disastrous. The Tories facilitated it, Grant Shapps, they allowed it to | :17:50. | :17:54. | |
go ahead. I have said, we are going to have a proper, independent | :17:55. | :17:58. | |
review. What I cannot understand is, when you announce a robber, | :17:59. | :18:03. | |
independent review, the response you get to these serious questions. The | :18:04. | :18:09. | |
response is, oh, this is a smear. It is crazy. We are trying to answer | :18:10. | :18:14. | |
the big questions for this country. We have done all of that, and we are | :18:15. | :18:24. | |
out of time. The Reverend Flowers' chairmanship of the Co-op bank was | :18:25. | :18:27. | |
approved by the regulator at the time, which no longer exists. It was | :18:28. | :18:32. | |
swept away by the coalition government in a supposed revolution | :18:33. | :18:36. | |
in regulation. But will its replacement, the Financial Conduct | :18:37. | :18:39. | |
Authority, be different? Adam has been to find out. Come with me for a | :18:40. | :18:49. | |
spin around the Square mile to find out how we regulate our financial | :18:50. | :18:53. | |
sector, which is almost five times bigger than the country's entire | :18:54. | :18:58. | |
annual income. First, let's pick up our guide, journalist Iain Martin, | :18:59. | :19:03. | |
who has just written a book about what went so wrong during the | :19:04. | :19:09. | |
financial crisis. The FSA was an agency which was established to | :19:10. | :19:11. | |
supervise the banks on a day-to day basis. The Bank of England was | :19:12. | :19:16. | |
supposed to have overall responsible at for this to Bolivia the financial | :19:17. | :19:20. | |
system and the Treasury was supposed to take an interest in all of these | :19:21. | :19:24. | |
things. The disaster was that it was not anyone's call responsibility, or | :19:25. | :19:30. | |
main day job, to stay alert as to whether or not the banking system as | :19:31. | :19:34. | |
a whole was being run in a safe manner. And so this April, a new | :19:35. | :19:38. | |
system was set up to police the City. Most of the responsibly delays | :19:39. | :19:47. | |
here, with the Bank of England, and its new Prudential Regulation | :19:48. | :19:50. | |
Authority. And the Financial Services Authority has been replaced | :19:51. | :19:54. | |
with the new Financial Conduct Authority. Can we go to the | :19:55. | :20:00. | |
financial conduct authority, please? Canary Wharf, thank you. Here, it is | :20:01. | :20:06. | |
all about whether the people in financial services are playing by | :20:07. | :20:09. | |
the rules, in particular, how they treat their customers. This place | :20:10. | :20:14. | |
has got new powers, like the ability to ban products it does not like, a | :20:15. | :20:18. | |
new mandate to promote competition in the market, the concept being, | :20:19. | :20:22. | |
more competition means a better market, plus the idea that a new | :20:23. | :20:26. | |
organisation rings a whole new culture. Although these are the old | :20:27. | :20:33. | |
offices of the FSA, so maybe not quite so new after all. It has also | :20:34. | :20:38. | |
inherited the case of the Co-op bank and its disgraced former chairman | :20:39. | :20:42. | |
the Reverend Paul Flowers. The SCA will be part of the investigation | :20:43. | :20:46. | |
into what happened, which will probably involve looking at its own | :20:47. | :20:51. | |
conduct. One member of the Parliamentary commission into | :20:52. | :20:54. | |
banking wonders whether the new regulator, and its new boss, are up | :20:55. | :21:00. | |
to it. I have always said, it is not the architecture which is the issue, | :21:01. | :21:04. | |
it is the powers that the regulator has, and today, it does not seem to | :21:05. | :21:08. | |
me as if there is any increase in that. And with the unfolding scandal | :21:09. | :21:14. | |
at the Co-op, it feels like the new architecture for regulating the City | :21:15. | :21:22. | |
is now facing its first big test. And the chief executive of the | :21:23. | :21:24. | |
Financial Conduct Authority, the SCA, Martin Wheatley, joins me now. | :21:25. | :21:30. | |
Welcome to The Sunday Politics. The failure of bank regulation was one | :21:31. | :21:33. | |
of the clearest lessons of the crash in 2008, and yet two years later, in | :21:34. | :21:39. | |
2010, Paul Flowers is allowed to become chairman of the Co-op - why | :21:40. | :21:45. | |
have we still not got the regulation right? We have made a lot of changes | :21:46. | :21:49. | |
since then. We have created a new regulator, as you know. At the time, | :21:50. | :21:54. | |
we still had a process which allowed somebody to be appointed to a bank | :21:55. | :21:57. | |
and they would go through a challenge, but in the case of Paul | :21:58. | :22:01. | |
Flowers, there was no need for an additional challenge when he was | :22:02. | :22:03. | |
appointed to chairman, because he was already on the board. But going | :22:04. | :22:10. | |
from being on the board to becoming chairman, that is a big jump, and he | :22:11. | :22:15. | |
only had one interview? That is why today, it would be different. But | :22:16. | :22:19. | |
the truth is, that was the system at the time, the system which the FSA | :22:20. | :22:25. | |
operated. He was challenged, we did challenge him, and we said, you do | :22:26. | :22:28. | |
not have the right experience, but at the time, we would not have | :22:29. | :22:33. | |
opposed the appointment. What we needed was additional representation | :22:34. | :22:35. | |
of the board of people who did have banking experience. You can say that | :22:36. | :22:40. | |
that was then and this is now, but up until April of this year, it was | :22:41. | :22:45. | |
still the plan for the Co-op, under Mr Flowers, and despite being | :22:46. | :22:48. | |
seriously wounded by the Britannia takeover, to take on 632 Lloyds | :22:49. | :22:54. | |
branches. That was the Co-op's plan. They needed to pass our test | :22:55. | :22:58. | |
as to whether we thought they were fit to do that, and frankly, they | :22:59. | :23:02. | |
never passed that test. It was not the regulator that stopped them It | :23:03. | :23:07. | |
was. We were constantly pushing back, saying, you have not got the | :23:08. | :23:11. | |
capital, you have no got the systems, and ultimately, they | :23:12. | :23:14. | |
withdrew, when they could not answer our questions. You were asking the | :23:15. | :23:19. | |
right questions, I accept that, but all of the time, the politicians on | :23:20. | :23:25. | |
all sides, they were pushing for it to happen, and I cannot find | :23:26. | :23:28. | |
anywhere where the regulator said, look, this is just not going to | :23:29. | :23:34. | |
happen. I cannot comment on what the politicians were doing, but I | :23:35. | :23:38. | |
continue what we were doing, which was constantly asking the Co-op | :23:39. | :23:41. | |
have you got the systems in place, have you got the people, have you | :23:42. | :23:45. | |
got the capital? And they didn't. But it only came to a head when | :23:46. | :23:49. | |
Lloyds started its own due diligence on the bank, and they discovered | :23:50. | :23:52. | |
that it was impossible for them to take over the branches, it was not | :23:53. | :23:57. | |
the regulator... In fairness, what we do is ask the questions, can you | :23:58. | :24:02. | |
do this deal? And we kept pushing back, and we never frankly got | :24:03. | :24:06. | |
delivered a business plan which we were happy to approve. Is the SCA | :24:07. | :24:13. | |
going to launch its own inquiry into what happened? -- the FCA. The | :24:14. | :24:24. | |
Chancellor has announced what will be a very broad inquiry. There are a | :24:25. | :24:29. | |
number of specifics which we will be able to look at, relating to events | :24:30. | :24:34. | |
over the last five years. Could there be a police investigation I | :24:35. | :24:38. | |
think the police have already announced an investigation. I am | :24:39. | :24:42. | |
talking about into the handling of the bank. It depends. There might | :24:43. | :24:46. | |
be, if there is grim low activity, which we do not know yet. You worked | :24:47. | :24:55. | |
at the FS eight, didn't you? I did. Some of those people who were signed | :24:56. | :25:02. | |
off on the speedy promotion of Mr Flowers, are they now working | :25:03. | :25:08. | |
there? Yes, we have some. I came to join the Financial Services | :25:09. | :25:11. | |
Authority, to lead it into the creation of the new body, the SCA. | :25:12. | :25:17. | |
We had people who were challenging and they did the job. There was not | :25:18. | :25:28. | |
a requirement to approve the role as chairman. There was not even a | :25:29. | :25:31. | |
requirement to interview at that stage. What we did do was to require | :25:32. | :25:37. | |
that he was interviewed, and that the Co-op should get additional | :25:38. | :25:48. | |
experience. One of the people from the old organisation, who signed up | :25:49. | :25:53. | |
on the promotion of Mr Flowers to become chairman is now a | :25:54. | :25:56. | |
nonexecutive director of the Co op, so how does that work? Welcome he | :25:57. | :26:03. | |
was a senior adviser to our organisation, one of the people who | :26:04. | :26:07. | |
made the challenges, and who said, you need more experience on your | :26:08. | :26:11. | |
board. Subsequently he then went and joined the board. Surely that should | :26:12. | :26:15. | |
not be allowed, the regulator and the regulated should not be like | :26:16. | :26:20. | |
that. Well clearly, you need protection, but we have got to get | :26:21. | :26:25. | |
good people in, and frankly, we want the industry to have good people in | :26:26. | :26:29. | |
the industry, so there will be some movement between the regulator and | :26:30. | :26:33. | |
industry. We all wonder whether you have the power or even the | :26:34. | :26:36. | |
confidence to stand up if you look at all of the really bad bank | :26:37. | :26:40. | |
decisions recently, politicians were behind them. It was Gordon Brown who | :26:41. | :26:45. | |
pushed the disastrous merger of Lloyds and RBS. It was Alex Salmond | :26:46. | :26:49. | |
who egged on RBS to buy the world. All three main parties wanted the | :26:50. | :26:54. | |
Co-op to buy Britannia, even though they did not know the debt it would | :26:55. | :26:58. | |
inherit, and all three wanted the Co-op to buy the Lloyds branches - | :26:59. | :27:02. | |
how do you as a regulator stand up to that little concert party? Well, | :27:03. | :27:07. | |
that political pressure exists, our job at the end of the day is to do a | :27:08. | :27:11. | |
relatively technical job and say, does it stack up? And it didn't and | :27:12. | :27:16. | |
we made that point time and time again to the Co-op board. They did | :27:17. | :27:19. | |
not have a business case that we could approve. The bodies on left | :27:20. | :27:24. | |
and right -- the politicians on left and right gave the Co-op special | :27:25. | :27:31. | |
support. They may have done, but that was not you have made a warning | :27:32. | :27:37. | |
about these payday lenders, but I think what most people would like to | :27:38. | :27:41. | |
see is a limit put on the interest they can charge over a period of | :27:42. | :27:46. | |
time - will you do that? We have got a whole set of powers for payday | :27:47. | :27:50. | |
lenders. We will bring in some changes from April next year, and we | :27:51. | :27:55. | |
will bring in further changes as we see necessary. Will you put a limit | :27:56. | :27:57. | |
on the interest they can charge That is something we can study. You | :27:58. | :28:03. | |
do not sound too keen on it? Well, there are a lot of changes we need | :28:04. | :28:08. | |
to make. One change is limiting rollovers, limiting the use of | :28:09. | :28:11. | |
continuous payment authorities. Simply jumping to one trigger would | :28:12. | :28:16. | |
be a mistake. Finally, an issue which I think is becoming a growing | :28:17. | :28:21. | |
concern, because the Government is thinking of subsidising them, 9 % | :28:22. | :28:25. | |
mortgages are back - should we not be worried about that? I think we | :28:26. | :28:30. | |
should if the market has the same experiences that we had back in 2007 | :28:31. | :28:34. | |
- oh wait. We are bringing a comprehensive package in under our | :28:35. | :28:40. | |
mortgage market review, which will change how people lend and will put | :28:41. | :28:43. | |
affordability back at the heart of lending decisions. -- 2007-08. You | :28:44. | :28:54. | |
have not had your first big challenge yet, have you? We have | :28:55. | :28:56. | |
many challenges. It was once called the battle of the | :28:57. | :29:05. | |
mods and the rockers - the fight between David Cameron-style | :29:06. | :29:07. | |
modernisers and old-style traditional Tories for the direction | :29:08. | :29:10. | |
and soul of the Conservative Party. But have the mods given up on | :29:11. | :29:17. | |
changing the brand? When David Cameron took over in 2005, he | :29:18. | :29:22. | |
promoted himself as a new Tory leader. He said that hoodies need | :29:23. | :29:26. | |
more love. He was talking about something called the big society. He | :29:27. | :29:33. | |
told his party conference that it was time to that sunshine win the | :29:34. | :29:37. | |
day. There was new emphasis on the environment, and an eye-catching | :29:38. | :29:42. | |
trip to a Norwegian glacier to see first-hand, supposedly, the effects | :29:43. | :29:47. | |
of global warming. This week, party modernise and Nick bone has said | :29:48. | :29:51. | |
that the party is still seen as an old-fashioned monolith and hasn t | :29:52. | :29:56. | |
done enough to improve its appeal. The Tories have put some reforms | :29:57. | :30:05. | |
into practice, such as gay marriage, but they have put more into welfare | :30:06. | :30:09. | |
reform band compassionate conservatism. David Cameron wants | :30:10. | :30:13. | |
talked about leading the greenest government ever. Downing Street says | :30:14. | :30:21. | |
that the quote in the Son is not recognised, get rid of the green | :30:22. | :30:28. | |
crap. At this point in the programme we were expecting to hear from the | :30:29. | :30:31. | |
Energy and Climate Change Minister, Greg Barker. Unfortunately, he has | :30:32. | :30:34. | |
pulled out, with Downing Street saying it's for ""family reasons"". | :30:35. | :30:40. | |
Make of that what you will. However, we won't be deterred. We're still | :30:41. | :30:45. | |
doing the story, and we're joined by our very own mod and rocker - David | :30:46. | :30:48. | |
Skelton of the think-tank Renewal, and Conservative MP Peter Bone. | :30:49. | :30:54. | |
Welcome to you both. I'm glad your family is allowed you to come? David | :30:55. | :30:59. | |
Skelton, getting rid of all the green crap, or words to that effect, | :31:00. | :31:04. | |
that David Cameron has been saying. It is just a sign that Tory | :31:05. | :31:07. | |
modernisation has been quietly buried. I do think that's right | :31:08. | :31:13. | |
Modernisation is about reaching out to the voters, and the work to do | :31:14. | :31:19. | |
that is now more relevant than ever. We got the biggest swing since 931, | :31:20. | :31:24. | |
and the thing is we need to do more to reach out to voters in the North. | :31:25. | :31:29. | |
We need to reach out to non-white voters, and show that the concerns | :31:30. | :31:38. | |
of modern Britain and the concerns of ordinary people is something that | :31:39. | :31:42. | |
we share. And what way will racking up electricity bills with green | :31:43. | :31:45. | |
levies get you more votes in the North of England? We have to look at | :31:46. | :31:52. | |
ways to reduce energy bills. The renewable energy directive doesn't | :31:53. | :31:54. | |
do anything to help cut our emissions, but does decrease energy | :31:55. | :32:01. | |
bills by ?45 a year. We should renegotiate that. That is a part of | :32:02. | :32:05. | |
modernisation and doing what ordinarily people want. And old | :32:06. | :32:11. | |
dinosaurs like you are just holding this modernisation process back I | :32:12. | :32:16. | |
am very appreciative of covering on this programme. The Tory party has | :32:17. | :32:21. | |
been reforming itself for more than 150 years. This idea of modern eyes | :32:22. | :32:26. | |
a is just some invention. We are changing all the time. I'm nice and | :32:27. | :32:33. | |
cuddly! So you are happy that the party made gay marriage almost a | :32:34. | :32:38. | |
kind of symbol of its modernisation? Fine Mac the gay marriage was a free | :32:39. | :32:46. | |
vote. David Cameron was recorded as a rebel there because more Tories | :32:47. | :32:51. | |
voted against his position than ever before. It was said that this was a | :32:52. | :32:54. | |
split between the old and young but it actually was a split between | :32:55. | :32:59. | |
those who were religious and nonreligious. It is a | :33:00. | :33:02. | |
misinterpretation of what happened. Is a modernisation in retreat? I | :33:03. | :33:10. | |
think modernisation is an invention. Seven years ago, in my | :33:11. | :33:15. | |
part of the world, we got three councillors elected, two were 8 and | :33:16. | :33:22. | |
one was 21. A few months ago, a 25-year-old was chosen to fight | :33:23. | :33:25. | |
Corby for the Conservative Party. He came from a comprehensive School. He | :33:26. | :33:31. | |
was one of the youngest. The Tory party is moving on. So you found | :33:32. | :33:37. | |
three young people? Hang on a minute. You can't get away with | :33:38. | :33:46. | |
that. Three in one batch. Does modernisation exist? Modernisation | :33:47. | :33:51. | |
is about watering our appeal and sharing our values are relevant to | :33:52. | :33:54. | |
voters who haven't really thought about voting for us for decades now. | :33:55. | :33:59. | |
Modernisation is about more than windmills and stuff, it is about | :34:00. | :34:03. | |
boosting the life chances of the poorest, it is about putting better | :34:04. | :34:11. | |
schools in poorer areas. It is also saying that modernisation and the | :34:12. | :34:16. | |
Tory party... When has the Tory party been against making poorer | :34:17. | :34:20. | |
people better off? Or against better schools? Do you think Mrs Thatcher | :34:21. | :34:24. | |
was a moderniser when she won all those elections? The problem we have | :34:25. | :34:28. | |
at the moment is that UKIP has grown-up. If we could get all of | :34:29. | :34:33. | |
those people who vote UKIP to vote for us, we would get 47% of the | :34:34. | :34:38. | |
vote. We don't need to worry about voters on the left. We need to worry | :34:39. | :34:43. | |
about the voters in the north, those people who haven't voted for us for | :34:44. | :34:51. | |
decades. Having an EU Referendum Bill is going to get people to | :34:52. | :34:57. | |
vote. We have to reach out to voters, but not by some sort of | :34:58. | :35:02. | |
London based in need. You have to broaden your base. I agree with you | :35:03. | :35:07. | |
on that. We have to broaden our appeal, but this back to the future | :35:08. | :35:10. | |
concept is not going to work. We need something that generally | :35:11. | :35:15. | |
appeals to low and middle-income voters, and something that shows we | :35:16. | :35:19. | |
genuinely care about the life chances of the poorest. Do you think | :35:20. | :35:26. | |
that the people who vote UKIP don't support those aspirations? We are | :35:27. | :35:33. | |
not doing enough to cut immigration. We don't have an EU Referendum Bill | :35:34. | :35:36. | |
stop we have to get the centre right to vote for us again. Do that, and | :35:37. | :35:44. | |
we have it. Tom Pursglove, the 25 euros, will be returned in Corby | :35:45. | :35:47. | |
because we cannot win an election there. -- the 25-year-old. Whether | :35:48. | :36:00. | |
you are moderniser or traditionalist, people, particularly | :36:01. | :36:06. | |
in the North, see you as a bunch of rich men. And rich southerners. You | :36:07. | :36:15. | |
are bunch of rich southerners. We need to do more to show that we are | :36:16. | :36:19. | |
building on lifting the poorest out of the tax. We need to build more | :36:20. | :36:26. | |
houses. There is a perception that the leadership at the moment is | :36:27. | :36:31. | |
rich, and public school educated. What we have to do is get more | :36:32. | :36:35. | |
people from state education into the top. You are going the other way at | :36:36. | :36:42. | |
the moment. That is a fair criticism. Modernisers also say | :36:43. | :36:50. | |
that. I went to a combo hedge of school as well. -- do a | :36:51. | :36:56. | |
comprehensive school. We need to show that we are standing up for low | :36:57. | :37:05. | |
income. Thank Q, both of you. You are watching the Sunday Politics. | :37:06. | :37:07. | |
Coming up in just under 20 Hello. | :37:08. | :37:23. | |
Coming up on the Sunday Politics in the South West: The wind and solar | :37:24. | :37:36. | |
industry is warning that Tory talk of cutting green taxes is scaring | :37:37. | :37:38. | |
investors and threatening jobs. And for the next 20 minutes, I'm joined | :37:39. | :37:42. | |
by The Lib Dem Peer Robin Teverson and Labour Councillor in Plymouth | :37:43. | :37:45. | |
Nicky Williams. Welcome both of you. | :37:46. | :37:54. | |
Let's start with council cuts. This week, the Conservative mayor of | :37:55. | :37:57. | |
Torbay blamed the government for his council's plans to remove funding | :37:58. | :38:00. | |
from charities which work with drug users and homeless people. Meanwhile | :38:01. | :38:02. | |
in Somerset the Conservative County Council put plans to cut children's | :38:03. | :38:06. | |
centres on hold. When you are talking about children's services, | :38:07. | :38:10. | |
of course it will be an emotive subject. We are going to go out and | :38:11. | :38:14. | |
continue to listen so we make sure we come up with the right result. 18 | :38:15. | :38:19. | |
children's centres are under threat in Somerset. Is this now the cuts be | :38:20. | :38:28. | |
inviting? I think it is. `` really biting. There are challenges to all | :38:29. | :38:35. | |
of the services. Implement, have you seen any children's centres become | :38:36. | :38:45. | |
vulnerable? `` implement. We are making sure that families in need | :38:46. | :38:51. | |
are being helped. We have done a lot of work to secure our future. There | :38:52. | :39:00. | |
has been support of children's centres, but the councils are saying | :39:01. | :39:04. | |
it is their fault for the budget cuts in the first place. Can there | :39:05. | :39:09. | |
be such aggressive cuts in spend be upset with the cuts are biting? Cuts | :39:10. | :39:17. | |
have been biting. Local authorities clearly can now spend the money that | :39:18. | :39:21. | |
they have left on the services that they want to. There is a lot more | :39:22. | :39:26. | |
flexibility there. Which services oh or stay is another issue. `` go or | :39:27. | :39:35. | |
stay. Eg the villages passing the buck? `` you do not feel it is | :39:36. | :39:42. | |
passing the buck? I am sure that is not the case. There is only so far | :39:43. | :39:46. | |
it can go, and I think central government will have to be very | :39:47. | :39:50. | |
careful in the future. Plenty more to discuss today. | :39:51. | :39:56. | |
This week the Prime Minister denied reports he'd told his team to get | :39:57. | :40:01. | |
rid of all the green rubbish. His earlier talk of rolling back green | :40:02. | :40:04. | |
levies is causing concern in the South West. With one renewable | :40:05. | :40:07. | |
energy expert this week warning David Cameron's comments are already | :40:08. | :40:09. | |
frightening investors and threatening jobs in the region. | :40:10. | :40:12. | |
Just how green do the Conservatives want to be? The issue hit the | :40:13. | :40:22. | |
headlines this week after one newspaper printed claims from what | :40:23. | :40:25. | |
it called a unnamed senior party member that the PM was making a U | :40:26. | :40:32. | |
turn on environmental issues. It comes only weeks after this | :40:33. | :40:36. | |
statement in the Commons. We need to roll back some of the cream | :40:37. | :40:45. | |
chargers. `` green charges. Last month, David Cameron revealed he was | :40:46. | :40:48. | |
considering rolling back green levies on energy companies to make | :40:49. | :40:51. | |
bills more affordable. Such talk inevitably sets alarm bells ringing | :40:52. | :40:54. | |
in the green energy sector. We need clarity and a long`term framework. | :40:55. | :40:59. | |
The message we are reviewing is very unhelpful. Many of the 10,000 jobs | :41:00. | :41:05. | |
in renewables are at some parts `` are at some degree of risk. South | :41:06. | :41:13. | |
West Conservatives have been pressuring David Cameron to cut the | :41:14. | :41:16. | |
subsidies given to some forms of renewable energy. Among them, the | :41:17. | :41:21. | |
Torridge and West Devon MP Geoffrey Cox, who pledged to oppose all new | :41:22. | :41:25. | |
commercial wind farms in his constituency, and Richard Drax, | :41:26. | :41:27. | |
whose Dorset South constituency lies near to the proposed Navitus Bay | :41:28. | :41:29. | |
offshore wind farm. A development he spoke out against | :41:30. | :41:32. | |
in Westminster this week. Eight other states `` sites have been | :41:33. | :41:39. | |
identified. There is no World Heritage Site or coastline site. Why | :41:40. | :41:43. | |
can't we do that? But despite this, Mr Drax is also a supporter of | :41:44. | :41:46. | |
renewable. He's just had planning approved for a 175 acre solar farm | :41:47. | :41:51. | |
on his estate in Dorset. Something campaigners were dismayed and | :41:52. | :41:56. | |
slightly bemused by. He is credited as being opposed to the subsidy that | :41:57. | :42:01. | |
government is giving to green energy. Apparently he has been very | :42:02. | :42:08. | |
vocal about that and also about offshore wind farms. Then he | :42:09. | :42:14. | |
proposes a development of this sort. So are the party that once urged | :42:15. | :42:18. | |
people to vote blue and go green sending out mixed messages? The | :42:19. | :42:24. | |
Prime Minister has strongly denied the comments reported in the press. | :42:25. | :42:27. | |
But those in the renewable energy sector might need a bit more | :42:28. | :42:30. | |
convincing. Earlier, I asked the Conservative MP | :42:31. | :42:34. | |
Geoffrey Cox if he thought he'd won his campaign to get the Government | :42:35. | :42:40. | |
to cut green energy subsidies. I think what we have one is a review, | :42:41. | :42:47. | |
and it is a perfectly sensible and I think proper thing to do at the time | :42:48. | :42:51. | |
of extreme financial hardship for many people that we review all of | :42:52. | :42:54. | |
these kinds of charges that fall heavily on the ordinary consumer and | :42:55. | :43:00. | |
see whether we can do better for last. What does that mean for jobs | :43:01. | :43:05. | |
in the region? It doesn't necessarily mean anything for jobs. | :43:06. | :43:10. | |
But we have heard that there are worries about the threat to jobs in | :43:11. | :43:18. | |
the green industry. That is a response to mood music, not any | :43:19. | :43:22. | |
particular detail. The Prime Minister is committed to green | :43:23. | :43:26. | |
policies. We have the first green investment bank. We have a whole | :43:27. | :43:33. | |
range of policies on green issues. He did `` do you think he used the | :43:34. | :43:36. | |
words that were quoted in the newspaper? I do not know, but I know | :43:37. | :43:45. | |
he is committed to seeing whether we can make this file less heavily on | :43:46. | :43:51. | |
the householder. There may be people that feel cheated by this, that you | :43:52. | :43:57. | |
are relaxing the green agenda. I do not buy that. We are not rolling it | :43:58. | :44:01. | |
back. What we are doing is reviewing its to make it cleaner. But David | :44:02. | :44:06. | |
Cameron said he was rolling it back. We are rolling it back in the sense | :44:07. | :44:10. | |
that we want to reduce the charge on the consumer, but there are other | :44:11. | :44:17. | |
ways of getting this particular cat `` skimming this particular we can | :44:18. | :44:23. | |
make it default less on the individual householder. But you are | :44:24. | :44:29. | |
doing it as a knee jerk reaction to Labour talking about freezing | :44:30. | :44:34. | |
prices. Freezing prices is going to cause massive upset in the | :44:35. | :44:40. | |
marketplace. Except profits have soared under this government by 70%, | :44:41. | :44:46. | |
and the average bill has gone up by about ?300 under this Parliament. | :44:47. | :44:51. | |
That is true, because the wholesale price of electricity and energy has | :44:52. | :44:56. | |
gone up. Let me just finish one answers so that the message is very | :44:57. | :45:01. | |
clear. The review is going to look at how we make it lighter on the | :45:02. | :45:05. | |
householder. There are plenty of other ways of raising this money and | :45:06. | :45:09. | |
not allowing it to fall so heavily as it does on the householder. At a | :45:10. | :45:13. | |
time of financial hardship, that has got to be the right thing to do. You | :45:14. | :45:19. | |
surprised by the negotiations on the deal to get a vast solar farm that | :45:20. | :45:28. | |
covers around ten football pitches? I do not think it is for me to | :45:29. | :45:33. | |
comment. I do not know enough about the detail about what Richard is | :45:34. | :45:37. | |
planning. I simply do not know enough about the detail. It is but | :45:38. | :45:42. | |
it would get around ?2 million of subsidies, and he has actually been | :45:43. | :45:46. | |
opposed to these subsidies himself. I am not going to comment on any | :45:47. | :45:51. | |
personal or individual case, certainly not about a colleague, the | :45:52. | :45:54. | |
detail of which I certainly do not know. I do want to say that it must | :45:55. | :46:01. | |
be right to reduce the charge on the householder of these levies. I have | :46:02. | :46:04. | |
to stop you there. Thank you for joining us. You speak on energy. | :46:05. | :46:16. | |
What is Jeffrey talking about here? He says that there are other ways to | :46:17. | :46:20. | |
raise money and not allow it to fall happily on the householder. You have | :46:21. | :46:26. | |
to put it through direct taxation. I suspect that is what the Chancellor | :46:27. | :46:30. | |
is trying to do. In some ways, that is quite good. What it does do is | :46:31. | :46:37. | |
create a whole uncertainty in the industry, particularly in the South | :46:38. | :46:43. | |
West, and in terms of investment, and this whole argument about cost | :46:44. | :46:49. | |
to the consumer of electricity, the trouble is, because of the lack of | :46:50. | :46:53. | |
investment we have had from the big energy companies in the past, if we | :46:54. | :46:59. | |
stayed stuck to gas and coal, we have seen how price rises go up and | :47:00. | :47:02. | |
up, and we need to get off of that fossil fuel junkie that we have | :47:03. | :47:09. | |
become and get renewables in. Are you worried that David Cameron's | :47:10. | :47:14. | |
comments about rolling back green levies infesting green investment | :47:15. | :47:19. | |
and jobs are threatened? Absolutely. This is real. This is politics. The | :47:20. | :47:24. | |
whole reason we have been going through this over a two`year period | :47:25. | :47:29. | |
is to get investing competence in the industry `` confidence in the | :47:30. | :47:36. | |
industry, and this is seriously undermining it. I do not think | :47:37. | :47:40. | |
George Osborne believes in this agenda at all and he is driving | :47:41. | :47:43. | |
David Cameron to this degree. It is a real split within the Tories will | :47:44. | :47:49. | |
stop it is bad for investment. `` Tories. Can you make these cuts | :47:50. | :47:55. | |
without affecting the green industry? I believe that we can. We | :47:56. | :48:01. | |
need to reset the energy market, which is why we want to do a | :48:02. | :48:05. | |
two`year freeze, and then we can reset the market by making it much | :48:06. | :48:08. | |
more fair and transparent and break down the power that the big five | :48:09. | :48:14. | |
have. Robin was saying that you could freeze the price is now on a | :48:15. | :48:18. | |
budget should have been doing this a long time ago. Is that what you were | :48:19. | :48:27. | |
thinking? Yes all stop `` yes. The companies have too much power at the | :48:28. | :48:31. | |
moment. Under the Labour government, I think it was down to six | :48:32. | :48:37. | |
companies. We do not have a good enough market and the government | :48:38. | :48:40. | |
hasn't done enough about it so far. We need a radical change but a price | :48:41. | :48:47. | |
freeze is a sticking plaster. The price freeze will give us the time, | :48:48. | :48:52. | |
whilst discontinuing the ?300 extra people have been facing in their | :48:53. | :48:59. | |
pockets on energy, to actually put the legislation through, to break | :49:00. | :49:02. | |
the monopoly that these big five companies have. What about the idea | :49:03. | :49:07. | |
that we need to support green energy in other ways? We need a balanced | :49:08. | :49:13. | |
market. Yes, we need to support green energy. The problem is, we | :49:14. | :49:17. | |
have seen that there has been a fall in investment in green energy since | :49:18. | :49:23. | |
2009, where it was at an all`time high. It has dramatically dropped to | :49:24. | :49:27. | |
what it is today. There is more renewable generation, it is up about | :49:28. | :49:36. | |
15% in the second half of the last year. That is quite wrong. It is the | :49:37. | :49:44. | |
highest it has ever been. It was a 7.2 billion. Before we argue too | :49:45. | :49:48. | |
much about this, what do you make of the solar farm idea? Do you think | :49:49. | :49:53. | |
there is any hypocrisy going on there? I think he is a very astute | :49:54. | :50:01. | |
businessman and it is up to him to put the pathway between his business | :50:02. | :50:04. | |
and his parliamentary career. We will move on. | :50:05. | :50:12. | |
Figures out this week revealed nearly 3,000 families in Cornwall | :50:13. | :50:15. | |
have been hit by what Labour calls the bedroom tax. April's benefit | :50:16. | :50:18. | |
changes mean people in social housing with spare bedrooms get less | :50:19. | :50:21. | |
money. They can apply for an emergency bailout to help them | :50:22. | :50:25. | |
adjust to the cuts but that cash is normally time limited and for some | :50:26. | :50:36. | |
tenants it's about to run out. When his marriage broke down and his | :50:37. | :50:40. | |
wife and twins moved out, Matt Pope was left with two spare bedrooms. | :50:41. | :50:44. | |
He's had to find an extra ?80 a month to pay his rent because of new | :50:45. | :50:47. | |
rules on under occupancy which have seen his housing benefit cut. It's | :50:48. | :50:53. | |
been a tough year for him. My wife left and took my children. I had | :50:54. | :50:58. | |
previously lost my job, and that all of the sudden, I had letters from | :50:59. | :51:03. | |
the council saying that they were going to charge me for the now | :51:04. | :51:09. | |
vacant rooms that I had. It felt like the straw that broke the camels | :51:10. | :51:19. | |
back `` camel's back. I attempted suicide in April. It was a | :51:20. | :51:22. | |
culmination of all of those issues at that point. Matt fell behind with | :51:23. | :51:30. | |
the rent and recently got a letter from his council warning him that he | :51:31. | :51:33. | |
could be evicted if he didn't pay the ?78 he owed. The Council has | :51:34. | :51:36. | |
spent thousands of pounds and keeping me in this property, for | :51:37. | :51:44. | |
adapting the place to suit my requirements, to meet my | :51:45. | :51:48. | |
disability. It would have been easy for me to move into a glow that was | :51:49. | :51:56. | |
disabled adapted `` a small home that was disabled adapted. Matt has | :51:57. | :52:06. | |
been claiming discretionary housing payment to help him cover the | :52:07. | :52:09. | |
shortfall in his housing benefit but the amount has reduced over the past | :52:10. | :52:13. | |
three months and it is due to end in December. Figures obtained by BBC | :52:14. | :52:16. | |
Sunday Politics South West show there has been a big rise in the | :52:17. | :52:20. | |
number of people on benefits asking for emergency cash or what's known | :52:21. | :52:23. | |
as discretionary housing payment to help them pay their rent. Last year, | :52:24. | :52:26. | |
between April and September 2012, 1,600 people applied for the help. | :52:27. | :52:29. | |
This year over the same period, applications have more than doubled, | :52:30. | :52:39. | |
with 4,100 applying. The government has given councils more funds for | :52:40. | :52:41. | |
discretionary housing payment this year in anticipation of the impact | :52:42. | :52:48. | |
of its welfare reforms. But some housing providers say there isn't | :52:49. | :52:51. | |
enough money to help everyone who needs it. There is variation in the | :52:52. | :52:55. | |
ways that the local authorities work, and in some of our areas, we | :52:56. | :53:01. | |
are not being successful. We have one area where we made seven | :53:02. | :53:04. | |
applications and they were all refused. In Plymouth, the number of | :53:05. | :53:19. | |
people on benefits applying for emergency cash for their rent has | :53:20. | :53:23. | |
more than tripled. From 200 last year to more than 700 this year. | :53:24. | :53:26. | |
Oliver Colvile, the Conservative MP for Plymouth Sutton and Devonport | :53:27. | :53:29. | |
says the benefit changes are needed. There are some people who do not | :53:30. | :53:32. | |
need family houses. The big issue, though, is that there are an awful | :53:33. | :53:36. | |
lot of people who are living in cramped conditions. And my | :53:37. | :53:39. | |
constituency, it is about 5,000 families who come and talk to me | :53:40. | :53:43. | |
about how it is that they have been stuck in cramped accommodation, and | :53:44. | :53:47. | |
we have to make sure that those people have the right accommodation. | :53:48. | :53:55. | |
Back in Mid Devon, Matt Pope is now up to date with his rent because the | :53:56. | :53:58. | |
parish council stepped in and used a community crisis fund to pay off his | :53:59. | :54:02. | |
arrears. But he's worried about the future because he knows this is just | :54:03. | :54:08. | |
a temporary fix. A temporary fix for him. It seems there are a lot of | :54:09. | :54:13. | |
temporary fixes going on. This emergency cash that is being | :54:14. | :54:17. | |
supplied is only temporary. It is not all temporary. In terms of | :54:18. | :54:23. | |
forces families and retired people, in terms of foster parents, all of | :54:24. | :54:28. | |
those have been permanently fixed. Certainly Liberal Democrats would | :54:29. | :54:31. | |
include disabled people, but we have not been able to persuade our | :54:32. | :54:37. | |
colleagues in the coalition. A number of local authorities do | :54:38. | :54:42. | |
manage to fulfil those requirements from money that has been sent out to | :54:43. | :54:47. | |
local government. There was one specifically that had not responded. | :54:48. | :54:51. | |
I think that is down to attitude of particular local authorities at that | :54:52. | :54:55. | |
time how that works. Surely the point of this is to free up some of | :54:56. | :55:00. | |
these houses, and if you are going to hand out emergency and out of | :55:01. | :55:04. | |
emergency cash to different people, then you are not actually freeing up | :55:05. | :55:08. | |
the houses. Maybe you do need to evict a few more people. What we are | :55:09. | :55:15. | |
doing is putting out enough money for people in need. Yes, the | :55:16. | :55:20. | |
reconfiguration within the housing market is needed, because what we | :55:21. | :55:24. | |
had under the previous government was 420,000 fall in the number of | :55:25. | :55:29. | |
social and council homes in the country. The Labour government | :55:30. | :55:32. | |
actually introduced spare room tax in terms of people having to live in | :55:33. | :55:37. | |
the private rented sector. Yes, it has had to spread into the public | :55:38. | :55:41. | |
sector. It is not good but things have to change. It is fundamentally | :55:42. | :55:47. | |
unfair, which is why Labour have said they would get rid of it. You | :55:48. | :55:55. | |
invented it in 2008. But it is inherently unfair. Implement, we | :55:56. | :56:02. | |
have 600 families who wants to downsize. There is nowhere for them | :56:03. | :56:08. | |
to go will stop we not `` them to go. It is causing more money because | :56:09. | :56:12. | |
more people are having to go to private landlords, where it costs | :56:13. | :56:16. | |
more, so they are claiming more in benefits, so this is a complete | :56:17. | :56:20. | |
false economy. It is very well to say we need to build more houses, | :56:21. | :56:23. | |
but if you desperately need those houses now, maybe this is the | :56:24. | :56:30. | |
solution. We don't have the houses available for people to downsize. We | :56:31. | :56:35. | |
have an enormous problem in that there are too many people on the | :56:36. | :56:39. | |
waiting list. We are not building enough houses across the country. We | :56:40. | :56:44. | |
are trying to put that right under lease of land onto the market and | :56:45. | :56:47. | |
work with housing associations to bring forward more affordable | :56:48. | :56:53. | |
accommodation. The stock of social housing and council housing during | :56:54. | :56:56. | |
the Labour government went down 420,000 nationwide. You have waiting | :56:57. | :57:03. | |
lists of up to 12,000 people that are not able to get decent housing | :57:04. | :57:07. | |
because, during the Labour government, you did not build the | :57:08. | :57:14. | |
houses. The number of housing stock has been reduced because of the | :57:15. | :57:19. | |
right to buy policy. So why did you not do anything when you were in | :57:20. | :57:23. | |
government? You didn't. You stop local authorities from replacing the | :57:24. | :57:28. | |
houses that were sold. Your government stop you from replacing | :57:29. | :57:31. | |
council houses that you sold under right to buy. We are working with | :57:32. | :57:36. | |
housing associations to release more land so that we can actually build | :57:37. | :57:42. | |
more houses. Labour has pledged to work out solutions to actually solve | :57:43. | :57:47. | |
this problem. The bedroom tax is not a solution. It is just pledging more | :57:48. | :57:53. | |
and more people into poverty. `` plunging. It is trying to get to a | :57:54. | :57:57. | |
problem that we inherited as a government. It is not perfect. It is | :57:58. | :58:02. | |
always fun to debate this but we have to move on because it is time | :58:03. | :58:05. | |
for our round up of the political week in 60 seconds. | :58:06. | :58:12. | |
Concern about rising water bills was raised in Parliament. If my right | :58:13. | :58:21. | |
honourable friend convinced that the regular age or is robust enough and | :58:22. | :58:26. | |
ensuring that future rises will be kept to a minimum? The problem of | :58:27. | :58:32. | |
pay day lending was put to the Prime Minister by the MP for Torbay. | :58:33. | :58:35. | |
Devon and Cornwall's Police Commissioner revealed he's spending | :58:36. | :58:38. | |
more than half a million on consultants. I think it is | :58:39. | :58:40. | |
ridiculous. I think he needs to go to the public and say, what do you | :58:41. | :58:44. | |
think? The majority of them would say to put police back on the | :58:45. | :58:48. | |
streets. It emerged that some Devon councillors have been failing to pay | :58:49. | :58:53. | |
their council tax. They bowed these things in and they should be | :58:54. | :58:56. | |
prepared to pay for them themselves. `` bowed to pay for them | :58:57. | :58:59. | |
themselves. `` voted these things in. Councillors in Weymouth said | :59:00. | :59:04. | |
Dorset was missing out on its olympic legacy. These things should | :59:05. | :59:10. | |
be used now. And the campaign to get a Cornish tick`box on the census was | :59:11. | :59:17. | |
revived. We haven't much time. Would you like | :59:18. | :59:27. | |
a Cornish text box on the census? Yes, absolutely. Take away. Do you | :59:28. | :59:32. | |
think that is ridiculous? Would you like a dev in the box? `` Devon. I | :59:33. | :59:44. | |
do not see a reason why that data cannot be collected. You never | :59:45. | :59:48. | |
know, there is still time. That is Sunday Politics in the South West. | :59:49. | :59:54. | |
Thank you to my guests. Before we go back to Andrew in London, just time | :59:55. | :59:59. | |
to tell you that, as always, the programme is available to watch on | :00:00. | :00:02. | |
the eye player, and you can always check out Martin's blog, which you | :00:03. | :00:08. | |
can go to buy the BBC website. `` through the BBC website. | :00:09. | :00:10. | |
those people who want to cycle. We will be returning to this one. Thank | :00:11. | :00:14. | |
you. A little bit of history was made at | :00:15. | :00:25. | |
Prime Minister's Questions this week. A teensy tiny bit. It wasn't | :00:26. | :00:30. | |
David Cameron accusing one MP of taking "mind-altering substances" - | :00:31. | :00:32. | |
they're always accusing each other of doing that. No, it was the first | :00:33. | :00:36. | |
time a Prime Minister used a live tweet sent from someone watching the | :00:37. | :00:39. | |
session as ammunition at the dispatch box. Let's have a look We | :00:40. | :00:48. | |
have had some interesting interventions from front edges past | :00:49. | :00:54. | |
and present. I hope I can break records by explaining that a tweet | :00:55. | :00:58. | |
has just come in from Tony McNulty, the former Labour security | :00:59. | :01:02. | |
minister, saying that the public are desperate for a PM in waiting who | :01:03. | :01:07. | |
speaks for them, not a Leader of the Opposition in dodging in partisan | :01:08. | :01:12. | |
Westminster Village knock about So I would stay up with the tweets if | :01:13. | :01:16. | |
you want to get on the right side of this one! We are working on how the | :01:17. | :01:21. | |
Prime Minister managed to get that wheat in the first place. What did | :01:22. | :01:25. | |
you think when you saw it being read out? I was certainly watching the | :01:26. | :01:32. | |
Daily Politics. I almost fell off my chair! It was quite astonishing He | :01:33. | :01:36. | |
didn't answer the question - he didn't do that the whole time. But I | :01:37. | :01:41. | |
stand by what the tweets said. I have tweeted for a long time on | :01:42. | :01:46. | |
PMQs. Normally I am praising Ed Miliband to the hilt, but no one | :01:47. | :01:52. | |
announces that in Parliament! Because the Prime Minister picked up | :01:53. | :01:56. | |
on what you said, it unleashed some attacks on you from the Labour side. | :01:57. | :02:01. | |
It did, minor attacks from some very junior people. Most people were | :02:02. | :02:05. | |
supportive of what I said. They took issue with the notion of not doing | :02:06. | :02:11. | |
it until 12:30pm, when it wasn't available for the other side to use. | :02:12. | :02:16. | |
Instant history, and instantly forgettable, I would say. Do you | :02:17. | :02:21. | |
think you have started a bit of a trend? I hope not, because the | :02:22. | :02:25. | |
dumbing down of PMQs is already on its way. Most people tweet like mad | :02:26. | :02:35. | |
through PMQs! Is a measure of how post-modern we have become, we have | :02:36. | :02:38. | |
journalists tweeting about someone talking about a tweet. That is the | :02:39. | :02:45. | |
level of British politics. I am horrified by this development. The | :02:46. | :02:48. | |
whole of modern life has become about observing people -- people | :02:49. | :02:55. | |
observing themselves doing things. Do we know what happened? Somebody | :02:56. | :03:00. | |
is monitoring the tweets on behalf of the Prime Minister or the Tory | :03:01. | :03:05. | |
party. They see Tony's tweet. They then print it out and give it to | :03:06. | :03:09. | |
him? There was a suggestion that Michael Goves had spotted it, but | :03:10. | :03:13. | |
Craig Oliver from the BBC had this great sort of... Craig Oliver was | :03:14. | :03:23. | |
holding up his iPad to take pictures of the Prime Minister, which he then | :03:24. | :03:28. | |
tweeted, from the Prime Minister. People will now be tweeting in the | :03:29. | :03:32. | |
hope that they will be quoted by the Prime Minister, or the Leader of the | :03:33. | :03:38. | |
Opposition. I wasn't doing that I'm just talking about the monster you | :03:39. | :03:44. | |
have unleashed! I hope it dies a miserable death. I think Tony is a | :03:45. | :03:49. | |
good analysis -- a good analyst of PMQs on Twitter. Moving onto the | :03:50. | :03:58. | |
Co-op. You were a Co-op-backed MP, white you? I was a Co-op party | :03:59. | :04:07. | |
member. There are two issues here about the Co-op and the Labour | :04:08. | :04:11. | |
Party. All the new music suggests that the Co-op will now have to | :04:12. | :04:16. | |
start pulling back from lending or donating to the Labour Party, which, | :04:17. | :04:21. | |
at a time when Mr Miliband is going through changes that are going to | :04:22. | :04:24. | |
cut of the union funds, it seems quite dangerous. There are three | :04:25. | :04:30. | |
things going on. There's the relationship that the party has | :04:31. | :04:33. | |
politically with the Co-op party, there is the commercial relationship | :04:34. | :04:39. | |
you referred to, and then there is this enquiry into the comings and | :04:40. | :04:43. | |
goings of Flowers and everybody else. The Tories, at their peril, | :04:44. | :04:50. | |
will mix the three up. There's a lot of things going on with a bang. | :04:51. | :04:54. | |
Labour has some issues around funding generally, and they are | :04:55. | :04:59. | |
potentially exacerbated by the Co-op issue. The Labour Party gets soft | :05:00. | :05:07. | |
loans from the Co-op bank, and it gets donations. ?800,000 last year. | :05:08. | :05:14. | |
Ed Balls got about ?50,000 for his private office. You get the feeling, | :05:15. | :05:18. | |
given the state of the Co-operative Bank now, that that money could dry | :05:19. | :05:24. | |
up. We will see. There's lots of speculation in the papers today At | :05:25. | :05:28. | |
the core, the relationship between the Co-op party and the Labour Party | :05:29. | :05:33. | |
is a proud one, and a legitimate one. I don't think others always | :05:34. | :05:38. | |
understand that. Here is an even bigger issue. Is it not possible | :05:39. | :05:43. | |
that the Co-op bank will cease to exist in any meaningful way as a | :05:44. | :05:50. | |
Co-op bank? Is the bane out means it is 70% owned -- the bail out means | :05:51. | :06:01. | |
that it is 70% owned, or 35% going to a hedge fund, I think I read | :06:02. | :06:06. | |
Yes, there is a move from the mutualism of the Co-op. But don t | :06:07. | :06:10. | |
confuse the Co-op bank with the Co-op Group. Others have done that. | :06:11. | :06:21. | |
I haven't. Here's the rub. The soft loans that Labour gets. They got | :06:22. | :06:29. | |
?1.2 million from this. And 2.4 million. They are secured against | :06:30. | :06:38. | |
future union membership fees of the party. What is Mr Miliband doing? He | :06:39. | :06:44. | |
is trying to end that? You have this very difficult confluence of events, | :06:45. | :06:49. | |
which is, could these wonderful soft loans that Labour has had from the | :06:50. | :06:53. | |
Co-op, could they be going? And these union reforms, where Ed | :06:54. | :06:59. | |
Miliband is trying to create a link between individuals and donations to | :07:00. | :07:04. | |
the Labour Party... Clearly, there could be real financial difficulties | :07:05. | :07:08. | |
here. The government needs to be careful, because George Osborne | :07:09. | :07:11. | |
launched one of his classic blunderbuss operations this week, | :07:12. | :07:14. | |
which is that the Labour Party is to blame for Paul Flowers' private | :07:15. | :07:22. | |
life. No, it's not. And that all the problems, essentially... Look at | :07:23. | :07:28. | |
what George Osborne was doing in Europe. He was trying to change the | :07:29. | :07:32. | |
capital requirement rules that would make it easier for the Co-op to take | :07:33. | :07:37. | |
over Lloyd's. If there is to be a big investigation, George Osborne | :07:38. | :07:40. | |
needs to be careful of what he wishes for. This is another example | :07:41. | :07:45. | |
of the Westminster consensus. All of the Westminster parties were in | :07:46. | :07:49. | |
favour of the Britannia takeover. This is how the Co-op ended up with | :07:50. | :07:54. | |
all this toxic rubbish on its balance sheet. All the major parties | :07:55. | :07:58. | |
were in favour of going to get the Lloyds branches. The Tories tried to | :07:59. | :08:02. | |
outdo Labour in being more pro-Co-op. There was nobody in | :08:03. | :08:09. | |
Westminster saying, hold on, this doesn't work. It is like the | :08:10. | :08:15. | |
financial bubble all over again Everyone was in favour of that at | :08:16. | :08:20. | |
the time. I think there is no evidence so far that the storm is | :08:21. | :08:24. | |
cutting through to the average voter. If I were Ed Miliband, I | :08:25. | :08:29. | |
would let it die a natural death. I would not write to an editorial | :08:30. | :08:33. | |
column for a national newspaper on a Sunday. That keeps the issue alive, | :08:34. | :08:39. | |
and it makes him look oversensitive and much better at dishing it out | :08:40. | :08:47. | |
than taking it. I agree about that. The Labour press team tweeted this | :08:48. | :08:50. | |
week saying that it was a new low for the times. And this was | :08:51. | :09:00. | |
re-tweeted by Ed Miliband. It isn't a great press attitude. It is very | :09:01. | :09:06. | |
Moni. Bill Clinton went out there and fought and made the case. So did | :09:07. | :09:11. | |
Tony Blair. If you just say, they are being horrible to us, it looks | :09:12. | :09:17. | |
pathetic. And it will cut through on Osborne and the financial | :09:18. | :09:23. | |
dimensional is, not political. I shall tweet that later! While we | :09:24. | :09:32. | |
have been talking, Mr Miliband has been on Desert Island Discs. He | :09:33. | :09:38. | |
might still be on it. Let's have a listen to what he had to say. | :09:39. | :09:46. | |
# Take on me, take me on. # And threw it all, she offers me | :09:47. | :09:58. | |
protection. # A lot of love and affection. | :09:59. | :10:09. | |
# Whether I'm right or wrong #. # Je Ne Regrette Rien. #. | :10:10. | :10:25. | |
Obviously, that was the music that Ed Miliband chose. Who thought - | :10:26. | :10:31. | |
you would have thought he would choose Norman Lamont's theme tune! | :10:32. | :10:40. | |
He chose Jerusalem... He has no classical background at all. He had | :10:41. | :10:51. | |
no Beethoven, no Elgar. David Cameron had Mendelssohn. And Ernie, | :10:52. | :11:00. | |
the fastest Notman in the West. -- fastest milkman. Tony Blair chose | :11:01. | :11:10. | |
the theme tune to a movie. Tony Blair's list was chosen by young | :11:11. | :11:13. | |
staffers in his office. It absolutely was. Tony Blair's list | :11:14. | :11:24. | |
was chosen by staff. The Ed Miliband this was clearly chosen by himself, | :11:25. | :11:28. | |
because who would allow politician to go out there and say that they | :11:29. | :11:38. | |
like Aha. I am the same age as Ed Miliband, and of course he likes | :11:39. | :11:42. | |
Aha. That was the tumour was played in the 80s. Sweet Caroline. It is | :11:43. | :11:53. | |
Angels by Robbie Williams. I was 14-year-old girl when that came out. | :11:54. | :12:02. | |
I thought Angels was the staple of hen nights and chucking out time in | :12:03. | :12:09. | |
pubs. The really good thing about his list is that the Smiths to not | :12:10. | :12:12. | |
appear. The Smiths were all over David Cameron's list. The absolutely | :12:13. | :12:17. | |
miserable music of Morris he was not there. What was his luxury? And | :12:18. | :12:27. | |
Indian takeaway! Again, chosen for political reasons. I would agree | :12:28. | :12:33. | |
with the panel about Aha, but I would expect -- I would respect his | :12:34. | :12:41. | |
right to choose. Have you been on Desert Island Discs? I have. It took | :12:42. | :12:46. | |
me three weeks to choose the music. It was the most difficult decision | :12:47. | :12:50. | |
in my life. What was the most embarrassing thing you chose? I | :12:51. | :12:56. | |
didn't choose anything embarrassing. I chose Beethoven, Elgar, and some | :12:57. | :13:01. | |
proper modern jazz. Anything from the modern era? Pet Shop Boys. | :13:02. | :13:13. | |
That's all for today. The Daily Politics will be on BBC Two at | :13:14. | :13:16. | |
lunchtime every day next week, and we'll be back here on BBC One at | :13:17. | :13:20. | |
11am next week. My luxury, by the way, was a wind-up radio! Remember, | :13:21. | :13:23. | |
if it's Sunday, it's the Sunday Politics. | :13:24. | :13:30. |