:00:37. > :00:44.Morning folks. Welcome to the Sunday Politics. George Osborne's fifth
:00:45. > :00:47.Budget will offer more tax relief for the lower paid but not
:00:48. > :00:49.Budget will offer more tax relief middle income earners being thrust
:00:50. > :00:51.into the 40p tax bracket. That's our top story.
:00:52. > :00:55.Ed Balls says millions of people aren't feeling any benefit from the
:00:56. > :00:58.recovery. We'll discuss the economy with big political beasts from
:00:59. > :01:05.Labour, the Conservatives, and the Lib Dems. Now that Ed Miliband has
:01:06. > :01:09.effectively ruled out an in/out EU referendum, how does UKIP deal with
:01:10. > :01:16.In the South West, the concdrn about means no
:01:17. > :01:18.In the South West, the concdrn about the tourist tax. And fresh hopes for
:01:19. > :01:25.Cornish nationists. Right on! of cycling. The three areas of
:01:26. > :01:33.London getting a cash boost to try something different.
:01:34. > :01:38.And with me as always our top political panel - Nick Watt, Helen
:01:39. > :01:40.Lewis and Janan Ganesh. They'll be tweeting their
:01:41. > :01:44.Lewis and Janan Ganesh. They'll be hashtag #bbcsp throughout the
:01:45. > :01:46.programme. So, just three months after his last major financial
:01:47. > :01:52.statement, George Osborne will be at the despatch box again on Wednesday,
:01:53. > :01:55.delivering his 2014 Budget. The Chancellor has already previewed his
:01:56. > :02:05.own speech, pledging to build what he calls a "resilient economy". The
:02:06. > :02:09.message I will give in the Budget is the economic plan is working but the
:02:10. > :02:13.job is far from done. We need to build resilient economy which means
:02:14. > :02:16.addressing the long-term weaknesses in Britain that we don't export
:02:17. > :02:20.enough, invest enough, build enough, make enough. Those are the things I
:02:21. > :02:24.will address because we want Britain to earn its way in the world. George
:02:25. > :02:27.Osborne's opposite number, Ed Balls, has also been talking ahead of the
:02:28. > :02:30.Budget. He says not everyone is feeling the benefit of the economic
:02:31. > :02:32.recovery, and again attacked the Government's decision to reduce the
:02:33. > :02:38.recovery, and again attacked the top rate of tax from 50 to 45%.
:02:39. > :02:42.George Osborne is only ever tough when he's having a go at the week
:02:43. > :02:45.and the voiceless. Labour is willing to face up to people on the highest
:02:46. > :02:52.incomes and say, I'm sorry, justifying a big tax cut at this
:02:53. > :02:56.time is not fair. We will take away the winter allowance from the richer
:02:57. > :02:59.pensioners, and I think that's the right thing to do. George Osborne
:03:00. > :03:04.might agree, but he's not allowed to say so. That was the Chancellor and
:03:05. > :03:09.the shadow chancellor. Janan, it seems like we are in a race against
:03:10. > :03:12.time. No one argues that the recovery is not under way, in fact
:03:13. > :03:16.it looks quite strong after a long wait, but will it feed through to
:03:17. > :03:23.the living standards of ordinary people in time for the May election?
:03:24. > :03:26.They only have 14 months to do it. The big economic variable is
:03:27. > :03:28.They only have 14 months to do it. business investment. Even during the
:03:29. > :03:33.downturn, businesses hoarded a lot of cash. The question is, are they
:03:34. > :03:37.confident enough to release that into investment and wages? Taking on
:03:38. > :03:40.new people, giving them higher pay settlements. That could make the
:03:41. > :03:46.difference and the country will feel more prosperous and this time next
:03:47. > :03:51.year. But come to think of it, it strikes me, that how anticipated it
:03:52. > :03:54.is, it's the least talked about Budget for many years. I think that
:03:55. > :03:58.is because the economy has settled down a bit, but also because people
:03:59. > :04:02.have got used to the idea that there is no such thing as a giveaway.
:04:03. > :04:07.Anything that is a tax cut will be taken away as a tax rise or spending
:04:08. > :04:11.cut. That's true during the good times but during fiscal
:04:12. > :04:17.consolidation, it's avoidable. - unavoidable. There is a plus and
:04:18. > :04:22.minus for the Conservatives here. 49% of people think the government
:04:23. > :04:24.is on roughly the right course, but only 16% think that their financial
:04:25. > :04:29.circumstances will improve this year. It will be a tough one for the
:04:30. > :04:35.Labour Party to respond to. I agree with Janan. Everyone seems bored
:04:36. > :04:40.with the run-up to the Budget. The front page of the Sunday Times was
:04:41. > :04:45.about fox hunting, the front page of the Sunday Telegraph was about EU
:04:46. > :04:50.renegotiation. Maybe we are saying this because there have not been
:04:51. > :04:55.many leaks. We have got used to them, and most of the George Osborne
:04:56. > :04:59.chat on Twitter was about how long his tie was. Freakishly long. I
:05:00. > :05:06.wouldn't dare to speculate why. Anything we should read into that? I
:05:07. > :05:13.don't know. For a long while there was no recovery, then it was it is a
:05:14. > :05:16.weak recovery, and now, all right, it's strong but not reaching
:05:17. > :05:22.everyone in the country. That is where we are in the debate. That's
:05:23. > :05:28.right, and the Conservative MPs are so anxious and they are making
:05:29. > :05:32.George Osborne announcing the rays in the personal allowance will go
:05:33. > :05:40.up, saying it might go up to 10 750 from next year, and Conservative MPs
:05:41. > :05:44.say that that's OK but we need to think about the middle voters.
:05:45. > :05:47.People are saying the economy is recovering but no one is feeling it
:05:48. > :05:51.in their pocket. These are people snagged in at a 40p tax rate. The
:05:52. > :05:56.Tories are saying these are our people and we have to get to them.
:05:57. > :06:02.He has given the Lib Dems more than they could have hoped for on raising
:06:03. > :06:06.the threshold. Why is he not saying we have done a bit for you, now we
:06:07. > :06:13.have to look after our people and get some of these people out of that
:06:14. > :06:15.40% bracket? Partly because the Lib Dems have asked for it so
:06:16. > :06:19.insistently behind-the-scenes. Somebody from the Treasury this week
:06:20. > :06:22.told me that these debates behind the scenes between the Lib Dems and
:06:23. > :06:27.Tories are incredibly tenacious and get more so every year. The Lib Dems
:06:28. > :06:32.have been insistent about going further on the threshold. The second
:06:33. > :06:38.reason is that the Tories think the issue can work for them in the next
:06:39. > :06:41.election. They can take the credit. If they enthusiastically going to
:06:42. > :06:46.?12,000 and make it a manifesto pledge, they can claim ownership of
:06:47. > :06:51.the policy. The Liberal Democrats want to take it to 12,500, which
:06:52. > :06:55.means you are getting into minimum wage territory. It's incredibly
:06:56. > :07:00.expensive and the Tories are saying that maybe you would be looking at
:07:01. > :07:04.the 40p rate. The Tories have played as well. There have been authorised
:07:05. > :07:07.briefings about the 40p rate, and Cameron and Osborne have said that
:07:08. > :07:10.their priority was helping the lowest paid which is a useful
:07:11. > :07:16.statement to make and it appeals to the UKIP voters who are the
:07:17. > :07:21.blue-collar workers. And we are right, the economy will determine
:07:22. > :07:24.the next election? You assume so. It was ever that is. It didn't in 992
:07:25. > :07:34.or 1987. It did in 1992. Ed Miliband's announcement last week
:07:35. > :07:37.that a Labour government would not hold a referendum on Europe unless
:07:38. > :07:39.there's another transfer of powers from Britain to Brussels has
:07:40. > :07:44.certainly clarified matters. UKIP say it just shows the mainstream
:07:45. > :07:47.parties can't be trusted. The Conservatives think it means UKIP
:07:48. > :07:49.voters might now flock back to them as the
:07:50. > :07:50.voters might now flock back to them securing a referendum. Giles Dilnot
:07:51. > :07:57.reports. When it comes to Europe and
:07:58. > :08:01.Britain's relation to it, the question is whether the answer is
:08:02. > :08:04.answered by a question. To be in or not to be in, that is the question,
:08:05. > :08:07.and our politicians have seemed less interested in question itself but
:08:08. > :08:16.whether they want to let us answer it. Labour clarified their position
:08:17. > :08:23.last week. There will be no transfer of powers without an in out
:08:24. > :08:26.referendum, without a clear choice as to whether Britain will stay in
:08:27. > :08:32.the EU. That seems yes to a referendum, but hold on. I believe
:08:33. > :08:36.it is unlikely that this lock will be used in the next Parliament. So
:08:37. > :08:45.that's a no. The Conservatives say yes to asking, in 2017, if
:08:46. > :08:49.re-elected, but haven't always. In 2011, 81 Tory MPs defied the PM by
:08:50. > :08:51.voting for a referendum on EU membership: the largest rebellion
:08:52. > :09:02.against a Tory prime minister over Europe. Prompted by a petition from
:09:03. > :09:05.over 100,000 members of the public. The wrong question at the wrong time
:09:06. > :09:07.said the Foreign Secretary of a coalition Government including
:09:08. > :09:10.selfie-conciously-pro European Lib Dems, who had a referendum pledge in
:09:11. > :09:12.their 2010 manifesto, but only in certain circumstances. So we have
:09:13. > :09:16.the newspapers, and the public meeting leaflets. UKIP have always
:09:17. > :09:19.wanted the question put regardless. But Labour's new position may change
:09:20. > :09:28.things and The Conservatives think so. I think it does, because, you
:09:29. > :09:32.know, we are saying very clearly, like UKIP, we want a referendum but
:09:33. > :09:40.only a Conservative government can deliver it because most suffer
:09:41. > :09:47.largest would say it is possible in the first past the post system to
:09:48. > :09:55.have a UKIP government -- sophologists. And then it's easy for
:09:56. > :10:02.as to say that if a UKIP vote lets in a Conservative government, then
:10:03. > :10:05.they won't hold a referendum. UKIP seem undaunted by the clarifications
:10:06. > :10:09.of the other parties, campaigning like the rest but with a "tell it
:10:10. > :10:14.how it is, just saying what you re thinking, we aren't like them"
:10:15. > :10:19.attitude. They seem more worried about us and what we want, and I
:10:20. > :10:23.don't see that in the other parties. In parts of the UK, like South
:10:24. > :10:30.Essex, it's a message they think is working. They are taking the voters
:10:31. > :10:37.for granted again and people have had enough. People are angry, they
:10:38. > :10:41.see people saying they will get a vote on the European Union, but then
:10:42. > :10:46.it just comes down the road. They were quick to capitalise on the
:10:47. > :10:53.announcements, saying only the Conservatives will give you say so
:10:54. > :10:56.does it change things? Not really. We have been talking about a
:10:57. > :10:59.referendum and having a debate on the European Union for years, and
:11:00. > :11:04.the other parties are playing catch up. They have a trust issue. Nobody
:11:05. > :11:08.trusts them on the European Union and that is why people come to us.
:11:09. > :11:10.Who the average UKIP voter is, or how they voted before is
:11:11. > :11:13.complicated, and what dent they might make on Conservative and
:11:14. > :11:20.Labour votes in 2015 is trickier still, but someone's been crunching
:11:21. > :11:24.the numbers anyway. We reckon it is between 25 and 30% of the electorate
:11:25. > :11:28.broadly share the UKIP motivation, so to top out at that level would be
:11:29. > :11:33.difficult. That's an awful lot of voters, but it's not the majority,
:11:34. > :11:37.and this is the reason why the main parties can't afford to just openly
:11:38. > :11:41.appealed to the UKIP electorate too hard because the elections are won
:11:42. > :11:47.and lost amongst the other 70%, the middle-class, the graduate, the
:11:48. > :11:50.younger, ethnic minorities. An appeal to the values of UKIP voters
:11:51. > :11:55.will alienate some of the other groups, and they are arguably more
:11:56. > :11:57.significant in winning the election. Whatever, the numbers UKIPers seem
:11:58. > :11:59.doggedly determined to dig away at any support the other parties have
:12:00. > :12:05.previously enjoyed. Giles Dilnot reporting. UKIP's
:12:06. > :12:16.leader, Nigel Farage, joins me now for the Sunday Interview.
:12:17. > :12:23.Nigel Farage, welcome back. Good morning. So the Labour Party has
:12:24. > :12:28.shot a fox. If Ed Miliband is the next by Minister, there will not be
:12:29. > :12:31.a referendum customer there's a long way between now and the next
:12:32. > :12:35.election, and Conservative party jobs and changes. We had a cast iron
:12:36. > :12:38.guarantee of a referendum from camera, then he three line whip
:12:39. > :12:43.people to vote against it, and now they are for it. What the Labour
:12:44. > :12:46.Party has done is open up a huge blank to us, and that is what we
:12:47. > :12:50.will go for in the European elections this coming year in May. I
:12:51. > :12:53.think there is a very strong chance that Labour will match the
:12:54. > :12:57.Conservative pledge by the next general election. There may be, but
:12:58. > :13:01.at the moment he has ruled it out, and if he does not change his mind
:13:02. > :13:05.and goes into the election with the policy as it is, the only
:13:06. > :13:10.and goes into the election with the a referendum is a Tory government.
:13:11. > :13:14.If you think the Tories will form a majority, which I think is unlikely.
:13:15. > :13:17.Remember, two thirds of our voters would never vote Conservative
:13:18. > :13:22.anyway. There is still this line of questioning that assumes UKIP voters
:13:23. > :13:25.are middle-class Tories. We have some voters like that, but most of
:13:26. > :13:31.them are coming to us from Labour, some from the Lib Dems and a lot of
:13:32. > :13:37.nonvoters. But it come the election you failed to change Mr Miliband's
:13:38. > :13:41.line, I repeat, the only chance of a referendum, if you want a
:13:42. > :13:44.referendum, if that is what matters, and the polls suggest it doesn't
:13:45. > :13:47.matter to that many people, but if that is what matters, the only way
:13:48. > :13:52.you can get one is to vote Conservative. No, because you have a
:13:53. > :13:55.situation in key marginals, especially where all
:13:56. > :13:59.situation in key marginals, are getting a good share, where we
:14:00. > :14:05.will see, and this depends a lot on the local elections and the European
:14:06. > :14:08.elections, there are target constituencies where UKIP has a
:14:09. > :14:13.reasonably good chance of winning a seat, and that will change the
:14:14. > :14:19.agenda. Every vote for UKIP makes a Tory government less likely. Arab
:14:20. > :14:22.voters are not Tory. Only a third of the UKIP boat comes from the
:14:23. > :14:28.Conservative party -- our voters are not Tory. -- the UKIP vote. It was
:14:29. > :14:32.mentioned earlier, about blue-collar voters. We pick up far more Labour
:14:33. > :14:36.Party and nonvoters than conservatives. On the balance of
:14:37. > :14:40.what the effect of the UKIP boat is, the Tories should worry about
:14:41. > :14:45.us, they should worry about the fact they have lost faith with their own
:14:46. > :14:48.electorate. Even if there is a minority Ed Miliband government it
:14:49. > :14:50.electorate. Even if there is a means no referendum. Labour and the
:14:51. > :14:54.Liberal Democrats are now at one on the matter. The next election is in
:14:55. > :14:59.a few weeks time, the European elections. What happens in those
:15:00. > :15:02.elections will likely change the party stands and position on a
:15:03. > :15:06.referendum. The fact that Ed Miliband has said this means, for
:15:07. > :15:10.us, our big target on the 22nd of May will be the Labour voters in the
:15:11. > :15:14.Midlands and northern cities, and if we do hammer into that boat and we
:15:15. > :15:24.are able to beat Labour on the day, there's a good chance of their
:15:25. > :15:31.policy changing. One poll this morning suggests Labour is close to
:15:32. > :15:38.you at 28, the Conservatives down at 21, the Lib Dems down at eight. You
:15:39. > :15:42.are taking votes from the Conservatives and the Liberal
:15:43. > :15:49.Democrats. We are certainly taking votes from the Lib Dems but that is
:15:50. > :15:55.comparing the poll with one year ago when I don't think most people knew
:15:56. > :15:59.what the question really was. You seem to be in an impossible position
:16:00. > :16:05.because the better you do in a general election, the less chance
:16:06. > :16:10.there will be a referendum by 2 20. No, look at the numbers. Only a
:16:11. > :16:16.third of our voters are Conservatives. When we have polled
:16:17. > :16:20.voters that have come to us, we asked them if there was no UKIP
:16:21. > :16:25.candidate who would you vote for, less than one in five said
:16:26. > :16:30.Conservative. Less than one in five UKIP voters would be tempted to vote
:16:31. > :16:36.so the arithmetic does not suggest so the arithmetic does not suggest
:16:37. > :16:39.we are the Conservative problem it suggests we are hurting all of the
:16:40. > :16:44.parties and the reason the Tories are in trouble is because they have
:16:45. > :16:51.lost their traditional base. Why do you think Nick Clegg is debating
:16:52. > :16:59.Europe? I think they are in trouble, at 8% they could be wiped
:17:00. > :17:04.out, they could go from 12 to nothing and I think it is a chance
:17:05. > :17:10.for Nick Clegg to raise their profile. They are fringe party with
:17:11. > :17:15.respect to this contest so I see why he wants to do it. One of our big
:17:16. > :17:20.criticisms is that we have not been able to have a full debate on
:17:21. > :17:24.national television on the alternatives of the European Union
:17:25. > :17:38.so I am looking forward to it. How are you preparing? I think you can
:17:39. > :17:44.be over scripted with these things. Are you not doing mock debates? No,
:17:45. > :17:48.I am checking my facts and figures and making sure that I can show the
:17:49. > :17:54.British people that in terms of jobs, we would be far better off not
:17:55. > :17:58.being within the European Union not being within its rule book, not
:17:59. > :18:04.suffering from some of the green taxes they are putting on the
:18:05. > :18:10.manufacturing industry. The idea that 3 million jobs are at risk I
:18:11. > :18:14.want to show why that is nonsense. Who do you think is playing you in
:18:15. > :18:19.their mock debates? They probably Who do you think is playing you in
:18:20. > :18:25.went to the pub and found someone! We will see. You have promised to do
:18:26. > :18:31.whatever it takes to fund your European election campaign, how much
:18:32. > :18:36.has been given so far? Just give it a few weeks and you will see what
:18:37. > :18:46.Paul is planning to do. He has made a substantial investment in the
:18:47. > :18:51.campaign already. How much? I'm not answering that for now. We are well
:18:52. > :18:55.on our way to a properly funded campaign and our big target will be
:18:56. > :19:01.the big cities and the working vote in those communities. Your deputy
:19:02. > :19:07.chairman Neil Hamilton is another former Tory, he says so far we
:19:08. > :19:14.haven't seen the colour of his money. Exactly two weeks ago, and
:19:15. > :19:21.things have changed since then. Mr Sykes has written a cheque since
:19:22. > :19:28.then? Yes. This morning's papers saying you will be asking MEPs to
:19:29. > :19:35.contribute ?50,000 each, is that true? Over the next five years, yes.
:19:36. > :19:42.Not for the European campaign. So lack of money will not be an excuse.
:19:43. > :19:47.We will have a properly funded campaign. How we raise the kind of
:19:48. > :19:57.money needed to fund the general election afterwards is another
:19:58. > :19:59.question. What is UKIP's policy on paying family members? We don't
:20:00. > :20:04.encourage it and I didn't employ paying family members? We don't
:20:05. > :20:10.family member for years. My wife ended up doing the job and paid for
:20:11. > :20:18.the first seven years of my job She is paid now? Until May, then she
:20:19. > :20:25.comes off the payroll am which leaves me with a huge problem. In
:20:26. > :20:31.2004 you said, UKIP MEPs will not employ wives and there will be no
:20:32. > :20:35.exceptions. An exception was made because I became leader of the
:20:36. > :20:39.National party as well as a leader of the group in European
:20:40. > :20:43.Parliament. Things do change in life, and you can criticise me for
:20:44. > :20:49.whatever you like, but I cannot be criticised for not having a big
:20:50. > :20:58.enough workload. No, but you didn't employ your wife when you had told
:20:59. > :21:01.others not to do it your party. Nobody else in my party has a big
:21:02. > :21:07.job in Europe and the UK. We made the exception for this because of
:21:08. > :21:11.very unusual circumstances. It also looks like there was a monetary
:21:12. > :21:18.calculation. Listen to this clip from a BBC documentary in 2000. It
:21:19. > :21:24.is a good job. I worked it out because so much of what you get is
:21:25. > :21:27.after tax that if you used the secretarial allowances to pay your
:21:28. > :21:36.wife on top of the other games you can play, I reckon this job in
:21:37. > :21:38.Stirling term is over a quarter of ?1 million a year. That is what you
:21:39. > :21:45.would need to earn working for Goldman Sachs or someone like that.
:21:46. > :21:48.I agree with that. More importantly the way you really make money in the
:21:49. > :21:54.European Parliament is being their five days a week, because you sign
:21:55. > :21:59.in every day, you get 300 euros every day, and that is how people
:22:00. > :22:04.maxed out. The criticism of me is that I am not there enough so
:22:05. > :22:08.whatever good or bad I have done in the European Parliament, financial
:22:09. > :22:13.gain has not been one of the benefits. There have been
:22:14. > :22:18.allegations of you also employing a former mistress on the same European
:22:19. > :22:23.Parliamentary allowance, you deny that? I am very upset with the BBC
:22:24. > :22:28.coverage of this. The ten o'clock news run this as a story without
:22:29. > :22:32.explaining that that allegation was made using Parliamentary privilege
:22:33. > :22:38.by somebody on bail facing serious fraud charges. I thought that was
:22:39. > :22:46.pretty poor. You have a chance to fraud charges. I thought that was
:22:47. > :22:51.that and you deny you have employed a former mistress? Yes, but if you
:22:52. > :22:56.look at many of the things said over the last week, I think it is
:22:57. > :22:59.becoming pretty clear to voters that the establishment are becoming
:23:00. > :23:07.terrified of UKIP and they will use anything they can find to do us down
:23:08. > :23:13.in public. Is an MEP employs his wife and his former mistress, that
:23:14. > :23:17.would be resigning matter, wouldn't it? Yes, particularly if the
:23:18. > :23:23.assumption was that money was being taped for work but was not being
:23:24. > :23:31.done. Who do you think is behind these stories? It is all about
:23:32. > :23:35.negative, it is all about attacks, but I don't think it is actually
:23:36. > :23:40.going to work because so much of what has been said in the last week
:23:41. > :23:45.is nonsense. A reputable daily newspaper said I shouldn't be
:23:46. > :23:49.trusted because I had stored six times for the Conservative party, I
:23:50. > :23:55.have never even stored in a local council election. I think if you
:23:56. > :24:04.keep kicking an underdog, it will make the British people rally around
:24:05. > :24:11.us. Is it the Conservatives? Yes, and the idea that all of our voters
:24:12. > :24:20.are retired colonels is simply not true. We get some voters from the
:24:21. > :24:25.Labour side as well. Would you consider standing in a Labour seat
:24:26. > :24:33.if you are so sure you are getting Labour votes? Yes, but the key for
:24:34. > :24:39.UKIP is that it has to be marginal. Just for your own future, if you
:24:40. > :24:45.fail to win a single soul -- single seat in the general election, if Ed
:24:46. > :24:51.Miliband fails to win an outright majority, will you stand down as
:24:52. > :24:57.UKIP leader? I would think within about 12 hours, yes. I will have
:24:58. > :25:02.failed, I got into politics not because I wanted a career in
:25:03. > :25:05.politics, far from it. I did it because I don't think this European
:25:06. > :25:09.entanglement is right for our country. I think a lot of people
:25:10. > :25:14.have woken up to the idea we have lost control of our borders and now
:25:15. > :25:19.is the moment for UKIP to achieve what it set out to do. Will UKIP
:25:20. > :25:24.is the moment for UKIP to achieve continue without you if you stand
:25:25. > :25:34.down? Of course it will. I know that everyone says it is a one-man band
:25:35. > :25:36.but it is far from that. We have had some painful moments, getting rid of
:25:37. > :25:41.old UKIP, new UKIP is more professional, less angry and it is
:25:42. > :25:47.going places. Nigel Farage, thank you for being with us.
:25:48. > :25:49.So, what else should we be looking out for in Wednesday's Budget
:25:50. > :25:51.statement? We've compiled a Sunday Politics guide to the Chancellor's
:25:52. > :25:54.likely announcements. Eyes down everyone, it's time for a
:25:55. > :25:58.bit of budget bingo. Let's see what we will get from the man who lives
:25:59. > :26:01.at legs 11. Despite some good news on the economy, George Osborne says
:26:02. > :26:05.that this will be a Budget of hard truths with more pain ahead in order
:26:06. > :26:07.to get the public finances back under control. But many in the
:26:08. > :26:10.Conservative party, including the former chancellor Norman Lamont
:26:11. > :26:12.want Mr Osborne to help the middle classes by doing
:26:13. > :26:18.want Mr Osborne to help the middle 4.4 million people who fall into the
:26:19. > :26:22.40% bracket. Around one million more people pay tax at that rate compared
:26:23. > :26:27.to 2010 because the higher tax threshold hasn't increased in line
:26:28. > :26:30.with inflation. Mr Osborne has indicated he might tackle the issue
:26:31. > :26:36.in the next Conservative manifesto, but for now he is focused on helping
:26:37. > :26:39.the low paid. It's likely we will see another increase in the amount
:26:40. > :26:45.you can earn before being taxed perhaps up another ?500 to ?10, 00.
:26:46. > :26:48.The Chancellor is going to flesh out the details of a tax break for
:26:49. > :26:51.childcare payments, and there could be cries of 'house' with the promise
:26:52. > :27:08.of more help for the building industry. The Help To Buy scheme
:27:09. > :27:12.will be extended to 2020 and there could be the go-ahead for the first
:27:13. > :27:15.Garden City in 40 years. Finally, bingo regulars could be celebrating
:27:16. > :27:17.a full house with a possible cut in bingo tax.
:27:18. > :27:19.And I've been joined in the studio by the former Conservative
:27:20. > :27:22.chancellor Norman Lamont, in Salford by the former Labour Cabinet
:27:23. > :27:25.minister Hazel Blears, and in Aberdeen by the Lib Dem deputy
:27:26. > :27:30.leader, Malcolm Bruce. Let me come to Norman Lamont first, you and
:27:31. > :27:35.another former Tory Chancellor, Nigel Lawson, have called in the
:27:36. > :27:46.fall in the threshold for the rate at which the 40p clicks in. I would
:27:47. > :27:49.have preferred an adjustment in the Budget but I agree with what you are
:27:50. > :27:56.saying, it sounds like the Chancellor will not do that. My main
:27:57. > :28:00.point is that you cannot go on forever and forever increasing the
:28:01. > :28:04.personal allowance and not increasing the 40% tax threshold
:28:05. > :28:08.because you are driving more and more people into that band. It is an
:28:09. > :28:12.expensive policy because in order to keep the number of people not paying
:28:13. > :28:19.tax constant, you have to keep adjusting it each year. When this
:28:20. > :28:26.was introduced by Nigel Lawson, it applied to one in 20 people, the 40%
:28:27. > :28:32.rate, it now applies to one in six people. By next year, there will be
:28:33. > :28:36.6 million people paying base. Why do you think your Tory colleagues seem
:28:37. > :28:51.happy to go along with the Lib Dems and target whatever money there is
:28:52. > :28:57.for tax cuts rather -- on the lower paid rather than the middle incomes?
:28:58. > :29:02.They are not helping the lowest paid. If you wanted to really help
:29:03. > :29:07.the lowest paid people you would raise the threshold for national
:29:08. > :29:12.insurance contributions, which is around ?6,000. Is it the Lib Dems
:29:13. > :29:22.stopping any rise in the 40p threshold? We are concentrating on
:29:23. > :29:30.raising the lower threshold because we believe that is the way to help
:29:31. > :29:33.those on lower incomes. Whilst they haven't benefited as much as the
:29:34. > :29:38.lower paid they have participated and I think people understand right
:29:39. > :29:42.now, if you were going to prioritise the high earners, when we are still
:29:43. > :29:46.trying to help those on lower and middle incomes who haven't enjoyed
:29:47. > :29:51.great pay increases but have got the benefit of these tax increases, that
:29:52. > :29:57.is why we would like to do it for the minimum wage level. But the
:29:58. > :30:03.poorest will not benefit at all The poorest 16% already don't pay tax.
:30:04. > :30:08.Why don't you increase the threshold at which National Insurance starts?
:30:09. > :30:16.You only have two earned ?5,500 before you start to pay it. You ve
:30:17. > :30:19.got to remember that the raising of the threshold to ?10,000 or more was
:30:20. > :30:28.something the Tories said we could not afford. Why are you continuing
:30:29. > :30:32.to do it? If you want to help the working poor, the way would be to
:30:33. > :30:38.take the lowest out of national insurance. The view we take is they
:30:39. > :30:42.are benefiting, and have benefited from, the raising of the tax
:30:43. > :30:47.threshold. You now have to earn ?10,000, we hope eventually 12, 00,
:30:48. > :30:51.and that means only people on very low wages. If you opt out of
:30:52. > :30:56.national insurance, you're saying to people that you make no contribution
:30:57. > :31:00.to the welfare system, so there is a general principle that people should
:31:01. > :31:06.participate and paying, and also claim when they need something out.
:31:07. > :31:09.We thought raising the threshold was simple and effective at a time of
:31:10. > :31:16.economic austerity and the right way to deliver a helpful support to
:31:17. > :31:19.welcoming people. -- working people. With the Labour Party continue to
:31:20. > :31:23.raise the threshold, or do they think there is a case that there are
:31:24. > :31:29.too many people being dragged into the 40p tax bracket? If Norman
:31:30. > :31:32.Lamont thinks this is the right time to benefit people who are reasonably
:31:33. > :31:36.well off rather than those who are struggling to make ends meet, then
:31:37. > :31:40.genuinely, I say it respectfully, I don't think he's living in the world
:31:41. > :31:45.the rest of us are. Most working people have seen their wages
:31:46. > :31:50.effectively reduced by about ?1 00 because they have been frozen, so
:31:51. > :31:55.the right thing is to help people on modest incomes. I also understand
:31:56. > :31:58.that if the 40% threshold went up, the people who would benefit the
:31:59. > :32:03.most, as ever, are the people who are really well off, not the people
:32:04. > :32:09.in the middle. The Conservatives have already reduced the 50p tax on
:32:10. > :32:12.people over ?150,000 a year, and we have to concentrate on the people
:32:13. > :32:16.going out to work, doing their best to bring their children up and have
:32:17. > :32:20.a decent life and need a bit of help. I think raising the threshold
:32:21. > :32:25.is a good thing. We would bring back the 10p tax, which we should never
:32:26. > :32:29.have abolished, and do things with regard to childcare. At the moment,
:32:30. > :32:34.childcare costs the average family as much as their mortgage, for
:32:35. > :32:37.goodness sake. We would give 25 hours free childcare for youngsters
:32:38. > :32:44.over three and four years old. That would be a massive boost the working
:32:45. > :32:48.families. We are talking about nurses, tube drivers, warrant
:32:49. > :32:52.officers in the army. There are many people who are not well off but have
:32:53. > :32:57.been squeezed in the way everybody has been squeezed and they are
:32:58. > :33:00.finding it continuing. I am stunned by Malcolm's argument where
:33:01. > :33:04.everybody should pay something so you should not take people out of
:33:05. > :33:08.national insurance, but the principle doesn't apply to income
:33:09. > :33:14.tax. You can stand that argument on its head and apply it to income tax.
:33:15. > :33:16.Most people don't see a difference between income tax and national
:33:17. > :33:21.insurance, it's the same thing to most people. It is true that it
:33:22. > :33:24.isn't really an insurance fund and there is an argument from merging
:33:25. > :33:30.both of them. But we have concentrated on a simple tax
:33:31. > :33:36.proposition. Norman is ignoring the fact the people on the 40% rate have
:33:37. > :33:40.benefited by the raising of the personal allowance. To say they have
:33:41. > :33:44.been squeezed is unfair. The calculation is that an ordinary
:33:45. > :33:49.taxpayer will be ?700 better off at the current threshold, and about
:33:50. > :33:53.?500 better off at the higher rate. It is misleading to say the better
:33:54. > :33:58.off we'll be paying more. I agree with Hazel, if you go to the 40
:33:59. > :34:01.rate, it's the higher earners who benefit the most, and we won't do
:34:02. > :34:07.that when the economy is not where it was before the crash. How much
:34:08. > :34:14.will the lower paid be better off if you reintroduce the 10p rate?
:34:15. > :34:20.Significantly better off. I don t have the figure myself, but they'd
:34:21. > :34:23.be significantly better off and the Budget should be a mixture of
:34:24. > :34:27.measures to help people who work hard. That is why I think the
:34:28. > :34:31.childcare issue has to be addressed. ?100 a week of the people
:34:32. > :34:37.with childcare payments. It is a massive issue. We want the job is
:34:38. > :34:40.guaranteed to get young people back into work. There's been hardly any
:34:41. > :34:44.discussion about that, and we have nearly 1 million people who have
:34:45. > :34:49.been out of work for six months or more, and as a country we need to do
:34:50. > :34:53.something to help that. 350,000 full-time students, so it is a
:34:54. > :34:58.misleading figure. It is not a full-time students, so it is a
:34:59. > :35:04.students. All parties do this. It sounds to me, Malcolm Bruce, you
:35:05. > :35:07.have more in common with the Labour Party than you do with the
:35:08. > :35:12.Conservatives. You want an annual levy on houses over ?2 million, so
:35:13. > :35:15.does Labour. A lot of your members want to scrap the so-called bedroom
:35:16. > :35:20.tax and so does labour. You think every teacher should have a teaching
:35:21. > :35:25.qualification, and so does Labour. Your policy on the EU referendum is
:35:26. > :35:30.the same. Let me go on. And you want to scrap the winter fuel allowance
:35:31. > :35:33.for wealthy pensioners. We want to make sure we get the public finances
:35:34. > :35:39.in order and we have grave reservations about the Labour Party
:35:40. > :35:46.promises. But they followed your spending plans in the first year.
:35:47. > :35:49.The point we are making is we can make a fairer society and stronger
:35:50. > :35:51.The point we are making is we can economy if you keep the public
:35:52. > :35:55.finances moving towards balance. We don't think the Labour Party will
:35:56. > :35:58.take a stand that track. It is interesting that the Labour Party
:35:59. > :36:04.want to introduce the 10p rate that Gordon Brown abolished. We consider
:36:05. > :36:11.that before we can -- committed to the 0% rate -- we considered that.
:36:12. > :36:16.It makes a complicated system difficult and we think it's better
:36:17. > :36:20.doing it that way. As a fiscal conservative, why are you talking
:36:21. > :36:23.about any tax cuts when the deficit is over ?100 billion, and
:36:24. > :36:28.effectively, anything you propose today can only be financed by more
:36:29. > :36:33.borrowing. I totally agree with you. I said that this week. I thought the
:36:34. > :36:37.best thing would have no Budget. The main thing is to get the deficit
:36:38. > :36:40.down. My argument is is that you have an adjustment in tax rates it
:36:41. > :36:46.should be shared between the allowances and the higher rate, but
:36:47. > :36:51.I don't think that the progress on the deficit is something we can give
:36:52. > :36:54.up on. This is still a very long way to go. We're only halfway through.
:36:55. > :37:00.Hazel, does it make sense to borrow to go. We're only halfway through.
:37:01. > :37:06.for tax cuts? I am reluctant to do this, but I agree with both Norman
:37:07. > :37:11.and Malcolm. Malcolm Bruce wants to borrow for tax cuts. We absolutely
:37:12. > :37:15.need to get the deficit down and get finances on a strong footing. But we
:37:16. > :37:18.also have to think about having some spending in the system that in the
:37:19. > :37:22.longer run saves us money. We all know we need to build new homes. I
:37:23. > :37:28.don't think it's necessarily the right priority to give people in
:37:29. > :37:33.London mortgage relief in terms of ?600,000. We have to get the balance
:37:34. > :37:39.right. Sometimes it is right to spend to save. I'm afraid we have
:37:40. > :37:41.run out of time. There will be plenty more discussion in the lead
:37:42. > :37:46.up to the Budget on Wednesday. It's just gone 11:35am. You're
:37:47. > :37:49.watching the Sunday Politics. We say goodbye to viewers in Scotland who
:37:50. > :37:52.leave us now for Sunday Politics Scotland. Coming up here in 20
:37:53. > :38:11.Coming up on the Sunday Polhtics in General Secretary of the TUC, joins
:38:12. > :38:15.Coming up on the Sunday Polhtics in the Southwest...
:38:16. > :38:24.Fresh hope for Cornish nationalists. Right on! And for the next 20
:38:25. > :38:27.minutes, I'm joined by Consdrvative MEP Julie Girling, and Labotr
:38:28. > :38:31.councillor Chaz Singh. Welcome to both of you.
:38:32. > :38:34.This week, Julie was disappointed by a letter she received from the
:38:35. > :38:37.floods minister making it plain that the government will not be `pplying
:38:38. > :38:39.for money from the European pot designed to help with natur`l
:38:40. > :38:43.disasters. The Environment Secretary said the damage caused by the floods
:38:44. > :38:47.wasn't bad enough to justifx a claim.
:38:48. > :38:50.I would be perfectly happy to apply if we qualify, but I would have to
:38:51. > :38:53.talk to other colleagues in government, but when I last looked
:38:54. > :38:58.at it, we needed to get a threshold of three billion.
:38:59. > :39:01.One MP described that as tosh, saying the real reason the
:39:02. > :39:12.government isn't applying is to spare the blushes of Euroscdptic
:39:13. > :39:16.Tories. If Europe came in whth a serious amount of money to sort out
:39:17. > :39:19.some of the problems in Somdrset and other parts of the country, it is
:39:20. > :39:22.going to be slightly embarr`ssing. They will not be able to sax
:39:23. > :39:25.anything rude about Europe. Julie, as an MEP, how likelx is it
:39:26. > :39:29.if the UK applies for this grant, that they could get it? It depends
:39:30. > :39:33.on the amount of damage. It's based on the percentage of GDP of each
:39:34. > :39:39.member state. We got it in 2007 when we had serious flooding. 130
:39:40. > :39:43.million, wasn't it? When thd Labour government was in power. I was
:39:44. > :39:49.involved then because I was on the county council in Gloucestershire. I
:39:50. > :39:52.don't see any reason why thd claim shouldn't get to the same sort of
:39:53. > :39:56.magnitude as it did then. I can t say for sure because I'm not privy
:39:57. > :40:03.to all the numbers. Would it be worth a go? I certainly think we
:40:04. > :40:06.should apply. Tessa Munt is talking nonsense when she says about it s
:40:07. > :40:13.sparing the blushes of Eurosceptic Tories. The letter I've had is from
:40:14. > :40:16.Dan Rogerson as the Minister for floods and he's a North Cornwall
:40:17. > :40:19.Liberal Democrat. It's got nothing to do with whether you are pro`or
:40:20. > :40:24.anti`Europe, it is just abott reaching the threshold. I would like
:40:25. > :40:27.government, and I have written to the secretary of state and Dan to
:40:28. > :40:37.look at this again because H think you are wrong. The EU Commission
:40:38. > :40:40.press office said that the president, Jose Manuel Barroso has
:40:41. > :40:42.said an application to the fund by the UK would be viewed
:40:43. > :40:46.constructively. It would indeed We've done work behind the scenes in
:40:47. > :40:48.Brussels to make sure that the commission would look at it
:40:49. > :40:52.constructively. It doesn't lean we would get it. There is a lilited
:40:53. > :40:56.period of ten weeks to applx. We are getting very close to the end of
:40:57. > :41:00.that. I just think it's wrong not to apply. I think we should apply. If
:41:01. > :41:04.we don't reach it, we don't reach it, but it's wrong not to try. I've
:41:05. > :41:09.tried very hard to get that message across. What do you make of that? As
:41:10. > :41:14.Julie said, 2007, Labour did apply for the money and got that loney. It
:41:15. > :41:19.helped those very people th`t need help now. It's no good saying that
:41:20. > :41:22.we're not speaking to the rhght people. I think it is a question of
:41:23. > :41:26.making sure that if that cl`im does go in, speaking to the right people,
:41:27. > :41:29.it is more importantly who `re the people and even though Dan Rogerson
:41:30. > :41:32.does live in North Cornwall, that is not, for me, a strong enough
:41:33. > :41:44.argument just because he resides in North Cornwall. So there was
:41:45. > :41:47.confusion... The argument w`s not because he lives there, he hs the
:41:48. > :41:53.Minister responsible. Only the government can apply. I can't apply
:41:54. > :41:58.as an MEP. People keep asking me to but I can't. Only the state
:41:59. > :42:02.government can apply. And in your opinion, it would be a big listake
:42:03. > :42:05.not to? Dan is a minister in this government. It is divisive to start
:42:06. > :42:15.talking about Tories and Lib Dems... But that is a realistic
:42:16. > :42:19.argument. You can't not sit there with Europe on the agenda, there is
:42:20. > :42:25.no way in the world that we can say it is not an issue. It is an issue.
:42:26. > :42:30.It is affecting everybody. @s is this situation, it's their life and
:42:31. > :42:33.happening to those very people. Tourism has long been a key part of
:42:34. > :42:38.the south`west economy, providing many thousands of jobs. Talk this
:42:39. > :42:41.week of a tourism tax has ldd to warnings that anything that might
:42:42. > :42:45.put visitors off might lead to a slowdown in the region's recovery.
:42:46. > :42:46.But a local government minister said charging tourists an extra pound a
:42:47. > :42:57.night could help our cash strapped Falmouth Harbour, with views that
:42:58. > :43:01.attract thousands of visitors to the area every year. But as loc`l
:43:02. > :43:04.government budgets are squedzed should these visitors be asked to
:43:05. > :43:11.pay ?1 a night tourist tax for the privilege? Would it put you off I
:43:12. > :43:17.guess so, yes. Being a penshoner, I guess it would.
:43:18. > :43:19.It is estimated the page th`t population of Cornwall swells from
:43:20. > :43:22.500,000 to millions during the summer months. These visitors are
:43:23. > :43:25.using things like public tohlets, the roads and the buses. A Lib Dem
:43:26. > :43:28.local government Minister h`s suggested a tourist bed tax could be
:43:29. > :43:31.one way local authorities in places like Cornwall could raise more of
:43:32. > :43:37.their own money. Not all holiday`makers agree?
:43:38. > :43:42.You are helping the local economy by being here anyway. The local shops
:43:43. > :43:46.get your money, the hotel gdts your money.
:43:47. > :43:49.Figures from the Tourism Alliance suggest across Devon and Cornwall,
:43:50. > :43:51.hundreds of millions of pounds are paid to the Treasury through VAT on
:43:52. > :44:03.to this spending. It says direct taxation on things
:44:04. > :44:05.like alcohol and petrol dutx raises around ?460 million a year hn
:44:06. > :44:09.Cornwall, ?480 million in Ddvon Even if a tourist tax went straight
:44:10. > :44:12.to the local coffers, those at the sharp end are not convinced and
:44:13. > :44:16.would rather see a cut in V@T. The high rates of VAT are very
:44:17. > :44:20.difficult. We have seen a cttback in services in terms of cleaning
:44:21. > :44:23.beaches, keeping toilets opdn. VisitCornwall, our marketing body
:44:24. > :44:32.has been cut, we are in a thme of public cuts and more tax and
:44:33. > :44:38.demands. I think it doesn't sound a lot, a pound, does it? But H think
:44:39. > :44:41.it may be the straw that wotld break the camel's back at a time when we
:44:42. > :44:43.are all trying to recover from a difficult recession.
:44:44. > :44:47.But one Dartmouth business owner thinks extra cash for services would
:44:48. > :44:53.be good for traders. I don't think it would deter people.
:44:54. > :44:57.I'm sure that people realisd the pressure rural communities `re
:44:58. > :45:00.under. I don't think people would look at it like that. I think they
:45:01. > :45:05.would think if it helps somdwhere like Dartmouth to stay spechal, they
:45:06. > :45:09.would be happy to pay it. It's not a huge amount of money.
:45:10. > :45:12.The concept of councils being more in control of their own tax`raising
:45:13. > :45:15.powers is generally welcomed by those in local government, but there
:45:16. > :45:21.is less agreement on whether a tourist tax is the way to go. The
:45:22. > :45:24.simple answer is if we charge too much, people won't come to Cornwall,
:45:25. > :45:28.they will stay in Devon. We need to make sure that people come `nd enjoy
:45:29. > :45:31.Cornwall and not put them off. Let's think about what's right for
:45:32. > :45:35.Cornwall, but let's make sure that those decisions are being t`ken in
:45:36. > :45:38.Cornwall, not in Westminster. Whatever form it takes, one thing we
:45:39. > :45:40.all agree on is the need for support for the tourism industry with all
:45:41. > :45:51.eyes on next week's budget. Tax on tourism, is that a good idea?
:45:52. > :45:55.No, it's not a good idea. In the piece it clearly said, at the end of
:45:56. > :46:01.the day, Cornwall is trying to encourage people to come and visit,
:46:02. > :46:05.not put people off. The ladx at the front of the piece did say, as a
:46:06. > :46:10.pensioner, it would affect her. One pound a night is not the answer to
:46:11. > :46:14.everything. I think you havd to look at other things that will hdlp more
:46:15. > :46:19.businesses in terms of making sure that they can look at their business
:46:20. > :46:24.rates. Like the VAT? Maybe the VAT, look at that as an option. This idea
:46:25. > :46:30.has been plucked out of the air to say this is what we need to do. What
:46:31. > :46:33.about the figures that Tamshn gave there, Cornwall has a popul`tion of
:46:34. > :46:36.500,000 which goes to millions in summer and you have to provhde those
:46:37. > :46:39.services for the tourists to use with such a small percentagd of the
:46:40. > :46:47.population paying the costs for road use, public toilets? If you pay
:46:48. > :46:52.?1000 for holiday accommodation ?5 a week does not seem that mtch? But
:46:53. > :46:54.when you start multiplying the figures, people going away `nd
:46:55. > :47:05.talking about it and saying, last year we paid this much... It is a
:47:06. > :47:09.bit of a bedroom tax. Is th`t going to turn people off? I think it will.
:47:10. > :47:15.But there are other options have to look at.
:47:16. > :47:19.Will it turn people off? I think it will. I'm delighted to hear Chaz say
:47:20. > :47:22.that he doesn't support it because Siddique Khan is on record of
:47:23. > :47:30.actually putting forward thd idea of tourist tax. It is not Labotr
:47:31. > :47:34.policy, but it is being talked about. I think it is the wrong way
:47:35. > :47:39.to go. I very much support the reduced VAT. It is absolutely proven
:47:40. > :47:43.across Europe and in other places such as the States that if xou
:47:44. > :47:49.reduce local VAT, you can rdduce costs. 20% VAT on your meal
:47:50. > :47:51.currently, if that was reduced to six or 7%, that will be
:47:52. > :48:03.significantly less you are paying for a meal and you will be going out
:48:04. > :48:07.more. Several MPs are calling for that. Adrian Sanders wants ht down
:48:08. > :48:12.to 5%. The absolute amount hs up for debate. But I do think that would be
:48:13. > :48:16.a much better campaign for Westminster politicians to get
:48:17. > :48:23.behind. Compared to France for example where it is somewhere
:48:24. > :48:28.between seven and 9%. We ard competing with that. If you go to
:48:29. > :48:33.France, they do have a tourhst tax, you see that on the tariff. When
:48:34. > :48:35.you've reduced the VAT, and you ve stimulated the tourist industry and
:48:36. > :48:43.actually stimulated growth, then you can talk about tourist tax. You cut
:48:44. > :48:47.VAT and introduce a secondary tax? You could, and I'm not suggdsting
:48:48. > :48:52.that, but if you look at thd American example, that's wh`t they
:48:53. > :48:55.do. Would that work or would hotels and guesthouses still have to remain
:48:56. > :48:58.competitive and they end up paying this cost? There would be an element
:48:59. > :49:05.of competitiveness for any business that has a certain amount of people
:49:06. > :49:08.coming in as tourists. Most importantly, we have seen the rise
:49:09. > :49:17.of the staycation so we know that less people are flying into
:49:18. > :49:20.Cornwall, but coming from UK cities. People will be thinking, if there is
:49:21. > :49:27.an opportunity where there hs a reduction in VAT, that would
:49:28. > :49:34.probably work far better. I think it makes sense to almost pilot a scheme
:49:35. > :49:37.first and see how that goes. I will have to stop you there.
:49:38. > :49:42.The Liberal Democrats are promising to give Cornwall its own assembly.
:49:43. > :49:45.The pledge, which was voted in at the party's Spring conference last
:49:46. > :49:47.weekend does depend on the Lib Dems securing a majority, but it has
:49:48. > :49:56.given new life to the devolttion Another week where Scotland's bid
:49:57. > :50:01.for devolution tops the news agenda. This time, it was Gordon Brown who
:50:02. > :50:03.made the headlines. But Scotland isn't the only place fighting for
:50:04. > :50:09.independence. Right on! Promise me one thhng, you
:50:10. > :50:16.will not stop singing and d`ncing and playing music and feasthng. .
:50:17. > :50:19.At the Lib Dems Spring confdrence, the party voted to allow Cornwall to
:50:20. > :50:26.create a lawmaking assembly like Wales. That is if they get dlected
:50:27. > :50:28.of course. We haven't heard a national party hitherto comlit to
:50:29. > :50:34.looking at the Cornish case seriously, looking at the provision
:50:35. > :50:36.for Cornwall. Locally, in Cornwall, we've had a number of polithcal
:50:37. > :50:47.parties at different times flirt with the idea, locally. The Liberal
:50:48. > :50:50.Democrats are the first UK wide party to say that we understand that
:50:51. > :50:53.there is a case for devoluthon to Cornwall and we have set th`t
:50:54. > :50:56.alongside the progress that is being made elsewhere.
:50:57. > :51:00.The Lib Dems might feel there is a case for Cornwall, but do voters?
:51:01. > :51:02.I think it would be a good hdea At the moment, everything is governed
:51:03. > :51:04.by people who don't live in Cornwall.
:51:05. > :51:08.I'm Cornish born and bred and nobody is more Cornish than I am, but I
:51:09. > :51:13.don't think we need to alter anything.
:51:14. > :51:18.The establishment of a Cornhsh assembly is not a new idea. 12 years
:51:19. > :51:22.ago, a 50,000 name petition was handed to Downing Street calling for
:51:23. > :51:25.one to be created. Since thdn, the language has been undergoing a
:51:26. > :51:30.revival. SPEAKS IN CORNISH.
:51:31. > :51:34.Dual road signs are becoming a common sight. But all of thhs is
:51:35. > :51:38.making leading business figtres in the county feel increasinglx
:51:39. > :51:40.uncomfortable. I don't think this is a realistic
:51:41. > :51:48.proposal in any meaningful timescale. We are too far away from
:51:49. > :51:51.a self`sustaining point. Incomes are too low, we need to work on getting
:51:52. > :51:54.Cornwall together, working together, income levels to the nation`l
:51:55. > :51:58.average before we talk about devolution.
:51:59. > :52:04.But for this film producer, it's not just about numbers, it's about
:52:05. > :52:07.Cornwall's heritage. Most Cornish people I know `re very
:52:08. > :52:09.happy to be considered Brithsh and want to be part of Britain `nd
:52:10. > :52:13.actually the decentralisation argument is one of allowing us to
:52:14. > :52:16.take charge of our own desthny, our own future, be consulted our own
:52:17. > :52:30.aspirations so we can be a proper player in the British familx.
:52:31. > :52:37.Joining us to discuss this we have Dick Cole, the leader of Mebyon
:52:38. > :52:43.Kernow. Lovely Celtic music we heard there. You have been campaigning for
:52:44. > :52:48.a devolved Cornish assembly for years, are you now pleased that the
:52:49. > :52:52.Lib Dems have adopted this stance? I have got to say that I would welcome
:52:53. > :52:56.any of the London centred p`rties taking initiatives in favour of more
:52:57. > :53:00.power to Cornwall. When I bdcame the leader of MK some years ago, the
:53:01. > :53:03.first thing I asked for was for a cross`party campaign to givd bring
:53:04. > :53:09.people together to argue for a Cornish assembly. As you have
:53:10. > :53:11.referenced in that piece, the 5 ,000 declarations that were taken to
:53:12. > :53:20.Westminster, all members of different parties joined in that
:53:21. > :53:23.campaign. If we had a Cornish assembly, would it be able to offer
:53:24. > :53:26.residents the same kind of benefits as Scottish and Welsh assemblies
:53:27. > :53:29.provide? For example, free university education for Cornish
:53:30. > :53:32.students, free residential care in care homes, is that the sort of
:53:33. > :53:43.thing you think it may be able to offer? The key to the argumdnt we
:53:44. > :53:46.are making and we brought ott a document last night called Towards a
:53:47. > :53:49.National Assembly, it is about people in Cornwall having ddmocratic
:53:50. > :53:52.control over the public sector, making the decisions that m`tter. At
:53:53. > :53:55.the moment in Cornwall, you have got local government and three puarters
:53:56. > :54:00.of the public sector is controlled from outside of Cornwall. Wd take
:54:01. > :54:03.the view that the whole public sector should be controlled within
:54:04. > :54:07.Cornwall. We should be making the decisions. In Scotland, thex have
:54:08. > :54:10.done such things as to safeguard the NHS from what happened in England,
:54:11. > :54:13.they have had no prescription charges for example, that is a
:54:14. > :54:17.political decision that whodver is in charge of the assembly would make
:54:18. > :54:20.in the future. It is about being ambitious for Cornwall and not
:54:21. > :54:23.sitting back and doing what Westminster tells us.
:54:24. > :54:25.Julie, at the moment, Scotl`nd offers Scottish students frde
:54:26. > :54:28.education, EU rules prevent there being any discrimination across
:54:29. > :54:30.European states so it has to offer free education to students from
:54:31. > :54:32.across European states, but not England and Wales because
:54:33. > :54:35.discrimination within a nathon is permissible. Obviously, if they
:54:36. > :54:38.become independent that would become a problem because they may have an
:54:39. > :54:41.influx of thousands of studdnts applying from England and W`les Is
:54:42. > :54:55.this the kind of thing that you think Cornwall could also do? Is it
:54:56. > :55:03.possible? I have no fundamental princhpled
:55:04. > :55:06.objection to it. I have an hssue about the size and whether `
:55:07. > :55:19.population of half a million can sustain that level of indepdndence,
:55:20. > :55:25.independent decision`making. That is round the costs of that. If you are
:55:26. > :55:28.going to take control entirdly of public spending at that levdl, you
:55:29. > :55:31.have got to have the political structure to do so. I know that the
:55:32. > :55:34.Mabyon Kernow suggestion is they would effectively return fotr
:55:35. > :55:37.district councils so we would end up with a lot more elected people in
:55:38. > :55:48.Cornwall, how would that be paid for? How would it work? Are we too
:55:49. > :56:01.small in Cornwall, you won't have the clout that, say, Wales `nd
:56:02. > :56:05.Scotland have? I think people in Cornwall get very fed up behng told
:56:06. > :56:09.we are too poor, or not clever enough to do that. I did not say
:56:10. > :56:12.that. I said it's a question of scale. I was coming onto th`t. The
:56:13. > :56:16.comment was made that we ard too poor. The reason we are too poor is
:56:17. > :56:19.that we live in an overcentralised state and the further away xou are
:56:20. > :56:22.from London, the less well off you are. It is about devolution, trying
:56:23. > :56:25.to get the whole of the United Kingdom refashioned in a more
:56:26. > :56:27.democratic way so that it is more even and there is less regional
:56:28. > :56:30.disparity. Regional disparities, if Cornwall
:56:31. > :56:32.were to get an assembly, yot could end up a neighbour, how would that
:56:33. > :56:52.affect you? `` a poor neighbour. Just go back to
:56:53. > :56:57.your piece, 12 years ago, 50,00 people signed. What happened from
:56:58. > :57:01.there? I think this, from mx point of view, I think towards thd end of
:57:02. > :57:06.December, this is the Lib Ddms saying we are going to go it alone.
:57:07. > :57:12.This is another of their far`fetched ideas where they think they can make
:57:13. > :57:24.Cornwall independent. I do not think it is structured in a way that there
:57:25. > :57:31.is no background evidence... There was a petition... 12 years `go. But
:57:32. > :57:36.is it something we are trying to do prior to the election? At the end of
:57:37. > :57:40.the day, it is one of those punching in the air policies where you think
:57:41. > :57:42.are we going to get anything out of this? There's more to Cornw`ll
:57:43. > :57:53.becoming independent, it dodsn't need to be. The fear is that our...
:57:54. > :57:56.Could I just see please stop using the word independence, this is about
:57:57. > :58:02.devolution within the United Kingdom. We despair when it is
:58:03. > :58:05.misrepresented in that manndr. I dare say that the Liberal Ddmocrats
:58:06. > :58:10.are using this politically, they have said it before and failed to
:58:11. > :58:15.follow through. We presented 50 000 signed declarations to a Labour
:58:16. > :58:19.government and they did nothing They threw it in the dustbin and
:58:20. > :58:27.didn't have the decency to consider devolution to Cornwall and H think
:58:28. > :58:32.that was a real missed opportunity. If it was, maybe it wasn't ` proper
:58:33. > :58:36.job. This is part of a biggdr debate. You are right about that.
:58:37. > :58:38.With the Scotland independence debate, it is interesting, there are
:58:39. > :58:43.discussions about English ddmocracy as opposed to Scottish and Welsh.
:58:44. > :58:55.They are really in their early stages, but the promoter on after
:58:56. > :58:58.September. `` they will motor on. If Scotland becomes independent, we
:58:59. > :59:01.will have to deal with the hssue of how we govern the UK, and that is
:59:02. > :59:03.when this will become reallx important.
:59:04. > :59:05.We will be discussing that lore as time goes on.
:59:06. > :59:12.It is time for our regular round`up of the political week in 60 seconds.
:59:13. > :59:18.Pupils in Devon were promisdd ? 00 a year as the schools minister
:59:19. > :59:24.announced a funding shake`up. It is the biggest step towards
:59:25. > :59:27.fairer schools funding in a decade. There was concern about plans for
:59:28. > :59:33.some 999 calls in Cornwall to be answered in North Yorkshire.
:59:34. > :59:39.People are going to have serious problems if they are ill.
:59:40. > :59:42.The badger cull debate was back at Westminster.
:59:43. > :59:46.This is a devastating disease having a devastating impact on cattle
:59:47. > :59:49.farmers. Ministers were told they must do
:59:50. > :00:00.more to stop the spread of wind farms. One Conservative MP said
:00:01. > :00:04.small rural communities are plunged into what can only be descrhbed as a
:00:05. > :00:07.miserable... It was revealed that parking meters
:00:08. > :00:08.which don't give change are making Cornwall Council ?300,000 a year.
:00:09. > :00:20.It's disgusting. Let's look at the parking charges.
:00:21. > :00:27.This is something that alwaxs annoys people. If vending machines can give
:00:28. > :00:32.change, why can't parking mdters? They can in some places. It's costs.
:00:33. > :00:38.You put in more sophisticatdd machines, they will cost more. This
:00:39. > :00:45.is a local decision. We just talked about local authorities. ?300,0 0,
:00:46. > :00:50.the money is there, the will has got to be there in order to takd on
:00:51. > :00:52.board new technology. That is the Sunday Politics in the
:00:53. > :01:00.south`west. Thanks to my gudsts industrial action is a sign of
:01:01. > :01:10.failure marked success. -- not success. Andrew, back to you.
:01:11. > :01:15.Has George Osborne got a rabbit in his Budget hat? Will the Chancellor
:01:16. > :01:17.find a way to help the squeezed middle? And how do Labour respond?
:01:18. > :01:28.All questions for The Week Ahead. And joining Helen, Janan and Nick to
:01:29. > :01:30.discuss the budget is the general secretary of the Trades Union
:01:31. > :01:35.Congress Frances O'Grady. Welcome back to the programme. I know the
:01:36. > :01:39.TUC has a submission, but if you could pick one thing that you wanted
:01:40. > :01:46.the Chancellor to do above all, what would it be? We want a budget for
:01:47. > :01:49.working people, which means we have to crack the long-term problem of
:01:50. > :01:57.investment in the British economy. Certainly I would like the
:01:58. > :01:59.Chancellor to merit that title they want of the new workers party, and
:02:00. > :02:02.take action on want of the new workers party, and
:02:03. > :02:12.if they're going to do that it's got to be about unlocking investment. In
:02:13. > :02:15.the period where the economy has been flat-lining there has been
:02:16. > :02:19.little business investment, but there are signs towards the end of
:02:20. > :02:25.last year that it is beginning to pick up. But a long way to go. The
:02:26. > :02:28.problem is we have key industries like construction and manufacturing
:02:29. > :02:34.that are still smaller than they were before the recession. The
:02:35. > :02:39.government itself, of course, has slashed its own capital investment
:02:40. > :02:43.budget by half. There is plenty of good and important work that needs
:02:44. > :02:49.to be done from building houses to improving the transport system, to
:02:50. > :02:53.improving our schools. And the government really needs to pick up
:02:54. > :02:58.that shovel and start investing in our economy to get the decent jobs
:02:59. > :03:03.we need, the pay increases we need, and that in itself will help
:03:04. > :03:09.stimulate demand. It was Alistair Darling who cut in 2011, and it s
:03:10. > :03:13.interesting that Ed Balls in his plans for the next parliament would
:03:14. > :03:17.run a current budget surplus by the end of the parliament as opposed to
:03:18. > :03:22.George Osborne who would have an overall budget surplus. That gives
:03:23. > :03:25.Ed Balls or -- more wriggle room to do what you talk about, but he is
:03:26. > :03:28.reticent to talk about it. He does not want to say that he has an
:03:29. > :03:31.opportunity to spend on investment because he fears if he says it he
:03:32. > :03:35.will be attacked by the Conservatives for being
:03:36. > :03:42.irresponsible. Why is business doing this? The recession was deeper than
:03:43. > :03:48.any since the war and the recovery was slower than almost any since the
:03:49. > :03:53.war. The lag, the time it takes to get over that is longer than anyone
:03:54. > :03:57.expected. I read the same evidence as you towards the end of last year
:03:58. > :04:02.pointing to money being released, and it depends what it is released
:04:03. > :04:06.on, whether it is capital investment or bringing in people on higher
:04:07. > :04:11.wages. The one surprise in the downturn is how well the employment
:04:12. > :04:14.figures have done, but they have not invested in new capacity and they
:04:15. > :04:18.are sitting on a lot of dosh. I looked at one set of figures that
:04:19. > :04:24.said if you took the biggest company in Britain, they have about 715
:04:25. > :04:28.billion pounds in corporate treasury -- the biggest companies. I think
:04:29. > :04:35.it's reduced a little but they are sitting on a mountain in dash of
:04:36. > :04:36.skills. Yes, but they're not investing in skills, wages, or
:04:37. > :04:41.sustainable jobs. The new investing in skills, wages, or
:04:42. > :04:47.have seen created since 2010, the vast majority of them have been in
:04:48. > :04:51.low paid industries, and they are often zero hours, or insecure, or
:04:52. > :04:56.part-time. So it's not delivering a recovery for ordinary working
:04:57. > :04:59.people. Government ministers, as you know when you lobby them, they are
:05:00. > :05:05.anxious to make out that they know the job is not done and the recovery
:05:06. > :05:10.has just begun, but the one bit they are privately proud of, although
:05:11. > :05:15.they can't explain it, is how many private-sector jobs have been
:05:16. > :05:17.created. A lot of unions have done sensible deals with employers to
:05:18. > :05:23.protect jobs through this period, but it's not sustainable. The
:05:24. > :05:28.average worker in Britain today is now ?2000 a year worse off in real
:05:29. > :05:32.terms than they were. On a pay against price comparison?
:05:33. > :05:39.terms than they were. On a pay take into account tax cuts. The
:05:40. > :05:47.raising of the personal allowance is far outweighed by the raising VAT.
:05:48. > :05:50.Does the raising of the threshold which the Lib Dems are proud of and
:05:51. > :05:55.the Tories are trying to trade credit for, does it matter to your
:05:56. > :06:00.members? -- take credit for. It matters that it is eclipsed by the
:06:01. > :06:03.cuts in benefits and know what is conned any more. We're going to hear
:06:04. > :06:09.a lot about the raising of the allowance, but as long as the real
:06:10. > :06:13.value of work, tax credits, things like that, people won't feel it in
:06:14. > :06:17.their pocket, and they will find it harder and harder to look after
:06:18. > :06:20.their family. When you look at the other things that could take over
:06:21. > :06:22.from consumer spending which has driven the recovery, held by house
:06:23. > :06:26.price rising in the south, driven the recovery, held by house
:06:27. > :06:29.exports and business investment and you look at the state of the
:06:30. > :06:34.Eurozone and the emerging markets which are now in trouble, and the
:06:35. > :06:38.winter seems to have derailed the US recovery. It won't be exports.
:06:39. > :06:46.Indeed, the Obie Eich does not think that will contribute to growth until
:06:47. > :06:52.2015 -- OBI. So the figures we should be looking at our business
:06:53. > :06:56.investment. And also the deficit. The deficit is 111 billion, and that
:06:57. > :07:01.is a problem, because we are not at the end of the cutting process,
:07:02. > :07:05.there are huge cuts to be made. I understand we are only a third of
:07:06. > :07:09.the way through. That will definitely affect business
:07:10. > :07:13.confidence. It is clear that the strategy has failed. Borrowing has
:07:14. > :07:14.gone up and it's not delivered improved living standards and better
:07:15. > :07:21.quality jobs, so cutting out improved living standards and better
:07:22. > :07:24.recession is not going to work. The structural budget deficit was going
:07:25. > :07:30.to be eliminated three weeks today under the original plan. They missed
:07:31. > :07:36.target after target. Every economist has their own definition of that. I
:07:37. > :07:41.think Mark Carney is right when he says that fundamentally the economy
:07:42. > :07:45.is unbalanced and it is not sustainable, growth is not
:07:46. > :07:51.sustainable. But if it clicked on, it would be more balanced. It is not
:07:52. > :07:54.just north and south and manufacturing a way out with
:07:55. > :08:00.services, but it is also between the rich and everybody else. What do you
:08:01. > :08:03.make of the fact that there will effectively be another freezing
:08:04. > :08:11.public sector pay, or at least no more than 1%? Not even that for
:08:12. > :08:16.nurses and health workers. But they will get 3% progression pay. 70 of
:08:17. > :08:20.nurses will not get any pay rise at all. They get no progression pay at
:08:21. > :08:26.all. I think this is smack in the mouth. Smack in the mouth to
:08:27. > :08:31.dedicated health care workers who will feel very, very discontented
:08:32. > :08:36.about the decision. Danny Alexander, I saw him appealing to
:08:37. > :08:42.health workers do not move to strike ballots and said they should talk to
:08:43. > :08:48.their department. But about what? Is that real pay cut has been imposed,
:08:49. > :08:53.what are workers left with? So do you expect as a result of yet more
:08:54. > :08:59.tough controls on public sector pay that unrest is inevitable? I know
:09:00. > :09:03.some unions will be consulting with their members, but ultimately it's
:09:04. > :09:08.always members who decide what to do. It does seem to me insulting not
:09:09. > :09:17.to at least be honest and say that we are cutting real pay of nurses,
:09:18. > :09:20.health care workers, on the back of a ?3 billion reorganisation of the
:09:21. > :09:28.NHS that nobody wanted and nobody voted for. Their long-term changes
:09:29. > :09:32.taking place here that almost talks about -- there are long-term
:09:33. > :09:39.changes. It is how lower percentage wages have become of GDP on how big
:09:40. > :09:44.the percentage of profits is. It seems to me there is a strong case
:09:45. > :09:48.for some kind of realignment there. The biggest event of my life, in
:09:49. > :09:52.this world, is the entry of a couple of billion more people into the
:09:53. > :09:56.labour supply. At the end of the Cold War, India and China plugged
:09:57. > :10:00.into the global economy. If there is a greater supply of that factor of
:10:01. > :10:05.production, logically you conclude that wages will fall or stagnate and
:10:06. > :10:07.that has been the story in this country and America and large parts
:10:08. > :10:12.of Western Europe in the last generation. What is not possible is
:10:13. > :10:15.for governments to do much about it. They can ameliorate it at the
:10:16. > :10:19.margins, but the idea that the government controls living
:10:20. > :10:22.standards, which has become popular over the last six months, and the
:10:23. > :10:28.Labour Party have in establishing that, and I don't think it's true.
:10:29. > :10:32.George Osborne's options are astonishingly limited compared to
:10:33. > :10:37.public expectations. If wages have reached a modern record low as
:10:38. > :10:43.percentage of GDP, who is going to champion the wage earner? We have
:10:44. > :10:48.lost Bob Crow, Tony Benn passed away, so who is the champion? The
:10:49. > :10:53.trade union movement is the champion of ordinary workers. We need those
:10:54. > :11:00.larger-than-life figures that we will mess. Have you got them yet? We
:11:01. > :11:04.have a generation of workers coming through. One thing about the loss of
:11:05. > :11:08.Bob Crow is that the whole union movement has responded strongly to
:11:09. > :11:11.that, and we want to say that we are strong and united and here to stand
:11:12. > :11:16.up for working people and we will fight as hard as Bob Crow did.
:11:17. > :11:20.Whoever replaces Bob Crow or Tony Benn, we can be sure they will not
:11:21. > :11:24.come from Eton because they all have jobs in the government. I want to
:11:25. > :11:26.put up on the screen what even Michael Gove was saying about this
:11:27. > :11:40.coterie of Old Etonian 's. He's right, is he not? He's
:11:41. > :11:46.absolutely right. We have the idea of the manifesto being written by
:11:47. > :11:52.five people from Eton and one from Saint Pauls. A remarkable example of
:11:53. > :11:55.social mobility that George Osborne, who had the disadvantage of going to
:11:56. > :12:03.Saint Pauls has made it into that inner circle. Here is the question,
:12:04. > :12:06.what is Michael Gove up to? If you saw the response from George
:12:07. > :12:10.Osborne, there was no slap down and they know this is an area they are
:12:11. > :12:14.weak on an David Cameron will not comment on it. If this had been a
:12:15. > :12:19.Labour shadow minister making a similarly disloyal statement, they
:12:20. > :12:22.might have been shot at dawn. But there is a real tolerance from
:12:23. > :12:26.Michael Gove to go freelance which comes from George Osborne. It's
:12:27. > :12:30.about highlighting educational reforms that he wants to turn every
:12:31. > :12:32.school in to eat and so it won't happen in the future. But it's also
:12:33. > :12:35.school in to eat and so it won't pointing out who did not go to Eton
:12:36. > :12:39.school and who would be the best candidate to replace David Cameron
:12:40. > :12:42.as leader, George Osborne, and who did go to Eton school, Boris
:12:43. > :12:50.Johnson. Michael Gove is on manoeuvres to destroy Boris
:12:51. > :12:55.Johnson's chances of being leader. It's a good job they don't have an
:12:56. > :12:59.election to worry about. Hold on. I think they are out of touch with
:13:00. > :13:04.businesses as well as working people. You ask about who is talking
:13:05. > :13:06.about wage earners. Businesses are. They are worried that unless living
:13:07. > :13:12.standards rise again there will be nobody there to buy anything. We are
:13:13. > :13:18.running out of time, but the TUC, are enthusiastic about HS2? We
:13:19. > :13:23.supported. We think it's the kind of infrastructure project that we need
:13:24. > :13:27.to invest in long-term. He could, if we get it right, rebalance north and
:13:28. > :13:34.south and create good jobs along the way -- it could. Thank you very much
:13:35. > :13:38.tool. I have to say that every week -- thank you very much to you all.
:13:39. > :13:41.That's all for today. I'll be back next Sunday at 11am, and Jo Coburn
:13:42. > :13:46.will be on BBC Two tomorrow at midday with the Daily Politics.
:13:47. > :13:49.Remember if it's Sunday, it's the Sunday Politics.