:00:36. > :00:40.Morning, folks. Welcome to the Sunday Politics.
:00:41. > :00:44.Labour's been hit hard by scandals at the Co-op. Ed Miliband says the
:00:45. > :00:47.Tories are mudslinging. We'll speak to Conservative Chairman Grant
:00:48. > :00:50.Shapps. Five years on from the financial
:00:51. > :00:53.crisis, and we're still talking about banks in trouble. Why haven't
:00:54. > :00:58.the regulators got the message? We'll ask the man who runs the
:00:59. > :01:01.City's new financial watchdog. And he used to have a windmill on
:01:02. > :01:06.his roof and talked about giving hugs to hoodies and huskies. These
:01:07. > :01:15.days, not so much. Has the plan to make the
:01:16. > :01:18.Is immigration really out of control? We meet Romanians working
:01:19. > :01:19.on farms in homelessness and population ships.
:01:20. > :01:30.What is the evidence? And as always, the political panel
:01:31. > :01:34.that reaches the parts other shows can only dream of. Janan Ganesh,
:01:35. > :01:37.Helen Lewis and Nick Watt. They'll be tweeting faster than England
:01:38. > :01:41.loses wickets to Australia. Yes, they're really that fast.
:01:42. > :01:44.First, some big news overnight from Geneva, where Iran has agreed to
:01:45. > :01:48.curb some of its nuclear activities in return for the partial easing of
:01:49. > :01:52.sanctions. Iran will pause the enrichment of uranium to weapons
:01:53. > :02:02.grade and America will free up some funds for Iran to spend. May be up
:02:03. > :02:05.to $10 billion. A more comprehensive deal is supposed to be done in six
:02:06. > :02:11.months. Here's what President Obama had to say about this interim
:02:12. > :02:17.agreement. We have pursued intensive diplomacy, bilaterally with the
:02:18. > :02:22.Iranians, and together with our partners, the United Kingdom,
:02:23. > :02:27.France, Germany, Russia and China, as well as the European Union.
:02:28. > :02:32.Today, that diplomacy opened up a new path towards a world that is
:02:33. > :02:37.more secure, a future in which we can verify that Iraq and's nuclear
:02:38. > :02:44.programme is peaceful, and that it cannot build a nuclear weapon.
:02:45. > :02:50.President Obama spoke from the White House last night. Now the difficulty
:02:51. > :02:53.begins. This is meant to lead to a full-scale agreement which will
:02:54. > :03:00.effectively end all sanctions, and end Iran's ability to have a bomb.
:03:01. > :03:05.The early signs are pretty good. The Iranian currency strengthened
:03:06. > :03:10.overnight, which is exactly what the Iranians wanted. Inflation in Iraq
:03:11. > :03:17.is 40%, so they need a stronger currency. -- information in Iran.
:03:18. > :03:20.France has played a blinder. It was there intransigence that led to
:03:21. > :03:25.this. Otherwise, I think the West would have led to a much softer
:03:26. > :03:30.deal. The question now becomes implementation. Here, everything
:03:31. > :03:35.hinges on two questions. First, who is Hassan Rouhani? Is he the
:03:36. > :03:40.Iranians Gorbachev, a serious reformer, or he's here much more
:03:41. > :03:47.tactical and cynical figure? Or, within Iran, how powerful is he?
:03:48. > :03:53.There are military men and intelligence officials within Iran
:03:54. > :03:57.who may stymie the process. The Western media concentrate on the
:03:58. > :04:00.fact that Mr Netanyahu and the Israelis are not happy about this.
:04:01. > :04:05.They don't often mention that the Arab Gulf states are also very
:04:06. > :04:14.apprehensive about this deal. I read this morning that the enemies of
:04:15. > :04:22.Qatar and Kuwait went to Saudi king. -- the MAs row. That is the key
:04:23. > :04:27.thing to watch in the next couple of weeks. There was a response from
:04:28. > :04:32.Saudi Arabia, but it came from the Prime Minister of Israel, who said
:04:33. > :04:36.this was a historic mistake. The United States said there would be no
:04:37. > :04:40.enrichment of uranium to weapons grade. In the last few minutes, the
:04:41. > :04:49.Iranian Foreign Minister has tweeted to say that there is an inalienable
:04:50. > :04:54.right -- right to enrich. The key thing is the most important thing
:04:55. > :04:59.that President Obama said in his inaugural speech. He reached out to
:05:00. > :05:06.Iran. It failed under President McKenna jab. Under President
:05:07. > :05:11.Rouhani, there seems to be progress. There is potentially now what he
:05:12. > :05:16.talked about in that first inaugural address potentially coming through.
:05:17. > :05:21.In the end, the key issue - and we don't know the answer - is the
:05:22. > :05:25.supreme leader, not the president. Will the supreme leader agreed to
:05:26. > :05:32.Iran giving up its ability to create nuclear weapons? This is the huge
:05:33. > :05:37.ambiguity. Ayatollah Khamenei authorise the position that
:05:38. > :05:40.President Rouhani took to Geneva. That doesn't mean he will sign off
:05:41. > :05:45.on every bit of implementation over the next six months. Even when
:05:46. > :05:52.President Ahmadinejad was president, he wasn't really President. We in
:05:53. > :05:57.the West have to resort to a kind of Iranians version of the study of the
:05:58. > :06:08.Kremlin, to work out what is going on. And the problem the president
:06:09. > :06:14.faces is that if there is any sign... He can unlock these funds by
:06:15. > :06:19.executive order at the moment, but if he needs any more, he has to go
:06:20. > :06:27.to Congress. Both the Democrat and the Republican side have huge
:06:28. > :06:30.scepticism about this. And he has very low credibility now. There's
:06:31. > :06:36.already been angry noises coming from quite a lot of senators. It was
:06:37. > :06:40.quite strange to see that photo of John Kerry hugging Cathy Ashton as
:06:41. > :06:50.if they had survived a ship great together. John Kerry is clearly
:06:51. > :06:52.feeling very happy. We will keep an eye on this. It is a fascinating
:06:53. > :06:55.development. More lurid details about the
:06:56. > :07:00.personal life of the Co-op Bank's disgraced former chairman, the
:07:01. > :07:03.Reverend Paul Flowers. The links between Labour, the bank and the
:07:04. > :07:06.wider Co-op movement have caused big problems for Ed Miliband this week,
:07:07. > :07:11.and the Conservatives have been revelling in it. But do the Tory
:07:12. > :07:19.allegations - Ed Miliband calls them "smears" - stack up? Party Chairman
:07:20. > :07:27.Grant Shapps joins us from Hatfield. Welcome to the programme. When it
:07:28. > :07:34.comes to the Co-op, what are you accusing Labour of knowing and when?
:07:35. > :07:39.I think the simple thing to say here is that the Co-op is an important
:07:40. > :07:44.bank. They have obviously got into difficulty with Reverend flowers,
:07:45. > :07:47.and our primary concern is making sure that that is properly
:07:48. > :07:50.investigated, and that we understand what happened at the bank and how
:07:51. > :07:56.somebody like Paul Flowers could have ended up thing appointed
:07:57. > :08:02.chairman. You wrote to edge Miliband on Tuesday and asked him what he
:08:03. > :08:05.knew and when. -- you wrote to Ed Miliband. But by Prime Minister's
:08:06. > :08:12.Questions on Wednesday, David Cameron claims that you knew that
:08:13. > :08:17.Labour knew about his past all along. What is the evidence for
:08:18. > :08:25.that? We found out by Wednesday that he had been a Labour councillor,
:08:26. > :08:29.Reverend Flowers, and had been made to stand down. Certainly, Labour
:08:30. > :08:33.knew about that, but somehow didn't seem to think that that made him
:08:34. > :08:38.less appropriate to be the chairman of the Co-op bank. There was no
:08:39. > :08:45.evidence that Mr Miliband or Mr Balls knew about that. I ask you
:08:46. > :08:55.again, what are you accusing the Labour leadership of knowing? We
:08:56. > :08:59.know now that he stood down for very inappropriate images on his
:09:00. > :09:04.computer, apparently. You are telling me that they didn't know. I
:09:05. > :09:07.am not sure that is clear at all. I have heard conflicting reports.
:09:08. > :09:12.There is a much bigger argument about what they knew and when. There
:09:13. > :09:17.was a much bigger issue here. This morning, Ed Miliband has said that
:09:18. > :09:21.they don't have to answer these questions and that these smears.
:09:22. > :09:25.This is ludicrous. These are important questions about an
:09:26. > :09:29.important bank, how it ended up getting into this position, and how
:09:30. > :09:36.a disastrous Britannia -- Italia deal happen. -- Britannia deal
:09:37. > :09:42.happened. And we need to know how the bank came off the rails. To be
:09:43. > :09:46.accused of smears for asking the questions is ridiculous. I am just
:09:47. > :09:49.trying to find out what you are accusing Labour of. You saying that
:09:50. > :10:01.the Labour leadership knew about the drug-taking? Sorry, there was some
:10:02. > :10:06.noise here. I don't know what was known and when. We do know that
:10:07. > :10:09.Labour, the party, certainly knew about these very difficult
:10:10. > :10:15.circumstances in which he resigned as a councillor. I think that the
:10:16. > :10:20.Labour Party knew about it. We knew that Bradford did, but not London.
:10:21. > :10:25.Are you saying that Ed Miliband knew about the inappropriate material on
:10:26. > :10:32.the Reverend's laptop? It is certainly the case that Labour knew
:10:33. > :10:38.about it. But did Mr Miliband know about it, and his predilection for
:10:39. > :10:43.rent boys? He will need to answer those questions. It is quite proper
:10:44. > :10:47.to ask those questions. Surely, asking a perfectly legitimate set of
:10:48. > :10:51.questions, not just about that but about how we have ended up in a
:10:52. > :10:56.situation where this bank has made loans to Labour for millions of
:10:57. > :11:03.pounds, that bank and the Unite bank, who is connected to it. And
:11:04. > :11:07.how they made a ?50,000 donation to Ed Balls' office. Ed Balls says that
:11:08. > :11:13.was nothing to do with Reverend Flowers, and yet Reverend Flowers
:11:14. > :11:18.said that he personally signed that off. Lots of questions to answer.
:11:19. > :11:24.David Cameron has already answered them on Wednesday. He said that you
:11:25. > :11:28.now know that Labour knew about his past all along. You have not been
:11:29. > :11:32.able to present evidence that involve Mr Miliband or Mr Balls in
:11:33. > :11:38.that. So until you get that, surely you should apologise? Hang on. He
:11:39. > :11:43.said that Labour knew about this, and they did, because he stood down
:11:44. > :11:48.as a councillor. If Ed Miliband didn't know about that, then why
:11:49. > :11:53.not? This was quite a serious thing that happened. The wider point is
:11:54. > :11:56.about why it is that when you ask perfectly legitimate questions about
:11:57. > :12:02.this bank, about the Britannia deal, and about the background of Mr
:12:03. > :12:10.flowers, why is the response, it is all smears? There are questions
:12:11. > :12:14.about how Labour failed to deal with the deficit and how it hasn't done
:12:15. > :12:20.anything to support the welfare changes, but there is nothing about
:12:21. > :12:29.that. Let us -- lets: To the wider picture of the Co-operative Bank.
:12:30. > :12:34.Labour wanted the Co-op to take over the Britannia Building Society, and
:12:35. > :12:40.it was a disaster. Do you accept that? The government of the day has
:12:41. > :12:46.to be a part of these discussions for regulatory reason. The
:12:47. > :12:54.government in 2009 - Ed Balls was very pleased... But you supported
:12:55. > :12:59.that decision. There was a later deal, potentially, for the Co-op to
:13:00. > :13:05.buy those Lloyds branches. There was a proper process and it didn't go
:13:06. > :13:09.through just recently. If there had been a proper process back in 2009,
:13:10. > :13:16.would the Britannia deal have gone through? First, you accept that the
:13:17. > :13:22.Tories were in favour of the Britannia take over. Then your
:13:23. > :13:25.Chancellor Osborne went out of his way to facilitate the purchase of
:13:26. > :13:31.the Lloyds branches, even though you had no idea that the Co-op had the
:13:32. > :13:36.management expertise to become a super medium. Correct? The
:13:37. > :13:43.difference is that that deal didn't go through. There was a proper
:13:44. > :13:49.process that took place. Let's look at the process. There was long
:13:50. > :13:56.indications as far back as January 2012 that the Co-op, as a direct
:13:57. > :14:00.result of the Britannia take over which you will party supported, was
:14:01. > :14:04.unfit to acquire the Lloyds branches. By January 2012, the
:14:05. > :14:11.Chancellor and the Treasury ignored the warnings. Wide? In 2009, there
:14:12. > :14:16.was political pressure for the Britannia to be brought together.
:14:17. > :14:19.Based on the information available, this was supported, but that process
:14:20. > :14:23.ended up with a very, very problematic takeover of the
:14:24. > :14:28.Britannia. Wind forward to this year, and when the same types of
:14:29. > :14:32.issues were being looked at for the purchase of the Lloyds deal, the
:14:33. > :14:37.proper process was followed, this time with us in government, and that
:14:38. > :14:41.purchase didn't go through. It is important that the proper process is
:14:42. > :14:50.followed, and when it was, it transpired that the deal wasn't
:14:51. > :14:53.going to be done. But it was the Treasury and the Chancellor who were
:14:54. > :14:59.the cheerleaders for the acquisition of the Lloyds branches. But there
:15:00. > :15:02.was a warning that the Co-op did not have enough capital on its balance
:15:03. > :15:09.sheet to make those acquisitions, but instead of heeding those
:15:10. > :15:12.warnings, your people went to Brussels to lobby for the
:15:13. > :15:17.requirements to be relaxed - why on earth did you do that? Our
:15:18. > :15:22.Chancellor went to argue for all of Rajesh banking, not specifically for
:15:23. > :15:25.the Co-op. He was arguing for the mutuals to be given a special
:15:26. > :15:31.ruling. The idea was to make sure that every bank in Britain could
:15:32. > :15:35.have a better deal, particularly the mutuals, as you say. That is a
:15:36. > :15:40.proper thing for the Chancellor to be doing. We could go round in
:15:41. > :15:43.circles here, but in the end, there was not a takeover of the Lloyds
:15:44. > :15:49.branches, that is because we followed a proper process. Had that
:15:50. > :15:53.same rigorous process been followed in 2009, the legitimate question to
:15:54. > :15:56.ask is whether the Co-op would have been -- would have taken over the
:15:57. > :16:00.Britannia. That is a proper question to ask. It is no good to have the
:16:01. > :16:04.leader of the opposition say, as soon as you ask any of these
:16:05. > :16:09.questions about anything where there is a problem for them, they come
:16:10. > :16:12.back with, oh, this is all smears. There are questions to ask about
:16:13. > :16:17.what the Labour government did, the debt and the deficit they left the
:16:18. > :16:21.country with, the way they stopped work from paying in this country.
:16:22. > :16:26.The big question your government has two answer is, why, by July 2012,
:16:27. > :16:31.when it was clear there was a black hole in the Co-op's balance sheet,
:16:32. > :16:35.your government re-confirmed the Co-op as the preferred bidder for
:16:36. > :16:40.Lloyds - why would you do that? Well, look, the good thing is, we
:16:41. > :16:44.can discuss this until the cows come home, but there is going to be a
:16:45. > :16:48.proper, full investigation, so we will find out what happened, all the
:16:49. > :16:52.way back. So, we will be able to get to the bottom of all of this. Grant
:16:53. > :16:56.Shapps, the only reason the Lloyds deal did not go ahead was, despite
:16:57. > :17:02.the Treasury cheerleading, when Lloyds began its due diligence, it
:17:03. > :17:06.found that there was indeed a huge black hole in the balance sheet and
:17:07. > :17:11.that the Co-op was not fit to take over its branches. That wasn't you,
:17:12. > :17:15.it wasn't the Government, it was not the Chancellor, it was Lloyds. You
:17:16. > :17:21.were still cheerleading for the deal to go ahead... Well, as I say, a
:17:22. > :17:25.proper process was followed, which did not result in the purchase of
:17:26. > :17:30.the Lloyds branches. At that proper process been followed with the
:17:31. > :17:35.purchase of the Britannia, under the previous government... Which you
:17:36. > :17:39.supported. Yes, but it may well be that under that previous deal, there
:17:40. > :17:42.was a excess political pressure perhaps put on in order to create
:17:43. > :17:51.that merger, which proved so disastrous. The Tories facilitated
:17:52. > :17:57.it, Grant Shapps, they allowed it to go ahead. I have said, we are going
:17:58. > :18:01.to have a proper, independent review. What I cannot understand is,
:18:02. > :18:07.when you announce a robber, independent review, the response you
:18:08. > :18:12.get to these serious questions. The response is, oh, this is a smear. It
:18:13. > :18:16.is crazy. We are trying to answer the big questions for this country.
:18:17. > :18:25.We have done all of that, and we are out of time. The Reverend Flowers'
:18:26. > :18:30.chairmanship of the Co-op bank was approved by the regulator at the
:18:31. > :18:33.time, which no longer exists. It was swept away by the coalition
:18:34. > :18:37.government in a supposed revolution in regulation. But will its
:18:38. > :18:47.replacement, the Financial Conduct Authority, be different? Adam has
:18:48. > :18:50.been to find out. Come with me for a spin around the Square mile to find
:18:51. > :18:54.out how we regulate our financial sector, which is almost five times
:18:55. > :19:01.bigger than the country's entire annual income. First, let's pick up
:19:02. > :19:04.our guide, journalist Iain Martin, who has just written a book about
:19:05. > :19:10.what went so wrong during the financial crisis. The FSA was an
:19:11. > :19:15.agency which was established to supervise the banks on a day-to-day
:19:16. > :19:19.basis. The Bank of England was supposed to have overall responsible
:19:20. > :19:22.at for this to Bolivia the financial system and the Treasury was supposed
:19:23. > :19:27.to take an interest in all of these things. The disaster was that it was
:19:28. > :19:32.not anyone's call responsibility, or main day job, to stay alert as to
:19:33. > :19:36.whether or not the banking system as a whole was being run in a safe
:19:37. > :19:41.manner. And so this April, a new system was set up to police the
:19:42. > :19:48.City. Most of the responsibly delays here, with the Bank of England, and
:19:49. > :19:53.its new Prudential Regulation Authority. And the Financial
:19:54. > :19:59.Services Authority has been replaced with the new Financial Conduct
:20:00. > :20:03.Authority. Can we go to the financial conduct authority, please?
:20:04. > :20:08.Canary Wharf, thank you. Here, it is all about whether the people in
:20:09. > :20:12.financial services are playing by the rules, in particular, how they
:20:13. > :20:16.treat their customers. This place has got new powers, like the ability
:20:17. > :20:21.to ban products it does not like, a new mandate to promote competition
:20:22. > :20:25.in the market, the concept being, more competition means a better
:20:26. > :20:31.market, plus the idea that a new organisation rings a whole new
:20:32. > :20:36.culture. Although these are the old offices of the FSA, so maybe not
:20:37. > :20:40.quite so new after all. It has also inherited the case of the Co-op bank
:20:41. > :20:44.and its disgraced former chairman the Reverend Paul Flowers. The SCA
:20:45. > :20:47.will be part of the investigation into what happened, which will
:20:48. > :20:53.probably involve looking at its own conduct. One member of the
:20:54. > :20:57.Parliamentary commission into banking wonders whether the new
:20:58. > :21:02.regulator, and its new boss, are up to it. I have always said, it is not
:21:03. > :21:07.the architecture which is the issue, it is the powers that the regulator
:21:08. > :21:12.has, and today, it does not seem to me as if there is any increase in
:21:13. > :21:16.that. And with the unfolding scandal at the Co-op, it feels like the new
:21:17. > :21:23.architecture for regulating the City is now facing its first big test.
:21:24. > :21:27.And the chief executive of the Financial Conduct Authority, the
:21:28. > :21:32.SCA, Martin Wheatley, joins me now. Welcome to The Sunday Politics. The
:21:33. > :21:38.failure of bank regulation was one of the clearest lessons of the crash
:21:39. > :21:42.in 2008, and yet two years later, in 2010, Paul Flowers is allowed to
:21:43. > :21:47.become chairman of the Co-op - why have we still not got the regulation
:21:48. > :21:52.right? We have made a lot of changes since then. We have created a new
:21:53. > :21:56.regulator, as you know. At the time, we still had a process which allowed
:21:57. > :21:59.somebody to be appointed to a bank and they would go through a
:22:00. > :22:03.challenge, but in the case of Paul Flowers, there was no need for an
:22:04. > :22:09.additional challenge when he was appointed to chairman, because he
:22:10. > :22:14.was already on the board. But going from being on the board to becoming
:22:15. > :22:17.chairman, that is a big jump, and he only had one interview? That is why
:22:18. > :22:22.today, it would be different. But the truth is, that was the system at
:22:23. > :22:26.the time, the system which the FSA operated. He was challenged, we did
:22:27. > :22:31.challenge him, and we said, you do not have the right experience, but
:22:32. > :22:34.at the time, we would not have opposed the appointment. What we
:22:35. > :22:39.needed was additional representation of the board of people who did have
:22:40. > :22:42.banking experience. You can say that that was then and this is now, but
:22:43. > :22:47.up until April of this year, it was still the plan for the Co-op, under
:22:48. > :22:52.Mr Flowers, and despite being seriously wounded by the Britannia
:22:53. > :22:57.takeover, to take on 632 Lloyds branches. That was the Co-op's
:22:58. > :23:01.plan. They needed to pass our test as to whether we thought they were
:23:02. > :23:05.fit to do that, and frankly, they never passed that test. It was not
:23:06. > :23:09.the regulator that stopped them? It was. We were constantly pushing
:23:10. > :23:12.back, saying, you have not got the capital, you have no got the
:23:13. > :23:17.systems, and ultimately, they withdrew, when they could not answer
:23:18. > :23:21.our questions. You were asking the right questions, I accept that, but
:23:22. > :23:27.all of the time, the politicians on all sides, they were pushing for it
:23:28. > :23:32.to happen, and I cannot find anywhere where the regulator said,
:23:33. > :23:36.look, this is just not going to happen. I cannot comment on what the
:23:37. > :23:39.politicians were doing, but I continue what we were doing, which
:23:40. > :23:42.was constantly asking the Co-op, have you got the systems in place,
:23:43. > :23:48.have you got the people, have you got the capital? And they didn't.
:23:49. > :23:51.But it only came to a head when Lloyds started its own due diligence
:23:52. > :23:54.on the bank, and they discovered that it was impossible for them to
:23:55. > :23:59.take over the branches, it was not the regulator... In fairness, what
:24:00. > :24:05.we do is ask the questions, can you do this deal? And we kept pushing
:24:06. > :24:12.back, and we never frankly got delivered a business plan which we
:24:13. > :24:23.were happy to approve. Is the SCA going to launch its own inquiry into
:24:24. > :24:27.what happened? -- the FCA. The Chancellor has announced what will
:24:28. > :24:32.be a very broad inquiry. There are a number of specifics which we will be
:24:33. > :24:36.able to look at, relating to events over the last five years. Could
:24:37. > :24:40.there be a police investigation? I think the police have already
:24:41. > :24:45.announced an investigation. I am talking about into the handling of
:24:46. > :24:52.the bank. It depends. There might be, if there is grim low activity,
:24:53. > :25:01.which we do not know yet. You worked at the FS eight, didn't you? I did.
:25:02. > :25:04.Some of those people who were signed off on the speedy promotion of Mr
:25:05. > :25:09.Flowers, are they now working there? Yes, we have some. I came to
:25:10. > :25:14.join the Financial Services Authority, to lead it into the
:25:15. > :25:27.creation of the new body, the SCA. We had people who were challenging
:25:28. > :25:30.and they did the job. There was not a requirement to approve the role as
:25:31. > :25:35.chairman. There was not even a requirement to interview at that
:25:36. > :25:38.stage. What we did do was to require that he was interviewed, and that
:25:39. > :25:50.the Co-op should get additional experience. One of the people from
:25:51. > :25:54.the old organisation, who signed up on the promotion of Mr Flowers to
:25:55. > :26:02.become chairman is now a nonexecutive director of the Co-op,
:26:03. > :26:05.so how does that work? Welcome he was a senior adviser to our
:26:06. > :26:09.organisation, one of the people who made the challenges, and who said,
:26:10. > :26:14.you need more experience on your board. Subsequently he then went and
:26:15. > :26:18.joined the board. Surely that should not be allowed, the regulator and
:26:19. > :26:23.the regulated should not be like that. Well clearly, you need
:26:24. > :26:28.protection, but we have got to get good people in, and frankly, we want
:26:29. > :26:31.the industry to have good people in the industry, so there will be some
:26:32. > :26:34.movement between the regulator and industry. We all wonder whether you
:26:35. > :26:39.have the power or even the confidence to stand up if you look
:26:40. > :26:43.at all of the really bad bank decisions recently, politicians were
:26:44. > :26:47.behind them. It was Gordon Brown who pushed the disastrous merger of
:26:48. > :26:51.Lloyds and RBS. It was Alex Salmond who egged on RBS to buy the world.
:26:52. > :26:56.All three main parties wanted the Co-op to buy Britannia, even though
:26:57. > :27:00.they did not know the debt it would inherit, and all three wanted the
:27:01. > :27:05.Co-op to buy the Lloyds branches - how do you as a regulator stand up
:27:06. > :27:10.to that little concert party? Well, that political pressure exists, our
:27:11. > :27:14.job at the end of the day is to do a relatively technical job and say,
:27:15. > :27:18.does it stack up? And it didn't, and we made that point time and time
:27:19. > :27:22.again to the Co-op board. They did not have a business case that we
:27:23. > :27:28.could approve. The bodies on left and right -- the politicians on left
:27:29. > :27:36.and right gave the Co-op special support. They may have done, but
:27:37. > :27:39.that was not you have made a warning about these payday lenders, but I
:27:40. > :27:43.think what most people would like to see is a limit put on the interest
:27:44. > :27:48.they can charge over a period of time - will you do that? We have got
:27:49. > :27:52.a whole set of powers for payday lenders. We will bring in some
:27:53. > :27:56.changes from April next year, and we will bring in further changes as we
:27:57. > :28:00.see necessary. Will you put a limit on the interest they can charge?
:28:01. > :28:05.That is something we can study. You do not sound too keen on it? Well,
:28:06. > :28:10.there are a lot of changes we need to make. One change is limiting
:28:11. > :28:13.rollovers, limiting the use of continuous payment authorities.
:28:14. > :28:19.Simply jumping to one trigger would be a mistake. Finally, an issue
:28:20. > :28:22.which I think is becoming a growing concern, because the Government is
:28:23. > :28:27.thinking of subsidising them, 95% mortgages are back - should we not
:28:28. > :28:33.be worried about that? I think we should if the market has the same
:28:34. > :28:37.experiences that we had back in 2007 - oh wait. We are bringing a
:28:38. > :28:42.comprehensive package in under our mortgage market review, which will
:28:43. > :28:53.change how people lend and will put affordability back at the heart of
:28:54. > :28:56.lending decisions. -- 2007-08. You have not had your first big
:28:57. > :29:02.challenge yet, have you? We have many challenges.
:29:03. > :29:06.It was once called the battle of the mods and the rockers - the fight
:29:07. > :29:08.between David Cameron-style modernisers and old-style
:29:09. > :29:12.traditional Tories for the direction and soul of the Conservative Party.
:29:13. > :29:21.But have the mods given up on changing the brand? When David
:29:22. > :29:25.Cameron took over in 2005, he promoted himself as a new Tory
:29:26. > :29:31.leader. He said that hoodies need more love. He was talking about
:29:32. > :29:35.something called the big society. He told his party conference that it
:29:36. > :29:39.was time to that sunshine win the day. There was new emphasis on the
:29:40. > :29:44.environment, and an eye-catching trip to a Norwegian glacier to see
:29:45. > :29:49.first-hand, supposedly, the effects of global warming. This week, party
:29:50. > :29:52.modernise and Nick bone has said that the party is still seen as an
:29:53. > :30:00.old-fashioned monolith and hasn't done enough to improve its appeal.
:30:01. > :30:06.The Tories have put some reforms into practice, such as gay marriage,
:30:07. > :30:12.but they have put more into welfare reform band compassionate
:30:13. > :30:16.conservatism. David Cameron wants talked about leading the greenest
:30:17. > :30:25.government ever. Downing Street says that the quote in the Son is not
:30:26. > :30:30.recognised, get rid of the green crap. At this point in the programme
:30:31. > :30:33.we were expecting to hear from the Energy and Climate Change Minister,
:30:34. > :30:38.Greg Barker. Unfortunately, he has pulled out, with Downing Street
:30:39. > :30:44.saying it's for ""family reasons"". Make of that what you will. However,
:30:45. > :30:47.we won't be deterred. We're still doing the story, and we're joined by
:30:48. > :30:53.our very own mod and rocker - David Skelton of the think-tank Renewal,
:30:54. > :30:58.and Conservative MP Peter Bone. Welcome to you both. I'm glad your
:30:59. > :31:02.family is allowed you to come? David Skelton, getting rid of all the
:31:03. > :31:06.green crap, or words to that effect, that David Cameron has been saying.
:31:07. > :31:11.It is just a sign that Tory modernisation has been quietly
:31:12. > :31:17.buried. I do think that's right. Modernisation is about reaching out
:31:18. > :31:22.to the voters, and the work to do that is now more relevant than ever.
:31:23. > :31:27.We got the biggest swing since 1931, and the thing is we need to do more
:31:28. > :31:33.to reach out to voters in the North. We need to reach out to non-white
:31:34. > :31:39.voters, and show that the concerns of modern Britain and the concerns
:31:40. > :31:43.of ordinary people is something that we share. And what way will racking
:31:44. > :31:48.up electricity bills with green levies get you more votes in the
:31:49. > :31:53.North of England? We have to look at ways to reduce energy bills. The
:31:54. > :31:59.renewable energy directive doesn't do anything to help cut our
:32:00. > :32:03.emissions, but does decrease energy bills by ?45 a year. We should
:32:04. > :32:09.renegotiate that. That is a part of modernisation and doing what
:32:10. > :32:15.ordinarily people want. And old dinosaurs like you are just holding
:32:16. > :32:19.this modernisation process back? I am very appreciative of covering on
:32:20. > :32:23.this programme. The Tory party has been reforming itself for more than
:32:24. > :32:28.150 years. This idea of modern eyes a is just some invention. We are
:32:29. > :32:35.changing all the time. I'm nice and cuddly! So you are happy that the
:32:36. > :32:41.party made gay marriage almost a kind of symbol of its modernisation?
:32:42. > :32:48.Fine Mac the gay marriage was a free vote. David Cameron was recorded as
:32:49. > :32:53.a rebel there because more Tories voted against his position than ever
:32:54. > :32:57.before. It was said that this was a split between the old and young, but
:32:58. > :33:00.it actually was a split between those who were religious and
:33:01. > :33:07.nonreligious. It is a misinterpretation of what happened.
:33:08. > :33:13.Is a modernisation in retreat? I think modernisation is an
:33:14. > :33:18.invention. Seven years ago, in my part of the world, we got three
:33:19. > :33:24.councillors elected, two were 80 and one was 21. A few months ago, a
:33:25. > :33:28.25-year-old was chosen to fight Corby for the Conservative Party. He
:33:29. > :33:33.came from a comprehensive School. He was one of the youngest. The Tory
:33:34. > :33:39.party is moving on. So you found three young people? Hang on a
:33:40. > :33:47.minute. You can't get away with that. Three in one batch. Does
:33:48. > :33:53.modernisation exist? Modernisation is about watering our appeal and
:33:54. > :33:58.sharing our values are relevant to voters who haven't really thought
:33:59. > :34:01.about voting for us for decades now. Modernisation is about more than
:34:02. > :34:06.windmills and stuff, it is about boosting the life chances of the
:34:07. > :34:12.poorest, it is about putting better schools in poorer areas. It is also
:34:13. > :34:17.saying that modernisation and the Tory party... When has the Tory
:34:18. > :34:22.party been against making poorer people better off? Or against better
:34:23. > :34:26.schools? Do you think Mrs Thatcher was a moderniser when she won all
:34:27. > :34:32.those elections? The problem we have at the moment is that UKIP has
:34:33. > :34:36.grown-up. If we could get all of those people who vote UKIP to vote
:34:37. > :34:41.for us, we would get 47% of the vote. We don't need to worry about
:34:42. > :34:45.voters on the left. We need to worry about the voters in the north, those
:34:46. > :34:53.people who haven't voted for us for decades. Having an EU Referendum
:34:54. > :35:00.Bill is going to get people to vote. We have to reach out to
:35:01. > :35:04.voters, but not by some sort of London based in need. You have to
:35:05. > :35:09.broaden your base. I agree with you on that. We have to broaden our
:35:10. > :35:14.appeal, but this back to the future concept is not going to work. We
:35:15. > :35:18.need something that generally appeals to low and middle-income
:35:19. > :35:22.voters, and something that shows we genuinely care about the life
:35:23. > :35:31.chances of the poorest. Do you think that the people who vote UKIP don't
:35:32. > :35:34.support those aspirations? We are not doing enough to cut immigration.
:35:35. > :35:39.We don't have an EU Referendum Bill stop we have to get the centre right
:35:40. > :35:46.to vote for us again. Do that, and we have it. Tom Pursglove, the 25
:35:47. > :35:59.euros, will be returned in Corby because we cannot win an election
:36:00. > :36:05.there. -- the 25-year-old. Whether you are moderniser or
:36:06. > :36:13.traditionalist, people, particularly in the North, see you as a bunch of
:36:14. > :36:18.rich men. And rich southerners. You are bunch of rich southerners. We
:36:19. > :36:24.need to do more to show that we are building on lifting the poorest out
:36:25. > :36:28.of the tax. We need to build more houses. There is a perception that
:36:29. > :36:34.the leadership at the moment is rich, and public school educated.
:36:35. > :36:40.What we have to do is get more people from state education into the
:36:41. > :36:48.top. You are going the other way at the moment. That is a fair
:36:49. > :36:55.criticism. Modernisers also say that. I went to a combo hedge of
:36:56. > :36:58.school as well. -- do a comprehensive school. We need to
:36:59. > :37:08.show that we are standing up for low income. Thank Q, both of you. You
:37:09. > :37:22.are watching the Sunday Politics. Coming up in just
:37:23. > :37:29.Welcome to the part of the programme that is just for us in the West.
:37:30. > :37:33.Coming up this week, UKIP claims we cannot cope with more immigration.
:37:34. > :37:37.We'll Romanians and Bulgarians really flocked to the West Country
:37:38. > :37:40.as they claim? We hear from some of those who are already working here
:37:41. > :37:46.and what has drawn them to live in market towns like Yeovil. Joining us
:37:47. > :37:50.are two politicians whose parties are locked in a fierce battle over
:37:51. > :37:54.the issue of immigration. They are the Conservative MP Ashley Fox and
:37:55. > :37:59.for the UK Independence Party, Neil Hamilton. Before we talk about
:38:00. > :38:04.immigration, let's take a look at the goings`on in the European
:38:05. > :38:09.Parliament this week. Ashley Fox, you have upset the French by trying
:38:10. > :38:13.to stop the parliament's monthly pilgrimage from Brussels to
:38:14. > :38:20.Strasbourg. Once a month, 766 MEPs, 3000 staff
:38:21. > :38:24.and 25 lorry loads of documents shuttle from here in Brussels to
:38:25. > :38:30.this rather similar looking building in the French city of Strasbourg. It
:38:31. > :38:35.is thought the round`trip costs over 100 million euros a year.
:38:36. > :38:40.Environmental terms it is 19,000 tonnes of carbon emissions.
:38:41. > :38:43.French members here should confess what they are doing, they are
:38:44. > :38:48.defending selfish national interest. If the seat of the European
:38:49. > :38:53.Parliament was in my home city of Bristol, I would do the same.
:38:54. > :38:59.That has not gone down well with the French, who insist that sitting in a
:39:00. > :39:03.city on the border with Germany is of huge symbolic significance.
:39:04. > :39:06.We are turning our backs on our history and culture and on some of
:39:07. > :39:10.the founding principles of the European Union.
:39:11. > :39:16.In the end, the European Union voted in favour of trying to change the
:39:17. > :39:21.treaty in favour of these two cities. But to do that they will
:39:22. > :39:25.need your disapproval of the two EU Council of ministers, one of whom
:39:26. > :39:28.happens to be French. Ashley, nice try, but you're wasting
:39:29. > :39:34.your breath because the French will veto it?
:39:35. > :39:38.Not at all. We want get it immediately, but the French and
:39:39. > :39:42.Germans will be coming with their own treaty changes to improve
:39:43. > :39:47.changes in the year was on. The only consent of Parliament to approve the
:39:48. > :39:53.changes. Any deal will need to be done. There is huge momentum for us
:39:54. > :39:57.to have one seat and save 150 million euros a year.
:39:58. > :40:00.The French might have to get something like that up, they will
:40:01. > :40:04.say to us, give up your budget rebate for something you get.
:40:05. > :40:09.This is nothing to do with the budget rebate, it is of a treaty
:40:10. > :40:12.change. They will want amendments to the treaties, and the European
:40:13. > :40:16.Parliament wants one seat. We want the treaty amended for that, and I'm
:40:17. > :40:20.confident within five years we can do a deal.
:40:21. > :40:25.No, has he got a crack? I think it is unlikely the French
:40:26. > :40:27.will ever agree to move the Parliament from Strasbourg because
:40:28. > :40:32.it is a huge symbolic significance for them. But this isn't a matter of
:40:33. > :40:38.a huge question of waste in the EU. If they say 150 million pounds a
:40:39. > :40:44.year and this move, they will only wish that somewhere else. We're not
:40:45. > :40:49.really convinced by this one way or another.
:40:50. > :40:54.It is not a sideshow, it is very important. You might ask Mr Hamilton
:40:55. > :40:59.by the UKIP MEPs did not support this. There are only four of them
:41:00. > :41:03.and they abstain. The whole thing is a Charente. The
:41:04. > :41:07.Parliament has no right to make this decision. It is so much hot air. If
:41:08. > :41:13.the money is not wasted on this, it will be wasted on something else. It
:41:14. > :41:19.makes sense for the Parliament at one Single Place to meet.
:41:20. > :41:23.Why didn't you vote on it? Because you have got no power to do
:41:24. > :41:26.anything. It seems extraordinary you did not
:41:27. > :41:31.even bother to say that we should not have two seats of government.
:41:32. > :41:36.It is of no interest to us at all. We want to be out of the EU.
:41:37. > :41:41.You should be interested in getting the best value for taxpayers' money.
:41:42. > :41:48.The best way to save taxpayers not about money is to get out of the EU.
:41:49. > :41:53.Four out of 13, they cannot be bothered to vote to save money.
:41:54. > :41:57.Would you have ordered a the debate had been held in Strasbourg?
:41:58. > :42:06.We don't vote in Strasbourg on matters which are of no interest in
:42:07. > :42:10.anybody. It is a waste of time. It is a story really out of the
:42:11. > :42:20.news, with politicians claiming we're on the wave of the new mass of
:42:21. > :42:25.immigration from Bulgaria mania. Today UKIP have warned that towns
:42:26. > :42:27.like Yeovil weather is already significant Eastern European
:42:28. > :42:34.community, cannot cope with more immigrants.
:42:35. > :42:44.This is virtual. He is Romanian and works in Yeovil as a taxi driver.
:42:45. > :42:48.We are 40 or 45 Romanians. The reason he has come is simple.
:42:49. > :42:53.More money, more opportunities for me.
:42:54. > :42:58.These Romanians and vulgarians are working on agricultural visas and
:42:59. > :43:01.for advance. They say they are not taking jobs from locals because they
:43:02. > :43:08.are the only ones who want to take the work will stop.
:43:09. > :43:17.I found some jobs in the mania, but it is better here. Better money
:43:18. > :43:20.here. They preferred the good jobs, they don't like working in
:43:21. > :43:25.agriculture. The same happen in my country. I don't want to work in
:43:26. > :43:30.agriculture in my country, I want to hear.
:43:31. > :43:33.But according to the UKIP councillor for central Yeovil, people are fed
:43:34. > :43:40.up with the drain immigration is putting on their committee.
:43:41. > :43:45.The main concern is immigration. Every person I spoke to said
:43:46. > :43:51.immigration. That, he claims, is putting a strain
:43:52. > :43:54.on our public services. When you have got a relatively small
:43:55. > :44:06.town, it can have a big impact on medical services, on education,
:44:07. > :44:09.school places. On housing. There is no doubt things have
:44:10. > :44:12.changed in our committees. Take a look at the number of Polish
:44:13. > :44:17.immigrants in this part of the world. It has gone up significantly
:44:18. > :44:20.since 2001, at least ten times. Here at this Catholic primary School in
:44:21. > :44:26.Yeovil, you can see the impact immigration has had on the area.
:44:27. > :44:29.Back in 2000, none of the pupils years book English as a second
:44:30. > :44:36.language, now it is nearly 50% of the pupils. But according to the
:44:37. > :44:40.headteacher that is not a bad thing. We are an inclusive Catholic school,
:44:41. > :44:44.are priorities to get on with our neighbours. This is a very
:44:45. > :44:48.harmonious place. Most of the parents of these peoples
:44:49. > :44:55.work in the hospitals or for local businesses.
:44:56. > :45:01.What we see is that most of those people coming in, most of whom are
:45:02. > :45:05.economic migrants, become here to work, they do not come here to live
:45:06. > :45:08.on benefits. We are 40 days away from the lifting
:45:09. > :45:12.of working restrictions on Bulgaria and Romania.
:45:13. > :45:17.There is a catastrophe looming ahead.
:45:18. > :45:21.But nobody knows yet how many more people will choose places like
:45:22. > :45:25.Yeovil for their home. Joining us is Jon Fox, an expert on
:45:26. > :45:31.immigration. But first, Neil Hamilton, are you and your
:45:32. > :45:36.colleagues in Yeovil using scare tactics here?
:45:37. > :45:42.The scale of immigration has been truly astonishing. These are numbers
:45:43. > :45:46.that are completely unheard`of in the whole of our history. When Enoch
:45:47. > :45:49.Powell made his famous speech nearly 50 years ago, we were getting
:45:50. > :45:55.immigration of 50,000 a year. In 2010 alone we have more people come
:45:56. > :46:00.to this country, 210,000, that came between 1066 and 1950 to stop we are
:46:01. > :46:06.dealing with a massive problem. If they are working hard and paid
:46:07. > :46:08.taxes, what is the problem? It is not against the individuals
:46:09. > :46:12.coming here, we can understand why they would want to. The average wage
:46:13. > :46:17.in Romania is less than jobseeker's allowance year. I would be not want
:46:18. > :46:25.to come here? Especially when they can qualify by simply turning up.
:46:26. > :46:30.Jon Fox, would you take a guess about how many Romanians and
:46:31. > :46:36.Bulgarians might come this way? No. It is they difficult to predict.
:46:37. > :46:40.We don't even have a good sense of how many people are here at the
:46:41. > :46:44.moment. Census figures will be different from National Insurance
:46:45. > :46:47.registrations. Migrants move, become here, they turn around and got back,
:46:48. > :46:53.then they come back again. It is hard to get a sense of this. This is
:46:54. > :46:57.why the predictions we do see are all over the place.
:46:58. > :47:00.People are worried. They say it is hard to get a doctors appointment at
:47:01. > :47:03.the moment, is hard to get a house, public services are pushed, it is
:47:04. > :47:06.hard to get the job. Can you understand why people are given
:47:07. > :47:12.nervous about possibly more immigration?
:47:13. > :47:16.Yes, sure. And in some places these will be felt more acutely than in
:47:17. > :47:19.other places. But if you look at the overall scale of things, I think you
:47:20. > :47:25.see that we are absorbing this migration fairly well, and we don't
:47:26. > :47:27.have this terrible problem of a strain on local councils, local
:47:28. > :47:33.services everywhere. This is an isolated places, and not in the
:47:34. > :47:39.entire country. Ashley Fox, is there a case for the
:47:40. > :47:43.government saying, we let the Polish in when the rest of Europe said now
:47:44. > :47:47.there has to be transitional controls, therefore, in this case
:47:48. > :47:53.should we have more strength now and let Europe take the strain as we did
:47:54. > :47:56.when the Polish game? There is no doubt there during the
:47:57. > :48:01.13 years of Liberal government far too many immigrants were allowed to
:48:02. > :48:03.comment United Kingdom. It was uncontrolled immigration, and the
:48:04. > :48:06.Labour Party have agreed that was a catastrophic mistake, they are
:48:07. > :48:10.words. The coalition government is committed to reducing immigration
:48:11. > :48:14.significantly, firm but fair controls.
:48:15. > :48:20.What controls are you putting over Romanians and Bulgarians coming in?
:48:21. > :48:25.Those controls expire on the 1st of January 2014. Those are EU laws, and
:48:26. > :48:30.that is the deal that Tony Blair signed. There is nothing we can do
:48:31. > :48:36.other than take the Neil Hamilton route which is to leave the EU.
:48:37. > :48:40.That is correct. We have an open door immigration policy in this
:48:41. > :48:43.country, and each of the three main parties believes in staying in the
:48:44. > :48:49.EU, that means we cannot control our borders from immigration, anywhere
:48:50. > :48:51.else in the whole of Europe. Would you urge the government not to
:48:52. > :48:56.allow Romanians and vulgarians not to come here from the 1st of
:48:57. > :48:59.January? We think there should be a points
:49:00. > :49:06.system for immigration, as Australia does and many other countries.
:49:07. > :49:10.If we had a UKIP government... That is not going to happen by the
:49:11. > :49:13.1st of January. The government should take
:49:14. > :49:18.unilateral decision to close the borders, and do that unlawfully. Why
:49:19. > :49:21.not? Rather, you should have a
:49:22. > :49:27.referendum, which my government wants to do.
:49:28. > :49:31.Yes, possibly in 2017. We're not talking about 2017, we're talking
:49:32. > :49:35.about 1st of January 2014. You want to bring in unlawful
:49:36. > :49:40.measures. We do not accept the legitimacy of the EU.
:49:41. > :49:44.If we had responsibility for taking this decision, we would control
:49:45. > :49:50.immigration. You do not want to control immigration.
:49:51. > :49:55.Let's go back to the expat here, Jon Fox. People are worried about people
:49:56. > :50:03.taking benefits. What can they actually get?
:50:04. > :50:05.The 2004 entrance to the EU have access to benefits after one year of
:50:06. > :50:12.continuous climate. Most of those people can claim benefits just like
:50:13. > :50:17.you and me. Or, like you. The Romanians and Bulgarians have
:50:18. > :50:20.stricter restrictions placed on them for what they can claim, but that
:50:21. > :50:28.will change from 1st of January 2014, when it will be the same as
:50:29. > :50:32.the 2004 entrance into the EU. I will get what benefits are being
:50:33. > :50:36.claimed, we see very clearly that eastern European migrations are
:50:37. > :50:39.making a net contribution. The statistic is the paying 34% more
:50:40. > :50:44.into the system than they are taking out.
:50:45. > :50:49.If they are paying in more than they are getting, why do you object?
:50:50. > :50:54.We're not the individuals coming here. The scale of the problem is
:50:55. > :50:59.what matters here. The numbers that are coming, the speed with which
:51:00. > :51:02.immigration is taking place is placing enormous strains on public
:51:03. > :51:08.services. It is also requiring us because of the numbers to concrete
:51:09. > :51:14.over vastly greater makers of England, because this is an English
:51:15. > :51:18.problem first and foremost. The planning minister wants another 3
:51:19. > :51:20.million acres of housing. And it is required because of the scale of
:51:21. > :51:27.immigration that is coming in from outside the EU as well, but we don't
:51:28. > :51:31.know what the scale of the problem will be from Romania and Bulgaria,
:51:32. > :51:36.but we do know what the scale of the problem was for the last 15 years.
:51:37. > :51:41.Nearly 1 million came from Poland in the end.
:51:42. > :51:44.There is this image of the people showing up and claiming benefits and
:51:45. > :51:48.being a strain on services, but they are paying a lot of money into the
:51:49. > :51:52.system, more than you and I are paying into the system.
:51:53. > :51:56.It is a question of how quickly you can have services that can respond
:51:57. > :52:00.to the scale of the immigration. Thank you.
:52:01. > :52:04.The protection of honourable children in the West Whatley is not
:52:05. > :52:07.good enough to stop under a new Ofsted Rhegium, two thirds of our
:52:08. > :52:11.councils would not meet the required standard. Somerset is taking
:52:12. > :52:18.measures after being judged inadequate.
:52:19. > :52:28.The shocking realities of front line social work.
:52:29. > :52:31.This was a social worker from Bristol on a TV documentary last
:52:32. > :52:36.year minutes after taking a baby into care. His mother was living
:52:37. > :52:39.with a sex offender. This challenging work has increased
:52:40. > :52:44.dramatically in the last five years. Child protection orders have, by
:52:45. > :52:50.47%, while care proceedings have gone up 64%. The number of children
:52:51. > :52:55.ending up in care has increased by 13%. Bristol was one of only three
:52:56. > :52:58.authorities in the West officially judged to have good child
:52:59. > :53:08.protection. Five were labelled as inadequate. `` adequate. That
:53:09. > :53:12.standard is no longer acceptable. In the future that will require
:53:13. > :53:15.improvement. One of them, Somerset, was told in August that its child
:53:16. > :53:19.protection was completely inadequate. The council knew they
:53:20. > :53:22.were in trouble. They brought in a new director of children's services,
:53:23. > :53:26.experience in helping struggling authorities. This week he was asked
:53:27. > :53:31.if things had improved for the county's children.
:53:32. > :53:36.Yes. Certainly better protected. There is sometimes a bit of
:53:37. > :53:39.mythology that says that all children can be protected of time,
:53:40. > :53:43.that is not true, but we have to make sure that we do our very best
:53:44. > :53:46.of the children be known about we protect very well, that we find out
:53:47. > :53:49.about those children who are at risk and do something about their
:53:50. > :53:52.circumstances. But Somerset is under huge financial
:53:53. > :53:57.pressure. Proposed changes to children centres have caused
:53:58. > :54:00.controversy. Campaigners packed a council meeting and forced a
:54:01. > :54:04.rethink. The council insists it wants to spend more on front line
:54:05. > :54:10.staff, not buildings, but saving money is a factor.
:54:11. > :54:13.The cuts have gone really deep now. Eric Pickles has given local
:54:14. > :54:17.government as almost a sacrificial lamb. I think this government is any
:54:18. > :54:22.fairly serious situation. In key care services, social care and
:54:23. > :54:26.learning disabilities, we're only one bad case away from being in the
:54:27. > :54:28.newspapers. Meanwhile in the chamber, members
:54:29. > :54:32.were reporting through another ?4 million of cuts, with more to come.
:54:33. > :54:37.The leader said other areas are harder hit, so children services can
:54:38. > :54:43.be protected. But winning approval from inspectors is a long way off.
:54:44. > :54:48.Ofsted continue to change the goalposts. Every year they change
:54:49. > :54:51.their inspection process. Yes, we hold our hands up and say this year
:54:52. > :54:54.we did not need their standards. We are working very hard, we have got
:54:55. > :54:59.the right people in place, we have made the right financial
:55:00. > :55:02.commitments. We are doing our best for children in Somerset to ensure
:55:03. > :55:07.they are safe. Nationally, one child a week dies
:55:08. > :55:09.because of abuse. Social workers worried because of increased and
:55:10. > :55:16.decreased resources, make that worse.
:55:17. > :55:19.Joining us is Ray Jones a professor of social work had shared the
:55:20. > :55:25.children safeguarding board for Bristol. Has reduced sauces got
:55:26. > :55:31.anything to do with this problem? It is a combination of things. There
:55:32. > :55:35.is a greater need in the community because of the welfare and benefit
:55:36. > :55:40.changes. Secondly, welfare cuts is bringing less assistance for those
:55:41. > :55:46.families, such as sure start centres closing. And more work is coming
:55:47. > :55:51.through to social workers and there is no commensurate increase in
:55:52. > :55:54.social worker numbers. They're not cutting social worker
:55:55. > :55:57.numbers. Now, they're trying to maintain the
:55:58. > :56:02.numbers of social workers they have, but doing well making cuts in other
:56:03. > :56:07.areas, children's centres for example, so they're not cutting the
:56:08. > :56:12.numbers of social workers, but they're not increasing them in line
:56:13. > :56:16.with increasing demand. Tragically around one child a week
:56:17. > :56:18.dies because of abuse in this country, which is absolutely
:56:19. > :56:27.shocking, but that figure has been static for 20 years.
:56:28. > :56:30.40 years. The first big scandal was a young girl who died in Brighton.
:56:31. > :56:35.Over the years we have learned more and more about how to take children.
:56:36. > :56:39.My concern at the moment is that we are seeing the amount of work coming
:56:40. > :56:46.into social work increasing dramatically. Child protection
:56:47. > :56:52.plans, plans for children, those have gone up dramatically. Someone
:56:53. > :56:55.has got to be around to make sure we implementing those plans
:56:56. > :57:00.appropriately. That requires an increase in resource. Overall we are
:57:01. > :57:05.seeing resources seeing static, the needs of families increasing.
:57:06. > :57:14.We have increased vastly over the last 40 years? The number of
:57:15. > :57:22.resources? But what we have had since the death
:57:23. > :57:24.of baby Peter in 2007 and the story breaking into those in need is an
:57:25. > :57:28.increasing number of children reported to agencies, more work for
:57:29. > :57:33.them to do, and now increasing the capacity for them to do that work.
:57:34. > :57:38.Let's bring in Ashley Fox here. Local authority reductions. The
:57:39. > :57:43.amount of pressure the coalition is putting on them. That has got to be
:57:44. > :57:48.to blame, hasn't it? I don't think it's to blame. Council
:57:49. > :57:53.services are under great pressure. It is very challenging. But just
:57:54. > :57:58.remember why ` we are clearing up the huge budget deficit, 156 Ilium
:57:59. > :58:02.pounds but Labour left us. We have cut that by one third. Taxes have
:58:03. > :58:07.gone up and public expenditure is being cut. But we face a huge
:58:08. > :58:11.challenge clearing up this mess will stop and councillors like those in
:58:12. > :58:15.Somerset are doing their bit and very difficult circumstances.
:58:16. > :58:27.We have to leave it there. Thank you. Now let's take a run through
:58:28. > :58:30.the week in one minute. Brittle's public toilets could soon
:58:31. > :58:34.be flushed away. Amir has proposed closing all but one as he trims his
:58:35. > :58:39.budget I want quarter over the next three years.
:58:40. > :58:44.If you are like me, with an elderly bladder, you need to have access to
:58:45. > :58:49.the loo. And this is a tourist city. Tourists come to the city and expect
:58:50. > :58:54.public toilets. Councillors have called for more
:58:55. > :58:58.time to propose closing 18 children centres after protests from
:58:59. > :59:02.children. We voted through ?4 million of cuts to the budget saying
:59:03. > :59:04.it was the tip of the iceberg. Gloucestershire's controversial
:59:05. > :59:08.incinerator project is being looked at ie government planning inspector.
:59:09. > :59:11.Campaigners say it would be a blot on the landscape by the developer
:59:12. > :59:18.says it is needed and will save millions of pounds.
:59:19. > :59:20.But's cab`drivers save you risk getting lost after being told to
:59:21. > :59:24.ditch their sap maps. Local authority says drivers should know
:59:25. > :59:33.their way around and other devices obstruct the view.
:59:34. > :59:40.That was a week. A word on public loos. Neil Hamilton, in UKIP land,
:59:41. > :59:44.would you have public loos morbidly funded?
:59:45. > :59:48.This is not an issue we are focused on particularly deeply, but on the
:59:49. > :59:53.elections in May we hope to be flushed with success.
:59:54. > :59:57.This is nothing to do with the EU. We have to leave it there. That is
:59:58. > :00:02.all we have time for today. I did it are guests, Ashley Fox and Neil
:00:03. > :00:07.Hamilton. You can watch the programme again on the BCI player,
:00:08. > :00:10.but now we return to Andrew who was waiting for us in London. We'll see
:00:11. > :00:14.those people who want to cycle. We will be returning to this one. Thank
:00:15. > :00:25.you. A little bit of history was made at
:00:26. > :00:30.Prime Minister's Questions this week. A teensy tiny bit. It wasn't
:00:31. > :00:33.David Cameron accusing one MP of taking "mind-altering substances" -
:00:34. > :00:36.they're always accusing each other of doing that. No, it was the first
:00:37. > :00:39.time a Prime Minister used a live tweet sent from someone watching the
:00:40. > :00:48.session as ammunition at the dispatch box. Let's have a look. We
:00:49. > :00:54.have had some interesting interventions from front edges past
:00:55. > :00:59.and present. I hope I can break records by explaining that a tweet
:01:00. > :01:02.has just come in from Tony McNulty, the former Labour security
:01:03. > :01:07.minister, saying that the public are desperate for a PM in waiting who
:01:08. > :01:12.speaks for them, not a Leader of the Opposition in dodging in partisan
:01:13. > :01:16.Westminster Village knock about. So I would stay up with the tweets if
:01:17. > :01:21.you want to get on the right side of this one! We are working on how the
:01:22. > :01:26.Prime Minister managed to get that wheat in the first place. What did
:01:27. > :01:32.you think when you saw it being read out? I was certainly watching the
:01:33. > :01:36.Daily Politics. I almost fell off my chair! It was quite astonishing. He
:01:37. > :01:41.didn't answer the question - he didn't do that the whole time. But I
:01:42. > :01:46.stand by what the tweets said. I have tweeted for a long time on
:01:47. > :01:52.PMQs. Normally I am praising Ed Miliband to the hilt, but no one
:01:53. > :01:56.announces that in Parliament! Because the Prime Minister picked up
:01:57. > :02:01.on what you said, it unleashed some attacks on you from the Labour side.
:02:02. > :02:06.It did, minor attacks from some very junior people. Most people were
:02:07. > :02:12.supportive of what I said. They took issue with the notion of not doing
:02:13. > :02:16.it until 12:30pm, when it wasn't available for the other side to use.
:02:17. > :02:21.Instant history, and instantly forgettable, I would say. Do you
:02:22. > :02:26.think you have started a bit of a trend? I hope not, because the
:02:27. > :02:36.dumbing down of PMQs is already on its way. Most people tweet like mad
:02:37. > :02:39.through PMQs! Is a measure of how post-modern we have become, we have
:02:40. > :02:45.journalists tweeting about someone talking about a tweet. That is the
:02:46. > :02:48.level of British politics. I am horrified by this development. The
:02:49. > :02:55.whole of modern life has become about observing people -- people
:02:56. > :03:00.observing themselves doing things. Do we know what happened? Somebody
:03:01. > :03:05.is monitoring the tweets on behalf of the Prime Minister or the Tory
:03:06. > :03:10.party. They see Tony's tweet. They then print it out and give it to
:03:11. > :03:14.him? There was a suggestion that Michael Goves had spotted it, but
:03:15. > :03:24.Craig Oliver from the BBC had this great sort of... Craig Oliver was
:03:25. > :03:29.holding up his iPad to take pictures of the Prime Minister, which he then
:03:30. > :03:32.tweeted, from the Prime Minister. People will now be tweeting in the
:03:33. > :03:38.hope that they will be quoted by the Prime Minister, or the Leader of the
:03:39. > :03:44.Opposition. I wasn't doing that. I'm just talking about the monster you
:03:45. > :03:49.have unleashed! I hope it dies a miserable death. I think Tony is a
:03:50. > :03:59.good analysis -- a good analyst of PMQs on Twitter. Moving onto the
:04:00. > :04:07.Co-op. You were a Co-op-backed MP, white you? I was a Co-op party
:04:08. > :04:11.member. There are two issues here about the Co-op and the Labour
:04:12. > :04:16.Party. All the new music suggests that the Co-op will now have to
:04:17. > :04:21.start pulling back from lending or donating to the Labour Party, which,
:04:22. > :04:24.at a time when Mr Miliband is going through changes that are going to
:04:25. > :04:30.cut of the union funds, it seems quite dangerous. There are three
:04:31. > :04:34.things going on. There's the relationship that the party has
:04:35. > :04:40.politically with the Co-op party, there is the commercial relationship
:04:41. > :04:43.you referred to, and then there is this enquiry into the comings and
:04:44. > :04:51.goings of Flowers and everybody else. The Tories, at their peril,
:04:52. > :04:54.will mix the three up. There's a lot of things going on with a bang.
:04:55. > :04:59.Labour has some issues around funding generally, and they are
:05:00. > :05:07.potentially exacerbated by the Co-op issue. The Labour Party gets soft
:05:08. > :05:14.loans from the Co-op bank, and it gets donations. ?800,000 last year.
:05:15. > :05:18.Ed Balls got about ?50,000 for his private office. You get the feeling,
:05:19. > :05:24.given the state of the Co-operative Bank now, that that money could dry
:05:25. > :05:28.up. We will see. There's lots of speculation in the papers today. At
:05:29. > :05:33.the core, the relationship between the Co-op party and the Labour Party
:05:34. > :05:38.is a proud one, and a legitimate one. I don't think others always
:05:39. > :05:43.understand that. Here is an even bigger issue. Is it not possible
:05:44. > :05:50.that the Co-op bank will cease to exist in any meaningful way as a
:05:51. > :06:01.Co-op bank? Is the bane out means it is 70% owned -- the bail out means
:06:02. > :06:07.that it is 70% owned, or 35% going to a hedge fund, I think I read.
:06:08. > :06:10.Yes, there is a move from the mutualism of the Co-op. But don't
:06:11. > :06:22.confuse the Co-op bank with the Co-op Group. Others have done that.
:06:23. > :06:30.I haven't. Here's the rub. The soft loans that Labour gets. They got
:06:31. > :06:39.?1.2 million from this. And 2.4 million. They are secured against
:06:40. > :06:45.future union membership fees of the party. What is Mr Miliband doing? He
:06:46. > :06:49.is trying to end that? You have this very difficult confluence of events,
:06:50. > :06:54.which is, could these wonderful soft loans that Labour has had from the
:06:55. > :06:59.Co-op, could they be going? And these union reforms, where Ed
:07:00. > :07:04.Miliband is trying to create a link between individuals and donations to
:07:05. > :07:08.the Labour Party... Clearly, there could be real financial difficulties
:07:09. > :07:12.here. The government needs to be careful, because George Osborne
:07:13. > :07:15.launched one of his classic blunderbuss operations this week,
:07:16. > :07:22.which is that the Labour Party is to blame for Paul Flowers' private
:07:23. > :07:29.life. No, it's not. And that all the problems, essentially... Look at
:07:30. > :07:32.what George Osborne was doing in Europe. He was trying to change the
:07:33. > :07:38.capital requirement rules that would make it easier for the Co-op to take
:07:39. > :07:41.over Lloyd's. If there is to be a big investigation, George Osborne
:07:42. > :07:46.needs to be careful of what he wishes for. This is another example
:07:47. > :07:49.of the Westminster consensus. All of the Westminster parties were in
:07:50. > :07:54.favour of the Britannia takeover. This is how the Co-op ended up with
:07:55. > :07:58.all this toxic rubbish on its balance sheet. All the major parties
:07:59. > :08:02.were in favour of going to get the Lloyds branches. The Tories tried to
:08:03. > :08:10.outdo Labour in being more pro-Co-op. There was nobody in
:08:11. > :08:15.Westminster saying, hold on, this doesn't work. It is like the
:08:16. > :08:20.financial bubble all over again. Everyone was in favour of that at
:08:21. > :08:24.the time. I think there is no evidence so far that the storm is
:08:25. > :08:29.cutting through to the average voter. If I were Ed Miliband, I
:08:30. > :08:34.would let it die a natural death. I would not write to an editorial
:08:35. > :08:39.column for a national newspaper on a Sunday. That keeps the issue alive,
:08:40. > :08:47.and it makes him look oversensitive and much better at dishing it out
:08:48. > :08:50.than taking it. I agree about that. The Labour press team tweeted this
:08:51. > :09:00.week saying that it was a new low for the times. And this was
:09:01. > :09:06.re-tweeted by Ed Miliband. It isn't a great press attitude. It is very
:09:07. > :09:12.Moni. Bill Clinton went out there and fought and made the case. So did
:09:13. > :09:18.Tony Blair. If you just say, they are being horrible to us, it looks
:09:19. > :09:23.pathetic. And it will cut through on Osborne and the financial
:09:24. > :09:33.dimensional is, not political. I shall tweet that later! While we
:09:34. > :09:38.have been talking, Mr Miliband has been on Desert Island Discs. He
:09:39. > :09:46.might still be on it. Let's have a listen to what he had to say.
:09:47. > :09:58.# Take on me, take me on. # And threw it all, she offers me
:09:59. > :10:10.protection. # A lot of love and affection.
:10:11. > :10:25.# Whether I'm right or wrong #. # Je Ne Regrette Rien. #.
:10:26. > :10:31.Obviously, that was the music that Ed Miliband chose. Who thought --
:10:32. > :10:41.you would have thought he would choose Norman Lamont's theme tune!
:10:42. > :10:52.He chose Jerusalem... He has no classical background at all. He had
:10:53. > :11:00.no Beethoven, no Elgar. David Cameron had Mendelssohn. And Ernie,
:11:01. > :11:11.the fastest Notman in the West. -- fastest milkman. Tony Blair chose
:11:12. > :11:14.the theme tune to a movie. Tony Blair's list was chosen by young
:11:15. > :11:24.staffers in his office. It absolutely was. Tony Blair's list
:11:25. > :11:28.was chosen by staff. The Ed Miliband this was clearly chosen by himself,
:11:29. > :11:38.because who would allow politician to go out there and say that they
:11:39. > :11:42.like Aha. I am the same age as Ed Miliband, and of course he likes
:11:43. > :11:54.Aha. That was the tumour was played in the 80s. Sweet Caroline. It is
:11:55. > :12:02.Angels by Robbie Williams. I was 14-year-old girl when that came out.
:12:03. > :12:09.I thought Angels was the staple of hen nights and chucking out time in
:12:10. > :12:12.pubs. The really good thing about his list is that the Smiths to not
:12:13. > :12:18.appear. The Smiths were all over David Cameron's list. The absolutely
:12:19. > :12:27.miserable music of Morris he was not there. What was his luxury? And
:12:28. > :12:34.Indian takeaway! Again, chosen for political reasons. I would agree
:12:35. > :12:41.with the panel about Aha, but I would expect -- I would respect his
:12:42. > :12:46.right to choose. Have you been on Desert Island Discs? I have. It took
:12:47. > :12:50.me three weeks to choose the music. It was the most difficult decision
:12:51. > :12:56.in my life. What was the most embarrassing thing you chose? I
:12:57. > :13:01.didn't choose anything embarrassing. I chose Beethoven, Elgar, and some
:13:02. > :13:13.proper modern jazz. Anything from the modern era? Pet Shop Boys.
:13:14. > :13:17.That's all for today. The Daily Politics will be on BBC Two at
:13:18. > :13:20.lunchtime every day next week, and we'll be back here on BBC One at
:13:21. > :13:23.11am next week. My luxury, by the way, was a wind-up radio! Remember,
:13:24. > :13:31.if it's Sunday, it's the Sunday Politics.