16/03/2014 Sunday Politics West


16/03/2014

David Garmston with the latest political news, interviews and debate. Andrew Neil looks ahead to the budget and speaks to UKIP leader Nigel Farage.


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Transcript


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Morning folks. Welcome to the Sunday Politics. George Osborne's fifth

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Budget will offer more tax relief for the lower paid but not for

:00:45.:00:47.

middle income earners being thrust into the 40p tax bracket. That's our

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top story. Ed Balls says millions of people

:00:50.:00:54.

aren't feeling any benefit from the recovery. We'll discuss the economy

:00:55.:00:57.

with big political beasts from Labour, the Conservatives, and the

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Lib Dems. Now that Ed Miliband has effectively ruled out an in/out EU

:01:05.:01:07.

referendum, how does UKIP deal with Tory claims that a vote for UKIP

:01:08.:01:09.

In the West: A special programme means no chance

:01:10.:01:19.

In the West: A special programme ahead of the European electhons from

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ahead of the European elections from Strasbourg. Can

:01:22.:01:22.

restoring confidence in the safety of cycling. The three areas of

:01:23.:01:23.

London getting a cash boost to try of cycling. The three areas of

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something different. And with me as always our top

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political panel - Nick Watt, Helen Lewis and Janan Ganesh. They'll be

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tweeting their thoughts using the hashtag #bbcsp throughout the

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programme. So, just three months after his last major financial

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statement, George Osborne will be at the despatch box again on Wednesday,

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delivering his 2014 Budget. The Chancellor has already previewed his

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own speech, pledging to build what he calls a "resilient economy". The

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message I will give in the Budget is the economic plan is working but the

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job is far from done. We need to build resilient economy which means

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addressing the long-term weaknesses in Britain that we don't export

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enough, invest enough, build enough, make enough. Those are the things I

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will address because we want Britain to earn its way in the world. George

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Osborne's opposite number, Ed Balls, has also been talking ahead of the

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Budget. He says not everyone is feeling the benefit of the economic

:02:28.:02:30.

recovery, and again attacked the Government's decision to reduce the

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top rate of tax from 50 to 45%. George Osborne is only ever tough

:02:38.:02:41.

when he's having a go at the week and the voiceless. Labour is willing

:02:42.:02:44.

to face up to people on the highest incomes and say, I'm sorry,

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justifying a big tax cut at this time is not fair. We will take away

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the winter allowance from the richer pensioners, and I think that's the

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right thing to do. George Osborne might agree, but he's not allowed to

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say so. That was the Chancellor and the shadow chancellor. Janan, it

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seems like we are in a race against time. No one argues that the

:03:07.:03:10.

recovery is not under way, in fact it looks quite strong after a long

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wait, but will it feed through to the living standards of ordinary

:03:15.:03:20.

people in time for the May election? They only have 14 months to do it.

:03:21.:03:24.

The big economic variable is business investment. Even during the

:03:25.:03:28.

downturn, businesses hoarded a lot of cash. The question is, are they

:03:29.:03:33.

confident enough to release that into investment and wages? Taking on

:03:34.:03:37.

new people, giving them higher pay settlements. That could make the

:03:38.:03:40.

difference and the country will feel more prosperous and this time next

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year. But come to think of it, it strikes me, that how anticipated it

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is, it's the least talked about Budget for many years. I think that

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is because the economy has settled down a bit, but also because people

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have got used to the idea that there is no such thing as a giveaway.

:04:00.:04:02.

Anything that is a tax cut will be taken away as a tax rise or spending

:04:03.:04:07.

cut. That's true during the good times but during fiscal

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consolidation, it's avoidable. - unavoidable. There is a plus and

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minus for the Conservatives here. 49% of people think the government

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is on roughly the right course, but only 16% think that their financial

:04:23.:04:24.

circumstances will improve this year. It will be a tough one for the

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Labour Party to respond to. I agree with Janan. Everyone seems bored

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with the run-up to the Budget. The front page of the Sunday Times was

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about fox hunting, the front page of the Sunday Telegraph was about EU

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renegotiation. Maybe we are saying this because there have not been

:04:46.:04:50.

many leaks. We have got used to them, and most of the George Osborne

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chat on Twitter was about how long his tie was. Freakishly long. I

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wouldn't dare to speculate why. Anything we should read into that? I

:05:00.:05:07.

don't know. For a long while there was no recovery, then it was it is a

:05:08.:05:14.

weak recovery, and now, all right, it's strong but not reaching

:05:15.:05:16.

everyone in the country. That is where we are in the debate. That's

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right, and the Conservative MPs are so anxious and they are making

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George Osborne announcing the rays in the personal allowance will go

:05:29.:05:33.

up, saying it might go up to 10 750 from next year, and Conservative MPs

:05:34.:05:40.

say that that's OK but we need to think about the middle voters.

:05:41.:05:44.

People are saying the economy is recovering but no one is feeling it

:05:45.:05:47.

in their pocket. These are people snagged in at a 40p tax rate. The

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Tories are saying these are our people and we have to get to them.

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He has given the Lib Dems more than they could have hoped for on raising

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the threshold. Why is he not saying we have done a bit for you, now we

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have to look after our people and get some of these people out of that

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40% bracket? Partly because the Lib Dems have asked for it so

:06:14.:06:16.

insistently behind-the-scenes. Somebody from the Treasury this week

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told me that these debates behind the scenes between the Lib Dems and

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Tories are incredibly tenacious and get more so every year. The Lib Dems

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have been insistent about going further on the threshold. The second

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reason is that the Tories think the issue can work for them in the next

:06:33.:06:38.

election. They can take the credit. If they enthusiastically going to

:06:39.:06:41.

?12,000 and make it a manifesto pledge, they can claim ownership of

:06:42.:06:46.

the policy. The Liberal Democrats want to take it to 12,500, which

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means you are getting into minimum wage territory. It's incredibly

:06:52.:06:55.

expensive and the Tories are saying that maybe you would be looking at

:06:56.:07:00.

the 40p rate. The Tories have played as well. There have been authorised

:07:01.:07:05.

briefings about the 40p rate, and Cameron and Osborne have said that

:07:06.:07:07.

their priority was helping the lowest paid which is a useful

:07:08.:07:11.

statement to make and it appeals to the UKIP voters who are the

:07:12.:07:16.

blue-collar workers. And we are right, the economy will determine

:07:17.:07:21.

the next election? You assume so. It was ever that is. It didn't in 992

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or 1987. It did in 1992. Ed Miliband's announcement last week

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that a Labour government would not hold a referendum on Europe unless

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there's another transfer of powers from Britain to Brussels has

:07:38.:07:39.

certainly clarified matters. UKIP say it just shows the mainstream

:07:40.:07:45.

parties can't be trusted. The Conservatives think it means UKIP

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voters might now flock back to them as the only realistic chance of

:07:49.:07:50.

securing a referendum. Giles Dilnot reports.

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When it comes to Europe and Britain's relation to it, the

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question is whether the answer is answered by a question. To be in or

:07:59.:08:03.

not to be in, that is the question, and our politicians have seemed less

:08:04.:08:05.

interested in question itself but whether they want to let us answer

:08:06.:08:09.

it. Labour clarified their position last week. There will be no transfer

:08:10.:08:22.

of powers without an in out referendum, without a clear choice

:08:23.:08:25.

as to whether Britain will stay in the EU. That seems yes to a

:08:26.:08:30.

referendum, but hold on. I believe it is unlikely that this lock will

:08:31.:08:34.

be used in the next Parliament. So that's a no. The Conservatives say

:08:35.:08:37.

yes to asking, in 2017, if re-elected, but haven't always. In

:08:38.:08:47.

2011, 81 Tory MPs defied the PM by voting for a referendum on EU

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membership: the largest rebellion against a Tory prime minister over

:08:51.:08:53.

Europe. Prompted by a petition from over 100,000 members of the public.

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The wrong question at the wrong time said the Foreign Secretary of a

:09:05.:09:06.

coalition Government including selfie-conciously-pro European Lib

:09:07.:09:08.

Dems, who had a referendum pledge in their 2010 manifesto, but only in

:09:09.:09:12.

certain circumstances. So we have the newspapers, and the public

:09:13.:09:14.

meeting leaflets. UKIP have always wanted the question put regardless.

:09:15.:09:17.

But Labour's new position may change things and The Conservatives think

:09:18.:09:25.

so. I think it does, because, you know, we are saying very clearly,

:09:26.:09:32.

like UKIP, we want a referendum but only a Conservative government can

:09:33.:09:37.

deliver it because most suffer largest would say it is possible in

:09:38.:09:42.

the first past the post system to have a UKIP government --

:09:43.:09:50.

sophologists. And then it's easy for as to say that if a UKIP vote lets

:09:51.:09:58.

in a Conservative government, then they won't hold a referendum. UKIP

:09:59.:10:04.

seem undaunted by the clarifications of the other parties, campaigning

:10:05.:10:07.

like the rest but with a "tell it how it is, just saying what you re

:10:08.:10:10.

thinking, we aren't like them" attitude. They seem more worried

:10:11.:10:17.

about us and what we want, and I don't see that in the other parties.

:10:18.:10:21.

In parts of the UK, like South Essex, it's a message they think is

:10:22.:10:28.

working. They are taking the voters for granted again and people have

:10:29.:10:31.

had enough. People are angry, they see people saying they will get a

:10:32.:10:38.

vote on the European Union, but then it just comes down the road. They

:10:39.:10:43.

were quick to capitalise on the announcements, saying only the

:10:44.:10:49.

Conservatives will give you say so does it change things? Not really.

:10:50.:10:55.

We have been talking about a referendum and having a debate on

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the European Union for years, and the other parties are playing catch

:10:59.:11:02.

up. They have a trust issue. Nobody trusts them on the European Union

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and that is why people come to us. Who the average UKIP voter is, or

:11:07.:11:10.

how they voted before is complicated, and what dent they

:11:11.:11:12.

might make on Conservative and Labour votes in 2015 is trickier

:11:13.:11:15.

still, but someone's been crunching the numbers anyway. We reckon it is

:11:16.:11:23.

between 25 and 30% of the electorate broadly share the UKIP motivation,

:11:24.:11:27.

so to top out at that level would be difficult. That's an awful lot of

:11:28.:11:30.

voters, but it's not the majority, and this is the reason why the main

:11:31.:11:35.

parties can't afford to just openly appealed to the UKIP electorate too

:11:36.:11:39.

hard because the elections are won and lost amongst the other 70%, the

:11:40.:11:44.

middle-class, the graduate, the younger, ethnic minorities. An

:11:45.:11:49.

appeal to the values of UKIP voters will alienate some of the other

:11:50.:11:52.

groups, and they are arguably more significant in winning the election.

:11:53.:11:56.

Whatever, the numbers UKIPers seem doggedly determined to dig away at

:11:57.:11:59.

any support the other parties have previously enjoyed.

:12:00.:12:02.

Giles Dilnot reporting. UKIP's leader, Nigel Farage, joins me now

:12:03.:12:05.

for the Sunday Interview. Nigel Farage, welcome back. Good

:12:06.:12:22.

morning. So the Labour Party has shot a fox. If Ed Miliband is the

:12:23.:12:25.

next by Minister, there will not be a referendum customer there's a long

:12:26.:12:30.

way between now and the next election, and Conservative party

:12:31.:12:33.

jobs and changes. We had a cast iron guarantee of a referendum from

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camera, then he three line whip people to vote against it, and now

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they are for it. What the Labour Party has done is open up a huge

:12:42.:12:44.

blank to us, and that is what we will go for in the European

:12:45.:12:48.

elections this coming year in May. I think there is a very strong chance

:12:49.:12:52.

that Labour will match the Conservative pledge by the next

:12:53.:12:55.

general election. There may be, but at the moment he has ruled it out,

:12:56.:13:00.

and if he does not change his mind and goes into the election with the

:13:01.:13:03.

policy as it is, the only chance of a referendum is a Tory government.

:13:04.:13:10.

If you think the Tories will form a majority, which I think is unlikely.

:13:11.:13:14.

Remember, two thirds of our voters would never vote Conservative

:13:15.:13:18.

anyway. There is still this line of questioning that assumes UKIP voters

:13:19.:13:22.

are middle-class Tories. We have some voters like that, but most of

:13:23.:13:26.

them are coming to us from Labour, some from the Lib Dems and a lot of

:13:27.:13:31.

nonvoters. But it come the election you failed to change Mr Miliband's

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line, I repeat, the only chance of a referendum, if you want a

:13:38.:13:41.

referendum, if that is what matters, and the polls suggest it doesn't

:13:42.:13:45.

matter to that many people, but if that is what matters, the only way

:13:46.:13:48.

you can get one is to vote Conservative. No, because you have a

:13:49.:13:53.

situation in key marginals, especially where all three parties

:13:54.:13:57.

are getting a good share, where we will see, and this depends a lot on

:13:58.:14:00.

the local elections and the European elections, there are target

:14:01.:14:07.

constituencies where UKIP has a reasonably good chance of winning a

:14:08.:14:11.

seat, and that will change the agenda. Every vote for UKIP makes a

:14:12.:14:17.

Tory government less likely. Arab voters are not Tory. Only a third of

:14:18.:14:20.

the UKIP boat comes from the Conservative party -- our voters are

:14:21.:14:27.

not Tory. -- the UKIP vote. It was mentioned earlier, about blue-collar

:14:28.:14:31.

voters. We pick up far more Labour Party and nonvoters than

:14:32.:14:34.

conservatives. On the balance of what the effect of the UKIP boat

:14:35.:14:38.

is, the Tories should worry about us, they should worry about the fact

:14:39.:14:41.

they have lost faith with their own electorate. Even if there is a

:14:42.:14:46.

minority Ed Miliband government it means no referendum. Labour and the

:14:47.:14:50.

Liberal Democrats are now at one on the matter. The next election is in

:14:51.:14:55.

a few weeks time, the European elections. What happens in those

:14:56.:14:59.

elections will likely change the party stands and position on a

:15:00.:15:02.

referendum. The fact that Ed Miliband has said this means, for

:15:03.:15:07.

us, our big target on the 22nd of May will be the Labour voters in the

:15:08.:15:10.

Midlands and northern cities, and if we do hammer into that boat and we

:15:11.:15:15.

are able to beat Labour on the day, there's a good chance of their

:15:16.:15:24.

policy changing. One poll this morning suggests Labour is close to

:15:25.:15:31.

you at 28, the Conservatives down at 21, the Lib Dems down at eight. You

:15:32.:15:38.

are taking votes from the Conservatives and the Liberal

:15:39.:15:42.

Democrats. We are certainly taking votes from the Lib Dems but that is

:15:43.:15:49.

comparing the poll with one year ago when I don't think most people knew

:15:50.:15:55.

what the question really was. You seem to be in an impossible position

:15:56.:15:59.

because the better you do in a general election, the less chance

:16:00.:16:05.

there will be a referendum by 2 20. No, look at the numbers. Only a

:16:06.:16:10.

third of our voters are Conservatives. When we have polled

:16:11.:16:16.

voters that have come to us, we asked them if there was no UKIP

:16:17.:16:20.

candidate who would you vote for, less than one in five said

:16:21.:16:25.

Conservative. Less than one in five UKIP voters would be tempted to vote

:16:26.:16:30.

Conservative under any circumstances so the arithmetic does not suggest

:16:31.:16:36.

we are the Conservative problem it suggests we are hurting all of the

:16:37.:16:39.

parties and the reason the Tories are in trouble is because they have

:16:40.:16:44.

lost their traditional base. Why do you think Nick Clegg is debating

:16:45.:16:51.

Europe? I think they are in trouble, at 8% they could be wiped

:16:52.:16:59.

out, they could go from 12 to nothing and I think it is a chance

:17:00.:17:04.

for Nick Clegg to raise their profile. They are fringe party with

:17:05.:17:10.

respect to this contest so I see why he wants to do it. One of our big

:17:11.:17:15.

criticisms is that we have not been able to have a full debate on

:17:16.:17:20.

national television on the alternatives of the European Union

:17:21.:17:25.

so I am looking forward to it. How are you preparing? I think you can

:17:26.:17:38.

be over scripted with these things. Are you not doing mock debates? No,

:17:39.:17:44.

I am checking my facts and figures and making sure that I can show the

:17:45.:17:48.

British people that in terms of jobs, we would be far better off not

:17:49.:17:54.

being within the European Union not being within its rule book, not

:17:55.:17:59.

suffering from some of the green taxes they are putting on the

:18:00.:18:04.

manufacturing industry. The idea that 3 million jobs are at risk I

:18:05.:18:10.

want to show why that is nonsense. Who do you think is playing you in

:18:11.:18:16.

their mock debates? They probably went to the pub and found someone!

:18:17.:18:24.

We will see. You have promised to do whatever it takes to fund your

:18:25.:18:27.

European election campaign, how much has been given so far? Just give it

:18:28.:18:34.

a few weeks and you will see what Paul is planning to do. He has made

:18:35.:18:40.

a substantial investment in the campaign already. How much? I'm not

:18:41.:18:49.

answering that for now. We are well on our way to a properly funded

:18:50.:18:53.

campaign and our big target will be the big cities and the working vote

:18:54.:19:00.

in those communities. Your deputy chairman Neil Hamilton is another

:19:01.:19:04.

former Tory, he says so far we haven't seen the colour of his

:19:05.:19:10.

money. Exactly two weeks ago, and things have changed since then. Mr

:19:11.:19:16.

Sykes has written a cheque since then? Yes. This morning's papers

:19:17.:19:25.

saying you will be asking MEPs to contribute ?50,000 each, is that

:19:26.:19:33.

true? Over the next five years, yes. Not for the European campaign. So

:19:34.:19:39.

lack of money will not be an excuse. We will have a properly funded

:19:40.:19:45.

campaign. How we raise the kind of money needed to fund the general

:19:46.:19:48.

election afterwards is another question. What is UKIP's policy on

:19:49.:19:59.

paying family members? We don't encourage it and I didn't employ any

:20:00.:20:04.

family member for years. My wife ended up doing the job and paid for

:20:05.:20:11.

the first seven years of my job She is paid now? Until May, then she

:20:12.:20:18.

comes off the payroll am which leaves me with a huge problem. In

:20:19.:20:25.

2004 you said, UKIP MEPs will not employ wives and there will be no

:20:26.:20:31.

exceptions. An exception was made because I became leader of the

:20:32.:20:35.

National party as well as a leader of the group in European

:20:36.:20:39.

Parliament. Things do change in life, and you can criticise me for

:20:40.:20:44.

whatever you like, but I cannot be criticised for not having a big

:20:45.:20:49.

enough workload. No, but you didn't employ your wife when you had told

:20:50.:20:58.

others not to do it your party. Nobody else in my party has a big

:20:59.:21:01.

job in Europe and the UK. We made the exception for this because of

:21:02.:21:07.

very unusual circumstances. It also looks like there was a monetary

:21:08.:21:11.

calculation. Listen to this clip from a BBC documentary in 2000. It

:21:12.:21:18.

is a good job. I worked it out because so much of what you get is

:21:19.:21:24.

after tax that if you used the secretarial allowances to pay your

:21:25.:21:28.

wife on top of the other games you can play, I reckon this job in

:21:29.:21:36.

Stirling term is over a quarter of ?1 million a year. That is what you

:21:37.:21:38.

would need to earn working for Goldman Sachs or someone like that.

:21:39.:21:45.

I agree with that. More importantly the way you really make money in the

:21:46.:21:48.

European Parliament is being their five days a week, because you sign

:21:49.:21:54.

in every day, you get 300 euros every day, and that is how people

:21:55.:21:59.

maxed out. The criticism of me is that I am not there enough so

:22:00.:22:04.

whatever good or bad I have done in the European Parliament, financial

:22:05.:22:08.

gain has not been one of the benefits. There have been

:22:09.:22:13.

allegations of you also employing a former mistress on the same European

:22:14.:22:18.

Parliamentary allowance, you deny that? I am very upset with the BBC

:22:19.:22:24.

coverage of this. The ten o'clock news run this as a story without

:22:25.:22:28.

explaining that that allegation was made using Parliamentary privilege

:22:29.:22:32.

by somebody on bail facing serious fraud charges. I thought that was

:22:33.:22:40.

pretty poor. You have a chance to do that and you deny you have employed

:22:41.:22:48.

a former mistress? Yes, but if you look at many of the things said over

:22:49.:22:53.

the last week, I think it is becoming pretty clear to voters that

:22:54.:22:57.

the establishment are becoming terrified of UKIP and they will use

:22:58.:23:04.

anything they can find to do us down in public. Is an MEP employs his

:23:05.:23:10.

wife and his former mistress, that would be resigning matter, wouldn't

:23:11.:23:16.

it? Yes, particularly if the assumption was that money was being

:23:17.:23:21.

taped for work but was not being done. Who do you think is behind

:23:22.:23:28.

these stories? It is all about negative, it is all about attacks,

:23:29.:23:34.

but I don't think it is actually going to work because so much of

:23:35.:23:38.

what has been said in the last week is nonsense. A reputable daily

:23:39.:23:42.

newspaper said I shouldn't be trusted because I had stored six

:23:43.:23:47.

times for the Conservative party, I have never even stored in a local

:23:48.:23:51.

council election. I think if you keep kicking an underdog, it will

:23:52.:23:56.

make the British people rally around us. Is it the Conservatives? Yes,

:23:57.:24:07.

and the idea that all of our voters are retired colonels is simply not

:24:08.:24:13.

true. We get some voters from the Labour side as well. Would you

:24:14.:24:22.

consider standing in a Labour seat if you are so sure you are getting

:24:23.:24:28.

Labour votes? Yes, but the key for UKIP is that it has to be marginal.

:24:29.:24:36.

Just for your own future, if you fail to win a single soul -- single

:24:37.:24:43.

seat in the general election, if Ed Miliband fails to win an outright

:24:44.:24:48.

majority, will you stand down as UKIP leader? I would think within

:24:49.:24:53.

about 12 hours, yes. I will have failed, I got into politics not

:24:54.:24:59.

because I wanted a career in politics, far from it. I did it

:25:00.:25:04.

because I don't think this European entanglement is right for our

:25:05.:25:07.

country. I think a lot of people have woken up to the idea we have

:25:08.:25:12.

lost control of our borders and now is the moment for UKIP to achieve

:25:13.:25:19.

what it set out to do. Will UKIP continue without you if you stand

:25:20.:25:25.

down? Of course it will. I know that everyone says it is a one-man band

:25:26.:25:34.

but it is far from that. We have had some painful moments, getting rid of

:25:35.:25:37.

old UKIP, new UKIP is more professional, less angry and it is

:25:38.:25:41.

going places. Nigel Farage, thank you for being with us.

:25:42.:25:47.

So, what else should we be looking out for in Wednesday's Budget

:25:48.:25:49.

statement? We've compiled a Sunday Politics guide to the Chancellor's

:25:50.:25:51.

likely announcements. Eyes down everyone, it's time for a

:25:52.:25:54.

bit of budget bingo. Let's see what we will get from the man who lives

:25:55.:25:58.

at legs 11. Despite some good news on the economy, George Osborne says

:25:59.:26:02.

that this will be a Budget of hard truths with more pain ahead in order

:26:03.:26:05.

to get the public finances back under control. But many in the

:26:06.:26:07.

Conservative party, including the former chancellor Norman Lamont

:26:08.:26:10.

want Mr Osborne to help the middle classes by doing something about the

:26:11.:26:13.

4.4 million people who fall into the 40% bracket. Around one million more

:26:14.:26:21.

people pay tax at that rate compared to 2010 because the higher tax

:26:22.:26:23.

threshold hasn't increased in line with inflation. Mr Osborne has

:26:24.:26:28.

indicated he might tackle the issue in the next Conservative manifesto,

:26:29.:26:32.

but for now he is focused on helping the low paid. It's likely we will

:26:33.:26:38.

see another increase in the amount you can earn before being taxed

:26:39.:26:43.

perhaps up another ?500 to ?10, 00. The Chancellor is going to flesh out

:26:44.:26:47.

the details of a tax break for childcare payments, and there could

:26:48.:26:50.

be cries of 'house' with the promise of more help for the building

:26:51.:27:07.

industry. The Help To Buy scheme will be extended to 2020 and there

:27:08.:27:10.

could be the go-ahead for the first Garden City in 40 years. Finally,

:27:11.:27:13.

bingo regulars could be celebrating a full house with a possible cut in

:27:14.:27:15.

bingo tax. And I've been joined in the studio

:27:16.:27:18.

by the former Conservative chancellor Norman Lamont, in Salford

:27:19.:27:21.

by the former Labour Cabinet minister Hazel Blears, and in

:27:22.:27:24.

Aberdeen by the Lib Dem deputy leader, Malcolm Bruce. Let me come

:27:25.:27:27.

to Norman Lamont first, you and another former Tory Chancellor,

:27:28.:27:33.

Nigel Lawson, have called in the fall in the threshold for the rate

:27:34.:27:43.

at which the 40p clicks in. I would have preferred an adjustment in the

:27:44.:27:48.

Budget but I agree with what you are saying, it sounds like the

:27:49.:27:53.

Chancellor will not do that. My main point is that you cannot go on

:27:54.:27:58.

forever and forever increasing the personal allowance and not

:27:59.:28:02.

increasing the 40% tax threshold because you are driving more and

:28:03.:28:08.

more people into that band. It is an expensive policy because in order to

:28:09.:28:11.

keep the number of people not paying tax constant, you have to keep

:28:12.:28:17.

adjusting it each year. When this was introduced by Nigel Lawson, it

:28:18.:28:23.

applied to one in 20 people, the 40% rate, it now applies to one in six

:28:24.:28:30.

people. By next year, there will be 6 million people paying base. Why do

:28:31.:28:35.

you think your Tory colleagues seem happy to go along with the Lib Dems

:28:36.:28:40.

and target whatever money there is for tax cuts rather -- on the lower

:28:41.:28:55.

paid rather than the middle incomes? They are not helping the lowest

:28:56.:29:01.

paid. If you wanted to really help the lowest paid people you would

:29:02.:29:03.

raise the threshold for national insurance contributions, which is

:29:04.:29:10.

around ?6,000. Is it the Lib Dems stopping any rise in the 40p

:29:11.:29:19.

threshold? We are concentrating on raising the lower threshold because

:29:20.:29:25.

we believe that is the way to help those on lower incomes. Whilst they

:29:26.:29:32.

haven't benefited as much as the lower paid they have participated

:29:33.:29:35.

and I think people understand right now, if you were going to prioritise

:29:36.:29:39.

the high earners, when we are still trying to help those on lower and

:29:40.:29:44.

middle incomes who haven't enjoyed great pay increases but have got the

:29:45.:29:48.

benefit of these tax increases, that is why we would like to do it for

:29:49.:29:54.

the minimum wage level. But the poorest will not benefit at all The

:29:55.:30:00.

poorest 16% already don't pay tax. Why don't you increase the threshold

:30:01.:30:05.

at which National Insurance starts? You only have two earned ?5,500

:30:06.:30:14.

before you start to pay it. You ve got to remember that the raising of

:30:15.:30:18.

the threshold to ?10,000 or more was something the Tories said we could

:30:19.:30:23.

not afford. Why are you continuing to do it? If you want to help the

:30:24.:30:31.

working poor, the way would be to take the lowest out of national

:30:32.:30:36.

insurance. The view we take is they are benefiting, and have benefited

:30:37.:30:40.

from, the raising of the tax threshold. You now have to earn

:30:41.:30:46.

?10,000, we hope eventually 12, 00, and that means only people on very

:30:47.:30:50.

low wages. If you opt out of national insurance, you're saying to

:30:51.:30:54.

people that you make no contribution to the welfare system, so there is a

:30:55.:30:59.

general principle that people should participate and paying, and also

:31:00.:31:04.

claim when they need something out. We thought raising the threshold was

:31:05.:31:08.

simple and effective at a time of economic austerity and the right way

:31:09.:31:10.

to deliver a helpful support to welcoming people. -- working people.

:31:11.:31:17.

With the Labour Party continue to raise the threshold, or do they

:31:18.:31:21.

think there is a case that there are too many people being dragged into

:31:22.:31:27.

the 40p tax bracket? If Norman Lamont thinks this is the right time

:31:28.:31:31.

to benefit people who are reasonably well off rather than those who are

:31:32.:31:34.

struggling to make ends meet, then genuinely, I say it respectfully, I

:31:35.:31:38.

don't think he's living in the world the rest of us are. Most working

:31:39.:31:43.

people have seen their wages effectively reduced by about ?1 00

:31:44.:31:47.

because they have been frozen, so the right thing is to help people on

:31:48.:31:53.

modest incomes. I also understand that if the 40% threshold went up,

:31:54.:31:57.

the people who would benefit the most, as ever, are the people who

:31:58.:32:01.

are really well off, not the people in the middle. The Conservatives

:32:02.:32:05.

have already reduced the 50p tax on people over ?150,000 a year, and we

:32:06.:32:11.

have to concentrate on the people going out to work, doing their best

:32:12.:32:14.

to bring their children up and have a decent life and need a bit of

:32:15.:32:18.

help. I think raising the threshold is a good thing. We would bring back

:32:19.:32:22.

the 10p tax, which we should never have abolished, and do things with

:32:23.:32:28.

regard to childcare. At the moment, childcare costs the average family

:32:29.:32:31.

as much as their mortgage, for goodness sake. We would give 25

:32:32.:32:36.

hours free childcare for youngsters over three and four years old. That

:32:37.:32:39.

would be a massive boost the working families. We are talking about

:32:40.:32:47.

nurses, tube drivers, warrant officers in the army. There are many

:32:48.:32:50.

people who are not well off but have been squeezed in the way everybody

:32:51.:32:55.

has been squeezed and they are finding it continuing. I am stunned

:32:56.:32:59.

by Malcolm's argument where everybody should pay something so

:33:00.:33:03.

you should not take people out of national insurance, but the

:33:04.:33:06.

principle doesn't apply to income tax. You can stand that argument on

:33:07.:33:11.

its head and apply it to income tax. Most people don't see a difference

:33:12.:33:15.

between income tax and national insurance, it's the same thing to

:33:16.:33:20.

most people. It is true that it isn't really an insurance fund and

:33:21.:33:22.

there is an argument from merging both of them. But we have

:33:23.:33:29.

concentrated on a simple tax proposition. Norman is ignoring the

:33:30.:33:35.

fact the people on the 40% rate have benefited by the raising of the

:33:36.:33:38.

personal allowance. To say they have been squeezed is unfair. The

:33:39.:33:41.

calculation is that an ordinary taxpayer will be ?700 better off at

:33:42.:33:47.

the current threshold, and about ?500 better off at the higher rate.

:33:48.:33:51.

It is misleading to say the better off we'll be paying more. I agree

:33:52.:33:56.

with Hazel, if you go to the 40 rate, it's the higher earners who

:33:57.:34:00.

benefit the most, and we won't do that when the economy is not where

:34:01.:34:04.

it was before the crash. How much will the lower paid be better off if

:34:05.:34:12.

you reintroduce the 10p rate? Significantly better off. I don t

:34:13.:34:16.

have the figure myself, but they'd be significantly better off and the

:34:17.:34:22.

Budget should be a mixture of measures to help people who work

:34:23.:34:25.

hard. That is why I think the childcare issue has to be

:34:26.:34:30.

addressed. ?100 a week of the people with childcare payments. It is a

:34:31.:34:36.

massive issue. We want the job is guaranteed to get young people back

:34:37.:34:39.

into work. There's been hardly any discussion about that, and we have

:34:40.:34:42.

nearly 1 million people who have been out of work for six months or

:34:43.:34:46.

more, and as a country we need to do something to help that. 350,000

:34:47.:34:53.

full-time students, so it is a misleading figure. It is not a

:34:54.:34:56.

million including full-time students. All parties do this. It

:34:57.:35:02.

sounds to me, Malcolm Bruce, you have more in common with the Labour

:35:03.:35:05.

Party than you do with the Conservatives. You want an annual

:35:06.:35:09.

levy on houses over ?2 million, so does Labour. A lot of your members

:35:10.:35:14.

want to scrap the so-called bedroom tax and so does labour. You think

:35:15.:35:17.

every teacher should have a teaching qualification, and so does Labour.

:35:18.:35:22.

Your policy on the EU referendum is the same. Let me go on. And you want

:35:23.:35:26.

to scrap the winter fuel allowance for wealthy pensioners. We want to

:35:27.:35:32.

make sure we get the public finances in order and we have grave

:35:33.:35:34.

reservations about the Labour Party promises. But they followed your

:35:35.:35:44.

spending plans in the first year. The point we are making is we can

:35:45.:35:48.

make a fairer society and stronger economy if you keep the public

:35:49.:35:51.

finances moving towards balance We don't think the Labour Party will

:35:52.:35:55.

take a stand that track. It is interesting that the Labour Party

:35:56.:35:59.

want to introduce the 10p rate that Gordon Brown abolished. We consider

:36:00.:36:04.

that before we can -- committed to the 0% rate -- we considered that.

:36:05.:36:11.

It makes a complicated system difficult and we think it's better

:36:12.:36:16.

doing it that way. As a fiscal conservative, why are you talking

:36:17.:36:20.

about any tax cuts when the deficit is over ?100 billion, and

:36:21.:36:23.

effectively, anything you propose today can only be financed by more

:36:24.:36:28.

borrowing. I totally agree with you. I said that this week. I thought the

:36:29.:36:33.

best thing would have no Budget The main thing is to get the deficit

:36:34.:36:38.

down. My argument is is that you have an adjustment in tax rates it

:36:39.:36:40.

should be shared between the allowances and the higher rate, but

:36:41.:36:46.

I don't think that the progress on the deficit is something we can give

:36:47.:36:51.

up on. This is still a very long way to go. We're only halfway through.

:36:52.:36:58.

Hazel, does it make sense to borrow for tax cuts? I am reluctant to do

:36:59.:37:01.

this, but I agree with both Norman and Malcolm. Malcolm Bruce wants to

:37:02.:37:09.

borrow for tax cuts. We absolutely need to get the deficit down and get

:37:10.:37:13.

finances on a strong footing. But we also have to think about having some

:37:14.:37:17.

spending in the system that in the longer run saves us money. We all

:37:18.:37:21.

know we need to build new homes I don't think it's necessarily the

:37:22.:37:26.

right priority to give people in London mortgage relief in terms of

:37:27.:37:30.

?600,000. We have to get the balance right. Sometimes it is right to

:37:31.:37:35.

spend to save. I'm afraid we have run out of time. There will be

:37:36.:37:41.

plenty more discussion in the lead up to the Budget on Wednesday.

:37:42.:37:43.

It's just gone 11:35am. You're watching the Sunday Politics. We say

:37:44.:37:48.

goodbye to viewers in Scotland who leave us now for Sunday Politics

:37:49.:37:51.

Scotland. Coming up here in 20 minutes, Frances O'Grady, the

:37:52.:37:54.

Good morning. Welcome to a special us discuss

:37:55.:38:09.

Good morning. Welcome to a special edition of the Sunday Polithcs for

:38:10.:38:15.

the West. We have left the West Country and come to the European

:38:16.:38:18.

Parliament in Strasbourg ahdad of the elections in May. Coming up

:38:19.:38:24.

inside the place where decisions are made, but could Britain dechded to

:38:25.:38:30.

waive this goodbye? Straight bananas and dangerous balloons, which EU

:38:31.:38:35.

laws are true and which are myths? And Nigel Farage last of crhtics who

:38:36.:38:40.

say his office is full of eccentrics. In two months, 400

:38:41.:38:46.

million EU citizens elect mdmbers of the European Parliament. Thd new

:38:47.:38:50.

MEPs will pass laws on the clothes we wear, the cars we drive, the

:38:51.:38:56.

hours we work and the food we eat. In our part of the world we have a

:38:57.:39:03.

small say in this. We have 6 euros MPs representing the south`west of

:39:04.:39:07.

England and, bizarrely, Gibraltar. To belong to the UK Independence

:39:08.:39:12.

Party, one is a Liberal Democrat and three are conservative. The amount

:39:13.:39:20.

of MEPs is being reduced to 751 from May. Let's begin by getting our

:39:21.:39:24.

bearings. I have been for a look around. We are gliding around

:39:25.:39:30.

Strasbourg, a town that has grown prosperous on the back of the EU, on

:39:31.:39:35.

trams that Europeans do effortlessly, but we are told are

:39:36.:39:38.

not affordable for us at hole in the West Country. Our destination is a

:39:39.:39:44.

chrome and glass building on the outskirts, the European Parliament.

:39:45.:39:50.

It is pretty much identical to the European Parliament in Brussels

:39:51.:39:54.

but, for some reason, MEPs `re obliged to spend one week hdre a

:39:55.:39:58.

month. Let's look at the agdnda this week. All sorts of debates going on,

:39:59.:40:06.

including the implementation of a single European sky and another on

:40:07.:40:08.

the eradication of world torture. Some people think this is vhtal

:40:09.:40:14.

Europeans talking to one another. Others believe it is the biggest

:40:15.:40:21.

non`job creation scheme. Sole nationalities take it seriotsly

:40:22.:40:28.

beaming back home earnest interviews with Euro officials that soletimes

:40:29.:40:33.

go on for four hours. TV vidwers in Britain are spared that orddal

:40:34.:40:38.

because it seems irrelevant to us. Are we mistaken? And independent

:40:39.:40:43.

commentator, American, think so Can you imagine this place without the

:40:44.:40:50.

British? Easily. It would cdrtainly be a huge loss if the UK were to

:40:51.:40:57.

leave, but in terms of the TK's influence, it punches way bdlow its

:40:58.:41:02.

weight. I think they do not play the game as well as some of thehr

:41:03.:41:11.

equally sized neighbours. The voting chamber is the giant hemi` cycle

:41:12.:41:17.

where 28 countries come togdther. This is a voting session and they

:41:18.:41:21.

are going through a series of motions, having just passed

:41:22.:41:25.

something about petitions. Xou can see the scale of it. The vast

:41:26.:41:31.

numbers and interpreters. It reminds me of something from a James Bond

:41:32.:41:36.

set. I am given a tour by a familiar face. This is the Labour MEP,

:41:37.:41:43.

Michael Cashman, who is standing down this election. He is known as

:41:44.:41:48.

an equality campaign and better known for playing a gay character on

:41:49.:41:52.

EastEnders. You are not standing again, so it is no skin off your

:41:53.:41:58.

nose. Can you convince me it is a worthwhile place and job? It is the

:41:59.:42:04.

most brilliant job imaginable. Does it make any difference at home? In

:42:05.:42:11.

terms of rights, there is a raft of rights David Cameron wants to get

:42:12.:42:14.

rid of in the workplace that prevents people from being

:42:15.:42:19.

discriminated against on grounds of race, religion, belief, the right to

:42:20.:42:25.

four weeks of paid holiday `nd maternity leave, paternity leave.

:42:26.:42:33.

Not everyone agrees. Nigel Farage is treated like a rock star by the

:42:34.:42:36.

European media, who have never seen anything like him. I caught up with

:42:37.:42:43.

him as newspaper reports at home alleged saucy carry ons at TKIP

:42:44.:42:48.

headquarters with claims and eccentric employee brought her cat

:42:49.:42:54.

to the office. Does one of xour senior officials bring her cat to

:42:55.:43:00.

work? Did once on the way to the vet, it is nonsense. This is not

:43:01.:43:04.

being written about other political parties. Sometimes it is sahd, after

:43:05.:43:11.

a day's work, UKIP staff go to the pub. Are we supposed to hang our

:43:12.:43:14.

heads in shame that we are normal people? Outside I bump into musical

:43:15.:43:23.

students from Slovenia, enjoying their status as young Europdans Yes

:43:24.:43:36.

or no, Europe? Yes! This st`tute talks about being at the he`rt of

:43:37.:43:41.

Europe. UKIP wants to put a dagger into Britain's membership. Duro

:43:42.:43:45.

scepticism is spreading across the continent.

:43:46.:43:51.

Among the 28 nations represdnted here, it used to be Britain who

:43:52.:43:56.

elected most sceptics, but that has changed and is expected to change

:43:57.:44:03.

more when by the end of May, people reckon the proportion of MEPs who

:44:04.:44:08.

are Eurosceptic could rise to 2 %. You can spot them by their flags.

:44:09.:44:14.

Alongside UKIP with the union Jack, there are others. They turn up to

:44:15.:44:20.

vote. The south`west's of MBP is said they do little else. Their

:44:21.:44:27.

performance is almost nil. They do not turn up to committee, they do

:44:28.:44:32.

not vote or ring gauge in ddtail scrutiny. They go to their hemi`

:44:33.:44:38.

cycle and they shout. He takes is to a committee meeting about product

:44:39.:44:43.

safety. He contends this is important and the UKIP group are not

:44:44.:44:46.

there. Persuading people it matters is not EC. The EU is running adverts

:44:47.:44:56.

to get us to vote. The decisions of the European Parliament are driven

:44:57.:44:58.

by N the thing that matters to you. The positive message makes little

:44:59.:45:07.

impact `` driven by everythhng. They want us to come out of Europe. `` I

:45:08.:45:14.

want to. I think we get a b`d deal. There is a lot of red tape `nd the

:45:15.:45:19.

facts they move between Brussels and Strasbourg is a nonsense. For other

:45:20.:45:25.

Europeans it can seem childhsh. Visiting a Bristol school is a

:45:26.:45:31.

French MP. She is horrified at the Eurosceptic tied. They could block

:45:32.:45:37.

the entire decisional process where we need more Europe, we need people

:45:38.:45:44.

to take decisions at Europe`n level, concerning employment, soci`l

:45:45.:45:48.

rights, climate change, banking regulation. It would be a

:45:49.:45:54.

catastrophe. I meet someone from the Green party. The voters havd to be

:45:55.:46:01.

taken seriously and they ard voting UKIP for a reason, not for what they

:46:02.:46:07.

say, because they do not provide solutions, they just providd an

:46:08.:46:12.

opportunity for people to bd cross. The biggest challenge may bd for the

:46:13.:46:17.

British Conservatives, who `re plotting tactics, sounding

:46:18.:46:20.

Eurosceptic but changing thhngs so that voters will not want to leave.

:46:21.:46:27.

I could not argue to stay in the European Union unreformed as it is

:46:28.:46:30.

now, particularly the financial side. That does not mean to say I

:46:31.:46:36.

want to throw the baby out with the bath water, there is good skeleton

:46:37.:46:43.

of good work. Probably only one third of British electors whll vote

:46:44.:46:47.

in May. The fear is that most `` those most likely to vote are those

:46:48.:46:53.

most hostile to the European Union. The people with the real power of

:46:54.:46:58.

the commissioners. They are not elected, but chosen by governments

:46:59.:47:03.

and they think up the laws that get voted on in Parliament. I wdnt to

:47:04.:47:07.

see a commissioner from Austria Could you for CNN European Tnion

:47:08.:47:13.

without Britain `` could yot foresee? I think it would bd a

:47:14.:47:21.

disadvantage for both. The TK is a part of Europe. I am convinced, I

:47:22.:47:31.

think positively, I am alwaxs saying I am a member of the glass half full

:47:32.:47:40.

party. I am optimistic that after an intensive information process, where

:47:41.:47:46.

people are discussing the pros and cons, British people will sde the

:47:47.:47:53.

advantages and I hope, I am sure, there will be a majority. If not, we

:47:54.:47:58.

have to live with it. You would say goodbye? Not goodbye, state

:47:59.:48:08.

partners. UKIP think we can leave but still enjoy the benefits of free

:48:09.:48:13.

movement and all of that. Is it the case? I do not think so. If you see

:48:14.:48:21.

the reaction of the European Community after the Switzerland

:48:22.:48:24.

referendum about free movemdnt, it was clear that you cannot continue

:48:25.:48:34.

cherry picking. In a family of 8, may be 30 in the future, thd

:48:35.:48:40.

willingness to allow exempthons becomes lower and lower. I think it

:48:41.:48:50.

would be a great misunderst`nding to believe one can get out and take

:48:51.:48:55.

good things with them. And leave the bad things behind. In that respect,

:48:56.:49:01.

I argue it is better to be hnside, to influence and participatd and

:49:02.:49:05.

contribute, and not to stay out having no influence.

:49:06.:49:18.

Whatever your views on the politics, there is no denying

:49:19.:49:22.

Strasbourg is a beautiful chty, dominated by the cathedral behind

:49:23.:49:28.

me. What about the apparently crazy EU directives? Are they fact or

:49:29.:49:34.

fiction? Robin back in Engl`nd has been trying to find out.

:49:35.:49:40.

We are bombarded by stories in the papers about how Europe is

:49:41.:49:44.

interfering with our lives. The classic is the ban on the bdndy

:49:45.:49:51.

banana, which had a grain of truth, but not all stories are trud. You

:49:52.:49:55.

are about to hear three that appeared in print. See if you can

:49:56.:49:57.

tell the fact from fiction. My name is Tim, I am a fruit

:49:58.:50:16.

wholesaler. In 2008, I was banned by Europe from selling 5000 kiwi fruit

:50:17.:50:21.

because they were one milliletre to narrow in diameter.

:50:22.:50:29.

I am John, I run a balloon shop I just could not believe it when

:50:30.:50:34.

Europe told us we were not `llowed children `` to let children under

:50:35.:50:41.

eight below `` blow`up balloons by themselves. I run a lighting shop.

:50:42.:50:51.

In 2008, the EU banned the hmport and manufacture of the incandescent

:50:52.:50:55.

light bulbs shortly after wd saw an increase in sales as the public

:50:56.:50:58.

rushed in to buy them worridd they could not get the much longdr.

:50:59.:51:04.

Brussels would be delighted to see signs in kilos. You have had the

:51:05.:51:11.

three stories. It was bluffhng? Unfortunately, I have to sax my

:51:12.:51:16.

story about throwing away khwi fruit is absolutely true. I am also happy

:51:17.:51:21.

to say that, since then, thd regulations have been modifhed and

:51:22.:51:28.

are now not so stringent. Mx story was overinflated. However, the story

:51:29.:51:31.

appeared in several national newspapers. Of course, it w`s a

:51:32.:51:38.

lie. Children under the age of eight can lower up balloons on thdir own,

:51:39.:51:43.

but they should have parent`l help. My lighting story is true. The EU

:51:44.:51:48.

did ban the incandescent light bulb. One lady bought 500 pheces,

:51:49.:51:53.

worried she would not be able to get them any more. Can you tell your

:51:54.:51:59.

apples from your bears? Consider it good training. We are about to be

:52:00.:52:05.

bombarded with facts about Durope and it will not always be e`sy to

:52:06.:52:13.

tell who is bluffing. Robin back in England. Next week,

:52:14.:52:18.

Nigel Farage and Nick Clegg will argue on TV. Ahead of that debate,

:52:19.:52:24.

we thought we would get in darly and I am joined by Liberal Democrat

:52:25.:52:30.

Graham Watson and Euroscepthc William Dartmouth. What would the

:52:31.:52:33.

United Kingdom gave if we are out? We would lose a lot. If we wanted to

:52:34.:52:39.

trade, we would have to do what Norway does. We would have to pay

:52:40.:52:43.

more for the privilege of trading ban if we were members but we would

:52:44.:52:48.

lose any say in the setting of the rules. You might be able to do that

:52:49.:52:53.

if you are a small economy like Norway, but not the United Kingdom.

:52:54.:53:03.

We only have 8.24% of votes. That proportion goes down as mord

:53:04.:53:08.

countries joined the EU. Yotr party and the establishment partids are

:53:09.:53:12.

cheerleaders for more countries joining and that means our hnfluence

:53:13.:53:18.

gets less will stop at least Graham Watson admitted, unusually for a

:53:19.:53:21.

Liberal Democrat, that tradd would continue if we left. The sc`re story

:53:22.:53:26.

put around by Nick Clegg and others is the implication that trade would

:53:27.:53:32.

cease. With the EU play hardball and say you will have to queue tp with

:53:33.:53:35.

the other countries and do business on their terms?

:53:36.:53:42.

This is my point. China does not have a trade agreement. The Chinese

:53:43.:53:52.

face tariffs to get goods on the European markets and that could be

:53:53.:53:57.

the case for us. Why is it that Toyota, Airbus group and others are

:53:58.:54:02.

saying, we have got to stay in. Because we would not be invdsting as

:54:03.:54:08.

much in the UK if we were ott. The chief executive 's of those

:54:09.:54:12.

companies are paid to consider what is best for individual comp`nies.

:54:13.:54:18.

That is their view which I disagree with. If you are a politici`n

:54:19.:54:23.

representing the south`west, you have to think of the interests of

:54:24.:54:27.

the people. One of the interests you must consider is the interests of

:54:28.:54:32.

the 95% of British businessds that do not sell anything to be xou. Are

:54:33.:54:38.

you conceding those chief executive say it will be bad for business

:54:39.:54:44.

That is not what they said. They denied they said it. I issudd a

:54:45.:54:52.

press release. There has bedn a string of companies saying ht will

:54:53.:54:59.

be bad for British investment. A whole string of companies h`ve said

:55:00.:55:03.

it will be bad. It is not only investment in jobs, and at ` time of

:55:04.:55:08.

coming out of recession, yot want to make sure this recovery is saved.

:55:09.:55:17.

But it is security, as well. Why are UKIP doing well in the polls?

:55:18.:55:24.

Because we have been in a ddep recession and we are looking for

:55:25.:55:30.

scapegoats. UKIP is essenti`lly an anti`immigrant party. We ard saying,

:55:31.:55:36.

wake up, people, this is serious. If we are outside the EU, we no longer

:55:37.:55:41.

get the security against crhme because of the way police forces

:55:42.:55:46.

cooperate, we do not get jobs and investment, and we do not gdt

:55:47.:55:50.

solidarity in dealing with global challenges such as climate change.

:55:51.:55:57.

UKIP is an internationalist party and you belong to a Federalhst party

:55:58.:56:02.

that wants the UK subsumed hnto a United States of Europe. Th`t has

:56:03.:56:06.

been your politics for 30 ydars which I respect. I do not rdspect

:56:07.:56:14.

when you deny it. We now have a seat on the UN Security Council which is

:56:15.:56:19.

under constant threat from the European Union and your Feddralist

:56:20.:56:24.

friends in the European Union. By staying in the European Union our

:56:25.:56:27.

membership of international organisations is threatened and

:56:28.:56:30.

influence would go down. Is he right? Are you an anti`immigration

:56:31.:56:40.

party? We do not think it rhght or in the national interest th`t

:56:41.:56:47.

millions of people from the other 27 member states have the absolute

:56:48.:56:50.

right to live, work and settle in the United Kingdom. I am a pualified

:56:51.:57:00.

chartered accountant and ye`rs ago there was a shortage of chartered

:57:01.:57:05.

accountants in the middle e`st. I worked in the middle east. H went

:57:06.:57:11.

there on a work permit. I h`d a two`year contract. When it was over,

:57:12.:57:15.

I had to come home. If this shortage... What would you say to

:57:16.:57:23.

2.2 million British people living and working on the continent because

:57:24.:57:28.

they have freedom of movement? Would you say it does not matter to us if

:57:29.:57:34.

they send you home? Are we crazy to pay for all this? We are and we

:57:35.:57:40.

would both agree we should have one seat of operation and if it's had

:57:41.:57:44.

not been for John Major who wrote it in to the treaty, it would have been

:57:45.:57:49.

easy to change. Now time to look at the rest of the

:57:50.:57:58.

political news in 60 seconds. As we were returning from Strasbourg

:57:59.:58:03.

the sad news broke that the former Bristol MP Tony Benn had passed away

:58:04.:58:08.

at the age of 88. He was a popular speaker, writer, anti`war c`mpaigner

:58:09.:58:12.

and held the seat of Bristol south`east for over 30 years. People

:58:13.:58:19.

remember him as a case workdr, a man of Bristol who fought passionately

:58:20.:58:23.

on behalf of Bristol. Wherever you go, people still talk about him and

:58:24.:58:28.

remember him. Many disagreed with his left`wing views, but those on

:58:29.:58:32.

the right praised him to sthcking by his principles. We talk abott

:58:33.:58:37.

politicians and people say xou are all the same. Then they say I wish

:58:38.:58:43.

we could have more like Tonx Benn. You say you are conservativd? They

:58:44.:58:47.

say yes, but he believed in what he said. We will have more on the life

:58:48.:58:53.

of Tony Benn in next week's programme.

:58:54.:59:05.

A taste of the political news back home in the West Country. You join

:59:06.:59:11.

me again in France, at the crossroads of Europe, and the final

:59:12.:59:16.

word goes to our political dditor. He is in Germany. Can you hdar me?

:59:17.:59:23.

Hearing you loud and clear on this side of the border. What is at stake

:59:24.:59:30.

in the European elections in the South West? Lets remember the

:59:31.:59:36.

impetus behind the creation of the EU was to bridge the gap between

:59:37.:59:41.

these two nations and others. What became a common market we joined in

:59:42.:59:46.

the 1970s has grown in size and scope. That is where the controversy

:59:47.:59:51.

comes in. People might have thought they were joining a trading market

:59:52.:59:57.

but it has become bigger th`n that. Are these elections a mini

:59:58.:00:05.

referendum about being in or out, in a sense? Officially, no. But the

:00:06.:00:13.

reality is that that is how most voters will see it. The

:00:14.:00:17.

Conservatives will try to sound sceptical about Europe, votd for us,

:00:18.:00:23.

you will get a referendum in a few years time. The Liberal Democrats

:00:24.:00:26.

and Labour will be saying there should be changes made, but broadly

:00:27.:00:30.

they are happy with Europe `nd they would like to stay.

:00:31.:00:41.

Thanks. And that is it from us. We are back in the studio next Sunday.

:00:42.:00:46.

If you would like to follow us on Twitter, we have put up somd

:00:47.:00:50.

pictures of our adventures hn Europe. And if you would like to see

:00:51.:00:54.

the programme again, you can see it on the eye play.

:00:55.:00:55.

industrial action is a sign of failure marked success. -- not

:00:56.:01:01.

success. Andrew, back to you. Has George Osborne got a rabbit in

:01:02.:01:13.

his Budget hat? Will the Chancellor find a way to help the squeezed

:01:14.:01:17.

middle? And how do Labour respond? All questions for The Week Ahead.

:01:18.:01:25.

And joining Helen, Janan and Nick to discuss the budget is the general

:01:26.:01:29.

secretary of the Trades Union Congress Frances O'Grady. Welcome

:01:30.:01:34.

back to the programme. I know the TUC has a submission, but if you

:01:35.:01:37.

could pick one thing that you wanted the Chancellor to do above all, what

:01:38.:01:43.

would it be? We want a budget for working people, which means we have

:01:44.:01:47.

to crack the long-term problem of investment in the British economy.

:01:48.:01:53.

Certainly I would like the Chancellor to merit that title they

:01:54.:01:59.

want of the new workers party, and take action on living standards but

:02:00.:02:02.

if they're going to do that it's got to be about unlocking investment. In

:02:03.:02:12.

the period where the economy has been flat-lining there has been

:02:13.:02:15.

little business investment, but there are signs towards the end of

:02:16.:02:19.

last year that it is beginning to pick up. But a long way to go. The

:02:20.:02:25.

problem is we have key industries like construction and manufacturing

:02:26.:02:28.

that are still smaller than they were before the recession. The

:02:29.:02:34.

government itself, of course, has slashed its own capital investment

:02:35.:02:40.

budget by half. There is plenty of good and important work that needs

:02:41.:02:43.

to be done from building houses to improving the transport system, to

:02:44.:02:49.

improving our schools. And the government really needs to pick up

:02:50.:02:54.

that shovel and start investing in our economy to get the decent jobs

:02:55.:02:58.

we need, the pay increases we need, and that in itself will help

:02:59.:03:03.

stimulate demand. It was Alistair Darling who cut in 2011, and it s

:03:04.:03:09.

interesting that Ed Balls in his plans for the next parliament would

:03:10.:03:14.

run a current budget surplus by the end of the parliament as opposed to

:03:15.:03:17.

George Osborne who would have an overall budget surplus. That gives

:03:18.:03:22.

Ed Balls or -- more wriggle room to do what you talk about, but he is

:03:23.:03:25.

reticent to talk about it. He does not want to say that he has an

:03:26.:03:28.

opportunity to spend on investment because he fears if he says it he

:03:29.:03:32.

will be attacked by the Conservatives for being

:03:33.:03:35.

irresponsible. Why is business doing this? The recession was deeper than

:03:36.:03:42.

any since the war and the recovery was slower than almost any since the

:03:43.:03:48.

war. The lag, the time it takes to get over that is longer than anyone

:03:49.:03:53.

expected. I read the same evidence as you towards the end of last year

:03:54.:03:57.

pointing to money being released, and it depends what it is released

:03:58.:04:02.

on, whether it is capital investment or bringing in people on higher

:04:03.:04:06.

wages. The one surprise in the downturn is how well the employment

:04:07.:04:11.

figures have done, but they have not invested in new capacity and they

:04:12.:04:14.

are sitting on a lot of dosh. I looked at one set of figures that

:04:15.:04:19.

said if you took the biggest company in Britain, they have about 715

:04:20.:04:24.

billion pounds in corporate treasury -- the biggest companies. I think

:04:25.:04:29.

it's reduced a little but they are sitting on a mountain in dash of

:04:30.:04:35.

skills. Yes, but they're not investing in skills, wages, or

:04:36.:04:39.

sustainable jobs. The new jobs we have seen created since 2010, the

:04:40.:04:44.

vast majority of them have been in low paid industries, and they are

:04:45.:04:49.

often zero hours, or insecure, or part-time. So it's not delivering a

:04:50.:04:52.

recovery for ordinary working people. Government ministers, as you

:04:53.:04:58.

know when you lobby them, they are anxious to make out that they know

:04:59.:05:02.

the job is not done and the recovery has just begun, but the one bit they

:05:03.:05:07.

are privately proud of, although they can't explain it, is how many

:05:08.:05:12.

private-sector jobs have been created. A lot of unions have done

:05:13.:05:16.

sensible deals with employers to protect jobs through this period,

:05:17.:05:19.

but it's not sustainable. The average worker in Britain today is

:05:20.:05:25.

now ?2000 a year worse off in real terms than they were. On a pay

:05:26.:05:32.

against price comparison? It doesn't take into account tax cuts. The

:05:33.:05:40.

raising of the personal allowance is far outweighed by the raising VAT.

:05:41.:05:47.

Does the raising of the threshold which the Lib Dems are proud of and

:05:48.:05:50.

the Tories are trying to trade credit for, does it matter to your

:05:51.:05:55.

members? -- take credit for. It matters that it is eclipsed by the

:05:56.:06:00.

cuts in benefits and know what is conned any more. We're going to hear

:06:01.:06:03.

a lot about the raising of the allowance, but as long as the real

:06:04.:06:09.

value of work, tax credits, things like that, people won't feel it in

:06:10.:06:13.

their pocket, and they will find it harder and harder to look after

:06:14.:06:17.

their family. When you look at the other things that could take over

:06:18.:06:20.

from consumer spending which has driven the recovery, held by house

:06:21.:06:25.

price rising in the south, it is exports and business investment and

:06:26.:06:28.

you look at the state of the Eurozone and the emerging markets

:06:29.:06:32.

which are now in trouble, and the winter seems to have derailed the US

:06:33.:06:36.

recovery. It won't be exports. Indeed, the Obie Eich does not think

:06:37.:06:43.

that will contribute to growth until 2015 -- OBI. So the figures we

:06:44.:06:48.

should be looking at our business investment. And also the deficit.

:06:49.:06:55.

The deficit is 111 billion, and that is a problem, because we are not at

:06:56.:06:59.

the end of the cutting process, there are huge cuts to be made. I

:07:00.:07:03.

understand we are only a third of the way through. That will

:07:04.:07:06.

definitely affect business confidence. It is clear that the

:07:07.:07:10.

strategy has failed. Borrowing has gone up and it's not delivered

:07:11.:07:14.

improved living standards and better quality jobs, so cutting out of the

:07:15.:07:21.

recession is not going to work. The structural budget deficit was going

:07:22.:07:24.

to be eliminated three weeks today under the original plan. They missed

:07:25.:07:31.

target after target. Every economist has their own definition of that. I

:07:32.:07:36.

think Mark Carney is right when he says that fundamentally the economy

:07:37.:07:41.

is unbalanced and it is not sustainable, growth is not

:07:42.:07:45.

sustainable. But if it clicked on, it would be more balanced. It is not

:07:46.:07:51.

just north and south and manufacturing a way out with

:07:52.:07:55.

services, but it is also between the rich and everybody else. What do you

:07:56.:08:01.

make of the fact that there will effectively be another freezing

:08:02.:08:03.

public sector pay, or at least no more than 1%? Not even that for

:08:04.:08:11.

nurses and health workers. But they will get 3% progression pay. 70 of

:08:12.:08:16.

nurses will not get any pay rise at all. They get no progression pay at

:08:17.:08:20.

all. I think this is smack in the mouth. Smack in the mouth to

:08:21.:08:26.

dedicated health care workers who will feel very, very discontented

:08:27.:08:31.

about the decision. Danny Alexander, I saw him appealing to

:08:32.:08:36.

health workers do not move to strike ballots and said they should talk to

:08:37.:08:42.

their department. But about what? Is that real pay cut has been imposed,

:08:43.:08:48.

what are workers left with? So do you expect as a result of yet more

:08:49.:08:54.

tough controls on public sector pay that unrest is inevitable? I know

:08:55.:08:59.

some unions will be consulting with their members, but ultimately it's

:09:00.:09:04.

always members who decide what to do. It does seem to me insulting not

:09:05.:09:08.

to at least be honest and say that we are cutting real pay of nurses,

:09:09.:09:17.

health care workers, on the back of a ?3 billion reorganisation of the

:09:18.:09:20.

NHS that nobody wanted and nobody voted for. Their long-term changes

:09:21.:09:28.

taking place here that almost talks about -- there are long-term

:09:29.:09:32.

changes. It is how lower percentage wages have become of GDP on how big

:09:33.:09:39.

the percentage of profits is. It seems to me there is a strong case

:09:40.:09:44.

for some kind of realignment there. The biggest event of my life, in

:09:45.:09:49.

this world, is the entry of a couple of billion more people into the

:09:50.:09:52.

labour supply. At the end of the Cold War, India and China plugged

:09:53.:09:56.

into the global economy. If there is a greater supply of that factor of

:09:57.:10:00.

production, logically you conclude that wages will fall or stagnate and

:10:01.:10:05.

that has been the story in this country and America and large parts

:10:06.:10:08.

of Western Europe in the last generation. What is not possible is

:10:09.:10:12.

for governments to do much about it. They can ameliorate it at the

:10:13.:10:16.

margins, but the idea that the government controls living

:10:17.:10:19.

standards, which has become popular over the last six months, and the

:10:20.:10:22.

Labour Party have in establishing that, and I don't think it's true.

:10:23.:10:28.

George Osborne's options are astonishingly limited compared to

:10:29.:10:32.

public expectations. If wages have reached a modern record low as

:10:33.:10:37.

percentage of GDP, who is going to champion the wage earner? We have

:10:38.:10:43.

lost Bob Crow, Tony Benn passed away, so who is the champion? The

:10:44.:10:48.

trade union movement is the champion of ordinary workers. We need those

:10:49.:10:53.

larger-than-life figures that we will mess. Have you got them yet? We

:10:54.:11:00.

have a generation of workers coming through. One thing about the loss of

:11:01.:11:05.

Bob Crow is that the whole union movement has responded strongly to

:11:06.:11:08.

that, and we want to say that we are strong and united and here to stand

:11:09.:11:12.

up for working people and we will fight as hard as Bob Crow did.

:11:13.:11:16.

Whoever replaces Bob Crow or Tony Benn, we can be sure they will not

:11:17.:11:20.

come from Eton because they all have jobs in the government. I want to

:11:21.:11:24.

put up on the screen what even Michael Gove was saying about this

:11:25.:11:26.

coterie of Old Etonian 's. He's right, is he not? He's

:11:27.:11:40.

absolutely right. We have the idea of the manifesto being written by

:11:41.:11:46.

five people from Eton and one from Saint Pauls. A remarkable example of

:11:47.:11:53.

social mobility that George Osborne, who had the disadvantage of going to

:11:54.:11:55.

Saint Pauls has made it into that inner circle. Here is the question,

:11:56.:12:04.

what is Michael Gove up to? If you saw the response from George

:12:05.:12:07.

Osborne, there was no slap down and they know this is an area they are

:12:08.:12:10.

weak on an David Cameron will not comment on it. If this had been a

:12:11.:12:15.

Labour shadow minister making a similarly disloyal statement, they

:12:16.:12:19.

might have been shot at dawn. But there is a real tolerance from

:12:20.:12:22.

Michael Gove to go freelance which comes from George Osborne. It's

:12:23.:12:26.

about highlighting educational reforms that he wants to turn every

:12:27.:12:30.

school in to eat and so it won't happen in the future. But it's also

:12:31.:12:33.

pointing out who did not go to Eton school and who would be the best

:12:34.:12:37.

candidate to replace David Cameron as leader, George Osborne, and who

:12:38.:12:41.

did go to Eton school, Boris Johnson. Michael Gove is on

:12:42.:12:45.

manoeuvres to destroy Boris Johnson's chances of being leader.

:12:46.:12:52.

It's a good job they don't have an election to worry about. Hold on. I

:12:53.:12:58.

think they are out of touch with businesses as well as working

:12:59.:13:01.

people. You ask about who is talking about wage earners. Businesses are.

:13:02.:13:05.

They are worried that unless living standards rise again there will be

:13:06.:13:10.

nobody there to buy anything. We are running out of time, but the TUC,

:13:11.:13:16.

are enthusiastic about HS2? We supported. We think it's the kind of

:13:17.:13:21.

infrastructure project that we need to invest in long-term. He could, if

:13:22.:13:25.

we get it right, rebalance north and south and create good jobs along the

:13:26.:13:30.

way -- it could. Thank you very much tool. I have to say that every week

:13:31.:13:36.

-- thank you very much to you all. That's all for today. I'll be back

:13:37.:13:40.

next Sunday at 11am, and Jo Coburn will be on BBC Two tomorrow at

:13:41.:13:45.

midday with the Daily Politics. Remember if it's Sunday, it's the

:13:46.:13:46.

Sunday Politics.

:13:47.:13:49.

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