Sarah Smith and David Garmston are joined by Conservative MPs Jacob Rees-Mogg and Stephen Hammond, plus former spin doctor Alastair Campbell and former Labour MP Gisela Stuart.
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Morning everyone, and welcome
to the Sunday Politics.
I'm Sarah Smith.
And this is your guide
to all the big stories that
are shaping politics this weekend,
and a few of the smaller ones too.
Philip Hammond is getting ready
to deliver his latest Budget
on Wednesday and he's not short
of advice - to spend more,
show restraint, even
to stop being an Eyore -
but can he change the direction
of the country and his government?
Conservative Party darling
Jacob Rees-Mogg has
some advice of his own.
He thinks the Chancellor
is being far too gloomy about Brexit
- he joins me live to explain why.
The former Leave campaign leader,
Gisela Stuart, will be here debating
with pro-EU campaigner
Alastair Campbell, after taking
a trip to her native Germany
to speak to businesses
And, as we wait to find out what's
on the menu for this week's budget,
we're in a diner off
the A1 in Peterborough,
finding out who people most trust
with the economy -
Philip Hammond or John McDonnell?
In the West: A hand
up or a hand-out?
Foodbanks say they're
expecting a busy Christmas -
but is the Government's new benefit
system making things worse?
All that coming up in the programme.
And with me for for all of it,
three journalists who've promised
not to show off like Michael Gove
by using any long economicky words -
although I'm not sure they really
know that many anyway -
it's Tom Newton Dunn,
Gaby Hinsliff and Iain Martin.
Let's take a look at the big
political stories making the news
this Sunday morning,
and as you might expect there's
plenty of speculation
about what might or not might be
in Philip Hammond's Budget.
The Chancellor is promising a big
investment in new technology,
including driverless cars -
which could be on the road by 2021.
He's been interviewed
in the Sunday Times,
where he talks about plans to reach
the target of building
300,000 homes every year,
or the equivalent of a city
the size of Leeds.
That paper speculates that he's
attempting to turn from "fiscal
Phil" into "hopeful Hammond"
as he tries to set out
a vision for the country,
not just a list of numbers.
The Sunday Telegraph thinks that
Mr Hammond is planning to offer
a pay rise to nurses as part
of a bid to take on Labour.
But that hasn't impressed
Shadow Chancellor John McDonnell.
He's spoken to a number of papers
and is calling for an emergency
budget to invest in public services
and help struggling households.
So that's a taste of what you might
hear on Wednesday and Mr Hammond
and Mr McDonnell have both been
appearing this morning
on the Andrew Marr Show.
I think Britain has a very
bright future ahead of it,
and we have to embrace
the opportunities that
a post-Brexit world will offer.
They will be opportunities that
are based on huge change,
huge technological evolution.
It's not always going to be easy,
but the British people have shown
time and time again that we're up
for these challenges.
For many people out there,
this is a depression.
We've had people whose wages
have been cut by 10%.
Nurses, for example.
We've had people who are now...
1.25 million food parcels handed out
in the sixth richest
country in the world.
That's what I call a recession
for large numbers of people.
We will be talking about Labour and
their economic policies in a moment,
but let's start with what we might
expect from the budget. We will talk
to our panel of political observers.
Philip Hammond is under pressure to
set out a bold vision and reset the
government's programme. Can we
No, we can't. We have
heard enough from the Chancellor
across various broadcast and his
article in the Sunday Times. I think
we will not be getting a bold
budget. His precise words short... A
short time ago were a balanced
budget. Some Tory hearts will think.
They desperately want something to
go out and shout about, something to
capture people's imagination, and do
big and bold things, like how on
earth are they going to build those
new 300,000 houses a year? There are
good reasons why he has chosen what
appears to be a pretty staid,
Conservative budget, and that is
that they are probably unable to get
anything bold through Parliament.
His capital is so low among Tory
MPs. If you have a minority
government, it is tricky.
seen ministers on programmes like
this in the last few weeks putting
in the bids for what they would like
spending on, whether it be payment
for nurses or parliament. Would he
struggled to get something radical
through the Commons?
Big ideas cost
money. That's the problem. Bold
ideas are controversial. In some
ways, Tory MPs are asking their
Chancellor to do the impossible.
Government is already doing
something big and bold, which is
Brexit. That has implications for
how much money is available, how
many risks you want to take with
everything else. What is crucial is
that he demonstrates a reputation
for competence. The reputation that
the Conservative government has for
economic competence, that many
people prefer them to Labour on the
issue of economic competence. The
worst thing he could do is come up
with a big, bold idea that
unravelled quickly. What they
absolutely don't want is to come up
with an exciting idea that falls
apart three days after the budget.
He is under pressure from
Brexiteers, who are suspicious of
him. Does he have to offer them
Part of his problem is he
has to offer so many different
people different things. This is
Philip Hammond trying to be and
It is hard to tell
At least in theoretical
terms. His longer-term difficulty is
that, if you look at the economic
cycle, we are getting to a point
where we are probably overdue, if
you put Brexit to one side, overdue
some kind of correction or downturn,
if you look what has happened to
asset prices globally. What will be
worrying for the Treasury is, just
as everyone is saying we should turn
on the taps and build this or that,
we might be at the top of a cycle,
and the Treasury will want to lose
something in the armoury in terms of
probably growing the deficit if
there are economic difficulties in
the next two years, and then there
is Brexit as well.
I think so. Talking to
his friends and colleagues over the
last few days, he had to make a
call, which was precisely how much
can I get away with, with my
political capital being as low as it
is, with the mixed problems he had
at the last budget, and a lot of the
party disliking his approach to
Brexit. He is damned if he is,
damned if he doesn't. Universal
Credit, we are expecting a reduction
in the time it takes to wait,
business rates, affected by high
inflation... I think we will see a
problem fixing budget which will
probably do quite a lot of important
spadework in many areas.
pick up on some of this later in the
Let's speak now to the Conservative
MP Jacob Rees-Mogg, this week
he helpfully launched an alternative
"budget for Brexit" and advised
the Chancellor to be less gloomy
about the consequences
of leaving the EU.
Thank you for joining us. Your
alternative budget is pretty
radical. Almost half corporation
tax, Cap Stamp duty to help the
London market. It seems you are
advocating the opposite from what we
will hear from your Chancellor on
There are two parts to
the proposals I suggested. One is
that we should show that after we
have left the European Union, the UK
is open to the rest of the world. It
is about opening up to the rest of
the world. Secondly, looking at the
modelling that has been done by the
Treasury and some other forecasters,
which has been so comprehensively
wrong. The forecasts made about what
would happen after Brexit have
turned out to be hopelessly false.
The team at Cardiff University have
done some modelling based on the
classical economic principles and
what happens if you move to free
trade that would be very positive
for the economy.
You are predicting
a Brexit dividend of £135 billion,
which sounds fantastic. Why are you
right, and everybody else, including
the Bank of England and the
Institute for Fiscal Studies, why
are they all wrong?
It depends on
the type of modelling. The modelling
that have been done by the Treasury
have been based on gravity models,
which work on the basis of the
nearness of the market and the size
of the economy you are trading with.
These have been wrong in the past.
They predicted that if we joined the
euro, trade would grow by 300%. That
was then revised down to 200%, but
it is fantasyland. The model I am
working on, by Sir Patrick Minford,
who has a record of getting these
things right. He was right about the
exchange rate mechanism, right about
Being right in the past
doesn't mean you are right about the
future. Why do you think the
Treasury will not pick up the same
numbers, if this is so obvious to
I think the Treasury was
humiliated by the errors in its
forecast prior to Brexit, and is
trying to defend its position. The
short-term economic consequences of
a vote to leave was one of the most
dishonest documents to come out of
the Treasury, purely a piece of
political propaganda. They are
wounded by that and sticking to the
same script, rather than looking at
other forecasts and other experts.
You think the governor of the Bank
of England is an enemy of Brexit,
and it sounds like you think the
Treasury is opposed to it. As the
Chancellor fallen under their spell
as well, and been persuaded to be an
enemy of Brexit?
I have admiration
the Chancellor, but George Osborne,
his predecessor, was the architect
of Project Fear. He was too close to
the Bank of England and lost his
independence. That is what needs to
change. It is an opportunity in the
budget for Philip Hammond to show he
is putting aside the Treasury's
mistakes in the past. It is very
encouraging what he is saying this
morning, about a more positive
approach to Brexit.
Lord Lawson has
accused Philip Hammond of being very
close to sabotage on Brexit. He says
we need a can-do man at the Treasury
and not a prophet of doom.
that Philip Hammond is an
exceptionally intelligent man, a
very thoughtful man. It is not a bad
thing to have a Chancellor who is
serious minded and steady, rather
than one who is a showman and uses
the Exchequer to interfere in
I have a lot
of confidence in the Chancellor.
When you launched your budget for
Brexit, you said the government has
to deliver the £350 million for the
NHS that was delivered during the
referendum, even though you didn't
think that promise should have been
made. Is that something they now
need to deliver wrong?
It is. This
only happens once we have left.
Politicians have to recognise that
voters don't look at the small print
of electoral policies. If you put
£350 million on the side of a bus
and say it may be available for the
NHS, it is reasonable for people to
think that is a promise. Brexit was
won by the Leave campaign, so it it
is important that they deliver on
that promise. Politicians must keep
faith with voters and deliver on
implied promises, as well as ones
that are set out in detail.
Cabinet will move on to talk about
the Brexit bill this week, and we
understand they may need to come up
with more money to satisfy EU
demands. The more money spent on
that is less money available for
things like spending on the NHS. Are
you worried about the size of the
You have your finger on
the important point. The government
will have to choose whether to give
lots of money to the European Union,
or whether to spend money on UK
public services, and that will be
part of the negotiation. On all
these issues, it comes down to
choice is the government makes. I
would encourage the government to
choose our own domestic public
services rather than expensive
schemes in continent or Europe.
are you advocating that the
government should spend up to £2.5
billion on a no deal scenario?
It is important that we are ready to
leave in the event of no deal. If we
left with no deal we would on
current figures still be saving the
remains of 18 billion so we would be
saving 15 and a half billion against
paying for the financial framework.
To show we're ready on day one would
be money well spent and most would
be needed any way. We need to have
new customs arrangements in place
even if it is not for a no deal
There are suggestions
that the Government might back down
on the idea of putting the time and
date of leaving the EU on the face
of the bill. Would you be Exxon
certained if that was -- concerned
if that was remove prd the bill?
is in Article 50, unless Article 50
is extended by the Council of Europe
we leave on 20th March 2019 and it
makes accepts that should be the
same in -- sense that should be in
same in domestic law. But that is a
secondary concern from my point of
view. It is important that we leave
on that date.
Stay there if you
We're joined in the studio
by the former minister
He's no relation to the Chancellor,
but he is a member
of the Treasury Select Committee
and he's one of the Tory MPs named
as "Brexit mutineers"
by the Daily Telegraph
this week - lucky him.
I'm assured you're no relation to
the Chancellor. Let's just pick up
on what Jacob Rees Mogg was saying.
How important is it to you as a
rebel that the Government does put
the date on.
I agree with Jacob it
is in the Article 50 process, the
key reason it is important is the
negotiations look like they're going
to be tricky and longer than we
expected and it may well be that we
are still negotiating up until March
2019. We could have a short couple
of weeks period of extension. Why do
harm to the economy by falling out
on a precise time? If those
negotiations need to be extended.
They won't go on for more than a
couple of weeks, because there will
be elections in Europe in June 2019
and there is no chance of a new
commission or Parliament dealing
with this. Giving it flexibility and
with this flexibility the government
said it wants flexibility in
negotiations, why give all the
advantage to the other side? Part of
that was evidenced yesterday by
somebody suggesting they will ask
for the Margaret Thatcher rebate to
be suspended. That is as a result of
putting the date on the bill.
did not agree with the Brexit
committee and think it is important
that we set the date and time?
think it is perfectly reasonable to
set the date and time and I think
these negotiations fill the time
available. The United States and
Australia agreed a free trade deal
between April 2003 and February
2004. These things don't need to be
interm Knabl if both sides want to
agree. I think the British
electorate would be very concerned
if nearly three years after the vote
to leave, we still hadn't left. I
think most people expected that we
would have left by now. The
negotiations realistically to get
through the approval of the European
Parliament and so on need to be
completed by at the end of next
year, going up to the last minute I
don't think is real is tick.
on to talk about a trade deal and
getting that done, the EU need to
agree to move on and we need to
settle the divorce, cabinet are
going to be talking about the amount
that needs to be spent on that,
Stephen what manned, are you happy
for the Government to offer more?
hope that the Government will stick
to the Florence speech in terms of
ensuring that we fulfil our
liabilities and obligations. I'm not
clear exactly whether that is 20
billion or 40 billion and I'm not
sure the government is. If part of
the divorce bill is then some
settlement for getting the trade
deal, we will need to examine that
Jacob Rees Mogg, is this
that might spark another war in the
party if the cabinet suggest they're
prepared to pay more?
I think we
need to go back to what you said,
that the - the EU said they want us
to settle the money first. The
Government doesn't need to follow
that. They need our money. If we
don't pay any money for the final 21
months of the framework, the EU has
about 20 billion pounds gap in its
finances and it has no legal
requirement to borrow. So it
insolvents or the Germans and the
others pay more. So our position on
money is very strong and we
shouldn't fall into the trap of
thinking just because Mr Barnier
said it it is as if he has received
tablets of stone like Moses, he has
There is a sense that the
Government feels a mo generous offer
would set a good tone, the kind of
approach that Jacob Rees Mogg
suggests would not make for smooth
It probably wouldn't. But
we have to be clear what we are
paying for and what we are getting.
No one is suggesting we should hand
over money without proper scrutiny.
It may be appropriate to put money
to facilitate international trade to
secure jobs. We have to be careful
about the analysis about what the
scale and size of Brexit dividend is
and the size of payments will be.
You mustn't confuse gross and net
and there is disagreement about some
of the numbers.
On that, Jacob Rees
Mogg in his budget for Brexit
suggests in five years time we would
have a 135 billion Brexit bonus. Do
you think it is real is tick.
using some analysis that has some
flaws. It is predicting a price drop
in the United Kingdom of 10%. Tariff
drops will only be 3 or 4%. It is
predicting huge productivity gains,
the likes of which we have not seen
in 20 years. Thirdly, despite his
view on modellers there is evidence
that they weren't and if you go into
the detail of the analysis, some of
the data is 14 years out of date.
Jacob Rees Mogg, you're being
I don't think
that right. I think the fall in
prices comes because you make the
economy more competitive and you
take away tariffs which reduces the
price of food by 20%. That is a big
reduction. Bear in mind that the
biggest tariffs hit food, clothing
and foot wear that, harm the poorest
in society the most. The gains from
productivity come from is in
additional tariffs. Leading to other
saving and further investment I
think the modelling done by the
professor is as good as modelling
can be. That doesn't mean it is
infallible. The failure of gravity
model is well known.
was accused of auditioning for the
job of Chancellor by using long
words. Do you know any good long
I don't think that
we want to get into this type of
business actually. I think all
Conservatives and Steven and I very
much agree on this, want to show as
united a front as we can manage.
There are differences on some
aspects of policy, but in terms of
individuals we want to stand
together and support the best
interests of the government.
Brexit Secretary David Davis
was in Berlin this week trying
to win the support of business
leaders there for a comprehensive
free trade deal with the EU.
He warned them against putting
'politics above prosperity'
and reportedly got a bit
of a frosty reception.
Well, the former Labour MP
Gisela Stuart was one of the leaders
of the Vote Leave referendum
We travelled with Gisela to Germany
to meet the business leaders
she says will help secure a good
trade deal for the UK.
Here's her film.
I was born and brought up
in this part of Germany,
and although I've lived in the UK
for the past 40 years,
and represented the constituency
of Birmingham and Edgbaston for 20
years, my family still live here,
and I've kept many links.
I was chair of Vote Leave,
and together with only a handful
of other Labour MPs,
we campaigned to leave
the European Union because we
thought the country would be
better off outside.
It's hard to remember now, but back
in the 1970s, when we joined
the European Economic Community,
people thought that by joining
the club we would see the kind
of economic miracle Germany
experienced in the '70s back home.
The "Deutsche Wirtschaftswunder"
would come to Britain.
But, of course, it didn't.
Within a few short years
of the devastation of World War II,
Germany had emerged as
the largest economy in Europe.
success is down to
the pragmatism of its business.
German Mittelstand is family
long-term thinking, reliability,
are very important values.
Changing moods on a political
landscape and changing frameworks
are toxic for our way of doing
business, and we want
that to go away.
German business is not given
to making big political statements
out of step with government policy,
but talk to those in decision-making
positions, and it is clear
that they want to secure a good deal
with the United Kingdom.
BMW employs almost 90,000
people here in Germany,
and exports just under
1 million cars annually.
The UK is a vital market.
What we are really seeking right now
is more clarity, more certainty,
because in our cycle of investment,
cycle of development,
it's about a seven-year or so period
that we look at,
but we are now, of course, starting
to think about what comes next,
and what we need to see now
is what is going to be
the trading relationship,
how are the logistics going to look,
what is going to be
the requirements for people
moving across the continent?
Because all of these things
are important to us today.
And, by the way, they will be just
as important tomorrow.
Berlin is well aware that
if the European Commission
is allowed to put up trade barriers
against Britain, it will be
German business, German consumers
and German employees
who will suffer.
I think it's very
important that we complete
the first phase successfully.
The first phase of the negotiations,
which looks at the financial
consequences of Great Britain
leaving the EU.
And then it's not a question
of punishment payments.
It's about when you are part
of a multilayer, contractual
obligation and you want to leave
that, then of course it takes
a whole lot of obligations
which you have to deal with,
so both sides are satisfied and can
live with the consequences.
It isn't everyone's interests
for the UK to part on good terms.
Of course there was going to be
upset when the UK voted to leave,
but creating uncertainty over
the terms of UK's exit will simply
have a disruptive effect
on exports to UK markets.
Far better to have a sensible,
amicable negotiation that results
both sides being able to trade
together and work
Markus Krall is managing
director of Goetzpartners,
and heads the Financial
Institution Industry Group.
Is it true to say that,
if we negotiate Brexit well,
then a good Brexit can actually
strengthen the United Kingdom,
the European Union and Germany?
It's absolutely true.
I think that this
is about two things.
One, about proving that
free trade is possible
between a European Union that is
smaller and a former member country.
If you don't prove that free
trade is possible there,
then the question becomes,
what is Europe standing for?
Number two is, I also
believe the free trade,
free market and democratic and less
bureaucratic approach that Britain
has chosen as the path
into the future is a role
model for Europe.
The time has come both
for the United Kingdom
and for the EU to be more clear
about what kind of
deal we can achieve.
Both sides need to be bold.
As long as we remain open to free
trade and sensible co-operation,
we can arrive at something that
will benefit both sides.
But one thing's obvious -
if we are an open and free trading
economy, we've got one big
cheerleader on our side,
and that is German business.
That was Gisela Stuart
setting out her case
and we'll be hearing
from the opposite side
of the argument in the coming weeks.
Gisela Stuart joins us in the studio
now, as does Alastair Campbell.
He used to work for Tony Blair
in Number 10, set up
the New European Newspaper
to campaign against Brexit,
and is so pro-European that at this
year's Labour conference
he was heard playing Ode
to Joy on the bagpipes.
Welcome both of you.
We will start with your point in the
film, that you think the German
business once the EU to offer the UK
a generous deal because it is in
their interests, yet the president
of the German equivalent of the CBI
said that defending the single
market must be the priority for the
EU, and another says that the
cohesion of the remaining member
states remains the highest priority.
The president of the CBI just after
the referendum said that it would be
in nobody 's interest to introduce
tariffs and trade barriers. On the
UK side, I don't think there's a
full understanding that economic
interests are incredibly important,
that they are trying to cover
economic interests on the cohesion
of the 27. I think different
economic interests will raise the
head of different countries. The
German auto industry is as important
as the financial sector is here. The
banking crisis is far from over, but
the big riffs which were going on is
that the E U is losing its second
biggest net contributor. Countries
like Germany want a deal with the UK
that is a free open market. There
are other tensions in the EU that
wants to become more protectionist,
and that is a bad thing.
the film there with the Jacob
Rees-Mogg interview. No matter what
side of leave you are, it is
delusional and all driven by wishful
thinking. You could find a
businessman who says Brexit will be
good for Germany. The vast bulk of
British businesses think this is a
disaster, as do the vast bulk of
European businesses. One of the
delusions on which they ran their
campaign is the idea that they need
us more than we need them. That is
Be you self about £80
billion more in goods and services
into the UK than we do to them, and
Germany has one of the biggest
deficits. It is in their interest.
Of course it is, but it is a myth
that they need us more than we need
them. The damage that will be done
to us, even with a good deal. Let's
be frank, where these negotiations
are, Theresa May is either going to
end up with a bad deal and dumber or
no Deal. A bad deal is bad, and a no
deal is a catastrophe.
setting up ideas that which were not
there to begin with and knocking
them down. Delusional.
the Brexit bonus.
If we had a
referendum, it was a democratic
decision. I know you don't like it
and that a lot of business would
have preferred to stay with the
status quo. We have had the
referendum. Undermining political
institutions is in no one's
interests. It is functioning
democracies which lead to economic
Theresa May fought an
election Inc on a hard Brexit that
As we heard from BMW,
there is uncertainty for business.
There will be elections, European
elections, in 2019. There will be a
change of the Commission and the
parliament. We have a narrow window
to implement the mandate for the
referendum which Parliament voted
for. So rather than you undermining
this country, why don't you work
together to get the best deal?
Because we totally disagree.
don't want a good deal?
favour of a good deal, and I could
give them some advice as to how they
get a good deal. First, you have a
cabinet that has an agreed strategy.
18 months in, they don't have that.
I am not undermining a deal. I am
continuing to pose questions about
what they are trying to do and how
they are trying to do it. This is
democracy. Democracy is the ability
for Parliament, which is not doing
its job properly, and the public, to
keep scrutinising, and if they want
to change their mind, having the
right to do that.
You were trying to
encourage the Taoiseach yesterday to
play hardball with the UK.
I am on
the side of the UK, and I am worried
that if we go down the path that we
are being taken down, and Theresa
May and Boris Johnson and the rest
of them, this shambolic path, we are
going to do fundamental, lasting
damage to the country we love. I
don't care about the Civil Aviation
Authority. I care about Britain. --
I don't care about the European
Union. If every lorry going into the
UK today was stopped for just two
minutes, we would create an instant
17 mile traffic jam. These people
just don't care...
I am not these
people! Let us not conflate... You
either decide that you are
implementing a democratic decision
of a referendum that was called and
over 17 million voted.
You will not
stop me debating it. Just as Nigel
Stop talking about Nigel
Farrell Raj. Vote Leave was not
Nigel Farage. There is no desire in
Germany to punish the United
They are behaving
There is a battle of
protectionism and free market going
on. If we implement this properly,
give businesses the kind of
incentives they want, we can get a
good deal. So you want a bad deal?
You are driven by wishful thinking.
Gisela Stuart, you are saying that
business will intervene to prevent
things like tariffs being put in
place? They are leaving it a bit
late to put pressure on.
find that business is laying out the
kind of things they need to get
those deals. I can find as much
fault with the speed of the
progress, but what I really do
resent is that you are actually
encouraging other countries to
Know I am not! I spoke
out in support of the Irish
Taoiseach because I spent a lot of
time with Tony Blair and his team on
the Good Friday Agreement. The
people who are driving this hard
Brexit without thinking it through,
still no answer on how you do Brexit
in our island without a hard border.
I think the Irish Taoiseach is right
to call out the government on the
incompetence and the fact they have
not thought it through.
the result of the referendum and the
fact that we will be leaving the EU?
I accept the result of the
referendum, but I do not accept that
the country will definitely leave,
because the country is entitled to
change its mind. As the chaos and
costs mount, the public is entitled
to change its mind and will change
There is no evidence at
Come out with me!
me to finish the sentence. There is
a changing of mind happening, a
crystallisation. Unlike you, I have
fought five elections and I have won
five elections. I have probably
spoken to more people like you.
may do, I'm just saying, come out on
the road with me...
40% of the
population in the middle just want
us to get on with it. What that film
showed is that if you want to make
it a self-fulfilling prophecy that
it's a disaster, which I don't. I
want to implement a deal that is
good for British jobs. The rest of
the world is changing in terms of
technology. Currently, Germany
hasn't even got a government, and
nobody is laughing about that.
they are stable without a
Let's leave it there.
It's coming up to 11.40,
you're watching the Sunday Politics.
Coming up on the programme,
we'll be looking at the latest
opinion polls and we'll bring
you the results of our moodbox
asking whether Phllip Hammond
or John McDonnell should be running
Good morning and welcome
to a live edition of
Sunday Politics here in the West.
Coming up: To fund or not to fund?
Austerity has meant big
cuts in grants for local
But should our taxes be
funding the arts at all?
I'm joined by two politicians
who have promised dramatic
performances this morning.
They are the Conservative MP
for Salisbury, John Glen,
and the Labour MP for Stroud,
Welcome to you both.
First, the papers are full
of all sorts of speculation
about next week's budget.
And the Chancellor was on the Andrew
Marr Show this morning.
He seemed to drop big hints
that he will announce
new measures on house-building.
To start to make inroads on the
affordability problem, we've got to
be sustainably delivering around
300,000 homes a year on average
across the housing cycle. That's a
big step up from where we are now.
There is no single magic bullet and
it's certainly not just about
putting money in because if you pour
money in without fixing other
elements of supply, you will lead to
inflation which makes the problem
worse, not better.
John, what is the average price of a
house in Salisbury?
Too high, too
high for young people to get on the
ladder and that's a challenge across
the country and I'm glad the
Chancellor seems he is going to
include it in this budget.
beautiful area, would you welcome
new housing estate in Salisbury?
It's a difficult issue and lots of
people campaign about where new
housing needs to go but the
Chancellor said the issue is not
just about more money it's about the
processes and there are large
numbers of permissions granted
across the country and houses aren't
Stroud isn't cheap
either, is it? Do you think the
Government can actually deliver and
It can, but it can
help local authorities. I have asked
the Government, we have bought our
stock from the Government and we now
have Stroud district council
completely owning the stock. We need
the Government to get off our backs,
allow us to borrow and stop taking
70% from their council houses sold.
We want to borrow to build council
houses goes we need affordable
social housing, not more executive
housing. . We need cheaper houses
for people to rent and buy from the
council but it's got to be at the
lower end of the market. We do not
need more executive housing. That's
They make a profit.
course they do, and that's why we've
got to change it.
It's about houses
for young people, lots of young
people are desperate to get on the
ladder and it's about making sure we
put the right incentives in place.
There will always need to be some
council housing. In Salisbury we
have seen new council housing. Quite
a lot. I don't know the exact number
but we have seen more council
housing. It's about a pragmatic
solution, not an ideological view,
and each area has a different
challenge in finding the right site.
I know the Chancellor will know
about the processes as well as the
John Glen, what could
the Chancellor announce that
would help your constituency?
You could get off our backs -- he
could. We want more affordable
social housing and that's where the
pressure has got to be, the state
has got to play its role but we've
got a job house-builders -- we've
got to tell the house-builders.
think it is fixing the issues were
permissions granted for planning and
people aren't building. He has to
deliver on that.
Take the land away
from them if they don't use it?
it or lose it. I have been looking
for permissions so that people are
under obligation to build the houses
they have planning permission for.
We need radical solution because
this problem has gone on far too
There's speculation the Government
may be forced into making changes
to its new benefits system.
Universal Credit is presently being
rolled out across the West country.
But in areas like Somerset,
which went first, people say
they have to wait 40 days before
they receive their money.
Here's Paul Barltrop.
In a prosperous town
in one of the world's
a sign of poverty.
At Taunton's foodbank,
they're about to open the doors.
If they have got benefit
changes on their vouchers,
could you just ask them what benefit
they are on and what their date
is for Universal Credit to start?
Staff are all too aware
of the Government's new benefit.
This young family have applied
for it, but it may be six
weeks before the first
payment comes through.
Right now we're trying to get
by because we've just
got Universal Credit,
we've just done all the meetings,
I got one more meeting to do
and then I go to wait at least 40
days is just getting by those
40 days will be hard.
Unemployed Andrew Harvey
is about to be transferred
onto Universal Credit.
It means I've got an extra month
to survive and I may have to survive
at least six to eight weeks before
I have any money to buy any food
or pay any bills and stuff,
which is paid fortnightly.
Will that be difficult?
It will be absolutely
Universal Credit came
to Taunton a year ago.
Since then, the foodbank's seen
the number of people
seeking help jump by half.
We were shocked, actually.
We had an idea that Universal Credit
was coming to the Taunton area
so we were prepared for a small
increase, but nothing
like the figures we've seen.
Personally, it's very difficult
to see people at such a loss of not
knowing what to do and that such
a low ebb, really.
The 50% rise recorded in Taunton
is one of the biggest.
At Bath's foodbank, the year
on year increase is 39%.
Nationally, the Trussell Trust say
they're seeing an average surge
of 30% after Universal Credit
starts rolling out.
That compares with a 12% increase
in areas where it's not yet arrived.
Visiting Bath on Tuesday, the former
Prime Minister Gordon Brown spoke
out not just about how
Universal Credit's being handled,
but also wider cuts
in welfare spending.
They simply have not put
the resources in to do it
and worse than that,
they're cutting £3 billion out
of the amount of social security
expenditure available for poorer
people and therefore it is bound
to be a disaster and it
already is a disaster.
It's been raised
repeatedly in Parliament.
On Wednesday, Labour
again went on the attack,
though the Prime Minister's defence
wasn't quite as robust as before.
There have been concerns raised
in this house previously
over the issue of people
managing their budgets to pay rent,
but what we actually
see is that over...
We see that after four months,
the number of people
on Universal Credit in arrears has
fallen by a third.
claimants end up here.
The roll-out of Universal Credit has
just started in Stroud.
The local Credit Union
is already giving out loans
to tide people over.
But one recipient tells me,
delay aside, the new system
is an improvement.
For me, going on to Universal Credit
is completely changed
my life for the good.
It put the focus of my finances
on myself and I was in control
of what I had to do,
and it's a much more simpler system.
I haven't got six different
benefits, you've just got one
where you pay once a month and,
to me, that is a godsend.
It's so much more simple.
There's been ongoing
controversy since the national
roll out began in 2015.
It's not due to be finished
for another five years.
John, most people seem to agree
Universal Credit will be beneficial
to most people but getting on it,
there is this painful gap of 40
days. I couldn't manage without
money for 40 days, could you?
to remember everyone moving on to
Universal Credit also has access to
emergency payments to tide them over
to when they get that first payment
and I think the Government are
looking at it and is a lot of
they seem to have dug
We've got a recognised the
massive advantage in the film said
about having a single payment.
People are very frustrated to see
Gordon Brown back from his demise
talking about more benefits. It was
them that created such a complex
system that left people in a very
Did you cope
without money for 40 days?
That is a
mechanism... I have in the past, I
have struggled, I have had times in
my life, is not ideal and
unsympathetic, we've got to sort it
out but the Government have ruled it
out over a long period to try and
get it right -- rolled it out.
Across the political spectrum,
people think Universal Credit is
beneficial so it has got to be
rolled out somehow, hasn't it?
but it's got to be pulled out
property and the difficulty is it's
a loan. It's a loan shark. For all
the complexity of tax credits,
people were substantially better
off. Now they're not. The child
poverty action group brought out a
report a week ago that showed this.
Google is the benefit into one but
two goals less benefits into one --
it rolls less benefits into one but
it rolls less benefits into one. We
found I guess today there because
December is a five-week month, we've
now got the ludicrous situation that
thousands of not millions of people
could be forced off the Universal
Credit for a period of time and then
have to reapply, it's madness. We
have to get it right then we will
join with the Government and see how
it could work properly.
Posit, get it right, stop
how would you get it
The migration of people is
where the real issues are going to
come. Housing benefits are going to
be a nightmare.
I think you've seen
thousands of people move on to
Universal Credit. It can be a
difficult transition but when that
transition is made, people value the
fact they got a simpler benefit
system. It incentivised as... Work
and fewer people are likely to be an
said the benefits budget is less
than they used to get.
I don't think
there is a great public appetite to
be increasing benefit payments.
We've seen a record number of people
over the last seven years in
unemployment. We've got the lowest
unemployment. We need a benefit
system that looks after the most
vulnerable but also create
incentives to get into work.
John, the Trussell Trust is based
in your constituency.
Why do you think more people
are using food banks?
When I looked at this on an
all-party basis a few years ago. We
found a number of the people using
foodbanks had a number of issues in
you haven't got any money
coming in, you have to use it.
tip of the iceberg, there's lots of
complexity in people's lives that
makes them happy Woodruff the bank.
I acknowledge there are challenges
with the delivery of benefits in
some circumstances and I think the
Government is working hard to
address it. We may see some
announcements next week.
posit and then all work together to
get the system working together. It
is too important that we don't drive
people into poverty.
They say all the world's
a stage and we are all
players, coming and going.
But in Britain, we are pretty good
at strutting our stuff.
Britain punches above its weight
in film, television and the arts.
But funding at a local
level is being reduced.
Martin Jones has been
getting a fix of culture.
It's called the most popular
art exhibition ever.
A landmark show at Bristol's
Arnolfini by Turner Prize
winner Grayson Perry.
And it's relied on public funds,
despite its popularity.
I do the kind of art that people
like to come and see.
It's got lots of man hours in it,
it's pretty, it's got relevant
issues that they're interested in.
It's bang on, so no
wonder it's popular.
200,000 people can't be wrong!
This will be the last exhibition
here at least until next spring.
Arts Council funding has been
generally steady in the West,
but Arnolfini has lost its grant.
It means the future
is somewhat fragile.
Another source of funds has
seen a dramatic decline.
Our local councils gave grants
of just under 23 million in 2010.
That was down by over
40% last year to 13.5.
Many have made further
cuts since then.
At the Rondo Theatre in Bath, then a
final rehearsals for a new play by
Pippa Thornton. The Rondo used to
get about 8000 a year from the local
council but there have been huge
cuts to its arts budget and they now
get nothing. Acting workshops,
writing classes and afternoon
concerts for older people have all
taken their final bow.
It's not just about giving money
to luvvies to prance
about on a stage, it's
about supporting local art so that
new work can take place so that Bath
doesn't just become a monoculture
of heritage wonderland and local
pubs and restaurants get the benefit
from our passing customers.
Support for funding the arts from
the public purse has been dwindling.
Why should I be forced to buy art
that they don't want? It could be
that you positively disapprove of
it. Art isn't like other goods in
that it can be more controversial,
it has ideas and values associated
with it. I don't make the idea of
the state having a role in
determining where the money goes in
art because they are all too
inclined to use it to peddle a
certain ideological agenda.
couldn't accuse Grayson Perry of
Somebody said to me, what do
you feel about the fact that public
money is going on that nobody likes?
My responses, a lot of my tax money
goes on weapons I don't like so I
think it is small fry compared to
It is a
polarising debate. To fund or not to
fund? That is the question.
We can survive without acting
Now we can't. The arts are part of
our culture and we need to fund
them. It's a difficult time because
austerity has had this area harder
than anything else because it was
always discretionary in terms of
local authority payments and sadly
we are now seeing is going backwards
to where we were a generation ago
and there are lots of things that we
support and is -- it's wrong to
say... They make their case as we
You're competing against the
big departments need money for
housing and for defence and
education and the NHS. Where do you
come down the pecking order?
we recognise as a Government that
the arts are critically important to
people's well-being, sense of place,
and we also see a combination of
funding sought sometimes you see the
local authority coming in with a gun
from the Arts Council and in the
South West we have had more money
this last year from the Arts Council
than in the previous year and we are
seeing more money coming out of
London across the regions from the
Arts Council, that is direct
Government funding, so I think we're
seeing people moving together,
combining their arts offers. In
Salisbury and Bristol bid is a large
number of artists seeking funding --
there are a large number of artists
seeking funding. There are
challenges to funding but the impact
in terms of the economic impact of
investing in the art is very
When you add in Downing
Street and saying this to the
Chancellor, what does he say to you?
Is very sympathetic. If you look at
the South West and the Government
money that comes through the Arts
Council it has gone up in the last
year sought is not as bleak as you
suggest about 13 million from the
Is there any public
spending that you wouldn't approve
Trident, I think that is
unnecessary. I know it's Labour
policy but some others disagree --
some of us. The reality is we need
debates on this whole area of what
the state should be involved in. To
my mind, the state coming out of a
steady which I hope we will do under
a Labour Government, we've got to
prioritise spending on education, on
health and on benefits because our
people are suffering and we want a
strong economy, but it can only be
strong with decent public spending.
If that means tax rises, so be it?
With the opposition, it would be
nice to know what happens on
Wednesday whether the Government go
for a tax rise. I suspect they will
because they know we've got to fund
the health service more, we've got
to get education funded because our
schools are broke.
We don't want to
get into a situation where we spent
500 million on interest payments.
Viewers will be interested to know
that over 500 billion over the last
seven years has been spent on debt
interest. The previous Labour
Government run that up.
Next week I hope we
will see a budget that takes
irresponsible line investing in
economic growth, investing in young
people, investing in housing, but we
also need to invest in our public
services so I hope the Chancellor
will be able to find some money for
the NHS and the hard-working people
who have struggled for several
years. It's not as simple as one
thing at the other, we need
responsible investment and we can't
get into a situation where we are
spending 10% of our expenditure on
debt interest payments.
mean higher taxes?
It means a
balanced approach in the long term.
Let's take a look at the rest
of the week's political
news in 60 Seconds.
Bristol has declared
war on litterbugs.
Council patrols fined more
than 600 people for dropping
rubbish in just one week.
But is it environmental protection
or an easy way to raise money?
If they don't give the correct name
and correct address,
then they are liable to be taken
to court for prosecution.
300 jobs are to be cut at Bath
and North East Somerset
Council to try to plug
a £16 million funding gap.
The council will also ask
the Government for extra cash.
Councillors in Swindon
have given the green
light to a new ice rink,
cinema and hotel.
They'll be built around the town's
Oasis leisure centre.
It should certainly make a splash.
And there were pro and anti-Brexit
marches in Stroud yesterday.
One group said Brexit means exit,
another waved EU flags.
The two sides don't agree on much -
they even argued on Twitter
about how many people turned up.
That's all from us this week.
My thanks to my guests,
John Glen and David Drew.
Don't forget you can follow us
on Twitter for the latest updates.
And you can watch the show back
on the iPlayer, too.
But for now, it's back
to London and Sarah.
Philip Hammond will deliver his
Budget on Wednesday -
he's moved it to the Autumn
if you remember - and he'll be
hoping it can help re-define
the Government in the eyes
of the public.
But when it comes to
the economy, do people trust
the Conservatives, or Labour?
Here's Ellie Price
with the moodbox.
MUSIC: The Road to Nowhere
by Talking Heads.
All eyes will be on the Chancellor
this week as we find out
what he has been cooking
up in his Budget.
So we have pulled off the A1
near Peterborough to ask people here
who they trust with the economy -
is it the Chancellor,
Philip Hammond, or is it
Labour's John McDonnell?
Which one's Tory?
I voted Conservative
for the last two
elections, don't feel very confident
now, so I'm going to swap.
If I said to you which
of these characters
would you trust with the economy,
what would you say?
The one who's currently
running it, because they
seem to be bringing
the deficit down.
Because I'm an NHS worker.
For me, it's just about
spending, public spending.
Labour always overspend.
John McDonnell, I think
capitalism as we know it is tanked
and I think we need
a radical re-think.
Broken his egg, who do you trust
more on the economy?
Because they never come up trumps
with anything that they
reckon they're going to do.
If I had to make you
choose one of them?
The man that's there, Hammond.
I wouldn't trust
Philip Hammond with a
bag of marbles or a plastic ball!
Who do you trust
more on the economy?
Oh, the Conservatives.
I just think they're better
for the small businessman.
We need a Maggie or
a Winston Churchill,
somebody in there with
balls to say, right,
that's the direction
going in, that's what
we are going to do.
I've got balls!
What are you doing?
Putting balls in holes
by the look of it!
I suppose the lesser of the two
evils is anything but Tory,
but I say that without a great
deal of conviction.
Having grown up in the '70s
with all the rubbish on the
streets, the strikes, the unions.
Re-nationalisation and they're
going to spend a lot of money
and increase taxes and it will pull
the country down.
I've seen an awful loft of all-day
breakfasts today, but it
is clearing up time here
at the diner and time
to reveal the Moodbox.
Take it away, Tim.
As you can say it was
a close-run thing, but
like any fiscally responsible
Chancellor, I've done my maths and
counted and Philip Hammond got six
more votes than John McDonnell.
Oh, chip, thank you very much!
That was Ellie and the entirely
at the Stibbington diner near
But for a slightly more scientific
understanding of how the public view
the parties on this and other
issues, let's have a look
at some recent polling.
Here's where the Conservatives
and Labour stood on the economy back
when the Prime Minister called
the snap election in April,
when the Conservatives had a big
lead, as they did in many
The most recent poll by the same
company reckoned Labour had narrowed
the gap significantly,
as they have in other areas,
although they're still 10 points
behind the Tories on this issue.
And there was another survey much
discussed at Westminster this week,
showing that while the gap
between Theresa May
and Jeremy Corbyn has narrowed
drastically since that pre-election
period, Mrs May is,
despite her many problems,
still pretty much level-pegging
in polling terms or
even slightly ahead.
And when it comes to how
people intend to vote
while the Tories are behind,
there's no sign of a
big Labour lead yet.
Tony Blair thinks that,
given the current "mess"
inside the Government,
Jeremy Corbyn's party should be
10 or 15 points ahead.
Well, many in Labour will find it
easy to dismiss both Tony Blair
and the opinion polls, as they both
called the last election entirely
wrong, so what if anything do
these polls tell us?
Let's turn to our expert panel.
Labour are now eight points on the
economy, according to a poll. Why is
there a gap between Labour and the
There seems to be a
deep-seated reservation in the minds
of many voters. They look at Jeremy
Corbyn and John McDonnell and
imagine them in charge of the
country, the finances, national
security, and think... It is
unfashionable to point out in many
circles that Labour did not win the
last election, and it didn't win it
for that kind of reason. Jeremy
Corbyn is very good at attracting
and inspiring young people and
people who had not voted before. We
underestimated his capacity to do
that. But he wasn't great at turning
Tories to Labour, or sealing off
those final reservations. The
government have had a shambolic few
weeks. We are tripping over
resigning a cabinet ministers. They
are fighting like ferrets. A lot of
people are having a really tough
time and looking at the government
to help them, and are unimpressed
with what they see. But there seems
to be a final fence that Corbyn does
not seem to be able to get over.
Isn't Tony Blair right, that Labour
should be 15 or 20 points ahead?
think he's completely wrong, and is
revealing he is out of date. I think
Labour are in a really good
position. If you look at what they
have achieved in the last year,
going into Christmas 2016, Corbyn
had just managed to avoid, had to
re-fight Labour leadership contest.
They were 20 points behind. Theresa
May was at the top of her game.
Through the general election and
beyond it, they have continued to
build their movement. They are very
effective on social media. I think
they are in a strong position, and
they need about 60 seats to win the
next general election. They will
probably start with 25 of those. The
fact that they are closing the gap
on the economy suggests that a lot
of voters are now giving them a
chance or a hearing, which they
certainly were not getting a year
ago. I think they have done very
Can they be confident with a
slim lead against the government?
am slightly more with Tony Blair
than with Iain. This goes back to
that very general election result. A
huge turnout for Labour for Jeremy
Corbyn. If you asked that same 40%
of people today, do you want Jeremy
Corbyn to be Prime Minister? Where
you really voting for Jeremy Corbyn
to lead the British governmentanswer
is no, because Theresa May still,
despite the fact she is presiding
over a shambolic cabinet, she has
the most support for Prime Minister.
The last general election may have
just been a giant by-election,
because everyone was so short that
Theresa May would get in.
Chancellor Philip Hammond gave
Labour a bit of a gift, when he
said, there were not any unemployed
people in Britain. A slip of the
tongue. Was that damaging?
to look at the context he was saying
it in, which will not be the context
of the Facebook meme you will get
shortly. He was asked about future
unemployment, and he was saying that
when technological advances came,
unemployment didn't materialise.
They would not be able to use that
against him so easily if it didn't
have something that people think
about the Conservative government,
which is that they are out of touch,
they have no idea about some people,
that they refuse to see what they
have done. People have that idea
about the Conservatives, so to drop
a bit of a clanger in that regard...
The budget is on Wednesday, and also
this week, the Brexit committee will
be meeting. What will they be
talking about and why does it
What Stephen Hammond said to
you a few moments ago was
fascinating. Tomorrow is going to be
the big meeting. It is the
negotiations committee. Nine or so
ministers have recently been
included in that, like Michael Gove.
They are going to be talking about
the money, precisely how much they
offer in two weeks' time to meet
this deadline in the December
council for phase two. Michael Gove
and Boris Johnson want to add in
conditions. They want to say, we
will give you this as long as we get
that. What was fascinating with
Stephen Hammond just now was that he
revealed that it wasn't just the
Brexiteers in Cabinet who want a
more precise definition of what we
are going for, it is the remainers
In the heart of the
government, David Davis is trying to
keep the bill as low as possible,
possibly around 30%. The divorce
Bill and future liabilities. Some in
the civil service have suggested
that it has to be 40 or above. What
it reveals to me is really, it's
another function of Britain not
really having a proper Prime
Minister. In normal circumstances,
of course the Cabinet is divided. A
strong leader would say, right, this
is what is happening. This is where
we are going. We will call it 35 or
40 billion. We will save to the
European Union, there is the check,
but it will not have a signature on
it until we are satisfied with the
stage. The government is hampered by
the lack of a strong personality who
could do that, make a political play
with other European leaders that
might break the deadlock.
that is why the full Cabinet have
not discussed what the future Brexit
deal will be.
That is the
astonishing thing. There has been no
sort of vision of what Britain is
going to look like after Brexit. We
have got down in what the
negotiation position for tomorrow
will be. What does it look like in
terms of immigration, trade with the
rest of the world, what life will
look like for ordinarily... Ordinary
There are visions for this,
but they will not agree on one. Is
there such a thing as a Tory Cabinet
Minister who could have one single
vision without them all ripping each
other's heads off? Probably not.
That's all for today.
Join me again next Sunday
at 11.00 here on BBC One.
Until then, bye bye.
Sarah Smith and David Garmston with the latest political news. Sarah discusses the upcoming budget with Conservative MPs Jacob Rees-Mogg and Stephen Hammond. She talks about Brexit with former spin doctor and now editor-at-large of the New European Alastair Campbell and prominent leave campaigner Gisela Stuart. The political panel consists of journalist Iain Martin, Gaby Hinsliff of The Guardian and Tom Newton Dunn of The Sun.