16/07/2017 The Andrew Marr Show

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Andrew is joined by Philip Hammond, John McDonnell and conductor and pianist Daniel Barenboim. Jane Moore, Ayesha Hazarika and Iain Duncan Smith review the papers.

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Good morning, if the government is to deliver a decent exit from the


year, and talks start again tomorrow morning, the first thing it has to


do is stick together. Precious little sign of that this morning,


Sunday papers brimming with the most poisonous cabinet briefings and


feuds since the referendum result. In the cross hairs of the worst of


the sniping, the Chancellor. So I am pleased that Philip Hammond,


Chancellor of the Exchequer, joins us this morning to talk politics,


public sector pay, and Brexit. If the Tories go on for much longer


like this we may see this man in number 11, John McDonnell, wouldn't


that mean higher taxes and even more debt? And we will be joined by the


great conductor Daniel Barenboim, on his love of the Proms and how he is


keeping alive the memory of Jacqueline du Pre. She had something


absolutely unique, as if music spoke to her. You could say that I love


her, and I do. And since we are feeling classical, there will be


some Mozart, as well, reviewing the news, I'm joined the former Labour


adviser and stand-up comedian, Ayesha Hazarika, former Tory


minister Iain Duncan Smith and refereeing the both of them, Jane


Moore. The Home Secretary, Amber Rudd,


has said those found guilty of acid attacks should "feel


the full force of the law", after last week's series


of attacks in London. There were more than four-hundred


assaults involving corrosive substances in England and Wales


in the six months to April, according to the latest


official figures. The Home Office also wants to work


with retailers to restrict British politics is at a "dangerous


moment" because of the abuse and intimidation of MPs,


according to the Chairman of the Committee on


Standards in Public Life. Lord Bew told BBC Radio 4's


The Westminster Hour that new laws may be necessary to protect


politicians and ensure that people are not put off entering


a career in elected office. The Turkish President has addressed


two huge rallies overnight, in which more than 250


people were killed. Mr Erdogan has seen


significant gains in his presidential powers


since the coup was defeated. Thousands of suspected supporters


of the plot have since been arrested and the president has now backed


the death penalty for coup plotters. The development of Artificial


Intelligence has become the greatest according to the technology


entrepreneur Elon Musk. who co-founded the car company


Tesla, made the comments


at a gathering of US lawmakers. He warned politicians should start


realising the threat posed by machines taking


over their human creators. Later today, Doctor Who fans


will find out who will emerge from the Tardis as the thirteenth


Time Lord. It's followed endless


speculation about who will The big reveal will take place


after the Wimbledon men's singles The next news on BBC One is at


12.15. The main story in the Sunday Times,


the Chancellor says the public sector is overpaid, he described


public sector workers as overpaid, we will ask about that.


The former head of the civil service, Gus O'Donnell, warning


Theresa May, the Prime Minister, of chaos over X it, partly because of


the rows I was discussing early on. The mail on Sunday French lot to


wreck the heart of London. -- chaos over Brexit.


are Ayesha Hazarika, Jane Moore and Iain Duncan Smith.


Three men with revolvers all pointed at each other. This is a very big


story by Tim Shipman, Spectator summer party, on Thursday night, I'm


afraid there was more drama in it than on Love Island, there really


was, less love, more press echo -- more prosecco, this is


extraordinary, Tim Shipman wrote a book called All That War and it


looks like that has broken out. Theresa May is now in a leadership


contest, people briefing against David Davis and Boris Johnson, but


the person most in the firing line is the Chancellor Philip Hammond,


you have on your show today. People leaking against him about cabinet.


-- All Out War. In specific terms, to moments in cabinet last week,


where he allegedly said something that went straight to the press. He


said two things, he thought public sector pay workers were overpaid,


and that for some reason, women could not drive trains... He denies


this. This week we have had a rather unseemly row in the Conservative


Party about the use of the N-word and once again they are showing


themselves to be out of touch. He says this is untrue, that this has


been overhyped, but political editor Tim Shipman took to Twitter and


said, he is getting this is the bait and from people, this is one of the


most bizarrely entertaining weeks I have had as a political editor,


seething rivalry. -- getting this the bait. Things are bad for Theresa


May, I'm sorry to do this, but things are so bad that in the


Telegraph there is a story saying that this is reminiscent of Iain


Duncan Smith! -- getting this verbatim. That is how bad things


are. You went through a very torrid time, you know what it is like. The


honest point, I know this makes a great cover, but there is a great


divide in the Conservative Party on another level, some of them in the


cabinet and the rest of the backbenchers, because it is quite


interesting, a lot of the new generation have come in and are


seething me furious with what this is representing at the moment. Their


view is, they want Theresa May to get through the Brexit stuff, and


she has already set at some point she will step down, their view, none


of the above, at some point, maybe some the else will step through.


Generational question, these people may be too old. Some of the people I


see them running around the place, it is reminiscent of the same people


running around when I was the leader. For once, shut up, for gods


sake, let everybody get on with the of governing. There will not be a


leadership election, I can promise you that, because there is no mood


in the Conservative Party in parliament for a leadership


election, they know what the problem is, unusual thing happening at the


moment, it's called Brexit, it has a timetable, you cannot afford it to


be broken into by a Conservative leadership election, we have to get


through that, first and foremost, there is a chance to do their jobs.


As an ardent Brexiteer, do you look at this stuff and say, this kind of


cabinet dispute could wreck our chances of a good deal? Certainly


doesn't help but the classic summer stuff, getting through this, get


through conference, get forward. My general view is, all of this stuff


does nobody any good, and everybody a bit of harm. We have lots of stuff


we may want to talk about with regard to Labour policies, in the


meantime... I don't think that we can just take for granted that there


will not be a leadership contest. You may like to see one... We would


all like to see one! I think there's so much briefing going wrong, can


these men be restrained from their ambition? The backbenchers, I


categorically tell you right now, there is no support for this to take


place, honestly, I have been through this, I have seen it before, you


know when there is a groundswell rumbling. You thought you would


survive conference, you were gone... In the middle of all of this, can I


just date, political journalists, people working behind the scenes and


at the front of politics get very excited about this kind of story but


meanwhile the British public, who voted for Brexit, in numbers


unprecedented in British political history, biggest vote ever, are


going: why the hell are they not getting on with it? It is like a


group of car dealers... Gus O'Donnell, in the Observer, he talks


about, the former cabinet secretary, of course, he is writing about this


and the job that his successor, Jeremy Hayward faces. The National


Audit Office, has waded in to say, this is like falling apart of a


chocolate orange. All these pieces... And suddenly, somebody


needs to come in and say, here is the foil, we need to stick together.


It is ridiculous. Saying that David Davis would have been better suited,


cordon aiding policy from the Cabinet Office, rather than having a


ministerial post on Brexit. He's pretty much there, that is where his


office stands. Coming back to the simple point I make, as a


backbencher, I promise you, right now, it is not... They are getting


some pretty strong messages at the moment. Photograph of John Landsman,


founder of momentum, I was at university within, I keep warmly and


Cordelia inviting him onto the show full there he is, looking quite


tough. This is a relatively rare interview with him, about momentum.


Quite interesting, this story, underneath some of the other stuff


going on, there is a real issue, about the way in which, in a sense,


some of this politics has shifted, the arrival of momentum, the


election was a debate about growing violence... Conservative MPs are


worried about the nature and the way in which the campaigning starts but


also Labour MPs, I know a lot of Labour MPs, who feel deeply


threatened by him to get them out and do nothing else but target


people who they don't think our supporters of Jeremy Corbyn. This


will grow, this story, it is a party that at some stage has got to


confront the idea of a party within a party. I wish he was here the sofa


to defend himself, momentum are the people who helped mobilise half a


million young voters, they helped Jeremy Corbyn, extraordinary


political phenomenon. My personal view is it is the growth of a party


in a party and what is interesting here, talking about taking control


of leadership elections, nominations, who should become MPs,


all of this is a real push for power, which is quite interesting.


Where is the Labour Party in this? Anybody in politics, anyone,


particularly women, particularly somebody from a BAME background,


there is a lot of abuse going around, I get as much abuse from the


right as I do from the left, and it is incumbent on all political


leaders to make a stand on this, and say, abuse against anybody is not


acceptable. I think there are guidelines going to the Labour NEC


to look at this. It is easy to demonise momentum. But... Jeremy


Corbyn did create an incredible amount of enthusiasm at the general


election, he led with ideas, he did mobilise young people who don't


normally come out to vote. It is not all malign, some of it is positive,


some of it is about people being energised. Your seat, once a Tory


stronghold, is now a marginal. Let's move on. I think there is a party


within every party, in the Conservative, there are hardline


Eurosceptic backbenchers who have been a party within a party for


decades. This is an organised movement, it is


nothing like that in the Conservative. A more traditional


party within a party, this is interesting, in the mail on Sunday,


about France trying to Nick the financial heart of the City of


London and plonk it in Paris. Leaked memo from Jeremy Brown, former Lib


Dem MP, envoy now for the city, he says, the French are going to play


hardball on Brexit, they do not want a soft Brexit, they see the


opportunity, London is the top city at the moment for financial services


and they think Paris could steal that away and they feel quite, you


know, quite motivated to do this. They want the maximum amount of


chaos. Is this a story? I'm surprised people think this is a


story, we did this six months ago. When we are told... When we are told


Brexit will be straightforward and simple, Walling on from what Jane


was saying about the Gus O'Donnell story, what we have to realise, we


do not have all the power in these negotiations, the EU will have to


make a decision about yes, trade is very valuable, but they will want to


make an example of us to show to other countries. We do not have the


power when we go forward with a war in cabinet, cabinet looking so weak.


Coming back to the story, you could have written this story two years


ago. What has been going on, France has been endlessly trying to attack


the City of London and take business away, this is not new. And by the


way... We are running out of time, we'll move on to a couple more


stories. 6 million, you have to learn, to learn a million. That is


the thing. The big story in London, the acid attack. I have a horrible


feeling it will get more widespread. Amber Rudd has written in the Sunday


Times: Of course it is another thing to


deal with, with everything else we have got going on, because these


kids, I think because they think stop and search now I can't


harmonise, they are using sports drinks bottles and this is now their


weapon of choice so it is horrendous. They were attacking


delivery drivers, stealing their motorbikes and then carrying out


more attacks. Speaking of bad stuff happening, nowhere is worse on the


planet now than Mosul. As an ex-soldier I can tell you the worst


thing you ever have to do is fight in a city in a built-up environment


because the devastation, the end -- the violence... People start to lose


track of human rights issues and you are seeing it, almost the reaction


from many who occupied it is little or no sense that people they capture


now should be dealt with in any humane way. I don't say this is


going on with any tacit approval but it's almost be expected. The


devastation is astonishing. What it'll say, and there's a story about


this in the papers, that the whole idea of ISIS doesn't exist because


they had amassed army to go, they only moved into Iraq because the


Sunni Muslims decided they had been so oppressed by the existing


government that they all turned to Isil. How does Iraq govern itself


after this if all we see is factionalised anger? Good question.


Everyone on the edges of the seat wondering who will be the next


Doctor Who. It is so exciting and they will announce it after


Wimbledon, which makes you think maybe it will be Roger Federer!


There's lots of speculation that it might be a woman and I would love to


see that because women can drive cars and trains, they can definitely


be Doctor Who as well. But isn't Doctor Who traditionally a man? I


don't understand why it has to be a woman. Doctor Who is a shape


shifter, it could be a woman. We have run out of time. Oh, no! I have


to confess, I got up this morning, put on the wrong pair of trousers!


Good luck for your gig. Will the roof on centre


court be open? I'm joined from Wimbledon this


morning by Sarah Keith-Lucas. The roof is open at the moment over


Centre court, we have some sunshine out there. There is rain in the


forecast later in the day so we could see the roof closing at some


point. Across the country it is a north-south split to the weather. In


many southern parts we will see quite a lot of cloud, the chance of


a few spots of rain but certainly sunny spells further north. There


will be that thick cloud in the south bringing drizzle. In the


south-west of England this morning we have low cloud, it is drizzly and


damp. Sunny spells across the south-east where it is fine and dry.


Moving north across the country, in the Midlands there could be a slight


spots of rain, but further north, much of northern England, Scotland


and Northern Ireland it is a fine day ahead. Just the odd light shower


across parts of Scotland where it will be quite breezy too. Lighter


winds through the course of the day and would keep the


sunshine in the north, cloudy skies sinking south into the London region


by about four o'clock in the afternoon where we have a chance of


a light shower or two. Into the evening hours, the cloud in the


south drifts away so we have clear and dry weather for much of the


country overnight. Some rain for Scotland, and temperatures holding


out to around 12 - 14 degrees. Tomorrow starts off on the dry and


bright note, and the weather is set fair with light winds, a bit breezy


for the north of Scotland, but it will be warming up with temperatures


reaching 26 degrees in the south, 20 degrees in parts of Northern Ireland


and Scotland. Another warm day on Tuesday but watch out for heavy


thundery showers in the south. Andrew.


Sounds very much like July. Now a look at what's coming up


straight after this programme. Is it time to re-wild the British


countryside? And priests won't need ropes... Are we dressing down too


much? Join us at ten o'clock. So, as we've heard, one of the big


stories of the morning There are millions of people


who presumably hope that if Labour doesn make it into power anytime


soon, their pay packets will go up. Labour also has questions


to answer, and I'm joined by the Shadow Chancellor John


McDonnell. Can I ask you first of all, if you


are public sector worker and you are watching this programme, what can


you expect from a Labour government? We will end the pericarp. We have


set aside 4 billion by the end of the Parliament on annual basis to


allow that to happen. We have looked at forecast about how he will rise


and it will certainly match inflation, and some review bodies,


because it will be set by review bodies, I think will try to


compensate some of the losses over the last seven years. Again, we are


very clear, unlike the Government which has set a cap the review


bodies have to follow, it will be up to the review bodies to make


recommendations that we will adhere to. You will write letters to the


review body setting overall recommendations, don't you think


public sector workers deserve a little bit more than inflation,


actually pay rise? I do but that will be up to the review bodies.


What I won't be doing is writing to the review bodies as this Government


have done and say you can review the paper but only go up by 1% which


effectively means a pay cut. So you would raise public sector pay. What


we don't know these would erase it so it is in line with private sector


pay by and large? These review bodies will have to look at these


factors, what's happening in the private sector and the economy


overall, and come up with their judgment about what they think is


best. What we cannot do is set in an envelope which is unreal in relation


to what people are learning. The real question is how much you will


give these people because if you are going to match private sector pay,


that rises to about 9 billion a year and that's money that is not


budgeted for in your manifesto. Are you prepared to spend money beyond


the manifesto? The figures of these, the Government said a pay cut would


save them 5 billion so they think the cost of overcoming that a cap is


1.2 billion a year. Some of that multinational insurance payments


paid back to government as well. We will make sure people get a fair pay


rise, they won't get a pay cut as a result of inflation. One of the


issues we have got now... All I'm saying is that is extra money beyond


what you have budgeted for. We have taken the OBR figures on pay rises.


To be clear, to match inflation cost 4 billion, but... We have looked at


the OBR's predictions on pay rises in the future. The issue for us is


how do we make sure people get proper pay because at the moment we


cannot retain staff. We assess that if public pay setting is delegated


to the review bodies by the Labour Party, you suggest the bodies would


be likely to increase public sector pay in line with private sector pay


and our analysis implies that additional 9.2 billion a year they


save for the higher cost... The IFF have come out with that figure and


what we have said to them is actually we are following the OBR,


the Government does own body that recommends to the Government what it


should be. However on the IFA is -- IFS figures, they haven't accounted


for the tax that will come back. We have pitched hours at 4 billion


based upon the Office for Budget Responsibility. But that doesn't


allow for a pay rise. Yes it does, the OBR figures are based on their


prediction of wages rising. You will have seen Angela Rayner sitting in


that chair last week and she was talking about Jeremy Corbyn's


promised at the electorate a few days before the election he was


looking at wiping out historic debt accumulated by students and she said


that would cost around 100 billion. Is that the figure you recognise?


Yes, it is a lot of money, the system is imploding. Half the


student debt we now know will not be paid back so the system itself is


falling apart. We will be inviting people to come and advise us and we


tried to do that using economists from across the piece... But you


will try to pay off the historic debt? We will look at what we can


do. It sounded like a promise at the time, that's the problem. Jeremy


said we recognise people are coming out of college now with debts of


?50,000. They cannot even think of getting a property so we have to


tackle that but the system has got to be tackled anyway because it is


falling apart. A very simple question, for students who have


accumulated debt in this country, would a future Labour government


help them out by at least dealing with some of that? We are going to


try to. It's a real ambition of hours. I'm not going to promise


something we cannot deliver. What Jeremy said is we will try and


tackle this issue and one of the reasons we have got to tackle it is


because the system itself is collapsing. The reason I'm asking...


Andrew Adonis wrote last week saying the system has got to be scrapped as


it's not working, the person who created it. This felt like a


promise, it was made in the new musical express, read by huge


numbers of young people, and younger voters thought it was a promise but


it sounds like a vague aspiration. What we said in manifesto about


scrapping tuition fees, we will do that. If we can help with the debt


we certainly will, and we have said clearly because the system is


collapsing, whoever is in Government has got to tackle this. Can I go


back to this issue low pay? Please do. I was at Barts Hospital


yesterday with the cleaners who are now on strike a cost they asked for


30p an hour extra and they were refused it. One of the cleaners gave


me a payslip, this is a payslip copy. This woman, full-time worker,


earns ?297 a week. At the moment median rent is ?350. Ask Philip


Hammond if he can live on that. If I can I will. Let me return to the


question of overall Labour spending. The IFS has said Labour would spend


at record levels in peace time, the tax burden would increase to its


highest level since 1949. That's why a lot of people looked to you and


Jeremy Corbyn and flinched. Where is that tax for falling? 97% of people


will not have any increase in income tax or VAT or national insurance. We


are asking two groups to pay more, the top 5% of earners but also the


corporations. The corporations have had their taxes cut by this


Government on a scale we have never seen before in history and as result


of that we are not getting business investment. They are sitting the


billions of pounds of income not invested. We believe the richest and


the corporations should pay a bit more. The resolution foundation


report this week said after the recession ten years ago, 1%, the


richest in our country now, have recovered. The 99% are still


suffering. One of the figures was 42%, so nearly half the people in


this country cannot afford a holiday this year, that is scandalous. Let


me ask about corporations -- corporation tax. Do you believe


leaving the customs union would be disastrous for British business? I


believe we have to try and maintain the benefits of the customs union


and that's one of the issues we have got to negotiate. Does that mean


staying inside or leaving? Keep all the options open. We are


concentrating on the objectives rather than the structures and that


seems to have a resonance across Europe at the moment. What about the


transitional arrangements because a lot of businesses want to


effectively stay inside the EU for maybe five years ahead so they can


plan for the exit. Most of the businesses I have been talking to


say they need at least a two year transitional period. Everyone


realises that has to be a transitional period, that is what we


are pressing the Government on. When it comes to what happens in the


House of Commons, you want the Conservatives to collapse and have a


general election soon but there is no necessary sign of that. They


could carry on for five years so inside the House of Commons you can


exercise some pressure as the opposition party. Do you use that to


get a different kind of Brexit? we have got, Conservative cabinet


fighting like rats in a sack, Europeans want to know what the


direction is, what is the negotiating position. There is a


different negotiating position virtually every day coming out of


this government's cabinet, it is falling apart, in the interests of


the country, my view is they should stand down and let us form a


government so we can negotiate Brexit in the interests of this


country, protecting jobs and the economy. If they don't do that in


the House of Commons, we will try to get a majority of MPs to vote for a


sensible Brexit stop what do you saying that the people killed in


Grenfell Tower were killed by political murder. Now I do not, I


was extremely angry, I am a west London MP, this site is not far,


political decisions were made which resulted in the deaths of these


people was a scandal. Murder means a political decision, and intentional


killing. There is a long history in this country of the concept of


social murder, where decisions are made with no regard for the


consequences of that, and as a result of that, it will have


suffered. That is what I think. Do you regard it as murder? I believe


that social murder occurred in this instance and people should be held


accountable. Who are the murders? A lot of political decisions over the


years have not addressed the housing problems we have had, cutting back


on local government, cutting back 11,000 firefighters, jobs cut as


well, even investment in aerial ladders and things like that in our


country. The politicians who sanctioned the cuts are murderers. I


believe they have to be held to account, I remain angry at how may


people have lost their lives as a result of political decisions made


over the years. To be clear, these decisions happened under Labour and


Tory governments, over the years, over the years. I set up the Fire


Brigades union is Parliamentary group back in 2004 I raised the


issue of sprinklers, all through the last seven years in particular I


have been going along with ministers on behalf of the FT you saying, stop


cutting jobs, stop undermining national standards, and nobly was


listening. -- FBU. Strong word to use, but murder is is how you regard


it? I do not move back from what I said, and I remain angry at the loss


of life that has taken place not far from my constituency. John


McDonnell, thank you for talking with us.


Daniel Barenboim has long been a towering


A revered conductor and pianist as well as an ardent advocate of how


music can bridge divides, even between Israel and Palestine.


Remarkably, he's a citizen of both places.


His return to the Proms is a real highlight of this season,


a programme that includes Elgar, Sibelius and a new


When we met, Barenboim told me why he's loved the Proms ever


since he and his late wife, cellist Jacqueline Du Pre,


used to queue up for tickets in 1960's London.


The Proms have a unique atmosphere, there's nowhere in the world...


And the extraordinary thing is I lived in England for many years


in the past, and I'm very much aware that programmes at the Proms


are wonderfully varied, and really don't shy away


from contemporary music and all types of music.


It's not the public that goes to the festival during the winter.


-- It's not the public that goes to the Festival Hall during the winter.


I've always asked myself, what do these people,


these 5,000 who have come daily to the Proms and listen so


attentively and are so enthusiastic, what they do for music the rest


Now you're doing another concert later in the year


at the Royal Festival Hall for a rather sad reason.


It's 30 years since Jacqueline du Pre died, and you're doing


a concert raising money for multiple sclerosis.


Can you just tell us a little bit about the reasons


Jacqueline suffered from multiple sclerosis for 18 years


And I was therefore in very close contact


with the cruelty of this illness,


because it is an illness that affects everything


The illness itself is as much a mystery today as it was then.


There's over 100,000 in Great Britain that suffer from MS


and it's absolutely imperative that money is raised for the research.


Otherwise it will be at a standstill.


And can you remember when you first saw something


She had lost the feeling on certain parts of her body,


and at first we didn't pay much attention to it but it got more


She was still able to play for another two years, but then it


affected her hands and she had to stop playing


She picked up the bow and she didn't know whether they weighed 50 grams


or 50 kilos and therefore she was unable to.


She was your beloved wife, she was also an extraordinary


can you explain to people watching why she was such a beloved


You would think I say this because I loved her, and I still do,


but I think quite objectively, musically speaking, she had


something absolutely unique, as if music spoke to her in a way,


in indirect way as it doesn't normally.


With her it was something absolutely directly put in front of her.


A piece of music she didn't know that she had never


played and never heard, and somehow the essence


of the piece, the essence of the piece came out.


One final question if I may, I think you're one of the only


people in the world who has both Israeli and Palestinian citizenship.


You want to take your Berlin orchestra to Iran,


they have called you an agent of Zionism,


and so you are attacked in Israel for being anti-Israeli


and you are attacked in Iran for being a Zionist!


And in Palestine for being a Zionist.


You are getting it from all sides, what keeps you going?


I think that the whole project and therefore I myself too


am admired in Israel and hated in Israel.


Admired in Palestine and criticised in Palestine too.


So something must be right of what I do!


Maestro, it's been a privilege talking to you, thank you very much.


And he's conducting the Berlin Staatskapelle


I should just say that tickets are now on sale for that benefit


It will take place in October at the Royal Festival Hall,


on the 30th anniversary of Jacqueline DuPre's death.


Talking of people who are getting it from all sides...!


According to repeated, if anonymous Cabinet sources overnight,


the Chancellor offended some of his own colleagues at this week's


political cabinet meeting by saying that public sector


there's a lot of Cabinet-level malice in today's papers,


but I'm now joined by the man himself to clear it up.


Did you say it? I'm not going to talk about what was said and what


was not said, it's easy to take something out of context, public


sector pay raised ahead of private sector pay after the crash in


2008/9, taking public sector pay before pension contributions, that


gap is now closed, public and private sector pay on average around


same level, when you take into account the very generous


contributions that public sector employers to pay in for the generous


pensions, they are still 10% ahead... I don't for a moment, I


don't for a moment tonight there are areas in the public service where


recruitment and retention is becoming an issue, that there are


areas of the country where public sector wages and private sector


wages are getting out of kilter in the other direction. We have to look


at these things and discuss them. It is important we discuss them on the


basis of the facts, not rhetoric from the Labour Party or the trade


unions. Your own department denied Virgin eyes you used the word


overpaid, do you think public sector workers are in general overpaid?


This is a relative question, this is about the relationship between


public and private sector pay, and it is a simple fact, independent


figures show this, public sector workers on average are paid about


10% more than private sector workers. You think relative to


private sector workers, are they overpaid? Well to two private sector


workers, they are paid a 10% premium, this includes pension


contribution, you cannot eat your pension, you cannot feed your kids


with the pension contribution, so I understand that and all the issues


that other sector think of that cleaner described by John McDonnell,


weekly payslip, ?297 is what she takes home, do you think that is


overpaid? Of course it is not, it is very hard... John McDonnell needs to


remember it was a Conservative government that introduced the


national living wage and also should know that the only way that we can


sustainably increase... Low pay is not just an issue in the public


sector, it is an issue in the private sector. The only way that we


can address that, the only way that we can address the high wage economy


we want to have sustainably is to increase productivity, to get our


public finances into good order, there is not a short cut. So you


think in relative terms, public sector workers are overpaid and when


you write letters to the pay review bodies in due course, it will be


more tough messages, those people watching who are public sector


workers should expect more austerity, more of the pay gap,


going backwards in terms of actual pay. The policy on public sector pay


has not changed, we have sought to be fair to public sector workers but


also fair... Seven you freeze. Not a freeze... -- a seven-year freeze.


Seven years pay restraint but also let's be clear about this, teachers


in 2015/16 at a 3.3% pay increase, NHS staff last year over half of


them had a pay increase averaging just over 3%, it is not the same


picture across the board. But look, our position is that we have to be


there to public sector workers and look at recruitment and retention


problems and be fair to taxpayers and try to protect jobs in the


public sector, those are the bits of the equation we had to juggle. We do


keep this under constant review and the fact is well-known, the cabinet


has been discussing this issue, then is a clear signal that we understand


the concern, both of public sector workers and the wider public. Most


people watching this interview will conclude that you said they were


overpaid. I have told you, I am not going to tell you what comes out of


a private cabinet meeting and they should not have leaked that, cabinet


meetings are supposed to be a private space in which we have a


serious discussion. I am the Chancellor, you would expect me to


put in discussion about private sector pay in the context of the


fiscal and economic situation that we face. Others who represent


spending departments, implying large numbers of public sector workers


will bring their experience and their realities to the table, that


is how we have a discussion and reach a decision. This morning they


have gone for you publicly, all over the newspapers, are you angry about


that? I don't know who said what, my colleague David leading to appeared


on your show last week was probable is spot on the money when he said we


are in the middle of the silly summer season, it may have been... I


was not there, but lots of parties going on, lots of tittle tattle,


lots of gossip, summer recess coming up, the government... The


government... I do think, on many fronts, it would be helpful if my


colleagues, all of us, focused on the job in hand. This government, as


Iain Duncan Smith said, is facing a ticking clock over Brexit


negotiations. David Davis will be going tomorrow to Brussels to start


the next round of the gauche durations. We have a crucial job to


do here -- negotiations. Which protects jobs, prosperity and


British businesses. That is why we should be focusing upon. They are


after you in particular. Can I ask, you said that trains are so easy to


drive today that even women can do it. Have you said that? Did the


Prime Minister say, I am going to take your shovel away from you? I'm


not going to get into what was or was not said in a cabinet meeting. I


have two daughters in their early 20s, I don't think like that and


would not make a remark like that. I would say it is a disgrace the 95%


of train drivers are men. There is no reason why that workforce


shouldn't be more gender balanced except that the unions control the


recruitment and training process, and in the context of a discussion


about industrial relations on the railways, I think it is very


important to focus on that control that the unions have over the


training process. So why are people going for you in the papers? Is


there a fight for the leadership of the Conservative Party under way? I


certainly hope not. If there is, I am no part of it. I think my


colleagues should focus on the job we have been elected to do. This


Government will be a stable government because people understand


that there is a crucial job that needs to be done. They will support


us while we get on with that job but they won't indulge us if we start


turning our attentions elsewhere. If you want my opinion some of the


noises generated by people who are not happy with the agenda that I


have over the last few weeks tried to advance of ensuring that we


achieve a Brexit which is focused on protecting our economy, protecting


our jobs, and making sure we can have continued rising living


standards in the future. So these are hard-core Brexiteers who want a


hard and fast Brexit attacking you for that reason? You will have to


ask Tim Shipman and Jane Forsyth who it is. Can I turn to the economy and


ask about the recent OBR report which was quite worrying to a lot of


people. It said the economy is in a poor condition. This was a report


that we asked the OBR to produce bringing us into line with IMF


guidance, to look at our position and tell us where the future risks


are in our economy and I think it's a very good exercise and I very much


appreciate the reports they have produced. What it warms is that the


levels of debt that we have in this country on the level of deficit we


are still running means that we would be vulnerable to any future


shock -- warns. So we can't borrow more? That is simply the point. We


wouldn't have capacity for government to intervene and protect


the economy as it did in 2008/9 because our level of deficit is too


high. Can I continue asking about Brexit in particular because there's


report again in the papers about Paris not surprisingly trying to


steal trade from the City of London. There are reports of a sharp fall in


levels of investment particularly in the car industry, you are getting


all of these businessmen coming to you, with reports on your table, are


you worried about the state of the economy has begun through the Brexit


negotiations? I think it is absolutely clear that businesses


where they can hold off are doing so and you can understand why. They are


waiting for more clarity about what the future relationship with Europe


will look like and the way to get the economy moving, the way to


restore business confidence and then consumer confidence, is to give as


much clarity as possible as early as possible. Which is why I have been


talking over the last four or five weeks about the importance of a


transitional arrangement and I believe the great majority of my


colleagues now recognise that that is the right and sensible way to go,


both in the UK and the European Union. And this could go on for


three or four years, a transitional arrangement? That's what business


ones. In my view it needs to be a defined period, we have got to do


this in a way that meet the concerns and requirements of people who want


a softer version of Brexit and those who campaigned hard to leave the


European Union. I think most people are willing to accept a transition


so long as it is of limited duration in order to avoid... But this would


be over a number of years during which in effect we would still be


members of the European market, we would still be paying in and be


under the ECJ. We would leave the single market when we left the


European Union on the 29th of March 20 19. That is fixed. How long


should a transition period be? That's a technical question, it


depends how long we need to put in place new customs systems, new


migration systems. These things cannot be magic up overnight. Have


you any idea how long we are talking about? I think we will be talking a


couple of years. But we do know for sure is that Michel Barnier and the


European team desperately want to sort out the money before anything


else happens. You are the man in charge of the money. Have you


budgeted for an exit fee for the EU? We don't have a sum of money


specifically for that purpose but our current public finances include


our contributions to the European Union and what the OBR has done if


you read its last report looking forward is assumed that, although


those monies might be used for different purposes on domestic


programmes, and continuing to contribute perhaps to some European


programmes, broadly speaking the amount of money will remain the


same. So they haven't budgeted a bonus for leaving the European Union


but nor have they budgeted cost. Do you accept because there was a


statement in the House of Lords that appeared to suggest this, that we


have ongoing obligations to the EU which are financial which we must


settle early in the negotiating period? We are discussing that


question this week in Brussels with the European Union and what we have


said repeatedly is that we are country that always honours its


obligations as we expect others to honour their obligations towards us,


and if there is any amount that is due when it's been properly


quantified and audited, of course we will deal it. So shouldn't just go


whistle for it then? If you are referring to the comment from Boris


Johnson earlier in the week, he was speaking specifically about this


fanciful 100 billion figure that has been bandied about. That is a


ridiculous figure. Is 40 billion a ridiculous figure? I'm not going to


get into a process of talking about specific figures when David Davis is


about to open a negotiation in Brussels tomorrow, that would


totally undermine his position. Is it possible for this Government to


negotiate a proper Brexit when the Cabinet is so divided over the


issue? This is a media line. I would say people are going for you that


they don't like the kind of Brexit you want. The Cabinet is coming


closer together on issues like transition for example. Five weeks


ago the idea of a transition period was quite a new concept, now you


would find that pretty much everyone around the Cabinet table accepts


there will be some kind of transition. We are into a real


process now with the start of negotiations and I think you will


find the Cabinet rallying around a position that maximises our leverage


and gets the best possible deal for Britain. Is it almost as simple as


if you and David Davis can agree... We are looking to get the best


possible deal for Britain and we both know that continued growth in


the economy is actually the measure by which people will judge their


political leaders. They can talk about a lot of other things but in


the end it will be about whether they see their incomes rising, their


standard of living rising, their jobs being secure and that is our


objective and certainly we try to work together to agree on these


things. In 2010 you warned Labour government could rise the national


debt to ?1.5 trillion. What it now? It is 1.7 trillion as you know. You


have done worse, that's a big failure. There were choices about


how fast we wanted to do deficit reduction, how much we wanted to


impose on the economy to do that. We could have done it more quickly as


some countries in the European Union have done at the price of soaring


unemployment. And we have a weaker economy now. We chose to protect


jobs as a priority and we have done brilliantly well. One final


question, you will have heard John McDonnell suggesting people who died


in Grenfell Tower whether victims of political murder, how do you


respond? That's a disgraceful suggestion. There is absolutely not


a shred of evidence to support that. It was a terrible tragedy but of


course we must wait for the outcome of the public inquiry to understand


what happened and learn the lessons from it and we will learn lessons.


Philip Hammond, thank you very much indeed.


Coming up later this morning Andrew Neil will be talking


about Brexit and lots more with the international


trade secretary Liam Fox, and he'll be joined


by Shadow Business Secretary Rebecca Long-Bailey.


That's the Sunday Politics at 11 here on BBC One.


Join us next week for our last show before we take a summer break.


I'll be talking to the Hollywood star, Ethan Hawke.


For now, here to play us out I'm delighted to welcome the flautist


Lisa Friend and the Brodsky Quartet, performing the first movement


For all the latest political news and debate,


tune in to the Sunday Politics at 11,


where we'll be analysing the week's big stories


and talking to the politicians and commentators who count.


Andrew is joined by chancellor Philip Hammond, shadow chancellor John McDonnell and conductor and pianist Daniel Barenboim.

Jane Moore of the Sun, former Labour adviser Ayesha Hazarika and Iain Duncan Smith review the papers, while music comes from Lisa Friend and the Brodsky Quartet.