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JOHN HUMPHRYS: Good afternoon. On Wednesday
old age pensioners got a rise in their basic state pension ... 75 pence.
I'll be asking the Social Security Secretary, Alastair Darling to justify
it. We'll be reporting on the state of our manufacturing industry and
asking why the government isn't doing more to help. And should they also
be helping people who are losing their post offices? That's after the
news read by Sian Williams.
NEWS
HUMPHRYS: Britain's factories have
been taking a beating these past few years. Should the government be stepping
in to help them?
JOHN EDMONDS: "Unless action is taken,
a lot of marginal constituencies are going to feel the heat , and the government
is going to feel the heat from the MPs who represent them now."
HUMPHRYS: And more post offices
are putting up their shutters and going out of business ... another case
perhaps for the government to take action? I'll also be talking to the
Shadow Foreign Secretary, Francis Maude, about Sierra Leone.
J[none1]OHN HUMPHRYS: Britain's pensioners
are feeling a little better off this weekend .. wondering, perhaps, how
to spend the increase they had when they collected their pensions on Wednesday
... all 75 pence of it. It's generally thought that many pensioners refused
to vote for the government in last week's elections precisely because the
increase was so small. The government points out that pensioners are actually
better off than that meagre rise suggests because of all the other extra
benefits they've had .. but that does not seem to impress them nor, indeed,
many Labour MP's who want to see a bigger increase next time around. The
Social Security Secretary Alastair Darling is in our Edinburgh studio.
Good afternoon, Mr Darling.
ALASTAIR DARLING MP: Good afternoon.
HUMPHRYS: The pensioners champion -
that's what the government calls you. That laurel seems to sit a little
uneasily upon your head this morning doesn't it?
DARLING: Well let me explain what
we are doing for today's pensioners. As you rightly say the increase in
the basic state pension is only part of what we're doing. The winter fuel
payment of one hundred and fifty pounds which of course is not taxable
nor is it taken into account for benefit purposes is going to everyone.
The television licences worth one hundred and four pounds to the over
seventy-fives will come in from this November. We've reduced VAT on fuel
which helps pensioners probably more than anybody else and of course for
the major problem that we inherited, that of pensioner poverty, it is worth
noting that as a result of what we've done someone on the minimum income
guarantee will be fifteen pounds, sometimes more than that, better off
than they were in nineteen ninety seven. So what we're doing is we're
tackling the dreadful inheritance that we took over and that is that you
had millions of pensioners living in poverty and if you look at the amount
of money we're spending on pensions during this parliament, some six and
a half billion pounds more than the Conservatives ever planned to spend,
almost half of that amount is going to the poorest three million pensioners
in this country. So the strategy is to deal with pensioner poverty first.
The next stage of course is to help those pensioners who've got modest
savings, and we've doubled the capital limits available to them and to
introduce the pensioner credit to help those pensioners who have got modest
occupational pensions.
HUMPHRYS: People watching this
programme, many elderly people watching this programme will have heard
that explanation, that little list many times before but they are still
unimpressed, they don't think it's good, they don't think it's enough,
can you understand why they're so unhappy?
DARLING: I think many people don't
always appreciate that the pensioner income comes from mainly two different
sources: One is what you get from the government, what you contribute
to, that is the basic state pension but of course that's always been a
foundation, a stepping stone for other measures and if you look at the
average pensioner income in this country at the moment it is a hundred
and thirty-two pounds. That is because in addition to the basic state
pension, more and more people have got funded pensions, occupational pensions,
works pensions, call it what you want on top of that. Now when we came
into office what we found was that over the last twenty years or so the
gap between the richest or better off pensioners and the poorest pensioners
was as wide in 1997 as it had been forty years earlier. That is the legacy
that we inherited and this is a major problem that we had to tackle, that
is why it's not a question of not wanting to spend the money because we're
actually spending two and a half billion pounds more than we would have
done if, for example, we'd restored the link to earnings, two and a half
billion pounds more, but as I say, nearly half of what we are spending
more is going to Britain's three million poorest pensioners and I think
that is the right thing to do in principle and I think when you explain
that to people they do accept that that is also the right thing to do in
practice.
HUMPHRYS: Do they? Well maybe
they do and maybe they don't. I can assure you that both you and certainly
I will get an awful lot of letters after this programme from pensioners
who say 'Why is the minister telling me I don't understand it?'
DARLING: No I'm not saying that
at all......
HUMPHRYS: Well that's exactly what
you said - 'they don't seem to understand'. I mean I quote you from what
you said at the beginning of your last answer. The fact is that they understand
perfectly well and they want it done differently. Can you not appreciate
that and can you not accept therefore that it was a mistake to give them
such a small rise in the basic pension? I take your point about what you
said about the basic state pension but they believe it was the wrong thing
to do. Do you accept that it was a mistake?
DARLING: All three political parties
in this country, the three major political parties gave exactly the same
promise - to increase pensions in line with prices. We want to do more
than that but we wanted to make sure that the money was spent where it
had the most effect. Now if you look at the top twenty per cent of pensioners
in terms of income in this country, they're income in the last twenty years
went up by about eighty per cent whereas the bottom twenty per cent, the
poorest, saw their incomes go up by about thirty per cent. Now as I've
said to you we are spending more, much more than the last government intended
to - some six and a half billion pounds and nearly half of that is being
spent on the poorest three million people.
HUMPHRYS: You make that point and
you've made that point quite clearly but what I'm asking you is whether
you appreciate now, bearing in mind the reaction to what has happened,
bearing in mind the local elections and all the rest of it that giving
an extra seventy-five pence on the basic state pension was a mistake.
Certainly John Prescott seems to think so. Do you not agree with him?
DARLING: No John Prescott didn't
say that........ what he said was precisely what I'm saying is that what
we're doing is right in principle and as I said last week just after the
local elections, clearly for any government and our government in particular,
we've done a lot, we clearly have a lot more to do to explain to people
what we're doing. Now let me just explain what the next step is. Firstly
if you look at those pensioners who do feel aggrieved and I perfectly well
understand the point they make, that is those people who have got modest
savings or a modest small occupational pension which they've built up and
as a result of which they don't qualify for the minimum income guarantee.
Now at the last budget we doubled the capital limits...........
HUMPHRYS: But you've already made
that point......... don't go and repeat yourself..........
DARLING: Can have twelve thousand
pounds in the bank and not be effected. The next thing we've got to do
through the new pensioner credit which I shall be consulting on later this
year is to make sure that those pensioners who've got very modest occupational
pensions are rewarded for their thrift and not penalised because of it.
HUMPHRYS: But I just wanted to
follow up you see where you said that John Prescott didn't say that. Let
me quote you because he was in this studio just last week saying it and
I've got a note here - a precise note - of what he said 'it's okay being
intellectually convinced that it's the best way to do it" - what you've
just been outlining "but pensioners don't believe it's benefiting them.
Governments are elected by those people, not by a kind of score board
as to whether it was intellectually right. That's what we learned." So
clearly Mr Prescott thinks that you have learned something. You, by contrast,
seem to be saying, well actually no, we haven't learned anything on that,
what we're doing is right, maybe, maybe it is right, the question is that
people don't think it is.
DARLING: No, what..both of us are
saying the same thing. I believe the pensions policy that we are following,
tackling the inheritance, making the long-term reforms of the pension system
that are absolutely necessary, are absolutely right. Where John and I say
exactly the same thing, clearly what we are doing needs to be got across
to people, we've got to win the political argument...
HUMPHRYS: ..that's all it is...
DARLING: ..neither of us would
disagree with that point. But let's come back to the first principles here,
you were asking what we're doing and why, what I am saying to you is that
the situation we inherited was that an awful lot of pensioners had lost
out, the gap between rich and poor like the rest of the society had never
been greater. That's why we're doing it. Now as I say to you, we could,
yes we could have restored the link to earnings which I think is the converse
argument being run by some people but the problem with that is that it
doesn't actually help the poorest pensioners because they'll lose it pound
for pound through the benefit system. The people at the top end probably
wouldn't notice it because it wouldn't amount to much in comparison with
their other income and it's far better therefore to say yes let us spend
more and we are spending more, next question, where do we spend it to best
effect, the answer is that the package ought in the first instance be weighted
towards those pensioners living in poverty. The next stage, as we've announced
is to ensure that the pensioner credit deals with a situation which is
something that should have been tackled years ago and that is people with
small occupational pensions or modest savings who ought to be rewarded
for all their effort during the lifetime and not penalised because of it.
HUMPHRYS: Alright. What about next
year's rise then, next year's rise in the basic state pension that is and
I am sticking with the basic state pension for the moment because that's
what concerns so many people, so many pensioners. It's going to be based,
presumably, on the assumption that inflation will be at a certain level.
We've been led to believe that they'll get another couple of pounds in
their pensions as a result of that. Now, if inflation is less when it's
calculated in September does that mean that they will get less than two
pounds or is that two pounds figure that's been bruited around by the Chancellor
among others, is that a guarantee?
DARLING: What I've said many times
is that on the information we have got at the moment the pension will rise
by at least two pounds for a single pensioner, over three pounds for a
pensioner couple. Every year, as required by statute, I have to make a
decision on all benefit levels, all pension levels, I have to do that having
regard to what the RPI is in September...
HUMPHRYS: ...those contradict each
other don't they, sorry..it's either going to be two pounds or it will
be linked to the RPI - I'm slightly puzzled by that.
DARLING: No, what I've said is
that on the information available to us now the RPI increase would mean
that pensioners, a single pensioner would get at least two pounds and pensioner
couples three pounds...
HUMPHRYS: ..so it's not guaranteed...
DARLING: What I was going on to
say is that the law requires me to decide on how much pensions actually
go up by reference to what the actual RPI is. Now, if you had asked me
a year ago I could have told you that it looked like about seventy five
pence based on the information we had. So my guess is, and you know I'm
pretty confident this is the case, that it will be at least two and three
pounds respectably, this coming Autumn. What we do for pensioners as
a whole, and as I've said to you it's not just the basic state pension
there's the other measures I referred to which we've already introduced
like the winter fuel payment, like the free television licences and the
pensioner credit, the details of which we've yet to announce. When we come
to sit down and decide what we are going to do, then we will make an announcement.
But what I can tell you is that all the information at the moment shows
that the pension, the basic state pension increase will be two and three
pounds but I do make this point, you know no matter how much it may be
tiresome to listen to it, the basic state pension always has been designed
to be just that. It is a stepping stone, a foundation, most pensioners
have incomes beyond that and of course one of the things you might - I
understand you want to ask me about are the longer term changes that we
are making to deal with the fact that you know in thirty years time nearly
half the population will be over fifty and a quarter will be living in
retirement. So in addition to dealing with today's problems, the problems
we've inherited, we've also introduced substantial changes to the pension
system to make sure that we have a sustainable, affordable system in the
future and that we get more and more pensioners able to retire on a good
income, something that hasn't been possible in the past.
HUMPHRYS: But just to draw a line
under this area of the basic state pension you are ruling out the possibility
that the next increase in the basic state pension will be higher than inflation?
DARLING: What I am saying to you
is that the information we have at the moment...
HUMPHRYS: No, no, I understand
that...but that's a simple yes or no..
DARLING: ... the RPI looks as if
it will be two and three pounds. I will make an announcement, usually
about November time and that will be when I'll set out exactly what we're
going to do so far as pensioners are concerned, and as I've also said to
you the proposals that we're working up at the moment for the pensioner
credit are designed to help the - I think the next problem that the government
needs to deal with, and as I say having, clearly pensioner poverty was
the first priority, the next thing to do is to help those pensioners with
modest savings or modest ....who really have lost out in the past.
HUMPHRYS: Indeed, but I am just
trying to draw a line under the question of the basic state pension. That's
what gets so many people so upset. Is it going to be above - well but you
see, you told me that it was linked to RPI. Clearly, we know that, that
that is the policy. I'm just asking you to tell us this morning whether
it is likely to be or whether it cannot be above the rate of inflation.
DARLING: I'm not going to make
the up-rating statement you know, in the middle of May. It has to be made
in November. What I said to you is you need to look and see what we're
doing for pensioners in the round, basic state pension yes, but also the
other measures, the winter fuel payment, the free television licences,
not to mention other things of course pensioners greatly benefit from.
You'll see the changes, the long term changes we're making in health care
for example, the reduction in VAT and fuel, they all add up, they all should
be taken into account and as I say to you what we're determined to do is
to make sure the money we do spend, and we would be spending far more than
we would have done with the earnings link, it's actually is spent to the
best possible effect.
HUMPHRYS: Yes, but the trouble
is that people don't like the way these benefits are - particularly old
people - there's a matter of pride here isn't there? A lot of elderly
people think that 'I've paid for all of this, all the years that I've worked
and paid my taxes and National Insurance and all the rest of it, and I
don't want to be taking benefit. I want to have my basic state pension'
So why you cannot just say let's roll it in together, all these fancy
benefits you've got - free television licences for heaven's sake. - why
can't you just roll it all up together so that you give them the money
and they can spend it on what they like and when they like, instead of
being a kind of nanny state that says you know, this is a free television
licence, whether you want it or not you'll get it.
DARLING: The hundred and fifty
pounds going into fuel payment is paid before Christmas, it's not taxable,
it isn't taken account from benefits which it would be if you lumped it
into the pension income generally. Now, you know, I think any pensioner
listening to this will know that you can pay a hundred and fifty pounds
in a lump sum or weekly it's still a hundred and fifty pounds and I think
most pensioners, many pensioners will welcome the fact they get it. Now,
on your broader point people want to work throughout their lives and they
don't want to have to rely on benefits. You're dead right. Now, the situation
we've inherited is that at the moment had we done nothing one person working
in three would have been retiring straight onto benefit. Now, as the
result of the changes we've made, firstly on the state second pension
which reforms SERPS the poorest people and those on the lowest wages will
in some cases see the amount of benefit they get from the state scheme
treble. So far as people who are on moderate and higher earnings are concerned
as the result of the changes we've made there, the introduction of the
new stake-holder pension which will benefit maybe some five million people,
as a result of those changes that we've made that means that most people
will be able to retire way above benefit level after a lifetime of hard
work. So those changes that we've made are absolutely fundamental to the
points you make, and that is that none of us want to work all our lives
only to discover we're on benefit. That will not happen in the future
because of the long term changes we're making.
HUMPHRYS: On the minimum income
guarantee that you mention, I think it's. what is it, seventy-eight pounds,
forty-five pence one of your ministers, Lord Faulkner has said he could
perfectly well live on that, given of course that may include Housing Benefit
and things like that. Jeoff Rooker, another of your ministers says he
couldn't. Your own minister of state says he couldn't. Could you, could
you live on seventy-eight pounds forty-five a week?
DARLING: Isn't the important thing
here to make sure that we gradually increase the ...
HUMPHRYS: But, I asked you whether
you could live on that at the moment.
DARLING: Our objective is to make
sure that everybody in this country retires on a decent pension. Now,
that was not happening in the past because of the system that we inherited
which was basically run down, no-one had given it any proper thought for
year. What we're doing is making sure that now, if somebody works throughout
their life, either through an occupational pension, a stake-holder pension
or perhaps a private pension, a personal private pension if they're better
off and that's appropriate, they will be able to retire on a decent income.
We'll also increase the amount of money that people get through the reformed
SERPS, the new state second pension as I say, sometimes trebling the amount
of money that someone earning less then nine-and-a-half thousand pounds,
and some eighteen million people will be better off as a result. But all
these changes to the pension system, they take time. You know this is a
classic example of where this government has looked to the long term, we're
making changes, we've done a lot, we clearly have a lot more to do. Yes,
we've got to win the argument in places where we're not winning it at the
moment, yes of course we've got to do that, but the long term changes to
the pension system, plus what we're doing to help today's pensioners seems
to me to be the right thing to do in principle...
HUMPHRYS: Yeah, but not enough,
enough to help today's pensioners, or many of feel, and then they may note
that you ducked that question on whether you could live on the minimum
income guarantee.
DARLING: Well, let's come back
to today's pensioners.
HUMPHRYS: Well, I'd like you to
answer that question.
DARLING: The average pensioner
income in this country is a hundred and thirty-two pounds. The reason
it is so far higher than the basic state pension is as I said more and
more people coming into the pension system come with their occupational
pension, thanks to the reforms made in the nineteen-fifties, the nineteen-sixties
and so on. What we've got to do is to make sure that those pensioners
who missed out on all that, many of whom because they had broken work
records, they were out of work for a time or they didn't actually
have access to occupational pensions, we've got to make sure that they
get the help. That's why as I say, nearly half of the six- and- a- half
billion pounds extra we're spending this parliament goes to Britain's
three million poorest pensioners.
HUMPHRYS: Right. Can I just ....
DARLING: I believe that's the right
thing to do. We're dealing with today's problems but we've also crucially
had the courage to sit down and ask ourselves what do we need to do to
stop this problem happening in the future. It will take time but we've
made a start.
HUMPHRYS: Just a very quick thought
about a story in the papers this morning about benefit fraud. I raise
because if you could crack it you might have a bit more money to spend
on pensioners. It says that you were supposed to be reducing benefit fraud,
in fact it's rising, it's up at seven billion pounds a year now. Is that
worrying you?
DARLING: No. I saw the story.
It was a bit of a muddle. They say it's a secret report, and then say
we've published it, so it can't be both. The position is that we know
that we lose between two and four billion pounds a year in relation to
fraud. Now, we've already begun to turn that round. If I give you one
example. When we came into office two out of every five cases of income
support were wrong. We've halved that already, that saved a billion pounds,
and indeed if you look at Social Security spending as a whole it is now
growing at the lowest rate than it has since the second world war. One
of the reasons is because we are making sure the system is more secure.
Because of that we've been able to spend more money on pensions, indeed
the only reason Social Security spending is growing is because we're spending
more money on pensioners, more money on families with young children.
So we are tightening the system, but it's like everything else we inherited
from the Conservatives, the system and Social Security was run down, it
was lax, it needed to be reformed. We're making those reforms, they will
take time to work their way through, but at the DSS, you know, at the end
of this parliament will be far more secure, it will be in far better shape
than it was when we took over from the Tories.
HUMPHRYS: Alastair Darling, thank
you very much indeed.
DARLING: Thank you.
HUMPHRYS: It has not been a good week for
Britain's factory workers. The big announcement in the past few days was
that thousands of jobs are going at Dagenham. But it seems scarcely a
week passes these days without someone, somewhere cutting jobs on the shop
floor. Tony Blair is expected to reject calls for intervention to help
manufacturing when he speaks to the CBI this week. But trade union leaders
and many Labour MP's say the government can and should do something. Paul
Wilenius reports on the growing pressures facing them.
PAUL WILENIUS: Britain's factories were
once the driving force of the economy. Manufacturing goods - like these
cars at Vauxhall in Luton - to be sold across the world. Even though they
now produce less than a fifth of the nation's wealth , for those who work
in them and the Labour Government , they're crucially important , as the
Chancellor admitted in 1991.
GORDON BROWN: Our argument is that manufacturing
matters . That even our service sector depends ultimately on modern manufacturing
strength.
MALCOLM GIBSON: Manufacturing industry at the moment
is under the cosh and unless we see some respite from the problems , particularly
of the high pound at the moment, there is no question that a number of
those businesses aren't going to survive.
DEREK FOSTER: A lot of votes hinge upon
the prosperity of manufacturing industry. Particularly in Scotland, Wales
, the North East, the North West, the West Midlands, but also in many other
parts of the country where there are marginal seats, and the government
can't afford to be seen to do nothing.
WILENIUS: Manufacturing was once
at the very heart of the Labour Party, and its policies. But despite strong
words of support for some of Britain's key industries, the government is
under attack from the unions and many Labour MPs for failing to act. They
fear the high value of the Pound is crippling vital businesses, and is
putting tens of thousands of jobs at risk. Since the election, manufacturing
has been suffering. The government let the Siemens semi-conductor factory
in County Durham close. But coal, Labour's heartland industry, needed
�100 million of aid to head off extinction. Then Ministers backed a rescue
package for Rover, which may only be a stay of execution - while Harland
and Wolf in Belfast was saved at the last minute when a no strike deal
with workers helped win �300 million pounds of new orders. There's also
trouble up at this woollen mill in Bradford. Whiteheads had to merge with
its rivals, invest in new machinery to increase productivity, and slash
the numbers of workers in an effort to cut costs. Textile factories axed
40,000 workers last year, and another 25,000 will go this year. The hardest
hit have been women. The dangers for this plant and the industry are stark,
as factory boss Malcolm Gibson explains. He's fighting to survive as
the huge rise in the value of the pound against the Euro has wiped out
productivity gains.
GIBSON: We have been working very
hard over the last three years to improve our productivity and reduce our
cost base. We have invested in new machinery. Our whole workforce is working
together in a much more effective way to ensure that we can produce more
for less time. In fact we have probably achieved significantly in excess
of a ten per cent improvement in our productivity This has been totally
eroded by a twenty five per cent strengthening of sterling in that period.
WILENIUS: Keeping industries like
this rolling is now a high priority and Ministers are under intense pressure
to bring down the value of the strong Pound, or bolster the weak Euro.
Others want the government to deliver more radical action, to change the
way the Bank of England sets interest rates, or even put up taxes.
JOHN EDMONDS: The remit of the Monetary
Policy Committee of the Bank of England which is just to look at inflation,
worry about that worry a lot about that, but not to worry about anything
else. That's got to be changed. It's got to be changed to have a much wider
scope, to look at competition abroad , to look at interest rates abroad
and see where Britain is standing by comparison, but also of course the
second change is actually need a change in personnel . You need the Monetary
Policy Committee to contain people who know about manufacturing industry.
At the moment it's just academic economists and a few economists from
merchant banks. There's no real experience there. So of course they're
worried about house prices in the South of England and they're not worried
about what happens in Belfast or the West of Scotland or the North West
or the West Midlands.
FOSTER: I've argued for some time
that we've over relied upon monetary policy but Gordon Brown would say
that his fiscal policy has actually been buttressing the monetary policy.
But there used to be a time when the economy was overheating and where
it was consumption that was driving the overheating, and it was a perfectly
feasible economic policy to raise taxes in order to take that extra consumption
out of the economy.
WILENUIS: But to make sure workers
like this stay in jobs , some in the Labour Party want Britain to spend
billions of pounds to prop up the Euro .
JOHN MONKS: Not so long ago there was concerted
action across the exchanges by governments and central banks to bring
down the value of the dollar and I think it is time for the same kind of
concerted action to be put together to bring up the value of the Euro against
the pound but also against the yen and against the dollar. And I am looking
for Gordon Brown to give a lead to the international authorities in the
financial area, particularly the G7 countries along those lines, I think
he can do it, I think the time is right.
WILENIUS: But to some this all
looks like old Labour is back on the march. The Rover crisis sparked off
this mass rally at Longbridge in Birmingham which saw the trade unions
back on the streets . The scale of the protests and fear of up to 50,000
job losses alarmed Ministers. Although the company's saved for the moment
, the new Rover boss John Towers and senior Labour figures feel manufacturing
can only bloom again if the government makes the Pound fall by saying Britain
will join the Euro soon.
MARTIN O'NEILL: The government's commitment
to join the Euro, which at the moment has been understated ought to be
made far more clear and that at the Labour Party Conference, or the TUC
a senior minister or the Prime Minister, or the Chancellor, should make
it abundantly clear that it's our intention to join the Euro within twelve
to eighteen months, or at least have a referendum on it.
LORD HASKINS: The government has got to
in my view make a more positive statement about where it might find itself
vis a vis the Euro in two or three years time. In other words if the conditions
that the government has laid down for joining the Euro are met they would
need to be saying at some point that that would clearly accelerate the
case for us joining the Euro. I don't think business is hearing a clear
enough message from government about its intentions about the relationship
with Britain and Euro land.
WILENIUS: This one hundred and
forty year old woollen mill in Bradford needs help, as it's fighting to
survive. The Government's unwilling to go beyond sending a message to
markets that the Pound is too strong but there are now growing calls on
Ministers to intervene in other ways, to support ailing businesses. And
these businesses will need gentle nurturing over the next couple of years.
Ministers are under pressure to give much more help to factories like
this Yorkshire woollen mill, otherwise it may become just another historical
monument to a golden age of British manufacturing.
MALCOLM GIBSON: We are not a headline industry,
the large companies, the motor industry which is obviously getting a lot
of publicity at the moment and appears to be getting support, a lot of
smaller and medium sized companies that are really where the back bone
of the employment is in this country could also benefit from having some
assistance in either a regional form or helping with training or similar
sort of aspects.
WILENIUS: The motor industry faced
two big crises last week over Longbridge and Dagenham. Here at Vauxhall
they're successful and investing. But to keep the wheels of manufacturing
industry turning many are calling for direct government intervention.
They want more "Regional Aid " to help hard hit areas, such as the West
Midlands and the North of England. "Grants " available for development
and training. And business is calling for "Tax Breaks " to keep industry
moving forward.
JOHN MONKS: We want to see the governments
intervene to protect jobs and employment and good jobs. We know that there
comes a time with some areas where those jobs can't be continued but there
are other cases where the dip is temporary and we don't want to see people
go out of business and jobs lost and Britain suffer loss of a major earner,
because of some short term dip.
WILENIUS: Although company bosses
wants tax breaks, they don't want a return to government intervention where
taxpayers' money is used to bale out lame duck businesses.
DIGBY JONES: I would hope over three years,
that this government has learned that where business is left to create
wealth, as long as it is responsible in a socially inclusive way. As long
as it can take on most of the processes going forward, the unions with
it, and the environment with it. The best role for government is to have
created an environment and butt out.
WILENIUS: But when the wheels of
business fall off , the big global companies can close factories very easily
in Britain. So many in the Labour Party also want British workers to have
the same kind of protection as workers on the Continent.
JOHN EDMONDS: Frankly within Europe ,British
workers are regarded as mugs. We're not properly protected . We haven't
got the sort of rights that should exist in a civilised society and frankly
any company can sort of shut up shop and leave almost without any notice
at all and BMW did in this country what they could never do in Germany,
just saying we're going to sell off Rover and go. No consultation with
government, but no consultation with their own employees. I mean what sort
of civilised standards are that. And that's possible in the economy at
the moment.
DEREK FOSTER MP: I think in the short term it's
very difficult for the UK government to stand on one side and to make our
manufacturing employees more vulnerable than anyone else in Europe. We
cannot actually live with unnecessary closures.
WILENIUS: Tony Blair will be told
by CBI bosses over dinner this week, that manufacturing industry is under
serious threat. They don't want Labour to go back to its old ways and
use taxpayers money to prop up ailing industries. But there'll be a political
price to pay, if parts of Britain boom, while more manufacturers go bust.
JONES: I want to hear this week
from the Prime Minister that he understands the serious effects that the
strength of sterling is having on jobs in the country. That he doesn't
abrogate the responsibility for the challenges that are now facing industry
by saying it's all down to interest rates and a weakness of the Euro.
WILENIUS: Tony Blair's determined
not to return to the old days of Labour intervention, but he could well
have his work cut out explaining to his party and the voters that this
could mean more lost jobs.
MARTIN O'NEILL: We've got to recognise
that the recent local election results are evidence of the end of the honeymoon.
I mean it really was the longest honeymoon in history and I think in that
sense, the government has got to recognise that they cannot take the electorate
for granted and that they've got to get across the message that we live
in a rapidly changing world economy in which production is being shifted
ruthlessly in part by the manufacturers and in part by the customers because
they will go where the prices are most attractive.
EDMONDS: The government can't afford
to allow manufacturing industry to suffer any more. The economic arguments
are very strong. But the political ones for a government in its last
eighteen months of office are overwhelming. Unless action is taken a lot
of marginal constituencies are going to feel the heat and the government
is going to feel the heat from the MPs who represent them now.
WILENIUS: Indeed this is one of
Tony Blair's hottest problems. If he backs old style Labour intervention,
his hard won reputation in business and the City could disappear. But
if he continues to leave manufacturing to its fate, many factories, jobs
and voters could well head off elsewhere.
HUMPHRYS: Paul Wilenius reporting
and we did ask the Trade and Industry Secretary, Stephen Byers, if he wanted
to respond to the points made in that film but he said he didn't.
JOHN HUMPHRYS: The Government continues
to insist that there is no danger of British troops being drawn into a
civil war in Sierra Leone. But there are hundreds of paratroopers there
and more soldiers arrived off the coast only last night. The Shadow Foreign
Secretary, Francis Maude, is in our Oxford studio. Mr Maude, what would
you like to see happen now?
FRANCIS MAUDE MP: I'd like to see some real clarity
about what the purpose of this mission really is. We haven't heard that.
Last Monday when Robin Cook announced the mission he said it was essentially
to get the British nationals and other European nationals for whom we were
taking responsibility, to get them out. That's broadly been done but we
are now seeing the mission being extended apparently more or less indefinitely
and you know a lot of us are finding difficulty in reconciling Robin Cook
saying this morning that there's no question of the British troops taking
a combat role with the fact that the government has sent some of the finest
combat troops that there are in world. You know these are real front line
strike troops and if they are not there in any sense in a combat role then
actually expectations in the government of Sierra Leone and the people
of Sierra Leone who are suffering hideously from this brutal so-called
rebel force led by Mr Sankoh, then their expectations are being raised
high in a way that's very unsatisfactory.
HUMPHRYS: Do you want some sort
of enquiry into what?
MAUDE: Well there's a bit of a
tangled history here in Sierra Leone going - of the British government's
involvement going back quite some time and the aspect that I think is causing
some concern at the moment is the way in which the peace agreement that
was reached last July - June/July time - which involved the President -
the democratically elected President of Sierra Leone granting a pardon
to Sankoh and then giving him a seat in the government and a number of
his rebel colleagues seats in the government and effectively handing over
control of the crucial diamond mining area. The suggestion has been made
that that was forced upon, or Mr Kabbah are put under considerable pressure
to agree to that kind of arrangement by the Foreign Secretary, the British
Foreign Office, in order to secure a peace agreement. Now obviously that
was a flawed agreement because the rebel forces have, the bulk of them
haven't gone along with this for a second.
HUMPHRYS: That they say was the
least worst option, that's what the Foreign Office says.
MAUDE: Well I hate to think what
the other options were at the time, but this was a man who was then in
exile. Who was out of the country, under sentence of death and from what
one hears very deservedly so, he's been leading the most appalling crusade
of maiming and killings and intimidation in a way that was quite intolerable.
And to, as it were, to impose him as part of a new government is quite
wrong and is actually precisely that that seems to have led to today's
civil war.
HUMPHRYS: So what would you do
now then? I mean we have troops there and we have more troops arrived
last night. Would you, if you were running the show, would you now pull
them out?
MAUDE: Well it's very hard for
me to say that because I don't know what commitments have been made. I
don't know what has been said to the government of Sierra Leone and said
to the United Nations. You've got a big United Nations force there which
hasn't by all accounts performed terribly well and so I don't know what
Robin Cook has led them to believe the British troops are going to. Any
commitments that have been made by the British government have obviously
got to be met, the problem we have, which is why I come back to what I
said at the outset, that we need some clarity here. The problem is that
we just don't know what has been - what the purpose of this mission is.
HUMPHRYS: But I mean given that
no particular commitment has been made of the sort you are implying there
and Robin Cook says that it hasn't, that the troops went in in order to
help British and European nationals get out and secure the airport while
they did so. Given that that is the case, are you saying that those troops
- and you can hardly criticise the government for no clarity if you don't
have a view on this - are you saying that those troops should be pulled
out now or what?
MAUDE: I'm sorry to come back to
it. I mean you are saying why they have a view if we don't. We can't have
a view on that because we are not close to what is going on. You know it
is the government that sent the troops in, the government must have said
things to the government of Sierra Leone and to the United Nations about
what the purpose of this troops contingent is. Now, the mission has already
gone considerably beyond what Robin Cook set out in his statement to the
House of Commons last Monday when he said this was essentially a mission
to evacuate the nationals. That's happened, that's been done, broadly.
There may be some clearing up to do..
HUMPHRYS: But that has been done,
so would it not be responsible...irresponsible to pull out now given the
state that the country is in. Would it not be irresponsible to do so?
MAUDE: There is certainly a case
for saying that the troops should stay but we should be told what the purposes
of their staying. If they are not to be combat troops then....not to be
employed in any combat role, then we need to be told precisely what their
role is. You know, the danger of this is that we get more expectations
among those in Sierra Leone, in the UN and in the government and the people
of Sierra Leone, get raised beyond what we are actually prepared to deliver
which is why we do need to know what commitments Robin Cook has made to
the UN and to the government of Sierra Leone, otherwise it's very difficult
to make a judgement over whether the right thing is being done.
HUMPHRYS: But if there were any
danger, and clearly this danger must exist depending on who you believe,
that Sankoh and his gang of thugs and there are many thousands of them
are going to march into Freetown and God knows what they might do there
- they've been savage enough as it is already, and we had the chance at
least to hold them back a bit or maybe to stop them because of the way
we might work with UN troops, would you then say 'that is our moral responsibility
we should do that'?
MAUDE: I think we should.... Again,
without knowing
precisely what the sort of position would be it's very difficult to answer
that hypothetically because again one of the big dangers here is promising
more than you can deliver and the problem here you see is that Robin Cook
has said at the moment these troops won't be employed despite their being,
as I say, some of the finest combat troops in the world, they won't be
deployed in a combat role. And so there doesn't seem even to be the sort
of deterrent effect on the Sankoh forces of having these people there.
All of this is part of the reason why we think there should be a proper
enquiry into the whole of this. It's an unhappy way to proceed. First
of all with the peace agreement last June with clearly some baggage as
far as the British government is concerned from the British government's
own involvement in it and then the way in which this mission has been set
up, has been configured and now has been apparently developed, without
anything explicit being said about what the change in the mission is.
HUMPHRYS: Just a very quick thought
then - what sort of enquiry do you have in mind?
MAUDE: Well I don't have a fixed
view about that but it should be an enquiry which is able to look thoroughly
at all of the history of this and reach some conclusions, mainly factual
conclusions, it doesn't necessarily even need to be judgements, about what
happened. If the facts are properly disclosed then we the politicians
and the public can make our judgements on what happened.
HUMPHRYS: Francis Maude, thank
you very much indeed for joining us.
MAUDE: Thank you.
HUMPHRYS: More and more post offices are
being shut down in Britain ... not just in villages but in towns and big
cities too. The problem is going to get worse because the government is
planning to change the way that benefits are paid out. So there'll be
even less reason to pop into the post office in future. Ministers say
they will do something to help but, as Polly Billington reports, many people
believe it won't be anything like enough.
POLLY BILLINGTON: It's the end of an era in Chalgrove.
Mrs Croxford has tried to sell her post office as a going concern. But
as she and her husband now are drawing their pensions and with no buyer
available, it closes for good in June.
MRS CROXFORD: It's been in the family for
over ninety years. We've had it on the market for nearly two years without
any success. We decided if we really wanted to retire we really had no
option but to close it down. I think the uncertainty over the future of
the network, although they've got lots of plans to open a bank and all
the rest of it, it's not - if you're starting off today and you'd got money
to invest you might think twice before you invested it in a post office.
It's sad, because it's a lovely profession and our customers are our friends.
BILLINGTON: Those friends include many
of the village's three thousand residents, especially those who don't have
the means to travel far afield. Chalgrove might be close enough to Oxford
for commuters - but not for pensioners like Mary Mayall and Elsie Roberts.
MARY MAYALL AND ELSIE ROBERTS: I don't know what we're going to do then.
Nor DO I. We'll have to pay bus fare to Cowley. What, out of the 75p they've
just given us? That's a bit stupid. It's only two thirty. I really feel
that we should have a post office don't you Mary?. Yeah we're going to
be really let down I think. We're going to be lost without it to be honest.
She's got it to a tee - we are going to be lost without our post office.
BILLINGTON: Post office closures increased
steadily during the late nineteen nineties - Mrs Croxford's is one of nearly
four hundred that are expected to shut down this year. And that rate of
decline could get worse because the government wants to pay pensions and
benefits into bank accounts by 2003. If that happens the fear is fewer
people will use their local post offices, they'll become less viable, and
even more of them will close down. Sub-post office staff delivered their
warning and that of three million customers, to Downing Street last month.
Sackfuls of signatures to a petition piled up outside Number Ten. But the
government says there are good reasons for introducing automatic credit
transfer - or ACT.
ALAN JOHNSON MP: It is a much better deal for the
tax payer and dramatically cheaper as it costs 79p to the tax payer to
cash a giro cheque, it costs 1p to the tax payer to pay the money into
ACT. It also eliminates around about a hundred, a hundred and fifty million
pounds worth of fraud every year at a stroke
VINCENT CABLE MP: We've already seen in the Romsey
constituency, which we won, there was a very, very strong public feeling
about this, that rural communities are going to be severely undermined
if they lose their post office branch. They've seen this happening over
many years and the process of decline will accelerate with ACT.
BILLINGTON: Recent bank closures have left
many people with no alternative to the post office in their area as a way
of getting hold of their money. If post offices close as a result of ACT
some MPs worry about people being left out.
TONY LLOYD MP: People who for different
reasons have never bothered with the banking system, have always operated
in the cash economy, who feel more comfortable drawing the benefits directly.
And we have to make sure that they don't end up having to travel long distances
or simply being put to ridiculous inconveniences to get access to their
own money.
BILLINGTON: So what will the government
do? The Federation of Sub-Postmasters Conference starts today - and the
Trade and Industry Minister Alan Johnson will address them on Tuesday.
He'll be able to tell them about some of the options available. But the
question is whether the government's preferred solution finds favour with
the sub-postmasters and their customers. The government's Performance and
Innovation Unit, the PIU, is supposed to be coming up with answers to the
problem. That weighty tome is such a long time in coming some fear it's
been lost in the post. The government has suggested that subsidy could
keep some of the most vulnerable Post Offices open.
JOHNSON: They are necessary for
all kinds of reasons, they will probably never make a profit, never be
able to operate commercially viably, in a commercially viable way, that
is where government subsidy may need to come in, to come in, that is what
the PIU will be looking at. But in a vast network like this you know that
is a fairly small proportion.
BILLINGTON: Chalgrove fulfils the stereotype
of a village with the Post Office at its heart. But in the pursuit of protecting
services in the countryside there are fears that help won't be forthcoming
to post offices that serve areas less photogenic and communities less articulate
about their troubles - places that don't tug at the collective heartstrings
of the country.
LLOYD: The emphasis has been on
the rural areas, the idyllic concept of village Britain, but an awful lot
of Britons don't live in idyllic villages they live in inner urban areas
and their needs have got to be met as well within this process, so politically
they must not be ignored. If you like there is a heartlands debate about
the post offices as well.
JOHNSON: We are looking to resolve
the problems particularly for rural communities but that doesn't mean to
say that post offices aren't as important, as important and sometimes more
important in urban areas and urban deprived areas in particular, so it
is not a rural urban issue it is a post office network issue.
BILLINGTON Customers already have access
to advice and information at their local post office. Rather than a handout
for the few, postmasters would prefer all branches to get financial recognition
for the services they currently offer for free.
CABLE: I think the issue we now
face is whether the government is just going to allocate subsidy to a handful
of high profile closures or whether he has a systematic programme of providing
this money in the form of additional income to postmasters and postmistresses
to keep the whole network functioning.
BILLINGTON: The Dome is supposed to be
the showcase for Britain's future and its innovative ideas and technology.
The sub-post office here is part of that showcase - in that it's fully
computerised - providing all the services currently on offer at your local
post office - and with the potential to deliver much more.
So can you explain what
you can do - what services you provide on this computer.
UNNAMED WOMAN: PMD is for pension allowances.
You can collect your pensions, your income support, green Giros and milk
tokens. Then we have utilities and bill payments.....
BILLINGTON: So you can pay your bills.......
UNNAMED WOMAN: You can pay all your bills with
a card. Then we have personal finances and you can also send moneygrams
from the Post Office.
BILLINGTON: So that's people paying in
and drawing money out......
UNNAMED WOMAN: Oh yes. You can actually pay in
and draw out. And then we have licences. You can buy game licences, fishing
licences as well as colour TV licences.
BILLINGTON: This automation could be the
starting point for a whole new kind of post office. Some people say the
best way of keeping Post Offices open is by making them more profitable
- by offering new services via new technology. But achieving this will
take time and money. What the sub Postmasters want to know is whether the
government is prepared to sign up to that vision.
BAKER: I see Sub Postmasters being
the general practitioners for government. Not only dispensing cash in the
form of benefits and payments for the Post Office account supported by
a banking package for other banks, but dispensing information, information
about what benefits people qualify for, what are those benefits? Passport
forms, driving licence forms, all this can be provided at your local post
office, this is where people want it where they live. On top of that we
could have a national lost property database, we can read documents for
the police. Only your brain forbids you from thinking what else a post
office can do, supported by this computerisation that we're currently putting
in.
BILLINGTON: But hi-tech doesn't necessarily
make money. The delivery of services would still have to be paid for -
by - guess who? the government. Half a billion pounds is being spent on
this modernisation - but however many new services they offer computers
on their own won't solve the problem.
CABLE: The post office network
is already investing substantially in new technology to enable post offices
to keep up with electronic switching, I mean that is going to happen.
It doesn't solve the immediate problem of the loss of income in the post
office network, they are getting new technology, but they need the income,
this is the core problem we keep coming back to.
BILLINGTON: The government has services
that must be made available - and post offices will soon have the means
to offer them. Everyone could be a winner if the government paid postmasters
to deliver.
DREW: What I want to see is individual
post masters and post mistresses paid a salary where they are undertaking
services on behalf of the State, or indeed undertaking those services which
clearly need support in order to keep them in place.
BROWNING: It's not a subsidy, it
is a payment for a specific service that has to be delivered. If the government
delivered it themselves, then there would be a cost to the tax payer, and
of course that's what happened with benefits payments, it was just that
the Post Offices received the repayment for carrying that out on behalf
of government, because the sub-post masters say to me; they don't want
government handouts, but what they do want are income streams and opportunities
to replace that income in a legitimate way.
BILLINGTON: Planning for their conference
the Federation of Sub-Postmasters would like to be upbeat about the minister's
address. But they know that their members won't be in the mood just for
warm words.
BAKER: I have worries that if the
Minister doesn't come and say what the delegates want to hear then it might
not get ugly, they could certainly express their dissatisfaction in a way
which we probably wouldn't enjoy but I don't see how we can head that off.
BILLINGTON: Their first concern is what
to do if the benefit changes hit before they are ready.
BAKER: We want to hear the Minister
say they are signed up for the vision and if we're not ready by 2003 then
they will delay their ACT plans until we are.
JOHNSON: I think it is a sensible
programme and I think we can meet that programme and we can meet it without
damaging the network and without the kind of closures the people have predicted.
BILLINGTON: It might be too late for Chalgrove's
post office and its postmen, who will have to travel to Oxford's sorting
office to work. But post office staff say the future of others could be
secured by an early government decision on a package of measures to help
them.
DREW: They want to see what is
going to be in the Performance Innovation Unit Report, and they want to
see the degree to which they are going to get support and the degree to
which the universal service obligation is going to be maintained. And I
hope he can make some indications about that but this is not going to be
a quick fix, this is going to be a long term strategy of making sure that
we keep sub post offices in existence.
LLOYD: I think we've got to say
that there are some services in society obviously things like our hospitals,
like our schools, which nobody would ever say could be operated without
recognition, that society pays to keep them there. Now I think whether
it's rural Britain or urban Britain, the same kind of argument does apply
for the post office.
BILLINGTON: The government might not want
to hand out bags of cash to every post office, but the whole network needs
more than a push start to modernise. Until a decision is made about how
to finance the future, other sub post offices will go the way of Chalgrove.
HUMPHRYS: And that was Polly Billington
reporting there. And that's it for this week. Until the same time next
week, good afternoon.
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