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JOHN HUMPHRYS: Good afternoon. The Danes
are divided over whether or not to join the euro and they will be voting
later to decide on what they are going to do and we'll be looking at how
that will affect us.
The great petrol crisis
is nearly over but the government's problems may only just be starting.
Have we reached the point with taxes where we're saying: enough is enough?
I shall be talking to the Chief Secretary to the Treasury, Andrew Smith.
And the Liberal Democrats
want us to join the euro and pay higher taxes - what will THAT mean for
them? That's after the news.
NEWS
HUMPHRYS: The Danes are divided
over whether or not to join the euro and they'll be voting soon in a referendum.
What THEY decide could have a big impact on how WE vote.
And the Liberal
Democrats are busy trying to build support but could they be stung by their
policies on the euro and taxes?
JOHN HUMPHRYS: But first the great
petrol crisis. Well, it's all over bar the pumping, we hope, and we'll
soon have full tanks in our cars and we'll have forgotten it all. Or
will we? The worry for the government, apart from the immediate problem
of those devastating opinion polls this morning, is that we won't... that
we'll remember this past week as the moment when so many of us decided
that we'd reached the limit- that we will say taxes are too high and we're
not putting up with it any longer. If so, how does the government - committed
to high public spending - deal with it? The man who hands out the money
to the spending ministers is the Chief Secretary to the Treasury, Andrew
Smith, and he is with me now.
HUMPHRYS: Good afternoon, Mr Smith.
ANDREW SMITH: Good afternoon.
HUMPHRYS: Not hand it out personally,
I dare say, but we have the general idea. Now, what the past week has
shown, apart from anything else, is that you are out of touch with the
voters, so you're going to have to respond to that, that's the case, isn't
it?
SMITH: What the last week has shown,
John, is that we're a government that doesn't give in to blockades and
to pickets, that these matters are determined in a normal budget timetable,
and I mean, what sort of impression would people have of this country if
the government did just cave in, and secondly, we have acted resolutely,
in co-operation with the Police, with the oil companies, with others, and
I am very grateful, and the government is, to all of those who have been
putting their energy and time into getting supplies restored, we have acted
resolutely to get the situation back to normal as quickly as possible.
But those are the keys things, we don't give in to blockades and normal
fuel supplies must be assured.
HUMPHRYS: But you didn't answer
the question as to whether you are out of touch with the voters which manifestly,
on the basis of the past week, you are.
SMITH: No, we, we are listening
to the voters, we are listening not only to those industries that have
been affected very deeply by restructuring of their businesses, the crisis
that has been affecting farmers, the situation affecting hauliers, we know
people are concerned about the level of petrol duty. That is why in the
last Budget we cut vehicle excise duty for lorries, we ended the automatic
fuel escalator, it is why we are bringing in a new vehicle excise duty
system that helps four million motorists through lower duty. And so we
are listening, we are giving extra help to the agricultural industry, the
two-hundred million package a few months ago, and perhaps many people don't
know this, you referred to my role as Chief Secretary and my responsibilities
for the spending review: over the next three years, agriculture gets a
real terms increase of six-and-a-quarter per cent on average, year on year,
more actually than the increase going to The Health Service and to Education,
so we are listening, we have been acting, but it would be quite wrong for
us to give in to blockades and deviate from the normal budget process which
settles these things in a balanced and democratic fashion....
HUMPHRYS: Interruption.
SMITH: ... but can I just say John,
we are listening, and we have to listen to the people who don't blockade
oil refineries as well as those who do, we listen to the pensioners, the
teachers...
HUMPHRYS: ... sure ...
SMITH: ... those who want public
services....
HUMPHRYS: Who of course were on
the side of the people who were as you putting it, as you put it, blockading.
Now those are the people, according to Mr. Hague this morning, you may
have heard him, 'decent hard-working people...' These aren't pickets who
intimidate people, these aren't people who make threats, these, he says,
are decent, hard-working people, and it would appear, most people, vast
majority of people are on their side...
SMITH: ...well I think Mr. Hague
has to be very careful about giving comfort to people who would see this
country governed by blockade and not by the democratic process. Now if
we look at the protesters, of course many of them, as I have said, are
sincerely protesting their views, the interests of their industries which
as I have acknowledged are badly affected by restructuring, of course many
people are voicing their views, and it's right in a democratic society
that they can protest, but you know, there is a line between legitimate
protest on the one hand, and stopping people going about their lawful business,
bringing the Health Service into a emergency situation, putting businesses
and firms and people's daily lives at risk, the carers who can't get out
to visit those they are looking after, and the rest of it, now I say that
the people of this country, yes they want people to have the opportunity
to protest, they don't want them to have the opportunity to bring the country
to a halt .....
HUMPHRYS: ... so
SMITH: ... and any government,
and Mr. Hague ought to think about this, any government that gave any signal
that it could give in to that wouldn't be a government worthy of the name,
and Mr. Hague certainly wouldn't be a Prime Minister worthy of the name.
HUMPHRYS: So they are not decent
hard-working people, in your estimation.
SMITH: Many...of course, of course,
many of them are. What actually happens with these protests, you get those
who've got a legitimate grievance, you get those who want to go along and
make a protest, you get some along there who are there out of political
motives and you get some, frankly, who turn up whenever there is some trouble,
because they want some bother.
HUMPHRYS: So, but you see, if,
if they are that, if they are decent hard-working people, it would be entirely
reasonable for a government to say, not just as you have said already,
we will listen to them, it's one thing to say, we will listen to them,
that doesn't cost anybody anything, does it, to listen to somebody, it's
another thing to say, and, and... 'we will take note of what they tell
us and we will do something about it because they are decent hard-working
people who are simply registering a legitimate protest.' You seem not
to be saying, we will do something about it, you seem not to have noticed
the what the polls have told you this morning, either for that matter.
SMITH: No, we, we certainly are
listening, and as I said, we have to listen to all the people...
HUMPHRYS: ...I acknowledge you
are listening...
SMITH: ...not just...
HUMPHRYS: ...I acknowledge you
are listening, my question was whether you are going to do anything about
it, not just listen.
SMITH: And the implication of listening
is that you take all of the arguments and the representations that are
made to you into account, as we draw up our pre Budget report later this
Autumn and towards the Budget next Spring and of course we will do that.
But where I would have to question your assumption John, it cannot be
right to say that, if you are listening, you must automatically do everything,
those who are calling for things to be done, want done...
HUMPHRYS: ...true enough, but ...
SMITH: ...because governments have
to make hard choices on levels of revenue raising, on levels and priorities
of expenditure, and what this debate really comes down to, and this is
something where I think the Conservatives are very vulnerable on indeed,
is, are we going to sustain public services, are we going to have the extra
money...
HUMPHRYS: ...no it doesn't, that's
a diversion, you know perfectly well that that's a diversion ...
SMITH: No it, no it's not, no it's,
it's, it's, no it's it's not a diversion, because, when John Redwood says
he'd like to see a 5p cut in the rate of duty, that 5p cut equals two-and-a-half
billion pounds this year, three-and-a-half billion next year, four-and-a-half
billion the year after that. Where would he get that money from? It's
clear on what the Tories have already said, that they are sixteen billion
short and that the question that they do have to answer is which hospitals,
schools, transport investments that we are making, would they cancel, because
their sums do not add up...
HUMPHRYS: ...well, well, nobody
believes you on that, but let me....
SMITH: ...interruption....
HUMPHRYS: ...let me...
SMITH: ...you're saying that nobody
believes in that...
HUMPHRYS: ...well polls tell us
that, they think that's a load of tosh...
SMITH: ...well, you see, er, er,
we are not going to be influenced in this, by short term polls, frankly...
HUMPHRYS: ...or indeed by anybody...
SMITH: ...it would have been...
HUMPHRYS: ...or anybody tells you
...
SMITH: ...it would have been very
surprising after a week like this, of course things happen which people
don't like, and of course they blame the government, but the responsibility
of government is to govern for the long term, to face up to the hard choices,
yes, to listen to people, and we are listening, and to reach a balanced
judgement through the normal budget process, which takes account of all
of the interest, and not just those who shout loudest and not just those
who can string a blockade across an oil refinery.
HUMPHRYS: Let me give you a little
quote here. "We would not load a burden on the poorest, the elderly and
the most disabled people in this country and claim that it had something
to do with the environment." That was you. You may recognises the quote
from a few years ago, when petrol tax was approximately, the take, was
approximately half what it is today. Well now we're taking sixty-one pence
out of the pound, out of a gallon of petrol.... out of a litre of petrol.
If that's what was the situation back in ninety-three, what are you doing
now if that's what you felt in ninety-three?
SMITH: Well John, if you actually
look at the facts to this situation, what's been happening over the last
sixteen months, of the increase in the oil price only two pence is only
actually down to duty changes. As I said we've listened...... we took
off...... (both speaking at once)
HUMPHRYS: ... but it's now sixty-one
pence.....
SMITH: .... No...no...
HUMPHRYS: .... It was thirty-six
pence when you made that comment.....
SMITH: The Conservatives put on
the automatic escalator.....
HUMPHRYS: But you kept it going
and you increased it year after year .....
SMITH: ....and we listened and
we took it off.
HUMPHRYS: But you see you said
it was explicitly said that it was not fair when they started it, and that
that level of taxation was not fair. What puzzles me and puzzles a lot
of people I think is why if it wasn't fair then, when it was a darn sight
lower, it's fair now when it's a darn sight higher.
SMITH: Well, John of course, people
would like petrol prices to be lower.... (both speaking at once)
HUMPHRYS: ...Well, do you want
to answer that point, I mean do you want to answer that particular point...
SMITH: ...to be lower, because
I said that governments have to face the tough choices, they have to look
at things, we have to look at things.......
HUMPHRYS: But it wasn't fair then,
in ninety-three....
SMITH: We do have to look at the
balance between the way in which money is raised across different taxes
and duties just as we look at the balance across the different public expenditure
priorities. The point I am making is that it would be wrong to have the
economy lurching or short-term budget decisions lurching depending on blockades
one day or volatility on oil prices the next day. You have to take a balanced
and sound judgement in the interests of the people, in consultation with
the people and that's what we are doing.
HUMPHRYS: You make that point very
clearly. What you've not done is answer the point that I have just put
to you - that if a certain level of taxation of fuel duty was 'wrong' and
'not fair', your own words, back in 1993, how come, now that it is higher
than that, it's fair? I don't understand it.
SMITH: Well I've already said John
how we've acted to address the concerns in the interests of fairness and
as Gordon set out in the last budget we took the fuel duty escalator off
precisely because the oil price increase was making its effects onerous.
So we've listened to the concerns, we act in the interests of fairness
so it's worth recalling the number of bodies from the Daily Telegraph,
the Automobile Association to the Road Haulage Association who actually
welcomed the measures in the last budget. Daily Telegraph - 'the most
motorist-friendly budget for eight years...' they claimed.
HUMPHRYS: Well compared to what
had gone before .....
SMITH: ... but we have acted and
we have listened but we will not be dictated to by blockades and the people
of this country wouldn't respect us if we were and they won't respect Mr
Hague for giving comfort to those who blockaded our country.
HUMPHRYS: Alright. So the message
I take from all of that is that you cannot tell the protesters and all
the people who support them and if the opinion polls, unless every single
opinion poll is sensationally wrong, that's about ninety per cent of the
population who support their aims, you cannot say to them 'we're going
to do something to help you' so therefore in sixty days we're going to
have another crisis aren't we? Because that's what they say and they were
terribly effective last time and they're even better organised now.
SMITH: John, we can't be dictated
to by arbitrary ultimatums like that. I heard Bryn Williams...(both speaking
at once)
HUMPHRYS: ... but that was the
deal wasn't it....?
SMITH: There's no deal. I heard
Bryn Williams on the television earlier today on the Frost Programme and
I welcomed the conciliatory tone of his remarks and he urged people to
think very carefully and he said not to engage in intimidation.....
HUMPHRYS: ..... but the ultimatum
remains.....
SMITH: ...and he said, 'we will
not intimidate the government today'. And my message is: He will not
intimidate the government at all. But we will listen, we will meet with
representatives in the industry and of those who are concerned and these
factors will be taken into account, of course they will, as we draw up
the pre-budget report and as the Chancellor finalises his budget. But
it's wrong to say that we're somehow not listening if having listened and
weighed all of the considerations as a government has to we can't guarantee
that we're going to do what people want and actually it would be irresponsible
if we were to attempt to do so. Any hint that these things can be dictated
by blockade and by fluctuations in oil prices.....
HUMPHRYS: ....public opinion, public
opinion? I thought in a democracy that was pretty important.....
SMITH: I believe the public opinion
respects a government which listens, which takes their concerns into account
and which makes the right overall judgement of the balance on the way we
raise revenues, of environmental considerations and so on and how we distribute
public spending. It's getting that judgement right for the long term which
is important. The importance in the stability and prosperity of our economy.
I was very interested you see.... You talked a lot about polls and public
opinion and so on. When the BBC had that excellent Straw Poll debate the
other night...
HUMPHRYS: On Radio 4?
SMITH: Yeah. Listeners voted five
to two that this was a selfish action and not a legitimate protest. Now
you know if you're taking straws in the wind those views have to be considered
as well and we have to listen to the people who don't blockade oil refineries
not just those who do.
HUMPHRYS: Yes, but your problem
you see is that you've been rumbled haven't you, as a government. People
now recognise there's a game because you approve of the Radio 4 poll so
perhaps you'd approve of the MORI and the other polls that we've seen this
morning, NOP polls this morning and where they say they recognise now,
quite clearly, that you are a high tax government. You're a tax and spend
government. That's what you......
SMITH: No.
HUMPHRYS: Well let's look at the
figures: Tax burden 1999..... er ninety-six/ninety-seven, thirty five
point three per cent. Ninety-seven to ninety-eight, thirty-six point five
per cent. Next year thirty-seven point three per cent. Now that is a
very very clear increase in the tax burden and Alistair Campbell, your
own man, has acknowledged the tax burden is going to rise.
SMITH: We all know
that the figure is in the red book and it's thirty-six point nine this
year as compared to thirty-seven per cent - but let's get to the guts of
the issue here John. When we came into government we inherited a mill
stone of debt which the Tories had strung round the British people. The
national debt up to forty-four per cent (INTERRUPTION) of the GDP - borrowing
of twenty billion, now that had to be sorted out. Of course it did, of
course it did, and that is why this year the tax burden is falling.
HUMPHRYS: Next year it's going
up.
SMITH: Now, what actually happens,
the tax burden next year will depend on the decisions which are being made
in the Budget, but we are not, we are not a tax raising or high tax by
instinct government, and the proof of the matter is, and this is where
we have kept faith with the electorate, each and every promise that we
made at the General Election on tax, not to put up the basic rate of Income
Tax, not to -
HUMPHRYS: No, no, no, steady on,
hang on, I can't let you get away with that one because Tony Blair said
taxes, not Income Tax. Tony Blair said taxes will not go up, He didn't
say Income Tax, he said taxes, and taxes have gone up.
SMITH: Now, look, I'm just listing
for you all the promises we made and all the promises -
HUMPHRYS: Well, you missed out
that one didn't you?
SMITH: We didn't, we haven't put
up Income Tax, indeed the basic rate's been cut, the higher rate hasn't
been increased. We said we'd cut the rates of VAT on fuel and we have,
we said we'd bring in a ten p starting rate when it was prudent to do so
and we have. Moreover we've cut corporate taxes and given extra help
to small businesses and to savers, so we have been keeping our promises
on tax,........
HUMPHRYS: Well, eighty-five per
cent of the population do not believe that........
SMITH: ..when the Tories broke
all of theirs.
HUMPHRYS: Well, eighty-five per
cent of the population according to the latest NOP poll does not believe
that. They believe you have put taxes up, they now trust the Tories more
than they trust you not to continue doing it.
SMITH: The people will take their,
make their judgement in the proper way as we approach the General Election.
I'm absolutely confident that we will be judged on our record, yes of
keeping our promises on tax, but judged also on our record of economic
competence of building an economy in this country where we've sorted out
the huge debts we inherited from the Conservatives, where we've got a million
more people in jobs, where we have low and stable inflation, where we have
interest rates less than half the level they reached under the Conservatives,
where we are investing in skills, and where we are helping our essential
services with investment in the Health Service, in education, in fighting
crime and transport, and for that matter in agriculture to a scale that
the Conservatives could not match. And one of the things some of the farmers
are protesting would like to reflect about I'm sure is that six and a
quarter per cent real increase in agriculture investment we're making across
the next three years, the Tories haven't promised to match that. They
haven't promised to match our investment in education of what we're putting
in to fight crime, and the fact is their sums do not add up, they hint
that they would consider cutting fuel duty, although when you actually
pin Mr Portillo or Mr Hague down, they're not promising to cut on fuel
duty, but what is clear they are sixteen billion short on the commitment
to public services and investment that we have made, and that when it comes
to voting at the General Election people will be looking at all of these
matters in the round, and we will be content to be judged on our record
and the fact that we have listened in pushing those .....
HUMPHRYS: Alright, let's look
ahead, we've only a short time left. In the longer term future are you
prepared to say to people: If we think it's necessary and there are difficult
views in one area or another, we have these odd emergencies that crop
up all the time, we would actually, we a Labour government would be prepared
to ask you to accept a tax rise in order to spend more money on the public
services that are so important. Is that your general philosophy?
SMITH: Well, first of all everything
we do in this parliament is governed by.....
HUMPHRYS: Now, I'm asking you for
the future....
SMITH: The promises we made at
the last....
HUMPHRYS: You've got ten seconds
left.....
SMITH: General Election, we are
not by instinct a high tax party, we will fund a good level of public services,
not only by building a strong economy as we have, but making it even stronger
for the future. That's the way Labour keeps faith with the British people.
HUMPHRYS: Andrew Smith thanks very
much indeed.
HUMPHRYS: Now the people of Denmark
will be voting next week on whether or not they should join the euro.
To judge by the polls, they're split right down the middle. The vote is
being watched very anxiously indeed by politicians in this country. It
could even influence the timing of our own referendum, perhaps even how
we vote in that. Paola Buonadonna reports from Denmark.
PAOLA BUONADONNA: Copenhagen is better known
as a charming tourist destination than as the scene of vital political
decision-making -- But the sedate atmosphere of these rainy streets is
deceptive. In eleven days' time the Danish people will be asked to vote
in one of the most controversial referendums in the country's history:
whether or not to join the single currency. Their decision could have powerful
implications beyond Denmark.
The Danish euro referendum
could not have happened at a more delicate time for the British Government.
The results will come out on the last day of the Labour Party Conference
and immediately before the Conservatives begin theirs. If the Danes vote
yes, it could persuade the Government to hold an early referendum on the
Euro shortly after the General Election. If they vote no, the British referendum
could be off the agenda.
FRANK FIELD: It's clearly important
for Denmark in that they were the country which was allowed to vote on
Maastricht and they rejected it and had to be given another vote to bring
them into line, but my guess is that their result will actually be quite
important in the debate in the run-up to the referendum on the euro here.
CLAIRE WARD: It's going to put
greater pressure upon Britain and those who are outside of the eurozone
to really think what the future is going to be like being on the outside.
BUONADONNA: In 1992 the Danes
delivered a spectacular warning to the project of European integration
when 50.7 per cent voted down the Maastricht Treaty. Stock market reactions
forced several countries to devalue their currencies, while the UK and
Italy were forced out of the Exchange Rate Mechanism. But in Britain the
political effects of the Maastricht vote were just as powerful, signalling
the beginning of a long and damaging split in the Conservative Government.
IAN TAYLOR The Danish seem
to have a habit of making their referendums important, it was during the
Maastrich debate, on our own House of Commons dealings with that treaty,
and now it appears to be likely to influence the mood at least in the United
Kingdom towards the euro.
BUONADONNA: The Danish euro referendum
was called in March, when the yes camp had a fifteen point lead in the
polls. All the main parties are in favour of the euro. But in the course
of the six month campaign popular support has ebbed away and now the two
sides are neck and neck, each energetically wooing the substantial number
of voters who remain undecided. If Denmark decides to join the euro it
will give a powerful boost to the pro-euro campaign in the UK. euro supporters
will tell the Government that it will have to be far more positive and
aggressive on the euro issue, to gear up for an early referendum.
WARD: If we're
going to be able to convince people of the need for the future of Britain,
for its interests, for its economic interests and for the future of the
jobs in this country, that we've got to spell out why we support the euro
and we've got to do it early.
BUONADONNA: The Danish Social
Democratic Prime Minister, Poul Nyrup Rasmussen, is on the campaign trail.
Workers at this steel foundry in Holstebro quizzed him at length on the
reasons for abandoning the Krone. He thinks his clear and unequivocal support
for the euro can win the doubters round. Many in Britain want Tony Blair
to display the same determination.
POUL NYRUP RASMUSSEN: We have been campaigning
now in six and a half months and that means that all the arguments are
there on the table What the Danes want to see is not a Prime Minister behind
his desk office, or in - in beautiful rooms, collared and all that, they
want to see a Prime Minister among themselves, on their working place,
on the streets, to the meetings, that's where we have to be and that's
what I like and I love. You know, like an old horse smelling a little
bit of the circus I like to be here.
WARD: I
think the government have got to decide if we really do support joining
the euro, then we've got to lead that campaign, and we've got to be in
a position when we are calling a referendum that we are in a strong position
to be able to lead it, as strong as we possibly can be.
BUONADONNA: The British
No campaign is well underway - last week they launched a media offensive
led by Lord Owen. They're determined that the euro remains centre-stage
between now and the next General Election. The Government appears to be
in trouble whatever it does. Some in Labour fear a pro-euro line could
jeopardise the election, but leaving the campaign until after the election
might not leave enough time to turn around public opinion.
TAYLOR: If
Tony Blair doesn't have the courage of his convictions and pretends this
is not an issue that he needs to discuss until after the next General Election,
then it's going to be very difficult suddenly, pre-supposing he does win,
for him to say now we must suddenly confront this and I'm going to put
the arguments in favour. That's just not credible, we've got to start progressively
now to prepare the British people for the political and economic debate
that we're going to have if we have a referendum within two years.
FIELD: The
government knows that the euro is a vote loser and therefore quite naturally
it is trying, it won't succeed but it is trying to keep the euro out of
the General Election campaign. There'd be huge tension about whether
the current formula can be sustained during the General Election campaign.
The more out of control from the government's point of view, the euro
debate gets, the more Labour seats would be put in danger.
WILLIAM HAGUE: The Conservative
Party takes another step to advance our common-sense revolution.
BUONADONNA: That's why
launching a mini-manifesto earlier this month, the Conservative leader,
William Hague, toughened his stance on Europe. He drew the line on any
further transfers of power to Brussels. But a yes victory in Denmark could
be embarrassing and Tory spokesmen are careful to avoid any comments ahead
of the referendum. But some say that it would undermine the official Tory
policy.
TAYLOR: Ah, yes victory in Denmark
would certainly cause some of my colleagues to stop in their tracks; rather
unwisely one or two or my colleagues have actually participated in the
Danish debate, ironically some of those colleagues are the very ones that
actually say we don't want interference in our affairs from people outside,
and here there are interfering in the Danish electorates affairs. So I
think it would have a big effect on the Tory party,
JOHN REDWOOD, MP: Well I don't think you're going
to change William Hague's mind. He won the leadership election around
the proposition, that he would rule it out for two parliaments then, the
one we're just living through, and the next one, and the party voted for
him on that basis. And I support him, because I want a coalition of all
those who say never, and there are a lot of people in the Tory party who
say never, and those who say, well certainly not for a long time.
BUONADONNA: The leaders of the small anti-Euro
Christian People's party are getting ready for a grilling on Denmark's
main TV channel. They need all the free air time they can get. The no camp
is made up of a mixture of fringe parties on the right and left together
with public sector workers who fear the Euro would damage Denmark's generous
welfare state. Their campaign has been buoyed by the continuing slide in
the value of the Euro.
If the Danes vote to reject the Euro, even by a narrow margin, Euro enthusiasts
in the British cabinet such as the Foreign Secretary Robin Cook, and the
Northern Ireland Secretary Peter Mandelson could find it hard to push for
the Euro campaign to be stepped up. And the Chancellor, Gordon Brown, may
well be tempted to put the referendum off.
FIELD: We have the fourth richest
economy. He's the first successful Labour chancellor. And therefore,
he's going to be very cautious indeed about putting that at risk, with
all the adjustments which would have to follow in this country if we entered.
And my guess is that his apparent scepticism will be one which will grow.
WARD: If there's a no vote in Denmark
and they are on the outside and they decide to stay out of the Euro zone,
it will make it difficult but that doesn't change the arguments about why
we want to join the Euro, and we believe that the longer we stay out of
the Euro, the more difficult it is for us and particularly for our businesses,
and that will increase as time goes on.
BUONADONNA: The former Labour Social Security
Minister Frank Field is one of the Eurosceptics who has been over to Denmark.
Mr Field believes a no victory will destroy the argument that it is inevitable
for Britain to join the Single Currency in the long run.
FIELD: You most assuredly will
influence the outcome in Britain...
BUONADONNA: Although eleven of the 15
EU countries are already part of the Euro and Greece is due to join soon,
if the Danes stay out Sweden as well as the UK may decide not to hold a
referendum.
FIELD: A 'no' vote in Denmark would
show that a country, only a fraction the size of us has got extraordinary
courage that it knows it can survive, it knows there's life after the Euro,
and that would actually have a very, very big effect on the debate in this
country.
BUONADONNA: MEP Jens Peter-Bonde, one of
the leaders of the cross party anti-Euro June Movement knows that both
Sweden and Britain are watching the Danish decision closely. His message
is clear - he tells these students in Copenhagen that rejecting the Euro
is the only way for Denmark to retain democratic control of its institutions.
The political argument has been exploited by the 'no' side very successfully,
both in Denmark and in the UK.
JENS PETER-BONDE, MEP They've never explained to the people
this is a political project. The aspirations of France and Germany is
to form a United States of Europe, they never told the truth, so this is
the reason that the 'yes' campaign has run into difficulties, because people
don't believe it's a question of, of the interest rate being a half per
cent higher or lower.
TAYLOR: I believe that we have
made a tactical error, or rather I don't think Ken Clarke and myself and
others in the Conservative party have ignored the political aspects of
it, but I think the government would rather the political aspects were
set aside, that is a mistake we have to address them. It's a question
of whether we actually increase our influence within the European Union
to which we are committed by being part of the Euro zone or not, and that
is political influence.
BUONADONNA: Members of the main centre
right opposition party, Venstre, are campaigning hard in favour of Denmark
joining the Euro. Unlike in the UK where the Tory party and large chunks
of the media and business are hostile to the Euro, in Denmark the single
currency project enjoys the support of most of the establishment. So anti-Euro
campaigners in Britain warn Tony Blair that a Danish 'yes' victory would
not offer much comfort while a 'no' victory would show just how tough the
challenge is.
REDWOOD: It might even cause the
Prime Minister to have some doubts, about his ability to persuade the British
people the wisdom of this, if he sees the whole Danish establishment, all
the industry leaders, all the trade union leaders, all the political parties
telling the Danish people, for the second time, that they've got to vote
'yes' for this thing and then failing, that would be quite a blow to their
esteem.
BUONADONNA: With eleven days to go till
polling day, the Danish campaign is hotting up - both sides are using any
trick to capture the public's imagination. The far right Danish People's
Party resort to unicycles to soften their image. Whichever way it goes,
it will have a big impact on the Euro debate in the UK. The Danish result
may well determine when or even whether the British people decide on the
future of the pound.
HUMPHRYS: Paola Buonadonna reporting
there.
The Liberal Democrats
are holding their annual conference in Bournemouth this week - the first
of the three main parties to do so. It will almost certainly be the last
party conference before the General Election. Paddy Ashdown did well to
take 46 seats last time... and his successor Charles Kennedy faces a tough
challenge if he's to hold on to them all, let alone win more... not least
because he's committed the party to increasing taxes to spend more on public
services. Terry Dignan reports.
TERRY DIGNAN: The Liberal Democrats face
a struggle to hold on to seats won from the Conservatives who say they're
now roaring back into contention. Preparing for the battle ahead with fund-raising
events like this one, at which visitors learn how to be rally drivers,
the Conservatives reckon they'll gain pole position at the next election
by executing a simple vote winning manoeuvre. The Conservatives here in
Winchester and in other marginal constituencies are gearing up their election
machine with a promise to expose the truth about the policies of the Liberal
Democrats. The Liberal Democrats, they say, would join up with Labour to
surrender British sovereignty to Europe. And that's not all. They'd want
swingeing tax increases to pay for their public spending programmes. So,
rather than try to raise their voices above the din of a noisy election
campaign, perhaps the Liberal Democrats would be better advised to stay
quiet about their policies. Andrew Hayes wants Britain to stay in control
of its own currency. The Tories' prospective candidate in Winchester, he
says although the Liberal Democrats are in favour of joining the Euro,
you wouldn't guess that from listening to the local Lib Dem MP.
ANDREW HAYES: The Liberals do not like
talking about Europe. They were frightened by the results of the European
elections last year when we got double the votes the Liberal Party got
here in Winchester. They do not want it on the agenda. Now this is a key
policy for them, nationally. They do not talk about it locally. My job
is make sure people understand the views of the local Member of Parliament
so they can make their judgement when the time comes.
DIGNAN: At Nuffield College, Oxford,
the findings of a study into how voters feel about the big issues of the
day are analysed by a team led by Professor Anthony Heath. They show that
the majority of people aren't aware that the Liberal Democrats are Britain's
most pro-European or Europhile party.
PROFESSOR ANTHONY HEATH: The Europhile approach of the
Liberal Democrats hasn't got across. Most of the electorate just think
they're a neutral middle-of-the-road party on Europe as on so many other
issues.
DIGNAN: Winchester's Liberal Democrat
MP Mark Oaten isn't going out of his way to enlighten voters about his
views on Europe. When he's visiting constituents - today he's meeting local
beekeepers - Europe, he says, is rarely raised. It's not that he's anything
to hide on the issue - it's just that people here have more pressing concerns.
MARK OATEN MP: My post bag tells me that
concerns about waiting times at the local hospital, concerns about actually
getting a decent education for children and the lack of increases in pension,
are what people want to hear me talking about. So that's why Europe won't
be my number one issue. But I'll certainly address it if it's put to me.
DIGNAN: The Liberal Democrats'
perspective on what matters most to voters may be accurate, despite the
evidence showing that Britain's electoral landscape now provides a natural
breeding ground for the Conservatives' brand of Euro-scepticism.
PROFESSOR HEATH: Historically the British voter
has always paid most attention to what we can think of as the bread and
butter issues, issues to do with unemployment, inflation, taxation and
government spending. Those are the issues which the voter thinks government
is responsible for, that it's up to the Government to deliver proper public
services, it's also up the Government to keep taxes down.
DIGNAN: Ian Liddell Grainger says
that when he talks to voters he finds that Europe is as important as the
bread and butter issues. The prospective Conservative candidate for Bridgewater,
he believes the issue will help the Tories to win back seats they've lost
and hold on to those, such as this part of rural Somerset, where the Liberal
Democrats are a close second.
IAN LIDDELL-GRAINGER: I think you'll find Europe is very
important and I'm gonna bring it up in every chance I can because it is
important and it matters to the people of Bridgwater. Today I've been
talking to farmers on Exmoor and here just outside Bridgwater, we have
talked mostly about the effect of Europe. They want to know and if I said
'I'm sorry it's not relevant,' they would be rightly furious. You can't
hide your head anymore, Europe is now predominant in British politics.
DIGNAN: It's all change at the
offices of Bridgewater's Liberal Democrats. Their prospective candidate
would also like a new look to the party's tactics in case the Conservatives
succeed in making Europe one of the big election issues. What he's looking
for is a more forceful response to Conservative attacks on the Liberal
Democrats' pro European policies.
IAN THORNE: I think we'd like to see the
party do more, I think it's all of our responsibilities to be much more
pro active in terms of getting the message across. There are a huge number
of people, ordinary voters, who are committed to Europe who understand
what the benefits are for our futures as this country and I think that
there are a lot of people out there who are waiting to hear a party that
is prepared to stand up and speak up for Europe.
DIGNAN: Liberal Democrat Winchester.
Targeted by the Conservatives. Tory Bridgewater. Targeted by the Liberal
Democrats. In each seat the Conservatives regard Europe as their opponents'
Achilles heal. But the Liberal Democrats believe their support for higher
public spending will see them through to victory even though they'd meet
this pledge by raising taxes.
OATEN: You've got to raise those
funds from somewhere and I speak to a lot of people and Conservatives in
Winchester as well, who do recognise that you can't have all of these things
without paying for it. Much better therefore to be up front, clear with
people and say, 'we won't do it beyond this, but yep there is a price to
pay and this is what it's going to be.'
HAYES: What we're seeing now is
a Liberal Party that is committed to policies that are more left wing than
the Labour Party. I never thought that we'd see a return to the kind of
punitive taxation the Liberal Party unmasked this week. These sort of policies
I do not believe will go down well in Winchester. They're to the left of
the Labour Party and I believe the Liberal Party's made a big fundamental
mistake if it wants to retain the support of people in areas such as this.
DIGNAN: When the Liberal Democrats
set out their policies at Westminster, as they did recently, the reporting
often concentrates on planned tax increases. Yet, frustratingly for the
Conservatives, the voters often don't notice.
PROFESSOR HEATH: If you studied the party manifestos
you would see that the Liberal Democrats are indeed now the, the most radical
party on taxing and spending. But that hasn't got across to the voters.
The voters at the moment think the Liberal Democrats are middle of the
road on taxes and spending.
DIGNAN: Which may be just as well
in view of the nation-wide protests against petrol tax increases. Dubbed
by the Tories the 'taxpayers revolt,' the sight of Britain grinding to
a halt is being used by some Liberal Democrats as a warning to their party
that support for higher taxes may prove to be damaging come the next election.
CHRIS FOX: The whole tax and spend
issue I think will be quite prominent in the next election, not least because
people seem finally to have understood that indirect taxes are also a major
part of the overall tax burden, that's what we're seeing with the petroleum
issue. So it's going to be an issue. There is a danger that each time
we make a proposal that says we're going to increase taxes and we're going
to spend it on that issue, that we can be depicted by our opponents as
being a tax and spend party. They can use each of those examples as evidence
of an underlying tendency within the party to be wholly tax and spend.
DIGNAN: But Conservative attacks
on Liberal Democrat spending plans could backfire, says Mark Oaten, by
drawing attention to the effects of Tory tax cuts on vital public services.
OATEN: If they're going to get
any more votes in a seat like this, then we need to know what they're going
to do about core public services and how they're going to fund them because
they're committed to more tax cuts. Well you know, the public aren't stupid.
If you're going to improve health, education and pensioners then how on
earth are you going to pay for it?
PROFESSOR HEATH: It might be tempting for the Tories
to try to educate the voters and to tell them where the Liberal Democrats
stand but this may well not work because the voters are really only going
to believe messages that comes from a source that they trust, so that if
the Conservatives are not really trusted in general then the things they
say about the Liberal Democrats won't be trusted either.
DIGNAN: So in seats like Bridgewater
the Liberal Democrats will risk calling for higher taxes. Although it might
scare off some voters, the policy could have the opposite effect on one
group in particular. The Liberal Democrats in Bridgewater believe their
party's message on tax and spend could prove to be popular with Labour
voters. Here in Somerset at the last election the Liberal Democrats persuaded
some Labour supporters to vote tactically for the Liberal Democrats to
get the Conservatives out. In Bridgewater, where Labour is third, tactical
voting could prove to be crucial at the next election.
THORNE: There is an overwhelming
non Conservative majority in the seat. My job is to get out there and to
talk to local people and to make sure that they know that if they want
to get the Conservatives out they have to vote for the Liberal Democrats.
PROFESSOR HEATH: We're going to see a great deal
of tactical voting at the next election, probably even more than we saw
at the last election because on issues like taxation and spending the,
the voters now don't really see any appreciable difference between Labour
and the Liberal Democrats.
DIGNAN: The Liberal Democrats are
counting down to the election and in Bridgewater there's no time to lose.
Their enemies say they're glossing over enthusiasm for Europe. Liberal
Democrats prefer talking about improving services. But that could mean
raising taxes when there's growing voter hostility to the idea. Tactical
voting may help - but will it be enough?
HUMPHRYS: Terry Dignan reporting
there, and that's it for this week. We'll be back at the usual time, twelve
o'clock next Sunday, but on BBC Two, not BBC One because of the Olympics.
In the meantime don't forget about our Website. Good afternoon.
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