It was the second of the Today Programme’s New Year’s interviews with the three party leaders today; this one with David Cameron. And there was plenty to digest from it. So much, in fact, that we thought we’d bash out a transcript, so that CoffeeHousers can read it through for themselves. That’s below, but before we get there it’s worth highlighting a couple of things that Cameron says. First, his point that ‘we’ve seen a level of reward at the top that just hasn’t been commensurate with success’, which is another volley in the battle against the ‘undeserving rich’ that James mentioned yesterday. And then his extended admission, in reference to effectively exercising the British veto in Europe last month, that ‘I’m not making some great claim to have achieved a safeguard’ for the country. Intentionally or not, both are messages that will placate Lib Dem supporters — the first because it’s a Lib Dem cause too; the second because it’s more ambiguous than Cameron’s thrusting rhetoric on Europe last month — and could bolster the coalition after its fragile spell before Christmas.
Anyway here’s Dave, on everything from the quality of nursing in the NHS to The Iron Lady, for your reading pleasure on a Friday afternoon:
Evan Davis: In his New Year’s message to the nation posted on the Downing Street website, the Prime Minister said this year is one ‘to go for it’, to be confident and decisive, bold on the economy, bold in tackling the excesses of the City and bold in reforming public services. What does he mean and is he going to be bold on Europe, one area he didn’t much mention in those New Year words? Well he is with me here in Manchester in the new Media City, the BBC’s facility in Salford. Good morning to you.
David Cameron: Good morning.
ED: You are off to Salford Hospital and you are going to make these pronouncements on nursing that we’ve just heard about in the new bulletin. I am a little bit confused
about it because you said you wanted to get Whitehall off the back of professionals and it sounds like you are making new stipulations, telling them what they have to do.
DC: Well I think everyone in the country hugely respects what Britain’s nurses do and I’ve seen it first-hand myself, the very high quality of standards and care that the best
nurses provide. But I think, while we know that the vast majority do a brilliant job, there is clearly a problem in some hospitals, in some settings, where we’re not getting the standards of
care that the nation expects and I think politicians frankly have done nurses a bit of a disservice by not talking about this. I think such is our respect for nursing that we’ve almost hidden
away concerns about this. But you’ve seen the Care Quality Commission reports… I’ve seen some constituency correspondence with some chilling stories about how some people’s
elderly relatives have been treated, and so it is time to speak up about this issue and absolutely key is to act on this issue and, yes, that does mean setting some standards and discussing that at
a national level, and that’s why we are going to be establishing this nurse’s quality forum, which will be with frontline nurses, to make sure that proper nursing rounds are done, to
make sure there is proper leadership by nurses on our wards, and also we can introduce some things that are good ways of helping to deliver this such as having patient-led inspections of wards. The
hospital I am about to visit in Salford has the very highest standards of care, that’s led to really good results in their hospital and we want the best to be available everywhere.
ED: Do you think it is the Prime Minister’s job to step in and deal with these things? I remember when you were in opposition I think you said Gordon Brown has produced a record number of gimmicks, announcements which have sought to grab the headlines. I just wondered if you were falling into that habit. You have the announcement of satnav…
DC: This is not a gimmick, this is a real problem in our country and …
ED: But as the Prime Minister is it your job to decide how often nurses go round wards?
DC: It is the Prime Minister’s job to speak up on issues that people care about and to point to areas where we have brilliant practice in our NHS but we could do better. And, as I’ve said politicians, myself included, have failed in the past to speak up about the quality of nursing in some settings because we have this huge respect, rightly, for what nurses do — but we haven’t had a public discussion about this issue and who better to lead that than the Prime Minister? So I am glad that later today I am going to be visiting a couple of hospitals, seeing some very dedicated nurses, seeing some of the best practice in our country and saying here are some ways we can spread that best practice so we get really high standards of care right across the NHS.
ED: Okay, so you are an expert on nursing. I want to talk about some other issues as well obviously facing us as we go into this New Year, and let’s start on the economy. Certain things must be going worse than you expected — let me just, before we talk about those, ask if anything’s going better than you expected economically?
DC: I think obviously we are in difficult economic times. Britain is not immune from what’s happening across the eurozone, those are our customers as it were, that is where we sell a lot of our goods and there has been a chilling effect across the euro. But to answer you very directly, I think what is going well is the fact that, because the UK has a plan for getting on top of our excessive deficits and debts, and because that plan has confidence in it, our interest rates are low, lower than in many other countries in Europe and that, frankly, is the best stimulus we can give to our economy. The fact that households and businesses and the government can borrow cheaply is vitally important but the big picture here is what we need to happen in Britain is a rebalancing of the economy, away from government spending, excessive borrowing, financial services and consumption and towards business investment, export, manufacturing, making things again right across the country. I would say what is happening is that there is a rebalancing taking place but it’s not going as far and as fast as I’d like it to, and we need to do better on that front. But there is some rebalancing — private sector employment is growing, the manufacturing surveys recently have been encouraging, exports to countries like India and China are booming — so there are some good signs, but, frankly, a rebalancing is a difficult thing to do after the debt fuelled boom that we had and we need to reinforce that rebalancing.
ED: It’s interesting you should say it because in fact yesterday I spend in and around this area looking at the private sector recovery and we actually found that most of the signs, most of the seeds being planted, are actually of a government variety. There is an Enterprise Zone, Greater Manchester Enterprise Zone is a government initiative; the BBC and the Salford development is a public sector initiative; the university expanding, again perhaps not core public sector but it’s a public sector institution; Metro Link expansion — do you recognise for that rebalancing to occur at a time of recession when private companies think ‘Goodness, we have no idea if we can make money on investment’, that the government probably has a bigger role than you would normally have entertained?
DC: Oh, of course government has a role, government sets some of the context and that’s why we’re not standing back and hoping this rebalancing takes place, we’re stepping in and boosting massively the number of apprenticeships because that’s going to help the rebalancing of the economy. The Enterprise Zones clearly are a way of helping to kick-start private investment, and we’re helping with that. We’ve cut the rate of Corporation Tax, so that we’re going to have one of the lowest rates of Corporation Tax of any major industrialised country, because that’s a great advertisement for companies to come and invest in Britain. I wouldn’t agree with you that it’s all public sector led, if I just take a couple of the companies that are on my sort of advisory board: Waitrose, where I was yesterday, is planning a massive expansion and creating more jobs around the country; Burberry is another company that is on my advisory board, they are building a huge factory up in Pontefract; that’s a private sector expansion. Basically there is some reindustrialisation in Britain going on. Another whole sector I would point to is the automotive sector. If you look at all of Britain’s car manufacturers — Nissan, Honda, Jaguar Land Rover with their announcement yesterday in terms of more jobs in Merseyside — I don’t think there is a British car manufacturer that isn’t expanding at the moment and so that’s … again there has been some government assistance in some places but, generally speaking, that is a reindustrialisation enhancing the manufacturing sector and bringing a lot of the supply chain onshore. So there are some positive signs but my general point would be that we need the rebalancing to go further and faster and that’s what the government should help focus on.
ED: You have hinted that deficit reduction is one of the areas where things have been more difficult than you had thought. It must be pretty depressing to you that the deficit projected for the end of the parliament is now slightly bigger than it was before you even had your first budget, that such has been the bad news, we have had two … we have had several austerity budgets, we’ve had a huge programme from you making it the centrepiece of everything and you are still planning to borrow more than Alistair Darling thought he was going to borrow in 2014 and …
DC: Well they are testing economic times. I think there have been two particular things that have happened that have been difficult, the first is obviously the eurozone crisis where you have seen a slowing of the French economy, the German economy, all our customer economies as well, as it were and Britain exports 50 per cent of our goods go to other European countries, so that’s had an effect. Also frankly inflation has been stubbornly high, and that had an effect on household income last year and so consumers felt particularly squeezed. Again, we haven’t stood back and done nothing about that, we cancelled increases in petrol duty, we cut petrol duty in a budget, we froze the council tax, we’ve helped where we can with the cost of living, but I think, looking into 2012, one of the trends that I hope to see happen is a fall in the level of inflation and so therefore households feeling under less pressure than they did in 2011. But, undoubtedly, I don’t want to pull the wool over people’s eyes, it is a difficult year, it’s a testing year — but, as I said in my New Year’s message, I think we’ve got to meet these challenges with a sense that we can overcome them.
ED: You said in your New Year’s message that you ‘get it’ on the difficulty households are in over energy bills. Some of that difficulty, not most of it, some of that difficulty comes down to policies to reduce carbon emissions, some of it is going to get worse when we have to finance a pretty big investment programme in the energy sector which is going to be loaded on to customer’s bills in one form or another. There is actually nothing you can do, is there, and if anything you have probably added to the cost of bills rather than taken away from them.
DC: We had to take a long term view which is that it’s not just about taking carbon out of the economy, it’s about making sure we are not over reliant on one source of energy — so there is a massive reinvestment that has to take place in our energy industries. We have got to replace the nuclear power stations, we need to have more renewable energies, we’ve got to make sure we are diversified. There is an investment that needs to take place, so there is a cost associated with that investment, but we have taken action, for instance on the solar issue where there were excessive costs going to be added to people’s bills, we had to take action on that and we did.
ED: Right. The excesses of the City, they got a special mention in your New Year’s message, do you think people are satisfied that the job is done in taming banker’s bonuses?
DC: Look, people aren’t satisfied, I’m not satisfied. I think frankly we’ve seen a level of reward at the top that just hasn’t been commensurate with success. I’m all for people being well paid if they are succeeding, growing their businesses, we’ve got to be a competitive country, a competitive economy but those figures that showed a 49 per cent increase in FTSE pay but only a 3 per cent increase in FTSE performance, that’s not…
ED: Can I just interrupt you because we have actually heard quite a lot of condemnation from you and from Nick Clegg on all of this…
DC: So what are we going to do about it, that’s the…
ED: Why isn’t it done? Why hasn’t it be dealt with?
DC: Well I don’t accept we have done nothing. I think actually this government started off, it started with itself, we cut Minister’s pay by 5 per cent and froze it for a
parliament.
ED: But you …
DC: Hang on a second, we published all of the figures for…
ED: But what are you going to do to get it done?
DC: Also massive cuts in the levels of bonuses and huge restrictions on bonuses. But the next steps are things using the tools at our disposal, much more transparency about levels of pay, much more shareholder power about restrictions on pay. I think those things can make a difference, and I’ll have more to say about that later this week.
ED: I don’t understand why any bank at a time like this, when the regulators have said ‘we need you to stock up on capital because we are in some very choppy waters’, how any bank would pay any discretionary bonus at all this year. Do you understand why they pay a bonus they don’t have to pay?
DC: I think the whole bonus culture has got completely out of …
ED: But why a bonus this year, just at the time the regulators are saying you need to stock up on capital so you protect yourself against what might hit you?
DC: Not just in banks but in all sorts of businesses and organisations, you use bonuses to incentivise staff. What we did with Lloyds is…
ED: But why now? You are not really answering my question.
DC: I’m trying to answer your question but you keep interrupting me. In RBS and Lloyds we restricted cash bonuses to £2000. Now it is important to allow organisations — and I expect even the BBC pays bonuses, the Civil Service pays bonuses, organisations use bonuses to incentivise staff, and banks should be able to do that as well. But the bonus culture got out of hand, but there has been a massive reduction in the level of bonuses compared with three or four years ago, down by almost half, down by about £5 billion and we want to see that trend continue.
ED: Okay, we have spoken about deficit reduction and the City, the thing that wasn’t so much in your New Year message was the issue of Europe. I am trying to work out whether you were bold last year in that meeting in December or whether it was a cock up.
DC: I’ll tell you exactly what it was. As Prime Minister I said what I was going to do, try and secure a deal with safeguards for Britain. I said if I can’t get those safeguards I won’t agree a Treaty and, surprise, surprise, I did what I said I was going to do. I don’t know why everyone is so surprised by this.
ED: But, on the safeguards, I don’t quite understand. Let’s take the example of the withholding tax. Were they able to impose a financial transactions tax on the UK before you went to the meeting?
DC: That wasn’t the point. The point was that a new Treaty was being proposed, a new Treaty within the framework of the European Union, and my position was, the government’s position was, agreed across government was that we would be all right with that and go ahead with that if there were safeguards, and this is important …
ED: But what did it stop them doing that they couldn’t previously do as a result of your … I don’t understand it, what is it, what can they now not do that they would otherwise have been able to do?
DC: The point is that they are not able to have a European Union Treaty …
ED: But you didn’t want to stop them having a European Union Treaty, you had no objection to them having a Treaty.
DC: I did have an objection to a treaty without safeguards for Britain and this is important because…
ED: What safeguard did you get for Britain? You have stopped them having the treaty with you in it, but they are still going to have the treaty.
DC: What I stopped was if you had a Treaty within the framework of the European Union that didn’t have safeguards on the single market and on financial services, Britain would have been in a worse position, so I’m not making some great claim to have achieved a safeguard, but what I did do was stop a Treaty without safeguards. Is that clear enough?
ED: So there are no safeguards. Let me ask this because this is going to come up: you were cheered by your backbenchers and others for what you did there, they are expecting you to veto the use of the Commission, the Court, the chauffeur driven cars and the rooms in the EU buildings by the other members when they have their Treaty without us — are you going to do that? I’m not clear whether that’s part of your…
DC: Well the problem is that the legal position is unclear. The good part is …
ED: But the legal position is a distraction. Are you going to tell them there needs to be a legal argument about this because we’re going to stop you using it, we’re going to take it to the courts?
DC: One of the strengths of there not being a Treaty within the European Union is that the new thing, whatever it is, can’t do things that are the property of the European Union, so they shouldn’t be doing things that are about the single market or about competitiveness. And we’ll be very clear that when it comes to that, you cannot use the European institutions for those things because that would be wrong. You can’t have a treaty outside the European Union that starts doing things that should be done within the European Union and that goes back to the issue of safeguards.
ED: I’m not clear as to whether if Germany, France and 24 other members get together and want to have a meeting in a Commission building about the euro and one that, for example, uses the Commission to provide data, are they allowed to do that?
DC: Well they do that now …
ED: And then if they say we’d like to use the Court are you going to say no, you mustn’t use the Court to uphold the things you have agreed amongst yourselves?
DC: Well I think the things… there are legal difficulties over this and one of the problems is that the European Court of Justice, we all think it’s this great independent
arbiter, but the European Court of Justice tends to come down on the side of whatever more Europe involves. That’s part of the problem.
ED: But if we take them to court against it, I want to know if you want to take them to court.
DC: I want to be very clear that they should not do things outside the European Union that are the property of the European Union. A single market… Why are we in the organisation, why are we there in the first place? We’re there because we’re a trading nation and we want access to the single market and a full say about the rules of the single market. And what we can’t have is the single market being discussed outside the European Union and we will do everything possible to make sure that doesn’t happen.
ED: If they say ‘We are not going to discuss single market issues, so no need to worry Mr Cameron. But we are going to use the Court, the Commission and the chauffeur driven cars to get on with our business’, is there no problem then and no argument? Nothing else happens between now and the end of parliament?
DC: That is what I’ve said. I ought to repeat myself. What matters is what belongs to the European Union and the single market stays there, but of course…
ED: So there is no issue there, there is no change in our relationship with Europe?
DC: We have a very clear position which is any transfer of power from Britain to Brussels triggers a referendum, that’s a guarantee that never previously existed. Had it been there, there would have been referendums on Maastricht, on Lisbon, on these treaties — and it is very important, that’s why people feel so cheated over the years, that politicians have given powers away without asking them first. That can never happen again because of action this government has taken.
ED: Nick Clegg told us yesterday that it had never been envisaged we would be in a minority of one and that I think is at the root of why some people say this was just as big cock up, that you hadn’t briefed your allies in the European Union ahead of the game and you misunderstood Angela Merkel when you met her in November that she would support you, and you were actually taken aback by what happened.
DC: First of all, there was a very clear understanding in government, in the coalition, a very clear preparation of our negotiating position that was agreed by everybody, and that negotiating position was to seek safeguards if there was going to be a treaty at the level of 27, but to be very clear that if we couldn’t get those safeguards we’d say no to a treaty at the level of 27. That was agreed across government and I think it was the right thing to do. We don’t fully yet know the outcome of how many countries have actually signed this new treaty or whatever it is, and exactly what that treaty will cover, but we’ll work very hard to make sure that treaty is about fiscal union and not about single market and competitiveness. As for our negotiating position, the safeguards we were seeking, as I said at the time they were moderate, they were reasonable, they were relevant. I talked Angela Merkel and others through those safeguards…
ED: But at the end they weren’t prepared to give those.
DC: No, no, I think that’s not true. I went to see Angela Merkel three weeks before the European…
ED: You didn’t tell her the proposals then so none of the groundwork had been done.
DC: No, no, no, I did, I went through a series of proposals then but more to the point is that the French and German proposals for treaty change, remember they only appeared a day before the European Council, so you can’t really accuse me of being late in the day with my, as it were, safeguards when we didn’t actually get the treaty change proposals till very late in the day.
ED: But Nick Clegg was right to say we had not envisaged, you had not envisaged, ending up in a minority of one?
DC: We absolutely envisaged either a situation where we had a treaty change at 27 with safeguards, or Britain saying no to a European Treaty, and in those circumstances we were absolutely clear it was very likely other European countries in the euro and some outside would go ahead with a treaty outside the European Union and that’s what looks like is going to happen. As I say, we don’t know how many countries will in the end sign up to that treaty but Britain won’t be one of them.
ED: We’re almost out of time, it’s the weekend that the movie The Iron Lady about Margaret Thatcher opens, I don’t know whether you’ve seen it.
DC: I’ve seen it, yes. It is a fantastic piece of acting by Meryl Streep, but you can’t help wondering why do we have to have this film right now. It is a film much more about ageing and elements of dementia rather than about an amazing Prime Minister, and my sense is it was a great piece of acting, a really staggering piece of acting, but a film I wish they could have made another day.
ED: Who would play you? Who is the most likely? I’ll give you some suggestions.
DC: No, I think we’ve run out of time!
ED: The nicest suggestion was Daniel Craig and the default suggestion was Michael Sheen who played Tony Blair of course.
DC: He can play everybody. I think his portrayal of Blair was fantastic, but I don’t know, it may be a B movie or even a C movie, but I’m sure they’re not going to…
ED: But one of the suggestions was Malcolm McDowell, who played Flashman. That must hurt!
DC: Well he has made some other good films like If…. but I’m not sure I want to… but no, no, I’m sure the movie will never be made.
ED: I’m not so sure. Prime Minister, thank you very much indeed.
DC: Thank you.
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