[John Humphries:] Good afternoon, and welcome to On The Record. Another seven people murdered in Northern Ireland, a dreadful end to a dreadful week, and yet on Friday there had been at least a little optimism in the air, John Major and Albert Reynolds getting together in Brussels for what were billed as substantive talks, where does all that go now? I'll be talking to John Hume, the leader of the S D L P, according to Mr Major his talks with Gerry Addams are at the end of the road. I'll also be talking to John MacGregor, about the privatization of British Rail, has he really given in to his rebels who want B R to be able to bid for the franchises, or is it all a clever conjuring trick? Have Labours's modernizers run into the buffers? I'll be talking to arch modernizer Harriet Harman, and John Cole takes a sideways look at the Chancellor's dilemma as he prepares his first budget. But first to Northern Ireland. It's difficult, impossible perhaps, for those of us who don't live their to fully understand the sheer horror of it. On a crude arithmetical basis if the same proportion of murders were carried out on the mainland of Britain in relation to the population we'd have had a thousand dead in the past eight days. Unthinkable, no government could allow it to continue and expect to survive. So what is happening to find a political solution? Well John Hume's meetings with Gerry Addams have been overshadowed by that meeting between the prime ministers of Great Britain and the Irish Republic, overshadowed and overtaken, according to Mr Major, I talked about that to John Hume a little earlier this morning, but I began by asking for his reaction to the latest murders.
[John Hume:] Well just another appalling slaughter of very innocent people, and it really is quite incredible that the people who carried out these terrible murders said they were doing so as retaliation for similar slaughter of people in the Shankhill Road last week. The people murdered last week were every bit as innocent as were the people in the Shankhill Road, and I would be certain that the families of the people in the Shankhill Road would be horrified that the murder of their loved ones would be used as an excuse as an excuse to do exactly the same to other innocent people.
[John Humphries:] You'll have known that pub, of course.
[John Hume:] Oh aye, I know that pub well, it's just outside my constituency but it's in the district where it's in the North West, and we all know one another very well there. I haven't heard the names yet, of the people who have lost their lives but I'd be I would be certain that I would know some of them personally.
[John Humphries:] Where do we go from here?
[John Hume:] Well of course I've been saying for some time now, for some time, and I want to underline that, and I hope the government are listening... that we've had twenty thousand troops on our streets, we've twelve thousand armed policemen on our streets, we have the strictest security laws in Western Europe, and none of these things have solved our problem. The number of people who have died on our streets is equivalent to a hundred thousand people dying in the streets of Britain, if that were happening, then the House of Commons would be packed to the doors everyday, until they got it sorted out. If the Government keeps telling us in every statement they make that we're an integral part of the. I think I'm making my point, I have been saying for some time now that given the fact that all that security hasn't produced the results, the logic of that is dialogue, and when I see the opportunity as I saw it, of dialogue, direct dialogue with Mr Addams that could lead to a total cessation of this violence, I felt it was my duty to do so. That dialogue has lead me to the point of issuing a joint statement with Mr Addams. Now remember I am the leader of a party that has been in the front line against his violence for twenty years, and have been at many risks, as have been members of my party, but when I say that that dialogue is the best hope they've seen for peace for twenty years. And in tha in our statement we say, that we are talking about a process which involves both governments, all parties, and what we're talking about is agreement among the divided people to which all sections can give their loyalty. The least I would expect would be an immediate invitation from the Prime Minister, come and see me, because if it was happening on the streets of any city in Britain and the MP stood up and said what I've said I think he would be in Downing Street within the night.
[John Humphries:] And you've not had that invitation?
[John Hume:] No.
[John Humphries:] Are you awaiting for it?
[John Hume:] Well I would expect that the Prime Minister would, I think this nonsense that is behind all this is that because I am talking to Gerry Adams, they don't want to be seen to be talking to me because it looks this fingerprint argument
[John Humphries:] Your hands are dirty.
[John Hume:] I'm talking about saving human life... governments over the last twenty years, troops over the last twenty years, policemen over the last twenty years, laws over the last twenty years, and politicians, including myself, have all failed in all the efforts that we've made including condemnation of violence, everything, but I am now saying that this dialogue is the best hope I've seen or, surely I'm entitled to say to the Prime Minister, alright given that I have said that why don't you put me to the test?
[John Humphries:] But have you not already briefed Mr Major, have you not already briefed Downing Street about those talks, and given that you have, what else is there, what else can you offer Mr Major, that you haven't already offered?
[John Hume:] Well, er, I think that both governments have said er in their, and both Prime Ministers, er and I'm glad they met, er that the
[John Humphries:] That's Mr Reynolds, I assume.
[John Hume:] Yes that they are beginning a process involving both governments and er naturally er I welcome that very much, because I think the attention of both governments would have to be concentrated on this terrible problem, and of course if they take the trouble to read the statement that Mr Addams and I issued that's precisely what we said, that the two governments should begin a process involving all parties.
[John Humphries:] So what else do you have to offer then?
[John Hume:] I think that both governments are aware of the proposals that emerged from th my dialogue with Mr Addams, and the process that has emerged, that I have said, and he has said is substantial progress towards lasting peace. I want the governments to act on it, and act quickly on it.
[John Humphries:] But act on what, do you see, this is what we don't understand?
[John Hume:] Sorry, I know you don't understand, and you're not going to understand on this program.
[John Humphries:] Why not?
[John Hume:] Because er it's a that's that's just the way it has to be for the present, at the end of the
[John Humphries:] But does the Government?
[John Hume:] Sorry. At the end of the day the whole community has to know what this is all about, but let me stress, there is no threat in this process that is being proposed, to bring about a total cessation of violence, there is no threat to any section of our community, none what so ever.
[John Humphries:] Does the Government, does Mr Major
[John Hume:] [cough]
[John Humphries:] know precisely what went on in your talks with Mr Addams, and does Mr Major approve of what you had agreed, or discussed with Mr Adams?
[John Hume:] Well I have no evidence of any description of Mr Majors approval or disapproval
[John Humphries:] But does he know?
[John Hume:] what he has said is that he, it's a matter for myself to talk to whoever I wish, and that he respects my judgement in these matters, er according to the joint statement issued Mr Reynolds briefed him on his discussions with me on that on that
[John Humphries:] Right, he does know.
[John Hume:] well, I er it it I am only reading what er their joint statement said.
[John Humphries:] And he has said Mr
[John Hume:] But I am available.
[John Humphries:] But Mr Major has said quite clearly that that process that dialogue between you and Gerry Adams has run it's course.
[John Hume:] Yes, he has said that and I am saying, I am saying, as somebody who has been in the front line against this violence, and with due respect to Mr Major knows a little more about it than he does
[John Humphries:] So Mr Majors wrong?
[John Hume:] I am saying Mr Major, as Prime Minister, if someone in my position is saying I believe, I believe, there is the best opportunity here for lasting peace, by which I mean a total cessation of violence, the least I expect is that you should listen to what I have to say.
[John Humphries:] So he, Mr Major, is wrong when he says he believes that that dialogue, that process that you began with Gerry Adams has run its course do you
[John Hume:] Well
[John Humphries:] believe that there is further that can go and that it should be exploited by Mr Major or Mr Reynolds, or by Mr Major?
[John Hume:] well, when I say that it's the best opportunity for peace I've seen in twenty years. If er Mr Major is not going to look at why I say that then I hope that he, I assume from that that he has a better hope of peace an an
[John Humphries:] But he's looked at it hasn't he?
[John Hume:] I'm sorry, and I'm waiting to hear what it is.
[John Humphries:] But he's looked at it, because you have told Albert Reynolds
[John Hume:] Well, what, why?
[John Humphries:] Albert Reynolds has told the Prime Minister, Mr Major, Mr Major has taken on board, has has considered, presumably, what it is that you've done with Gerry Adams, and concluded that it can go no further.
[John Hume:] Well i I'm not aware of how far he has taken anything on board, what I would expect as a Member of Parliament and the House of Commons, and as the leader of a party in the House of Commons, I would expect that he would want to hear what I would have to say face to face, and tell me face to face what's wrong with what I have said.
[John Humphries:] Given that he doesn't want to see you and your suspicion is that he doesn't want to see you because you have as it were the fingerprints of Gerry Adams on you now you're tainted because of your relationship with Gerry Adams, what do you now do? Do you have more meetings with Gerry Adams, do you try and to push it forward unilaterally?
[John Hume:] I am an elected representative of the people of Northern Ireland, three thousand three hundred of our people have been murdered, that's the equivalent of a hundred thousand people in Britain, it is the responsibility of every elected representative to do everything in their power, everything in their power, to stop that, The least responsibility that they have, the least they can do, is enter into dialogue directly with the people involved and I apologize to no-one for that, and if anybody is telling me that I'm tainted because I do that, you know, I don't know what sort of minds they've got, because I think it's our responsibility to do everything in our power to bring this violence to an end, and what's more, what I'm doing has massive support of ordinary people on both sections of our community because I have never in my twenty years experienced the nature of the support and the way that it's being expressed to me by people in the streets, by telephone, and in particular by
[John Humphries:] You
[John Hume:] families of those who have lost loved ones, who don't want to see other families going through the suffering that they have gone through.
[John Humphries:] You say that, but aren't isn't it th the case that the loyalists, the Protestants in Northern Ireland are terrified of any kind of deal that might involve Gerry Adams because that would be as far as they are concerned the ultimate sell out, and hence there is the danger of growing sectarian violence because of fear?
[John Hume:] Well in the first place, I have made clear throughout, and I have a record their of over twenty years that people can have a look at, but I made clear throughout, as has Mr Adams, that we are not engaged in secret deals, secret deals don't solve problems. What we have said we are involved in a process which must involve both governments and all parties, whose objective is agreement among our divided people an agreement which all our traditions must give their allegiance and agreement, and an agreement which must express which which must respect our diversity, now I have kept repeating that statement since we made it and I asked anyone to tell me what they disagree with it, now the loyalist paramilitary some weeks ago said that if the I R A were to k their impression they've given all along is that they're just a reaction to the I R A and if the I R A were to stop they would cease immediately, I immediately put out a statement welcoming that statement by them, I also offered to talk directly to them, but they have refused er given the nature of their campaign, particularly at the moment, I begin to wonder do they want the I R A to stop? Have they some other reason for their resistance but are able to use the I R A as their excuse?
[John Humphries:] Whatever Mr Major's motives may be for having concluded that your that the process is at an end that your involvement, effectively, with Gerry Adams is at an end, what about Mr Reynolds' motives? What possible reason might he have for agreeing with Mr Major that the Hume Adams initiative is dead?
[John Hume:] Well I have no evidence from either of them, you know, er that er they are slamming the door on my initiative, other than the statement that was issued which if you read it, there's very little in it that you can object to, or that I could object to, which commits them, the two governments to an initiative, and indeed that's what er the last statement that Mr Adams and I issued asked them to do, the only er they also in in their statements say that my actions have been both courageous and imaginative
[John Humphries:] But that th the
[John Hume:] er but that the that the they're not paying attention to what's coming out of it
[John Humphries:] But you clearly don't believe that that statement, the the Reynolds Major statement goes far enough.
[John Hume:] Well er n well oh f I'm not saying that er i I'm available.
[John Humphries:] John Hume.
[John Hume:] That's what I'm saying.
[John Humphries:] John Hume. Tomorrow the Transport Secretary John MacGregor reintroduces the bill to privatize British Rail to the House of Commons, it had a rough journey through the House of Lords and until late last week it looked set for a stormy passage through the Commons too, but then Mr MacGregor introduced a series of amendments that everyone assumes will satisfy the rebellious Tory MP s, but as Michael Gold reports, there are still obstacles for Mr MacGregor to surmount.
[speaker003:] Train now approaching platform two is the twelve fifty three service from Glasgow Central.
[Michael Gold:] It's been a bumpy ride, but the bill to privatize British Rail is almost at the end of its long parliamentary journey [bagpipes] but the battle isn't over yet, earlier this week hundreds of protestors from a variety of backgrounds gave up a day and travelled from the North to carry their defiant message to Transport Secretary John MacGregor. It was railway workers who were in the vanguard of the protest, worried about job losses and safety, but Middle England was also on the march, concerned that services might suffer, polls indicate that four out of five voters oppose the sell off.
[speaker005:] It's ridiculous, I don't think they really realize what they're doing.
[speaker006:] You cannot privatize British Rail, it cannot be done.
[speaker007:] It's only a few people at this moment in this country, that does believe in railway privatization, and that is the Department of Transport.
[speaker008:] Leave the railways with British Rail, and put the money in that they would spend on privatization to improve the service for all of us, and keep it as a national railway, please.
[Michael Gold:] Why is the Government embarking on such an apparently unpopular privatization? Some Tories think it's a sop to the right from a weakened premier, the Government insist that the sell off is the best way to attract investment from the private sector into the railways, but there are signs that the break up of B R isn't proving as attractive to outside investors as the government hoped. Mayfair's Park Lane Hotel, art deco rendezvous for London's deal- makers.
[speaker009:] Would you like coffee, sir?
[speaker010:] Coffee, sir?
[John Humphries:] Er white, please.
[Michael Gold:] This week it was the venue for a gathering of bankers, managers, and academics, exploring the future of transport. Few at this conference were a-quiver at the prospect of bidding for the Tilbury to Southend line. Among the experts who were there was Professor Bill Bradshaw.
[John Hume:] My name's Bradshaw.
[speaker003:] Good morning.
[Michael Gold:] The Professor was advisor to the Tory dominated Transport Committee, and he's convinced the sell off will be a turn off.
[John Hume:] The private sector cannot invest in the circumstances set out in the bill, because they need very long franchises with control of all the means of production, the track, the trains, the stations, the total business. That is not provided in the bill, the private sector will not invest, and our railways will go on getting more unreliable.
[Michael Gold:] The business men and boffins here have made money moving people from A to B across the globe, but very few of the governments they've advised have ever tried to privatize their railways, and none have tried in quite the manner Mr MacGregor proposes. One man who is used to spending millions helping finance transport projects is Frank Borgus, he's helped oversee privatizations in the U S but from his perspective the B R sell off doesn't look attractive.
[speaker003:] What you need to do is to be able to provide a private sector a certain level of certainty, that the concession will be er granted long enough so that one can recover both your costs anand certainly be able to to make a profit and so er to the extent that the franchises that are being considered are short natured, seven years, er that becomes rather disadvantageous and unattractive er concessions of twenty and thirty and forty years, and and really thirty thirty to forty year period er do make it in fact make it very attractive for private sector involvement.
[Michael Gold:] That might seem to leave the Government in the dark, but they're confident they know where there going. British Rail employees and managers will borrow cash, so the Government hopes, in order to buy profitable services, like the East Coast mainline from their employers. Getting their hands on their own trains might seem attractive, but any manager tempted would be taking a big risk.
[John Hume:] The prospects for management buy-outs are really very bleak, the reason for that is that the franchises which we're hearing about are likely to be very short, the franchisee will own no assets, no land, no rolling stock, nothing with which to go to the bank as security for loan. At the end of the franchise period he will have nothing to sell, so I cannot see how people could go away and borrow the working capital with which to run a business.
[Michael Gold:] The profitability of flagship lines like the Gatwick Express sustains the Government's belief there will be management buy-outs. Few managers would think of embarking on such a course if they faced competition from B R itself, that's why the Government originally barred B R from bidding. However, when the bill reached the upper house Lord Paignton amended it to let B R bid, for two reasons.
[speaker005:] First because it er offers the Government quite a good reason for dropping the bill altogether, er a er and bowing to parliamentary opinion in doing so that's not a shameful thing to do, er if it had been able to do that on the other hand it would have the benefit of inincorporating in its own proposals a measure of continuity and experience which are no there already.
[Michael Gold:] The Lord's vote had reverberations along the corridor at Westminster, a number of MP s hitherto quietly concerned about privatization now went public, they thought the Lords vote would take the sting out of the sell off because B R would win most of the bids, ministers vowed to defy the rebels, but just before the bill left the Lords the Government seemed to cave in.
[speaker005:] Your Lordships will be aware that the Government has been giving careful consideration to the issue of whether B R should be a franchisee in the light of the noble lord Lord Paignton's amendment, agreed at committee stage. Clearly my right honourable friend the secretary of state will want to hear the views of another place, but I can say that he will not be recommending that the amendment should be overturned.
[Michael Gold:] Even as Lord Caithness seemed to buckle the Government were tabling their own amendments to fix the odds against B R bids a finesse, but the rebels bought it.
[speaker006:] I want to see the er possibility of British Rail being able to say, well you know we could improve our act, we could do things differently, and er we we wou we have experience of running a railway, and therefore, you know, please let us bid. That's why I thought it was wrong that er British Rail should not be allowed to bid, and I think that the Government's compromise is a very sensible one.
[Michael Gold:] It was passengers who were supposed to benefit from Lord Paignton's amendment, the rebels think they've safeguarded the spirit of that vote, but experts disagree.
[speaker007:] The amendment the Government has put forward does not hold out much real hope for B R managers about remaining in the medium or long term in charge of viable business, to that extent the amendment does not carry out what I believe was the intention of Lord Paignton in in moving the amendment.
[Michael Gold:] So Mr MacGregor's hard work may yet come to grief, even if he sorts that problem out there's another obstacle to privatization running smoothly, many on the railways think the private sector will need a generous subsidy before they'd be interested, if their not attracted the state will have to spend more to make the new structure work, a lot more. On The Record's obtained a paper prepared by a committee including senior civil servants and the Treasury and Transport Department, called the Restructuring Working Group, the report forecasts an increase in the amount of taxpayer's money subsidizing the railways, this year it will be eight hundred and fifty million pounds, after privatization, the paper says, the central government grant requirement would total some two billion pounds in nineteen ninety four ninety five. By owning the track and leasing the trains the Government can recoup some money, but will that calm Tories who see millions spent on privatization while other budgets are cut. Mr MacGregor's avoided one collision with his back benchers, but when they realize the bills cost and consider how B R 's been dealt with the question is, will they think again?
[John Humphries:] Well, will they, Mr MacGregor? Have you, or have you not, please, accepted the Paignton amendment?
[speaker008:] Well firstly the bill didn't have that rough a passage in the House of Lords, because there are only two basic amendments, er that we're dealing with in the House of Commons that matter, and one of them is the one you've just mentioned, the answer to it is this, er I've had a lot of criticisms of giving B R the untrammelled right to bid, er right from the outset their criticisms to do with the danger that you wouldn't get competition for the franchises the private sector would be afraid, and incidentally this is not a sell off it's it's a way of getting the private sector into British Rail with all the advantages that brings, they would be afraid that they would face subsidized and unfair competition, above all, perhaps, British Rail gemanagement would feel if they were bidding against their employer that would be a real discouragement to bid, and we've a lot of evidence er that they feel that and that there are many who do wish to bid in managementemployee buy outs, so what we've done in the amendment is we've preserved the right for British Rail to bid, but we've dealt with those criticisms and worries which have come from a lot of quarters not least from within British Rail itself.
[John Humphries:] So, have you accepted the Paignton amendment?
[speaker008:] I have accepted part of it, and I've amended it to ensure that we can overcome the criticisms er that would have been involved if we'd left it er as it was, er and above all, and I think this is the most important thing, we've made sure that it will work, er and that it will meet our objectives of getting competition into the franchises, if we'd just ended up with one great monolithic British Rail, after all each franchise remember will be coming gradually, they won't be doing them all at once, there will be one next year, several the year after, and so on, if British Rail had been able to go around and pick them off, and say, Well we can run this now in the future much better than we've done it in the past, so we'll bid, and we'll bid a low bid, that really wouldn't have been getting fair and proper competition into the system, so what i what I've done is ensured, as I've done all the way through in this bill in accepting amendments, that we make sure we achieve our objectives, and that above all it's workable, the, as it was it wouldn't as it was the Paignton amendment wouldn't have been workable, because there would have been total chaos and confusion
[John Humphries:] Alright but
[speaker008:] within British Rail itself.
[John Humphries:] The reality is that you've said to British Rail, you can bid for those franchises that nobody else wants
[speaker008:] The
[John Humphries:] which is the situation anyway, because if people if nobody had bid British Rail would would have continued to
[speaker008:] Well, well
[John Humphries:] run them anyway.
[speaker008:] of course that is a point that we've made all the way through, it's not if nobody would bid, it's if the franchising director was not satisfied with the quality or the long term viability of the bids he'd received
[John Humphries:] Yes
[speaker008:] or didn't think they were
[John Humphries:] Comes down to the same thing in the end.
[speaker008:] Or they weren't, or, you see the other important point here is that British Rail will be restructuring all the twenty five potential passenger franchises, they're starting on this now
[John Humphries:] They've just finished one restructuring.
[speaker008:] they will then they will, they've just started actually
[John Humphries:] But they've finished one.
[speaker008:] No, well the key point is the key point is that they they have to have a period during which they have a track record of running those separate businesses, so that bidders will know the basis on which their bidding, now if if the franchising director, it's entirely his decision, decides that er he's not getting competitive enough bids or good enough bids, then yes British Rail would carry on, and this was clear right from the outset, would carry on running that particular
[John Humphries:] Right, so you actually
[speaker008:] franchise, so the difference the difference now, is that they will be able er in some, certain circumstances to come in and bid directly at the outset.
[John Humphries:] But only if the franchise director decides that there is not a viable bid from the private sector or from B R management.
[speaker008:] Only if he feels that a private sector or B R management would be er frightened off bidding, and he knew that there were viable bids in play
[John Humphries:] Yes, precisely.
[speaker008:] and if he feels it would not
[John Humphries:] But
[speaker008:] lead to proper competition, that's correct.
[John Humphries:] So let so nothing in reality has changed, has it?
[speaker008:] Oh I'm quite sure there will be situations in which er British Rail will bid, and will, well it's up to the franchising director, but is likely to get the franchise, there will be situations.
[John Humphries:] But then even if they do that and even if they get the franchise, they're not going to be able to say, we can now hold on to it for five, or seven, years, however long the franchise is going to be, because if another bidder comes along in the meantime and says, we rather like this ourselves, they'll be thrown off.
[speaker008:] No, if they bid for the franchise, then, and get it, obviously that franchise runs for the period, and by the way, a lot of the criticisms in the film, I think were based on a misunderstanding that all the franchises are going to be short, they're not, those where there's a substantial investment going in can be quite a bit longer
[John Humphries:] Well well how long, how long?
[speaker008:] Oh ou we haven't, it would depend on the market place, on the reaction.
[John Humphries:] But but I mean are we talking about really
[speaker008:] We could be talking of ten years and beyond, er beyond ten years.
[John Humphries:] What, twenty years?
[speaker008:] I doubt it, we no we wouldn't wish to go to, I don't think, to twenty years, er but it would depend on the level
[John Humphries:] Tha tha that's interesting
[speaker008:] it will it will depend on the level of investment that the bidder is prepared to put in we're being very flexible, responding to the market forces
[John Humphries:] So that it might be then
[speaker008:] But
[John Humphries:] fifteen years, let's say where we've
[speaker008:] Yes.
[John Humphries:] been talking until now about seven years, we might be talking about fifteen years.
[speaker008:] Well some people have been talking about five to seven years, I've been saying all the way through that we're very flexible on this, and clearly if erm a bidder whether it's a management buy out with other people in the bid, others in the consortium, or an outright bid from a private sector consortium er if if they get the franchise and make clear that that's on the basis that they're going to put a lot of money into the capital investment, then clearly they will want a longer period and we have made that clear.
[John Humphries:] Well I may have missed something you've said, but I haven't heard you say fifteen years before.
[speaker008:] I've said quite often that ga it could be
[John Humphries:] I mean
[speaker008:] flexible to a certainly to ten, and in the right circumstances beyond that.
[John Humphries:] So I can take it as as gospel this morning that some of these franchises will be fifteen years, how many might be fifteen years, might they all be fifteen years?
[speaker008:] If, if, if, they are prepared... if they're prepared to put sufficient funding in er into the capital investment side.
[John Humphries:] So if they all come along with lots and lots of money they'll all have fifteen years.
[speaker008:] Well now you see, I don't think they'll do that, because another, another, another,
[John Humphries:] I'm sure they won't from what we've been told.
[speaker008:] another mistake in the film was to suggest that in a a short franchise, say of seven years they would need a great deal of working capital, but they won't need a great deal of working capital or or share capital, they will actually be running a business where they get subsidy, because if er they're involving socially necessary lines, like commuter lines, or or rural lines, then we've made it very clear er that the taxpayers subsidy will continue, because these are loss making businesses, they will be bid they will bid for subsidy, and they will continue to get that subsidy, so they will have the flow of whatever income they can increase, in the passenger franchise, plus the subsidy, plus, and this is a very important point in what we're doing in the restructuring of British Rail, you see, nobody up till now has said that British Rail is perfect, everyone acknowledges that there are big improvements to be made, the way we're structuring it will get those improvements because the smaller franchises, not the great big monolithic nationalized industry, the smaller units,ha will be able to identify much more clearly where they can make the savings and where they can increase the revenue.
[John Humphries:] But they won't be able to deal with their main sources of production, as er Professor Bradshaw said there, they're going to have absolutely you've got no control over the track on on which they operate, and they ar going to have to hire their carriages from and rolling stock from a separate leasing company, so their room for manoeuvre is limited to say the least.
[speaker008:] That's, that's, that's in a very small, er short franchise which is very similar to operators in other
[John Humphries:] What so they
[speaker008:] passeng in in other in other transport areas
[John Humphries:] So that if it's a fifteen-year
[speaker008:] but you see it, I me
[John Humphries:] franchise, they may actually get, I'm I'm
[speaker008:] They
[John Humphries:] I'm very puzzled by this now so I ask for clarification, if it's a long franchise then, if it's a fifteen year franchise, are you saying that the franchisee will have control over the track? And over the rolling stock?
[speaker008:] They may, let me just explain the track then, in those situations they may well be investing in the depots, maintenance and so on, but let me just
[John Humphries:] And the track?
[speaker008:] let me just go beyond
[John Humphries:] So but but just answer that bit first, so I'm clear
[speaker008:] not, not, not on the track as not on
[John Humphries:] Right so, so
[speaker008:] the track as such, can I just explain the position on the
[John Humphries:] Alright.
[speaker008:] track, because it it, no other transport business er has er does has to have a business, which op owns both the track it's operating on and the operating er facilities themselves, so the we're not doing anything new here, what we are actually doing, and incidentally the German government and other governments are going down the same route now because it's not true to say that others aren't privatizing, what we're doing is saying that we are having a separate track authority, and there are a variety of reasons for that, er but the an and that means actually less investment by the franchisee himself, but he will have control over the th the track operations, because he will have a contract, with Rail Track, to deliver certain services, and if Rail Track doesn't deliver them then he's able to claim penalties so
[John Humphries:] But he
[speaker008:] he will have the same relationship as so many other companies have er in relationship to other services they need to operate their business.
[John Humphries:] Let's just consider the political problem though you have still got a problem selling it to a lot of MP s, if they're listening to this interview and they are concluding, maybe rightly, maybe wrongly, that actually things aren't changing very much, and they may think they've been sold a pup with these amendments, indeed I hear that some of them have had to be bought off, well, is it true that one of them was sent off to Peru on an on an election er supervision mission in order that he might not be around when the bill came up.
[speaker008:] He's, he's actually going to be there to to vote for the bill [LAUGHTER] vote for the amendment
[John Humphries:] But was he, he was sent off to Peru as a sweetener, was he?
[speaker008:] well there are, no, no, because he's going to be there to vote, but on, on
[John Humphries:] Yes
[speaker008:] Can I deal with your main point, er and in's very important, er, to understand this, er, the vast majority of the parliamentary party supports strongly what we're doing, because they believe it will improve passenger services, it will deal with getting freight on, more freight on to rail, now they they backed it throughout the party conference backed it almost unanimously
[John Humphries:] Alright,n
[speaker008:] what we're dealing with is a small group of MP s who thought there were some advantages in the Paignton amendment I've discussed it very thoroughly with them for some time, and they agree that there were real difficulties about the Paignton amendment which I've now addressed
[John Humphries:] Okay, let me talk about money then, do
[speaker008:] so there are an awful lot of people, let me say, there is th it is a complete falsehood to suggest that the parliamentary party isn't behind the bill
[John Humphries:] Okay, money
[speaker008:] we had a meeting earlier this week were I got huge support, indeed some were urging me not to give way at all on the Paignton amendment.
[John Humphries:] Money. Two billion pounds, it's going to cost you, going to cost us, the taxpayers.
[speaker008:] I, that, there have been endless position papers in the department and I haven't actually seen that one
[John Humphries:] Well, here it is.
[speaker008:] the I don't
[John Humphries:] You haven't seen it? It's, it's, it's, it's a committee that you set up, the Restructuring Working Group that that your department set up.
[speaker008:] But they do loads of that way way down in preparing all these things, and loads and loads of different views expressed at different times, I deal with actually the recommendations er as we get to the point of decision, but on the on the investment point
[John Humphries:] Well is it true, or is it not true that it is going to cost an extra tw, total, I'm sorry, not an extra, total of two billion pounds.
[speaker008:] No I don't recognize that figure although it it er it what matters, is that we continue
[John Humphries:] Well that's not quite the same as saying it isn't true, if I can just push you on that a little bit, you
[speaker008:] Well
[John Humphries:] say you don't recognize it, is it true? Now that I know that
[speaker008:] For, for ninety four, ninety five
[John Humphries:] and I've told you where it's come from, can you say that is too much
[speaker008:] It is not necessary, to have it on that scale er in nineteen ninety four ninety five
[John Humphries:] That's not the same as saying it isn't true is it?
[speaker008:] it isn't necessary, well it is the same as saying it isn't true, it isn't necessary er because this will be built up over a period and it will be for er the Government in all the normal ways in the public expenditure round to decide how much goes into the passenger franchises and through that therefore into the Briti the Rail Track investment.
[John Humphries:] Either way it's going to be an awful
[speaker008:] But
[John Humphries:] lot more than eight
[speaker008:] But
[John Humphries:] hundred and fifty million pounds, isn't it?
[speaker008:] But can I just make the point that we have been investing a great deal in British Rail, and the idea that er all over the piece we're talking about non-modernized railways simply not true. Eight hundred million on the East Coast main line, four hundred million for rolling stock announced this week, four hundred million in new contracts, there's a lot of money going in right now.
[John Humphries:] The ex the extra cost of privatization is going to be one heck of a lot more than than without any privatization, in that year we're talking about immediately, is it not?
[speaker008:] No it's certainly not, in nineteen ninety four ninety five, certainly not.
[John Humphries:] Not going to be more than eight hundred and fifty?
[speaker008:] Because were on not going to be of the scale that you were suggesting
[John Humphries:] Well
[speaker008:] for the very simple reason that we will at most have one franchise in er nineteen ninety four, ninety five
[John Humphries:] Well
[speaker008:] and so there will only be one franchise, this will build up gradually.
[John Humphries:] Well let me quote to you what your own document says, on
[speaker008:] I, I
[John Humphries:] the best view we have at the moment transfer of service from B R to franchises is likely to increase the subsidy requirement for the service in question a large upward leap in nineteen ninety four ninety five, now this is your own document and attending these on er on
[speaker008:] I, I
[John Humphries:] on this restructuring group it's British Rail, it's the Treasury, it's the Department of Transport, it's the franchise director.
[speaker008:] It is that is a paper from somebody, I know not who, but can I just explain, if we're having one franchise passenger service next year, which is pretty well all you can do because you do need to have that record, track record, the business operating as a separate business before bidders can bid, if we're having one next year, to suggest as I think the quote was, that the that would cost about one point two billion pounds is ridiculous, it's ridiculous, a single, a single,
[John Humphries:] What your group's quote, not mine, well must tell them then, will you go in tomorrow morning and say redo this working paper?
[speaker008:] a single passenger service costing that amount of money, absolutely not.
[John Humphries:] Well where did they suck it from then, I mean I
[speaker008:] Don't ask me.
[John Humphries:] know it's it's it's not something that I've put together.
[speaker008:] But it isn't actually the real point, the real point is that we will continue, well it
[John Humphries:] Oh it's a very important point, isn't it, if it's going to cost a great deal more to push privatization through when you've got a fifty billion overspend anyway, I'd have thought people who were worried about V A T on fuel would say that is a very significant point.
[speaker008:] But it isn't because I've just said to you several times that one point two billion for a single franchise is absolutely ridiculous.
[John Humphries:] Well, give me a figure then.
[speaker008:] It will be, it will depend on the bidding but it
[John Humphries:] Alright.
[speaker008:] for and we will continue the subsidies to the passenger service
[John Humphries:] Right.
[speaker008:] individual franchises will vary, depending on how successful they are and what the bids are
[John Humphries:] Final very
[speaker008:] but it won't be that scale.
[John Humphries:] Final very quick question, reports in the paper this morning that Chunnel, the the channel tunnel, the high speed link, and the tunnel itself are going to be delayed because the Treasury basically saying, we've run out of money, you can't do it, is that true? Delayed until two thousand and five, maybe.
[speaker008:] The point about two thousand and five is complete speculation.
[John Humphries:] So is the main report true? only got a few seconds, I'm sorry.
[speaker008:] Let me tell let me tell you exactly Jubilee line is going ahead, er very large sums of money in the next three years
[John Humphries:] Yes, lets talk about talk about channel tunnel high
[speaker008:] We
[John Humphries:] speed link.
[speaker008:] The Cross-Rail and channel tunnel high speed link are at nothing like the state of preparedness of Jubilee Line, that's going ahead now after a lot of work, er th it it will not be the case er it that you can do either of those very quickly, Cross-Rail's only just started going through the House of Commons.
[John Humphries:] So there is going to be a delay.
[speaker008:] So, we can't tell what the final deadline date will be because there are so many pro processes, to go through.
[John Humphries:] John MacGregor, thank you very much indeed. Yesterday the Labour coordinating committee met for its annual get together, now this is the body that has set itself the task of modernizing the Labour Party, a difficult task at the best of times, made more difficult now because there is a growing shortage of volunteers for the cause, they can't even raise enough members to fill their own executive. Earlier this morning I suggested to arch modernizer Harriet Harman that she and her reforming colleagues had run into the buffers.
[speaker009:] Absolutely not, I think there's a strong sense in the Party that moving forward with our traditional values, that what we have to do is to apply those traditional values to a very changed world, things are very different now from when the Labour Party was formed, or even from when the Labour Party was last in government, so that we keep our sense of values, they are what grounds us, but what makes us an effective government in the future is the fact that we are moving forward with the times, and the increasing representation of women is one of the things which is about moving us forward, and moving with the times.
[John Humphries:] Talk about the increasing representation of women, there were meant to be more women in the shadow cabinet with the elections for the shadow cabinet produced a disaster for women didn't it?
[speaker009:] They were abs
[John Humphries:] a disaster for you.
[speaker009:] They were absolutely not a disaster for women, obviously I would have preferred to stay on the shadow cabinet, but we have three women in the shadow cabinet, and we have a number of women in senior positions outside the shadow cabinet.
[John Humphries:] You'd like to have more.
[speaker009:] Well the trend though over all is absolutely clear, that the Labour Party is committed to increasing women's representation and is absolutely on that path, we've more Labour women MP s and increasing numbers of women in the shadow cabinet it's only in the end of the nineteen eighties, as recently as then, that we had no women in the shadow cabinet, now everybody agrees that it would look quite wrong not to have women in the shadow cabinet, we've got a woman deputy leader, three women in the shadow cabinet, and therefore we're definitely moving forward.
[John Humphries:] You say the Labour Party is agreed that there should be more women in the shadow cabinet, but which is this Labour Party then, the parliamentary Labour Party certainly isn't, there was a conspiracy to keep women out.
[speaker009:] I don't think there was a conspiracy to keep
[John Humphries:] Well Anne Clywd does.
[speaker009:] Well I don't
[John Humphries:] Lots of other people do.
[speaker009:] No, I think that we would have liked to have seen more women, I would have liked to have stayed on the Shadow Cabinet, and I would have liked to have seen more women in the Shadow Cabinet, but to say it's a disaster, and somehow we've moved away from the path we've set ourself is simply not the case.
[John Humphries:] Alright, let me substitute setback, for disaster then, how about that?
[speaker009:] Well I think it's it's a hiccup, nothing more, but I think the trend is clearly established, and it's very much agreed, it's recognized in the Labour Party, that the world outside has changed, women are now half the workforce, women are now half the college and university graduates, women's work now represents forty percent of our G D P, so we have to increase women's representation to recognize the world has changed.
[John Humphries:] Why isn't that message getting across to the P L P then? Or to the er to the gentlemen in the P L P?
[speaker009:] Well I think that message is getting across to the P L P and we've seen more women coming into the House of Commons, sitting on the Labour benches at the last general election, but there also is a sense that the progress, although it's being made, needs to be speeded up, because when you have profound social changes outside the House of Commons, with a change in women's role in society, a change in women's role in the Labour force, and a change in women's role in the family as well, you can't allow your parliament to lag behind.
[John Humphries:] So bearing all that in mind then, you sent exactly the wrong signal, didn't you with the elections to the Shadow Cabinet?
[speaker009:] Well I think that it is possible that as a result of the reporting of the Shadow Cabinet elections, that the sense was out in the public that somehow this was a setback for women, and that Labour
[John Humphries:] It was, wasn't it?
[speaker009:] no, because the point is that Labour has not changed it's course, which is recognizing that at the heart of it's policies we have to show that we know the world has changed, and we've got a message to women, which is that we know that you are essential in your role in the family, but we know you're also essential in the economy,
[John Humphries:] But, but
[speaker009:] and as bread winners for your family, and the way we do that is making sure that we have a parliamentary Labour Party of men and women, and that we're a party of men and women at all levels, and all
[John Humphries:] But it's what
[speaker009:] and all Labour MP s would agree with that.
[John Humphries:] But it's what, well would they? I mean it's one thing
[speaker009:] Yes, I think they would.
[John Humphries:] to have a course, but if the crew on that particular ship mutinies, as they did during the last er Shadow Cabinet, then you're in trouble, aren't you? I mean look,for forgetting the women, but just look look at who else did well in those elections and who did less well, you had the modernizers doing less well, the Tony Blairs and the Gordon Browns, and you had the traditionalists, or the perceived traditionalists if you prefer, er the John Prescotts, for instance, and the Frank Dobsons doing extremely well.
[speaker009:] Well I think it's not helpful to look at it with such stark divisions, I think everybody's clear
[John Humphries:] But those are the realities.
[speaker009:] No they're not the realities, because what we're saying is that we have to modernize the policies of the Labour Party, but the policies are absolutely based in our traditional concerns, I mean, let me give you an example, when Beveridge was talking about unemployment, and the life long need for people to work, he was talking about a male workforce, where it was a man supported by a non-working wife, now we still have at the absolute heart of our concerns in the Labour Party peoples need to work, but we're now talking about a situation, where women are sharing with their husbands the role of bed breadwinner, and in many families the woman is the sole breadwinner, and therefore our policies about employment and the economy recognize that the world has changed, our principles are the same, but the world to which we're applying it is very different, and, again, on that you see there would be no distinction between the so-called traditionalists and the so-called modernizers.
[John Humphries:] Well then what explains the er the rise and rise of the so-called traditionalists and the falling back of the so-called modernizers.
[speaker009:] Well I just think it's not helpful to look at it in those terms, you don't actually, if you pick
[John Humphries:] Well it... it may not be helpful, but it is the reality, isn't it?
[speaker009:] Well no it isn't, no, no.
[John Humphries:] You can't close your eyes and say, it isn't there, if I don't look it'll go away.
[speaker009:] No it's not, because it simply attaches labels to the people and doesn't understand what's going on,
[John Humphries:] Ah, but
[speaker009:] and
[John Humphries:] the real politics of it is that those labels are attached, and you know that as well as I do.
[speaker009:] No, what we have to look at is not the labels which are attached to each individuals, but say do we have
[John Humphries:] Mhm.
[speaker009:] a good team of people in the Shadow Cabinet, do we have an excellent team i people in the parliamentary Labour Party, do we know where we've come from, and do no we know where we're going, and we do.
[John Humphries:] Right, now will let m l Let me ask you where you are going then as far as the Party's own constitution is concerned, we saw a development, a significant development that I no doubt you would say at the Labour Party conference er er down in Brighton, but not withstanding O M O B the trade unions still have one third of the votes in the selection of the leader of the party, seventy percent say on policy matters at conference, there is still a trade union block vote. That isn't a modern party, is it?
[speaker009:] Well it certainly is, and we think that we've had an examin of our co, examination of the constitution, we've made a number of changes, but the task for Labour now is to press on with the issues of looking at our policies, and making sure that our economic policy and our social policy a actually meets the changes that are out their in the world.
[John Humphries:] So that's it, that's, so that's it then for the modernization of the Party's constitution, we we what happened at Brighton was the end of the process was it? What we've got now is what we're going to have in another ten years time?
[speaker009:] Well I think people think that a certain amount of time and attention has to be devoted to the Party's constitution, and there are two things that arose out of the conference in Brighton. One member, one vote, for the selection of Labour members of parliament, but also increasing the representation of women, now people want to move on from that, they want a
[John Humphries:] In what direction?
[speaker009:] well, they want us to move on to developing the policies which have addressed the changed world.
[John Humphries:] Ah, so that's it for the Party, though is it?
[speaker009:] Well
[John Humphries:] That, that the change to the constitution has ch that's it, all done.
[speaker009:] Well I think people are settled on the changes that have been made, and want to move on, and I don't think
[John Humphries:] Right, so the answer to my question, of I may just th th clarify this, the answer to my question is, yes that is it now, we have finished with the modernizing of the Party itself, lets forget about policies for one moment, we'll come back to that, but we have finished with the modernizing of the Party.
[speaker009:] I think that people don't want to see any more constitutional changes, but there are many more changes in the culture, in the way the Party operates at local, regional, and national level, which we will be addressing, but what we're not going to have is more constitutional changes, because people feel that we've made changes, we have moved the Party forward, we're clear the direction we're going in, and now the Party at all levels wants to address itself not only to building our membership, but also to showing how the policies we've got meet the changed world outside.
[John Humphries:] So it's okay in a modern Labour Party for the trades unions to have what is effectively still a block vote?
[speaker009:] Well, certainly people are satisfied with where we've got to and want to draw a line underneath it and move on from there, and I think the prospect of going back to the constitution er issues, and they m once again being a key focus, I don't think anyone in the Party, or outside the Party, sees the Labour Party wanting to devote itself to that at this time.
[John Humphries:] Alright, policies then, the economy. Erm Gordon Brown is giving in, is he not to pressure from the traditionalists, when it comes to soaking the rich, or soaking the middle class, he's now saying, well maybe there will be a bit of soaking the rich, or soaking the middle class, whereas he wanted to say, and you wanted him to say, no we're not going to do that, we moved away from that.
[speaker009:] No, what we're saying is two things, firstly that we are not in favour of taxation for taxation's sake
[John Humphries:] Well no party is.
[speaker009:] it's not a reflex action that the Labour Party somehow engages in, but there are things that we need to rave raise revenue for, such as investment in the economy, like our social policies, and that the way that we will raise revenue is that we we will have a fair taxation system, that is very straightforward, and agreed by the Party, unlike the Conservatives who firstly don't recognize there is any purpose in investment in the economy, public investment, or investment in social policies they don't agree with, and secondly, when they do have to raise money they do it in the unfairest possible way, penalizing most those who can least
[John Humphries:] Let
[speaker009:] afford it.
[John Humphries:] Let me just suggest to you that you are sending all the wrong signals on women, on Party constitution, on economic matters, on policy matters, the modernizers have lost the impetus, they're sending the wrong signals. The Party is sending the wrong signals.
[speaker009:] I think it's absolutely not the case to say that we're sending the wrong signals, I think there's a recognition in the country that the economy has been mismanaged, and the price that's being exacted by people is too high, high levels of unemployment, low levels of growth, and social services undermined, and people recognize that Labour is setting out a new way forward.
[John Humphries:] Harriet Harman. And now John Cole on the options facing the Chancellor in his first budget, one month from now.
[speaker010:] This year's battle of the budget is generating more anguish than any for years, John Major's cabinet now realize what a parliamentary mess December might turn into with week-long debates on both the Queen's speech and the budget to pack in, and worse to come in the spring, a budget combining taxes with public spending seemed a good idea at the time Norman Lamont announced it, but with November the thirtieth just a month away the political down-side is appearing, of course with a fifty billion pound deficit in the Government's accounts this years spending round would have been hard pounding anyhow, but the usual noisy haggle over the available cash among departments is now amplified by posses of Tory backbenchers trying to head off this or that tax increase, and there's an incentive to keep that up right through the finance bill after Christmas, since most new taxes would not come in until April. A phrase from the Conservative's manifesto last year, we are the only party that understands the need for low taxation, has now returned to haunt them, for an MP in a marginal constituency this evokes the electoral ghost of George Bush, so he firmly rules out increases in income tax, but wouldn't mind putting V A T on newspapers and books. But would it be within the spirit of the manifesto to murmur, read my lips, no more direct taxes? Really, he says, people don't notice V A T so much, others believe income tax will have to take some of the strain, but not by putting up the rates, that would be too blatant. The best bet is that the Chancellor will confine higher allowances against tax to the lowest grade, thus asking the better off to pay a bit more. On the spending side, with the total fixed, the game this year is robbing Peter to pay Paul, or rather, to pay Malcolm. Defence Secretary Rifkind is reported to be grateful for support from the fourteen military minded Conservatives whose confidential letter to the Prime Minister was somehow left lying on a copying machine for a Labour researcher to find, but he is irritated by the leak, an insider murmurs that Malcolm's notching up black marks for the future. Peter Lilley as a right winger has to combine his reputation as a zealous cutter of the state sector with a departmental budget that eats up to forty percent of the hole, one MP groans, rather inconsequentially, a weeks social security payments would buy a warship, even Kenneth Clark and Michael Portillo, sharpening their axes have to admit that Lilley did not exactly invent unemployment personally, but the burgeoning budget for invalidity benefit, together with much anecdotal evidence, suggest that somebody in Whitehall, well before his time, decided to cut the unemployment figures artificially by allowing, even encouraging people with little hope of jobs to remember that troublesome pain in their backs, and in the process get better benefits. But cutting this benefit will throw up hard cases, what worries a Tory elder is the way younger MP s approach the decision whether to support the Government on a pick and mix principle, he says, they no longer see the need to take the rough with smooth, to vote for the things they detest as well as those they like. According to one loyalist thirties thirty or so of his colleagues think it's more fun to vote against the Government, a smaller number go further, they think a spell in opposition might enhance their own careers. But a member of the cynical tendency jeers that after all this brouhaha, a Prime Minister who's obsessed with political safety, will only allow minor pain, though back benchers will be encouraged to squeal so as to impress the markets. But what, he demands, about the panic when interest rates go up to fund the deficit, and the City begins to think that Labour will win. A former senior minister who has been through many spending rounds says we take them all much too seriously, they are merely a mating ritual, he says, adding, and a barren one at that, no offspring. Well you can tell that to the Treasury, or to the Marines.
[John Humphries:] John Cole. That's it for this week, until next week at the same time, good afternoon.