Lloyds asks taxpayers for another £5bn | Business | The Guardian .
Alistair Darling is ready to hand over up to £5bn of taxpayers' money to the part-nationalised Lloyds Banking Group in order to shore up its finances.
Lloyds, 43% owned by the taxpayer, is seeking £25bn of extra capital so it can escape the multibillion-pound cost of the government's toxic asset insurance scheme. Selling new shares worth up to £5bn to the Treasury is part of the complex plan currently being considered by the regulators.
The move is likely to be seen as another climbdown by the government in its treatment of banks that are preparing to pay their staff millions of pounds in bonuses on the back of booming markets.
This is lunacy: the state is being asked to fund Lloyds' exit from state guaranatees sio it can pau unfettered bonuses.
There is a one word answer to that: no.
The sum involved is more than all that has been committed to green projects to counter recession. And that is where this money would be much better used.
This is crunch time: convictions take courage.
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That would have more than paid for the London infrastructure schemes that got cancelled when Boris Johnson was elected.
“Boris Johnson scrapped ten large projects to expand the capacity of the city’s transport network. The cuts will have the greatest impact on East London, especially the Thames Gateway redevelopment area, where 100,000 homes are due to be built but will now have little extra transport provision.
“Transport for London had already spent more than £60 million designing and planning the schemes that were abandoned yesterday.
“The mayor’s plan stated that TfL’s budget up to 2018 “assumes that all TfL fares will rise annually at a rate of the retail price index plus one per cent each January over the period 2009-10 to 2017-18”.
“One of the cancelled projects, the £500 million Thames Gateway Bridge, had been in preparation for two decades. The bridge was designed to relieve congestion on the other river crossings in East London and had already been granted £350 million of government-backed funding.
“Mr Johnson decided not to approve the £90 million needed from TfL for the bridge to proceed. He admitted that another Thames crossing was urgently needed but said that planners would now start looking at a different location, possibly at Silvertown.
“The mayor dropped plans to bring back trams to Central London after an absence of half a century. The Cross River Tram would have run between Euston and Waterloo, with several onward branches, and cost £1.3 billion.
“The £750 million extension of the Docklands Light Railway to Dagenham Dock and the £170 million Crystal Palace link in Croydon’s tram network have also been cancelled.”
From The Times November 7, 2008
This is the real cost of the nonsense that is going on. What is the matter with Britain’s politicians?
No, Richard, what is lunacy is that you object to this plan to increase the bank’s ‘s capital base which will in turn lead to it being less reliant on gov’t funding in the future, and indeed allow it to become independent once again.
An equity involvement in a business implies you may be asked for further cash by way of a rights issue.
How else do you propose the bank exits from reliance on the taxpayer’s money?
How otherwise do you envisage the bank increasing its capital base?
And what has the amount of funding set asside to (lunactic, headline grabbiong, yet wealth destroying) “green” policies to do with this issue?
Do you have any other non sequiturs up your sleeve?
Will
You may not have noticed this – but there is a very strong, rational and justifiable feeling at large that we may want to restrict what banks do as it is fundamentally harmful
And there’s a also a feeling that banks may need to be under state control – for the protection of the taxpayer
Despite your rhetoric that’s not lunacy – that’s a matter of ensuring:
a) self preservation
b) protection form economic abuse
c) putting banks back in the box. How can it make sense that banks are amongst our very largest companies? As Turner has noted – that is for doing socially worthless things. Tax is a mechanism for pricing socially worthless things out of the market
Not lunacy – absolute sense to all but those who are blinded by neoliberlism
Richard