Caroline Lucas MP was in action in the Commons today asking the Government Treasury team a question based on work I have done on banks being enriched by more than £40 billion a year as a result of interest payments made to them in their central bank reserve accounts:
Big 4 bank profits were up 700% in first half of this year compared to 2020, so I've just asked the Chancellor to introduce a windfall tax on banks' excess profits, to fund support for households struggling with energy & housing costs
If you agree he should please RT! 🙏 pic.twitter.com/Giu7mKa12c— Caroline Lucas (@CarolineLucas) September 5, 2023
The minister totally ignored the question Caroline asked and claimed that she should be grateful that profit in the financial services sector supported 20,000 jobs in her constituency. That was contemptuous and irrelevant, showing just how little regard the Tories have for politics and accountability, or economic justice, come to that.
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Is it just wishful thinking that the chair of one of the banks might declare:
We are deeply embarrassed by Caroline Lucas’ exposure of these payments to us by the Treasury.
Of necessity, bankers must seek to gain and hold funds but, in this case, we acknowledge that we should not do so.
Accordingly, I will be convening an emergency meeting of our board at which I will recommend returning the entire sum which I believe our bank should never have been paid.
I think there is not a hope of that
She will be missed. The Green party should be heard in Parliament but our out dated electoral system will probably deny them a seat.
Well done Caroline but the indifference to the question is staggering and must not be forgiven.
Or forgotten, PSR.
To forgive is to forget Larry.
‘The struggle of man against power, is the struggle of memory against forgetting’ – Milan Kundera
It is how we choose to remember that is important, as well as the remembering.
And I say we choose not to forgive. I say we choose to call the last 13/14 years unacceptable and reversible.
The Labour party now – what do you think their take is on that?
We have to first repudiate everything that has driven the Tories forward in order to change – not accommodate it again, as Laboured are suggesting.
Thank you, Caroline xxx
Great work on your part too Richard.
Just imagine if the Daily Mail and all the other “enrage them about X today + Royal photos” rags pushed this story into the public consciousness. It’s outrageous that interest is paid on banks’ reserves.
BTW, the RBNZ is doing exactly the same thing (and has driven NZ’s economy into recession).
There is one aspect to this saga which I find curious.
One of the banks benefitting from the BoE’s “I give you money & then pay you interest on the money I have given you” (I do prefer to describe things the way they really are) .. is Santander, a Spanish bank. According to some numbers that Richard recently published, the BoE’s free interest gift accounted for 50% of Santader Uk’s profits. Expressed another way, the UK state is funding a Spanish bank. Why?
One will never see any of the above in the Uk meeja – because for the subject to be even raised would be to start pulling a the thread of the “how is the Uk financed” carpet – & soon all would be laid bare.
This is not to argue re tax windfall profits – but circa 50% of those windfall profits are caused by the imbeciles in the BoE who are perfectly happy to fund the profits of Uk and foreign banks. A bunch of chimps could do better.
Thanks
And good points
Mike,
Far as I understood it Santander (any other UK foreign banks) are regulated by the UK regulatory system. They have to hold capital in this country to obtain their licences. In effect they are considered as a UK bank operating entirely within the country and separate from the parent company.Same obviously happens for UK banks with foreign operating banking.
Note I am not condoning payment of interest on reserves,it is dirspicable as it is.