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Taxpayer Guarantees - Uk Banks Get A £46Bn Subsidy

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Mail article blatantly reported after one of my rants on here recently detailing exactly this >>>

High Street banks enjoy a taxpayer subsidy of £46bn a year – or £1,840 for every household in Britain, research has revealed.

In a highly critical study, the New Economics Foundation said Barclays, Lloyds and Royal Bank of Scotland each received implicit windfalls of £10bn or more last year.

The think tank accused lenders of 'profiting at the expense of the British public as both taxpayers and customers' after successive Labour and Conservative government failed to rein in the sector.

The NEF broadside comes just day before the government's Independent Commission on Banking issues its final recommendations on the future of the financial industry. Led by Sir John Vickers, the ICB is likely to recommend erecting firewalls between banks' retail arms and their riskier investment banking operations.

The aim is to ensure that taxpayers never again have to rescue feckless banks and to eliminate the state guarantee that underpins the banking system.

Because many of the UK's lenders are deemed 'too big to fail', they are able to borrow more cheaply due to the perception that the government would re-pay their creditors in times of crisis.

At the height of the financial panic, the Bank of England estimated that UK lenders enjoyed £100bn a year benefit from this 'implicit guarantee'.

Although the subsidy has halved since then, according to the NEF estimate, it is still big enough to cover Britain's entire education budget.

David Hillman of the Robin Hood Tax campaign, which helped fund the NEF study, said the taxpayer subsidies are 'sustaining sky-high pay packets and casino-banking business models'.

Tony Greenham of the NEF said: 'Banks are still in the casino with our cash and the tables are fixed in their favour.'

The time for 'dodging' reforms is over amid signs that the government is losing its nerve amid a fierce lobbying campaign from the banking industry, according to Greenham.

The coalition is expected to delay full implementation of the Vickers proposals until 2015 after the banks warned that the ring-fencing proposals could choke off the flow of credit to firms.

■ 150,000 jobs have been lost in the financial sector since the run on the Northern Rock four years ago, according to the Unite union. But 'nothing has changed for the banking bosses', who still enjoy lavish rewards, said Unite's David Fleming.


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  • 429 Brexit, House prices and Summer 2020

    1. 1. Including the effects Brexit, where do you think average UK house prices will be relative to now in June 2020?

      • down 5% +
      • down 2.5%
      • Even
      • up 2.5%
      • up 5%

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