Wednesday 27 February 2019

Campaign reply - Stop the sell off of RBS


A number of constituents have written to me about the sell off of RBS.

It is important to remember the circumstances of why RBS was bailed out in the first place: The near collapse of the economy in 2008 must be laid at the feet of the then Labour government. Reckless over spending and so-called light touch regulation led directly to the first run on a UK bank (Northern Rock) for 150 years. As we all know the contagion spread. It has taken the nation a decade or more to recover and become a strong and healthy economy that can now afford to increase spending on the services we all use and appreciate.

With the banking crisis dealt with the plan to sell off the shares has commenced. Lloyds Bank  and other share sales have actually been profitable. Philip Hammond did pause the sale of RBS to ensure the best outcome. Looking at the sums and complex instruments used it is not easy to establish costs but it is worth remembering the government applied very substantial fees for giving guarantees to RBS. The bank levy  has  also raised £14.5bn between 2011/12 and 2016/17. It makes for some comfort from a situation that should never have arisen in the first place. There has been another £20bn of extra revenue paid by the banks recently – a further endorsement of the now sound financial state of the UK and so it is that taxpayers money  will be returned to HM Treasury.

A properly regulated banking system operating in a strong and well managed economy are the best ways to ensure a repeat of these events.

High street banking has seen a revolution  in how it operates and how customers interact with their bank. I have taken a keen interest in this and the impact these changes make on our communities. Please be in touch if you have any specific concerns.