With the last ever Spring Budget next Wednesday, the Chancellor Philip Hammond will be faced with a choice: continue with cuts that are hitting the poorest hardest; or change course and pursue policies that help those just about managing. We also need real solutions to fund our essential, frontline services (like the NHS and social care).
Of course, there is one sector that has managed to avoid the worst effects of the crisis - the very same sector that caused it: the banks. We think it’s time they paid their dues. Now, an ex-banker has reached the same conclusion.
Last week, Professor Avinash Persaud (formerly of JP Morgan) launched a report that has found an ingenious idea that could raise at least £25bn every 5 years from the banks and would lead to no relocation of trading.
And the idea? That the government should modernise the 300-year old UK’s existing Stamp Duty on Shares to include other, newer types of trades. In the last Autumn Statement, the Chancellor Philip Hammond commissioned a review to update the Stamp Duty - we need him to look at this option!
Here’s Professor Persaud explaining the idea (and listen out for Robin Hood Tax’s very own David Hillman commenting on the report):
When this idea could:
- Train the 30,000 nurses needed to fill all NHS vacancies until 2020;
- Close this year’s social care budget deficit;
- Build 100,000 new school places every year;
- Develop more than 15,000 social homes every year
...all within a year, the government needs to look at this idea very closely.
The banks say they can’t afford it, but we know better. As all the major UK banks’ end-of-year results arrived last week, we noticed a similar pattern emerging.
HSBC announced that profits had plummeted and that they were being investigated for money-laundering (not for the first time!). Lloyds enjoyed a bounce in profits, only after more than £20bn in fines since the crisis. RBS trumped them with yet another year of straight losses (the ninth), as well as totalling £58bn in fines for the same period: terrible from the publicly-owned bank.
Despite this catalogue of low profits, mammoth fines and reckless, rip-off behaviour, it seems executive pay-packets have bounced. Bonuses have returned to the absurd levels they were in 2008. Barclays recorded 364 millionaire employees last year. Executives for banks failing to make a profit are being paid eye-watering sums.
If they can still find money to fork out astronomic pay packets and bonuses, then they can pay their fair share to society. With people still struggling to make ends meet a decade after the banks’ crisis, we need politicians to step up and make bankers pay.