Banks back to ‘dark ages’?

Following yesterday’s Budget (July 8), Unite warned George Osborne that his plan to scrap the bank levy shows the Tory government are ditching their responsibility to bring order to the financial industry.

Ending the levy, along with the sell-off of Lloyds and the Royal Bank of Scotland, underlines the hands-off attitude of the Tories, a position which emboldens boardrooms to return to the reckless behaviour that led to the financial crisis.

In the Budget Osborne announced the levy, which raised ÂŁ1.9bn for the treasury last year, will be phased out over six years. The levy will be replaced by an 8 per cent surcharge on profits.

Unite believes this could lead to the largest banks, such as HSBC, paying less to the treasury overall. A surcharge tax will also be partially cancelled out by the planned decreases in corporation tax.

“By promising to scrap the bank levy George Osborne will win applause from the City boardrooms, but he is turning his back on the banking industry as a whole, allowing senior executives to return it to the dark ages that led to the financial crash,” said Dominic Hook, Unite national officer for finance.

“The bank levy forced the boardrooms to pay for the crisis they caused with a tax on their balance sheets. The ending of the levy, coupled with the sell-off of the public’s stake in both Lloyds and the Royal Bank of Scotland, underlines this government’s hands-off approach to the banks.

“This sends all the wrong signals to the banking industry. Already we have seen the board of Barclays, emboldened by this government’s stance, announce the sacking of their CEO and a potential acceleration of job cuts and branch closures.”